amitoc1.docx - Social Responsibility An organization can...

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Social Responsibility An organization can adopt a variety of approaches to social responsibility. Social responsibility in this case, simply refers to the obligation of an organization's management to make decisions and take actions which would enhance the welfare and interests of the society as a whole. (Anon, n.d.) According to the concept of corporate social responsibility, a manager must strive his hardest in order to achieve both organizational and societal goals. (Marion, 2001) Social responsibility may be shown by the organization's determination to treat its customers, employees, and investors both in an honest and fair manner. An organization's social responsibility may be ranked from the lowest to the highest stance, with the lowest being the obstructionist stance. It is then followed by the defensive stance, and the accommodative stance before it leads to the highest stance - the proactive. (Anon, n.d.) In this section we will look at the different approaches a company can take to become socially responsible Generally, the spectrum of approaches to corporate social responsibility (CSR) includes four separate stances. On the lower end, obstructionist and defensive stances relate to approaches that require little or no corporate action. Accommodative and proactive stances are on the higher end of the spectrum and involve a greater acceptance of being social responsible as a corporate citizen The diagram below illustrates a clearer picture of the different degrees in social responsibility: (Griffin, 2012) There are compelling reasons why companies should engage in some form of effort aimed primarily at social welfare. Proponents of Corporate Social Responsibility (CSR) have used four arguments to make their case: moral obligation, sustainability, license to operate, and reputation. Moral obligation means that stakeholders of a growing number of companies are satisfied only when the company balances the impact of its business with socially responsible practices.
Sustainability involves meeting the needs of the present without compromising the capability for future generations. Substantial progress can be made by investing in solutions that are socially, environmentally, and financially sustainable (Arena, 2006, p. 9). Moreover, the very license to operate and crucial contracts themselves, with governments and other entities, might be conditional upon such obligation. Finally, CSR initiatives may be supported due to reputation impact, on the grounds that they will improve a company's image and even raise the value of its stock (Porter & Kramer, 2006). Examples of such reputation benefits include a greater clientele, the ability to charge premium prices, and the retention of more productive workers. Companies tend to manage risks to their reputation and brand in a reactive mode, only dealing with crisis events after they happen. Companies confronted with boycott threats, as Nike was in the 1990s, or with the threat of high-profile lawsuits, as in the case of McDonald's over obesity concerns, may also see CSR as a strategy for presenting a friendlier face to the public (Doane, 2005).

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