Corporate Social Responsibility in the 21st Century
The multi-faced notion of CSR sometimes poses challenges for both business leaders and scholars, however, there is no doubt that there is a general global acceptance of the social responsibility concept.
Today, CSR is an integral part of the overall business strategy. Corporations no longer ask themselves if they should incorporate CSR in their activities or not, they only ask which CSR activities should be included in their business.
Each stakeholder has its own priorities, so the main challenge for the corporation nowadays is how to balance out the different stakeholder demands, which can sometimes be conflicting and competing. The primary stakeholders of a corporation are shareholders, employees, the government, customers, suppliers, local community and the environment. Solving the problems of the critical stakeholders adds real value to the goods and services of the company, and it also increases financial success (profit) in the long-run.
The primary drivers of CSR evolve around the so-called “Triple Bottom Line” consisting of:
Profit: the traditional measure of performance; corporate profit
People: measuring how socially responsible an organization is in its operations
Planet: measuring how environmentally responsible the organization is
The main CSR activities in the 21stcentury include:
- Corporate Philanthropy
- Cause-related marketing
- Codes of conduct
- Social and environmental reporting
- Stakeholder engagement
- Strategic community investment
- Socially responsible investments
Apart from greenwashing, there are a few other CSR controversies that have been a frequent discussion topic in the business and academic world. These include tax evasion and tax avoidance, the social responsibility of corporations in the extractive industries, the self-regulating nature of CSR, and etc.
Many corporate scandals prove that socially irresponsible behavior can be fatal for a company, and the future is in sustainability, which was recognized by the students, as well. Sustainability is a concept that goes beyond CSR and ensures the long-term survival of business organizations.
Author: Ena Fejzagic, lecturer at LIGS University