Corporate Social Responsibility

Corporate Social Responsibility CSR is becoming significant for business in all industries and sectors. CSR is in many ways profitable for business and for society, as shared value is the new reality and examples of collaboration between companies, even between the biggest competitors, have been increasing.

Author: Hassan Hend

Corporate Social Responsibility CRS is becoming significant for business in all industries and sectors. CSR is in many ways profitable for business and for society, as shared value is the new reality and examples of collaboration between companies, even between the biggest competitors, have been increasing. The paper will briefly introduce CSR and its benefits to organization, stakeholders especiallyemployeesand then a case study.

Key words

Corporate Social Responsibility, Customer Satisfaction, Organization Market Value, Public Image, Shared Value, Sustainability 

What is Corporate Social Responsibility CSR?

“This is the stage of shared value. Corporations are entering into an era where they are starting to rethink how they can better integrate their connection with society to create shared value.” (Michael E. Porter, Professor, Harvard Business School discussing the Clinton Global Initiative)

Corporate social responsibility CSR is the responsibility of corporations to contribute to a better society & cleaner environment.  This contribution can range from donating money to nonprofits to implementing environmentally-friendly policies in the workplace. CSR projects assist local organization and impoverished communities. This certainly leads to sustainable community development.  

Why CSR is Important?

I. Organization benefits from CSR

1. Increased reputation & public image

2. Increases media coverage

3. Boosts employee engagement

4. Attraction & retention of investors

5. Increased customer satisfaction 

6.  Honesty & integrity with stakeholders

7. Increased organization market value

8. Create shared value

9. Brand loyalty

10. Culture of innovation

11. Sustainability

Leading Corporate Philanthropists

AppleGoogleGeneral Electric/ Wal-Mart

“The 21st century will be the century of the social sector organization. The more economy, money and information become global, the more community will matter.” (Peter F.Drucker, Founder of the Drucker Foundation)

II. Stakeholders

Each stakeholder has interest in how an organization performs or interacts with them. These stakeholders can benefit from a company’s success & can be harmed by its mistakes. In order to serve their stakeholders in an ethical & social manner, organizations are adapting CSR’s model. Therefore the objective of being socially responsible business is achieved when its activities meet or exceed the expectations of all its stakeholders.

The model for evaluating an organization’s social performance; It indicates that total CSR can be subdivided into four criteria; economic, legal, ethical & discretionary responsibilities.

Four criteria of CSR

 A. Economic Responsibilities

It is the first level of social responsibility. The business institution is above all, the basic economic unit of society. Its responsibility is to produce goods & or services that a society wants & to maximize profit for its owners & shareholders. Economic responsibility carried to the extreme called Profit Maximizing View which is no longer considered an adequate criterion of performance in the world in general. Treating economic gain in the social as the only social responsibility can lead companies into troubles.

B. Legal Responsibilities

All modern societies lay down ground rules, laws & regulations that businesses are expected to follow. It defines what society deems as important with respect to appropriate corporate behavior. Businesses are expected to fulfill their economic goals within the legal framework.

C. Ethical Responsibilities

Include behavior that is not necessary codified into law & may not serve the organization’s direct economic interests. To be ethical, organization’s decision makers should act with equity, fairness & respect individual’s rights & provide different treatments of employees only if differences between them are relevant to the organization’s goals & tasks. Unethical behavior occurs when decisions enables an individual or organization to gain expense of society. 

D. Discretionary Responsibilities

It is purely voluntary & guided by an organization’s desire to make social contribution not mandated by economics, laws or ethics. It includes generous philanthropic contributions that offer no payback to the organization & aren’t expected. It’s the highest level of social responsibility, because it goes beyond societal expectations to contribute to the community’s welfare.

Employees benefits from CSR

1. Positive workplace environment

2. Increase in creativity & innovation

3. Encourages professionalism

4. Higher job satisfaction

5. Promotes individual philanthropy

6. The ability to have positive impact in the community

7. Building & maintaining trust between the employees &customers

“A fundamental issue in business and economics is the sustainability and not merely the growth of economic development, which crucially hinges on the socially responsible operational and investment behavior of modern corporations.” (Porter, 1991) Similarly, as sustainability metrics become more advanced, companies are increasingly measuring and communicating impact, giving them the ability to review how CSR efforts benefit their community and their bottom line.

I believe that CSR is the heart & soul of modern corporations, as we are driven by public value & a desire to do good things in the community. Accordingly, CSR is something that we take to heart. Positive CSR improves a company’s public image and relationship with consumers, employees like working for a company that has a good public image and is constantly in the media for positive reasons. Satisfied employees almost always equal better output. Companies that maximize their social responsibility potential foster innovative & creative employees; Employees are able to professionally & personally develop as a result of CSR. They become more philanthropically aware when working for companies that are socially responsible. CSR framework can also help a company become more attractive to potential future employees who are looking for workplaces with socially responsible practices, community mindedness & sound ethics. Business environments are more enjoyable when companies engage in CSR.

Case Study

CSR in my organization for example: a training volunteer program, it’s a crucial component of CSR to assist undergraduate universities students to take an overview on the Egyptian Stock Market. Therefore providing students with the opportunity to be involved in a company’s socially responsible activities can have the benefit of teaching new skills to them, which can in turn be applied in their universities. By undertaking activities outside of their usual study responsibilities, students have the chance to contribute to work and causes that they might feel passionate about, or learn something entirely new which can help enrich their own perspectives.

Students also experience a sense of pride when they know that they learn in a company that cares about the community. By supporting these activities, the organization encourages growth & satisfies students’ awareness & knowledge.Hence it supports public value outcomes by focusing on how their services can make a difference in the community.

Also annual donation for Children’s Cancer Hospital-Egypt; CSR is more than just donating money it’s about contributing to the health & welfare of society, operating transparently & ethically. More significant, this way of operating should be embedded in the organization, rather than an afterthought.

Therefore it is necessary to understand how modern corporations in a globalize wired world are part of the social and natural environments in which they operate and that in order to be successful in the medium and long run, then must be seen a legitimate and as offering value, including sculpting and evolving a sustainable business model where the business is both responsive & responsible. Moreover the degree of CSR adoption should be determined both by the legal frameworks that define corporate boundaries, and by corporations own tradeoff between shareholders and stakeholders rights. Finally, there is continued rising interest in the value of CSR to firms and the importance of sustainabilityCorporations that care about the lives of people outside the walls of their businesses are more likely to create a positive environment.”The success of CSR is determined by both internal and external factors. Internal factors are economic considerations, culture of the firm including the CEO and employees, and ethical influences; while external factors are compliance with legal requirements and technological influences as well as national culture.” (Bichta, 2003)


I. Reference Book

Corporate Social Responsibility 1st E

David Crowther & Guler Aras 2010

Management; A Competency Based Approach 10th E

Hellriegel, Jackson, Slocum


Bichta, (2003) corporate socially responsible industry (CSR) practices in the context of Greek. Social Responsibility and Environmental Management, 10, 12-24.

Porter (1991) “Towards a Dynamic Theory of Strategy”, Strategic Management Journal


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