Classification of CSR Activities
According to Blowfield and Murray (2008, p.21), as taken from Carroll (1979), company CSR activities can be classified into the following four groups:
- Economic responsibility. The responsibility of private entities of offering products and services to the marketplace according to the needs of society in order to make a profit.
- Legal responsibility. Companies have to operate within the boundaries of law in order to achieve their aims and objectives.
- Ethical responsibility. Ethical responsibilities of businesses include the types of responsibilities that are important, but at the same time they are not covered by law e.g. fair-trade.
- Discretionary responsibilities. Company responsibilities in this form, like philanthropy initiatives are not necessarily expected by societies, but they are usually welcomed by societies and create positive image for the business.
This classification is also known as Carrol’s Pyramid of CSR and is best illustrated on the following figure:
Source: Global Integration Business Consultants (2011, online)
Alternatively, CSR initiatives are classified by Kotler and Lee (2005) into six broad categories that can are illustrated on the following table:
|Type of CSR activity||Descriptions|
|Cause promotions||Resources spent by companies to promote a specific cause that benefits society in many levels such as eliminating poverty or fighting against child abuse|
|Cause –related marketing||A marketing campaign initiated by a business that highlights positive correlation between the amount of sales for the business and the amount of contribution to support a specific cause.|
|Corporate Social Marketing||Businesses promoting social causes such as healthy eating, caring about parents, quit smoking etc.|
|Corporate Philanthropy||This form of CSR involves businesses donating money or products of the company in substantial amounts in order to support specific causes.|
|Community volunteering||Businesses engaging their employees to work in a community sector for a specified number of hours on a voluntary basis|
|Socially responsible business practices||Engaging in fair trade when dealing with suppliers and sustaining ethical business norms and practices.|
Source: Kotler and Lee (2005)
Banerjee (2007) mention three important characteristics of CSR activities: a) CSR can be perceived as a company commitment formed and regulated through company policies and action; b) CSR activities engaged by businesses usually exceed law requirements; c) CSR activities are voluntarily and cannot be enforced upon businesses by law.
Lepoutre and Heene (2006), on the other hand, divide CSR activities on the following seven main groups: a) leadership, vision and values, b) marketplace activities, c) workforce activities, d) supply-chain activities, e) environmental activities, d) community activities and e) stakeholder engagement
All above classifications are needed to be mentioned in order to ensure sufficient depth to the current research, and to offer the discussions of relevant theoretical frameworks with an increased level of efficiency.
Range of CSR Activities Engaged in by Companies
Secondary data authors mention a wide range of CSR activities popular with businesses. It is stressed in secondary data sources that “responses to CSR also vary significantly by industry and firm, given the variations in business preferences, social pressure, the regulatory environment and the specific history and culture of each company, as well as how these elements interact” (United Nations, 2010, p.240)
It also has been noted that “firms engage in a wide range of CSR activities, but a common theme is that all are at an ‘engagement’ or active stage of corporate citizenship that represents a different view of the company’s role in society” (Gup, 2008, p.91). In other words, regardless of the type and form of CSR activities businesses employ they attempt to position the company in the favourable light in the viewpoints of its various stakeholders, especially customers. A similar viewpoint is formulated by Hill et al (2003), who states that the outcome of company CSR initiatives depend on a greater extend on the level of effectiveness with which chosen activities are implemented than the choice of CSR activities.
Mallin (2009), on the other hand, does not agree with this viewpoint and stresses the importance of choice of CSR activities for businesses by maintaining that only appropriately chosen CSR activities, taking into account a wide range of factors are able to create a positive image for the business.
Cowe (2004) mentions a set of market-related CSR activities such as avoiding misleading marketing and advertising, providing necessary product information, engagement in cause-related marketing, ethical approach towards the customer complaints etc. Product-related CSR activities, as suggested by Schwartz (2011), includes implementing necessary measures in order to ensure the safety of products and services, eliminating the potential misuse of products, addressing the needs of vulnerable customers etc.
The main shortcoming associated with the works of both above authors relates to the fact that their discussions are largely general and their fail to provide specific examples in order to support arguments offered.
