Lesson 5: Corporate Social Responsibility (CSR)
Overview
This lesson focuses on the concept of corporate social responsibility (CSR), its
importance, and how it integrates with various business functions. CSR is a
fundamental piece of a company’s business plan, affecting its bottom line, share
price, and long-term viability.
Learning Outcomes
By the end of this lesson, you should be able to:
Distinguish between different terms and concepts in the field of CSR.
Discuss the imperatives for good CSR.
Explain the business case for CSR.
Discuss corporate governance in the South African context, including the King Report
on Corporate Governance.
Draw up a stakeholder map for an organization, indicating different categories of
stakeholders.
Explain the link between CSR and various business functions.
Key Terms
Corporate Social Responsibility (CSR): The responsibility of businesses toward
society and the environment.
Corporate Citizenship: Similar to CSR, emphasizing a company's role as a member
of society.
Corporate Governance: How a company’s objectives, strategy, and decision-
making structures are developed, implemented, and monitored.
Sustainable Development: Development that meets present needs without
compromising future generations' ability to meet their own needs.
Stakeholder Engagement: Involving stakeholders in decision-making processes.
Triple Bottom Line: Measuring financial, social, and environmental impacts of
business.
Social, Sustainability, Environment, Economic: Elements considered in CSR.
1. Introduction
Businesses operate within a broader social environment, impacting communities and
the environment both positively and negatively. Companies have a responsibility
towards these communities and environments, necessitating involvement in societal
issues like poverty, unemployment, and pollution.
2. Introducing Corporate Social Responsibility (CSR)
Being a citizen involves rights and responsibilities. Similarly, corporations have rights
and responsibilities. CSR goes beyond legal compliance, encompassing voluntary
actions to ethically interact with the surrounding environment and stakeholders.
Carroll’s CSR Pyramid
Carroll’s CSR pyramid outlines four types of responsibilities:
1. Economic Responsibility: Businesses need to be profitable.
2. Legal Responsibility: Businesses must operate within the law.
3. Ethical Responsibility: Businesses must conduct themselves ethically.
4. Philanthropic Responsibility: Businesses have a duty to be good corporate
citizens.
3. Terms and Trends
3.1 Triple Bottom Line
The triple bottom line refers to considering social and environmental impacts
alongside financial profit or loss. It measures financial, social, and environmental
impacts equally and interconnectedly.
3.2 Sustainable Development
, Sustainable development aims to meet current needs without compromising future
generations. Key initiatives include the Rio Earth Summit, United Nations Global
Compact, Millennium Development Goals, and World Summit on Sustainable
Development.
3.3 Corporate Citizenship
Corporate citizenship emphasizes a company’s role as a responsible member of
society, aligning with CSR but avoiding the misleading emphasis on "social."
3.4 Corporate Social Investment (CSI)
CSI refers to companies’ philanthropic initiatives, such as sponsorships or community
support. It is one component of corporate citizenship.
3.5 Sustainability
Sustainability reporting involves publicly reporting on social and environmental
issues alongside financial matters.
3.6 Corporate Governance
Corporate governance relates to how a company develops, implements, and
monitors its objectives, strategy, and decision-making structures. It ensures
accountability to shareholders and stakeholders.
4. The CSR Imperative
4.1 Global Drivers
Global initiatives driving CSR include:
United Nations Global Compact: Encourages businesses worldwide to adopt
sustainable and socially responsible policies.
Sustainable Development Goals (SDGs): Aims to end poverty, fight inequality,
and protect the planet by 2030.
Global Reporting Initiative (GRI): Provides sustainability reporting guidelines.
AA1000 Framework: Assesses and strengthens the credibility of social, economic,
and environmental reporting.
ISO 14000 Series: Focuses on environmental management systems.
OECD Guidelines for Multinational Enterprises: Addresses disclosure,
employment relations, and environmental management.
4.2 South African Initiatives
Key South African initiatives promoting CSR include:
King Code on Corporate Governance: Provides guidance on good corporate
governance practices.
JSE Socially Responsible Investment Index: Identifies companies integrating
triple-bottom-line reporting.
Industry Charters: Promote socio-economic transformation, e.g., Tourism BEE
Charter, Financial Sector Charter.
5. The Business Case for CSR
CSR strategies can limit expenditure, improve employee and community relations,
manage risks, and enhance reputation. Benefits include:
Cost savings through energy efficiency.
Improved investor relations.
Access to new markets.
Enhanced reputation leading to greater staff, customer, and investor loyalty.
6. Corporate Governance
Corporate governance involves making decisions about managing an organization’s
affairs. Principles include:
Accountability: Justifying every action taken.
Transparency: Allowing informed decision-making.
Fairness: Treating all stakeholders equally.
