Corporate Social Responsibility Essay Example | Topics and Well Written Essays - 2500 words - 1

Corporate Social Responsibility - Essay Example In this brief treatise, the history and evolution of CSR will be described and followed by a discussion on the concept and drivers of CSR. Focus is put on the role of CSR in the financial crisis, the implications of CSR for both business and communities, and the prospects of CSR for the future. History and Evolution of CSR While the concept of business corporations possessing some type of social accountability or obligation may have surfaced in the past, the serious study of corporate social responsibility as a facet of management commenced in the 1950s and was called by a host of other names (see Table 1). In 1953, Bowen posed the following question: ‘To what extent do the interests of business in the long run with the interests of society?’ (Bowen 1953, p. 5) The corporate responsibility core concept emerged as an economic concern. Andrew Carnegie, the founder of US Steel, articulated two principles supportive of CSR: (1) the ‘charity principle’ requiring individuals who have more to assist those who have less; and (2) the ‘stewardship principle’ stating that the rich and wealthy hold their wealth ‘in trust’ for the rest of society; while they hold it, they are required to multiply the wealth through making sound and prudent investments (Freeman & Liedtka 1991). Carnegie’s position was termed ‘richesse oblige’ by Windsor (2001), which is a parody of ‘noblesse oblige’. On the other side of the debate is the argument of Milton Friedman that corporations should pursue their economic self-interest and that CSR activities amount to a moral wrong against the shareholders. Activities directed at the social welfare should be properly left to the government (Freeman & Liedtka 1991). Friedman’s position resounded among many businesspeople and practitioners, understandably more than academicians, and the concept of wealth creation as the priority (some say only) goal for business constituted a recurring theme of many policy makers. At one point the argument entered the realm of academic discussion, and the debate eventually led to the conciliation of the two sides: ‘wealth creation is the best path to social welfare improvement’ (Windsor 2001, p. 226). This approach has been accepted by most businesspeople and managers because it resolves the duality imposed by Bowen’s premise that separates wealth and social responsibility. What it does not resolve is the direction management should take if a decision should be required between what may emerge to be irreconcilable alternatives (i.e. in favour of wealth creation or in favour of social responsibility). Currently, the main promoter of the ideas and principles of corporate social responsibility is the United Nations (Madrakhimova 2013, p. 115). Through the UN Guiding Principles on Business and Human Rights, the UN sought to advance global standards for business firms, particularly the large multinational corporations, to abide by in order to preserve and protect human rights that these businesses may be violating in the interest of earning a profit. Table 1: The genesis of the concept of corporate social responsibility (Madrakhimova 2013, p. 116) Concept of CSR CSR is a ‘concept whereby companies integrate social and environmental concerns in their business operations and their interaction with their stakeholders on a voluntary basis’