This issue is effectively addressed in the work of Fernando (2011), who mentions the cases of companies such as Happy Computers and Dansk Kaffekompagni in order to illustrate the practical application of theories discussed in his work.
There are many other variations of CSR activities and among the most popular CSR activities mentioned by authors like Hill et al (2003), Lepoutre and Heene (2006), Hopkins (2007), and Johnson et al (2008) include engaging in fair trade, eliminating the cases of product testing on animals, ensuring all manufacturing and business processes to be harmless to employees, using less energy in various business processes, employing mainly organic materials in various production processes, and recycling a wide range of wastes.
Hond et al (2007) focus on corporate volunteering as one of the most effective methods of engaging in CSR. The authors stress that “corporate volunteering is one of a number of activities associated with corporate community involvement and an indicator of corporate social responsibility and good corporate citizenship” (Hond et al, 2007, p.116)
Moreover, Tolhurst et al (2010) mention the practices of participating in community projects, making financial donations to various charity organisations, addressing diversity and equality issues in the workplace, and assisting workforce to achieve greater work/life balance to be additional popular CSR practices engaged in by businesses. Additionally, “other activities range from corporate statements regarding value chain decisions, environmental compliance, women and minority issues, investment guidelines, support of local communities, and so on” (Heath, 2010, p.316)
Also, the benefits of active engagement in CSR-related activities have been mentioned by Kahle and Close (2006). Specifically, the authors state that “the measurable outcomes of CSR have received significant attention. Companies benefit in many ways, including enhanced national visibility, greater awareness, image reinforcement, sales increases, repeat purchases and improvement in overall financial performance” (Kahle and Close, 2006, p.148)
Aras and Crowther (2010) divide approach to CSR into two categories: business case model and social values model. The business case model of CSR is closely associated with the ability of specific CSR programs and initiatives to result in positive business gains, whereas the social values model of CSR refer to cases where businesses stand for and associate themselves with social cases.
Aras, G., & Crowther, D. (2010) A Handbook of Governance and Social Responsibility, Gower Publishing, UK
Banarjee., S.B. (2007) Corporate Social Responsibility: the good, the bad and the ugly Edward Elgar Publishing, Cheltenham, UK
Blowfield, M., & Murray, A. (2008). Corporate Responsibility: a critical introduction, Blackwell Publishing, Oxford, UK
Cowe, R. (2004). CSR hits the boardroom, European Business Forum 7-9.
Fernando, A.C. (2011) Business Environment, Pearson, USA
Gup., B.E. (2008) Handbook of Directors of Financial Institutions, Edward Elgar Publishing, Cheltenham, UK
Hill, R.P., Stephens, D. & Smith, I. (2003). Corporate Social responsibility: An examination of individual firm behaviour. Business and Society Review. 108(3):339-364
Hond, F.D., Bakker, F.G., & Neergaard, P. (2007) Managing Corporate Social Responsibility in Action: Talking, Doing and Measuring, Ashgate Publishing, Farnham, UK
Kahle, L.R., & Close, A. (2006) Consumer Behaviour Knowledge for Effective Sports and Event Marketing, Taylor & Francis, New York, USA
Kotler, P. & Lee, N. (2005). Corporate Social Responsibility: doing the most good for your company and your cause Wiley Publications, New Jersey, USA
Lepoutre, J. & Heene, A. 2006. Investigating the impact of firm size on small business social responsibility: A critical review. Journal of Business ethics. 67:257-273
Mallin., C.A. (2009). Corporate Social Responsibility: A Case Study Approach, Edward Elgar Publishing, Cheltenham, UK
Johnson., G., Scholes., K. & Whittington., R. (2008) Exploring Corporate Strategy, 8th Edition, FT Prentice Hall, Essex
Schwartz, MS, 2011, Corporate Social Responsibility: An Ethical Approach, Broadview Press, USA
Tolhurst, N, Pohl, M, Matten, D & Visser, W, 2010, “The A to Z of Corporate Social Responsibility”, Wiley Publications, New Jersey, USA