Responsibility: Being accountable for all actions.
Overview
This lesson focuses on the concept of corporate social responsibility (CSR), its
importance, and how it integrates with various business functions. CSR is a
fundamental piece of a company’s business plan, affecting its bottom line, share
price, and long-term viability.
Learning Outcomes
By the end of this lesson, you should be able to:
Distinguish between different terms and concepts in the field of CSR.
Discuss the imperatives for good CSR.
Explain the business case for CSR.
Discuss corporate governance in the South African context, including the King Report
on Corporate Governance.
Draw up a stakeholder map for an organization, indicating different categories of
stakeholders.
Explain the link between CSR and various business functions.
Key Terms
Corporate Social Responsibility (CSR): The responsibility of businesses toward
society and the environment.
Corporate Citizenship: Similar to CSR, emphasizing a company's role as a member
of society.
Corporate Governance: How a company’s objectives, strategy, and decision-
making structures are developed, implemented, and monitored.
Sustainable Development: Development that meets present needs without
compromising future generations' ability to meet their own needs.
Stakeholder Engagement: Involving stakeholders in decision-making processes.
Triple Bottom Line: Measuring financial, social, and environmental impacts of
business.
Social, Sustainability, Environment, Economic: Elements considered in CSR.
1. Introduction
Businesses operate within a broader social environment, impacting communities and
the environment both positively and negatively. Companies have a responsibility
towards these communities and environments, necessitating involvement in societal
issues like poverty, unemployment, and pollution.
2. Introducing Corporate Social Responsibility (CSR)
Being a citizen involves rights and responsibilities. Similarly, corporations have rights
and responsibilities. CSR goes beyond legal compliance, encompassing voluntary
actions to ethically interact with the surrounding environment and stakeholders.
Carroll’s CSR Pyramid
Carroll’s CSR pyramid outlines four types of responsibilities:
1. Economic Responsibility: Businesses need to be profitable.
2. Legal Responsibility: Businesses must operate within the law.
3. Ethical Responsibility: Businesses must conduct themselves ethically.
4. Philanthropic Responsibility: Businesses have a duty to be good corporate
citizens.
3. Terms and Trends
3.1 Triple Bottom Line
The triple bottom line refers to considering social and environmental impacts
alongside financial profit or loss. It measures financial, social, and environmental
impacts equally and interconnectedly.
3.2 Sustainable Development
, Sustainable development aims to meet current needs without compromising future
generations. Key initiatives include the Rio Earth Summit, United Nations Global
Compact, Millennium Development Goals, and World Summit on Sustainable
Development.
3.3 Corporate Citizenship
Corporate citizenship emphasizes a company’s role as a responsible member of
society, aligning with CSR but avoiding the misleading emphasis on "social."
3.4 Corporate Social Investment (CSI)
CSI refers to companies’ philanthropic initiatives, such as sponsorships or community
support. It is one component of corporate citizenship.
3.5 Sustainability
Sustainability reporting involves publicly reporting on social and environmental
issues alongside financial matters.
3.6 Corporate Governance
Corporate governance relates to how a company develops, implements, and
monitors its objectives, strategy, and decision-making structures. It ensures
accountability to shareholders and stakeholders.
4. The CSR Imperative
4.1 Global Drivers
Global initiatives driving CSR include:
United Nations Global Compact: Encourages businesses worldwide to adopt
sustainable and socially responsible policies.
Sustainable Development Goals (SDGs): Aims to end poverty, fight inequality,
and protect the planet by 2030.
Global Reporting Initiative (GRI): Provides sustainability reporting guidelines.
AA1000 Framework: Assesses and strengthens the credibility of social, economic,
and environmental reporting.
ISO 14000 Series: Focuses on environmental management systems.
OECD Guidelines for Multinational Enterprises: Addresses disclosure,
employment relations, and environmental management.
4.2 South African Initiatives
Key South African initiatives promoting CSR include:
King Code on Corporate Governance: Provides guidance on good corporate
governance practices.
JSE Socially Responsible Investment Index: Identifies companies integrating
triple-bottom-line reporting.
Industry Charters: Promote socio-economic transformation, e.g., Tourism BEE
Charter, Financial Sector Charter.
5. The Business Case for CSR
CSR strategies can limit expenditure, improve employee and community relations,
manage risks, and enhance reputation. Benefits include:
Cost savings through energy efficiency.
Improved investor relations.
Access to new markets.
Enhanced reputation leading to greater staff, customer, and investor loyalty.
6. Corporate Governance
Corporate governance involves making decisions about managing an organization’s
affairs. Principles include:
Accountability: Justifying every action taken.
Transparency: Allowing informed decision-making.
Fairness: Treating all stakeholders equally.
Responsibility: Being accountable for all actions.
