Main Approaches to CSR
Mohr et al (2010) divide distinctive profiles of CSR practices into three categories: business case, social values, and syncretic stewardship.
The business case model of CSR “is driven primarily by the ability of CSR initiatives to create positive business results. Because serving shareholders is paramount, a strong tie to the economic outcomes drives CSR initiatives” (Mohr et al, 2010, p.440). Companies operating under business case model usually adopt reactive approach towards CSR issues and may engage in such activities due to the pressure form various groups, or in the search of competitive edge.
Social values model of CSR, on the other hand, involves companies associating with a specific social cause and “it is integrated into the organisational fiber in every way: visible symbols of the cause can be found everywhere in the company” (Mohr et al, 2010, p.441).
Businesses operating under syncretic stewardship CSR model aim to harmonise and balance the demands of various stakeholders of he business. In other words, these companies focus on profit maximisation objective of the business as the business case model, but at the same time, they also comprehend the importance of CSR and aim to address it an an effective manner.
Four approaches to CSR have been specified by Tudler and Zwart (2006) as inactive, reactive, active and proactive (interactive). It is important to note that “these approaches emerged at different stages of societal development and they are neither mutually exclusive nor do they represent ‘best’ practice models” (Tulder and Zwart, 2006, p.143)
The following table illustrates the viewpoints associated with each individual CSR approach:
|‘Corporate self-responsibility’||‘Corporate social responsiveness’||‘Corporate social responsibility’||‘Corporate societal responsibility’|
|‘Doing things right’||‘Don’t do things wrong’||‘Doing the right things’||‘Doing the right things right’|
|‘Doing well’||‘Doing well and doing good’||‘Doing good’||‘Doing well by doing good’|
|‘Just do it’||‘Just don’t do it’||‘Do it just’||‘Just do it just’|
|Utilitarian motive: profit maximisation||Negative duty approach: quarterly profits and market capitalisation||‘Positive duty’ or ‘virtue based’: values (long-term profitability)||Interactive duty approach: medium-term profitability and sustainability|
|Business and Society Management||Business and Society Management||Business in Society Management||Business-Society Management|
|‘Trust me’||‘Trust me’||‘Prove it to me’||‘Involve/engage me’, ‘join me’|
Source: Tulder and Zwart (2006)
Consumer behaviour is considered to be one of the most important directions of business studies because it provides opportunities for businesses to increase the level of their revenues at a significant level. According to Sinkovics and Gauri (2009) the primary aim of learning consumer behaviour is to identify triggers of the behaviour, and accordingly identifying the ways of affecting it.East et al (2008) mention three the most popular models of consumer decision-making that are cognitive, reinforcement and habit.
Cognitive model perceives the purchase as the outcome of a rational decision making process. Reinforcement model, on the other hand, views purchase as behaviour that can be learned and altered with additional opportunities, rewards and costs within the customer’s environment. Habit model, treats purchase as behaviour that has been already learned and which has been assisted with the use of specific stimuli within the consumer’s environment.
The issues related to the link between consumer behaviour and CSR initiatives of businesses have been partially explored by Sun et al (2010). The authors maintain that CSR activities are initiated primarily with the aims of improving the company brand image through communicating those initiatives to various stakeholders of the business, thus it is fair to state that businesses attempt to influence consumer behaviour through their CSR programs and initiatives.
Assessing the Impact of CSR Initiatives
The viewpoints of secondary data authors regarding the assessment issues of CSR activities also need to be discussed in this chapter. The basic three principles of measuring the impact of CSR activities have been specified as sustainability, accountability and transparency (Fernando, 2011).
It has been noted that “sustainability of CSR activities implies that there must be a clear linkage established between use of resources and their regeneration, like the soft drink industry that uses plenty of water trying to maintain water tables through rain water harvesting and recycling; or a paper manufacturing company that destroys thousand of trees to make paper pulp will do well to plant and nurture an equal number of saplings” (Fernando, 2011, p.376).
In other words, sustainability relates to the idea that businesses have to re-generate the same amount of resources that have been consumed on the course of producing products or offering services. Banarjee (2007) considers sustainability to be impossible task to accomplish due to its direct contradiction to the core purpose of the business, which is profit maximisation.
Accountability is another measure of assessment of the level of effectiveness of CSR initiatives and it is “concerned with an organisation recognising that its action affect both internal and external environments, and therefore assumes responsibility for the effects of its actions” (Crowther and Capaldi, 2008, p.155)
Spence (2007) stress the role of organisational goals, the establishment of formal measures, audits, certifications and reporting when discussing accountability of businesses in terms of implementing CSR initiatives.
Another principle of CSR assessment relates to the transparency of businesses. Hawkins (2009) maintains that transparency involves organisations communicating the necessary amounts of right sort of information in a timely basis. The issues associated with transparency can be explained in a way that “big brand names have the financial where-with-all and experience to actively market their CSR practices and this may by used as a way to distract public attention from other less ethical practices” (Mullerat, 2010, p.101).
Therefore, through transparency is required to be exercised by businesses in order to allow the stakeholders access to the information they may need to possess.
- Banarjee., S.B. (2007) Corporate Social Responsibility: the good, the bad and the ugly Edward Elgar Publishing, Cheltenham, UK
- Crowther, D., & Capaldi, N. (2008) The Ashgate Research Companion to Corporate Social Responsibility, Ashgate Publishing, Farnham, UK
- East, R., Wright, M. & Vanhuele, M. (2008) Consumer Behavior: Applications in Marketing, SAGE Publications, California, USA
- Fernando, A.C. (2011) Business Environment, Pearson, USA
- Hawkins., D.E. (2006) Corporate Social Responsibility: Balancing Tomorrow’s Sustainability and Today’s Profitability, Palgrave Macmillan, New York, USA
- Mohr, J.J., Sengupta, S., & Slater,S. F. (2010) Marketing of High-Technology products and Innovations, Jakki Mohr, USA
- Mullerat, R. (2010) Corporate Social Responsibility: Corporate Governance in the 21st Century, Kluwer Law International, Netherlands
- Sinkovics, R.R. & Ghauri, P.N. (2009) New Challenges to International Marketing, Emerald Group Publishing, Bradford, UK
- Spence, L.J. 2007. CSR and small business in a European Policy Context: The 5 C’s of CSR and Small Business Research Agenda. Business and Society Review. 112(4): 533-552