Benefits and Costs of Adopting a CSR Strategy

Essay by hitubaba November 2007

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Organisations, governments and activists currently face the challenge in how to respond to the growth of Corporate Social Responsibility (CSR). CSR has now grown swiftly and relatively smoothly over the last two decades as the numbers of companies take up the standards of CSR in attempt to make their operations more moral ( Hancock, p27, 2005). CSR originated in the year1953 with the publication of Bowen's book "Social responsibilities of Businessmen" (Keller, 2003). CSR can be defined in various ways, it can be described as operating an organisation or a business in a way that meets or exceeds the ethical, legal, commercial and public expectations that a society expects from the business. CSR is closely connected with the principles of sustainable development in declaring that business organisation should be obliged to make decision not only based on its financial and economic factors but also on the social and environmental factors.

CSR could be in various forms such as, healthcare initiatives, and community relations, preservation of cultural heritage and volunteer assistance programs (Theaker, 2001). The philosophy of CSR is to give back to the society, what the organisation had taken from it to achieve its objectives.

There are two opposing views of social responsibility. On one hand there is the classical view and on the other hand there is the socioeconomic view. The classical view that is purely economic, states that the management's only social responsibility is to work on maximising the profits. At the social level, classical view identifies the managers as individuals responsive to market conditions and responsible to follow the laws and the societal norms (Brown, p15, 2005). Economist Milton Friedman adds that a corporation's principle goal is also to obey the laws of the countries within which it works. However, some people have different views on why...