What is Corporate Social Responsibility?
Corporate Social Responsibility (CSR) is a business model that mandates that business is conscious of the impact it has on various aspects of society. Broadly, it holds that business should improve society in terms of philanthropy, environmental sustainability, ethical business practices, and economic responsibility. Businesses implement CSR through their efforts to reduce their carbon footprint, monetary donations to specific causes and/or organizations, ethical labour policies and practices, and volunteering. A company’s industry, values, and objectives influence the priorities of its CSR strategy and therefore the specific outputs and outcomes it seeks to achieve.
In addition to contributing to social improvement, employees and consumers alike place a high value on working for and spending their money at businesses that demonstrate their commitment to CSR. As such, the actions of one company encourages their competitors to follow suit in order to maintain or improve their market share and attract top talent.
Today, businesses have a place alongside government and civil society organizations in influencing policy and promoting socio-economic development both locally and internationally. According to a study on the United Nations Global Compact and CSR, businesses are uniquely placed to contribute to economic development through “providing for investment, creating jobs, and transferring technology, skills and knowledge”.[i] Furthermore, being a non-state actor, businesses are more flexible and adaptable than government agencies, allowing them to act quickly to support and empower struggling individuals and communities. Overall, CSR has a powerful role in bringing about positive change across the globe.
[i] Stefan Fritsch (2008), “The UN Global Compact and the Global Governance of Corporate Social Responsibility”.