A literature review is usually an important test of the question under research against what is known about a particular topic. The role of a literature review is to find out what others have compiled in an area related to the topic under study (Flammer, 2013, p.775). Various public relations books, journal articles, corporate reports, internet articles and thesis have been published which address the topic of corporate social responsibility. For this test, specific scholarly sources will be analysed which discuss the subject of corporate social responsibility and the ecological environment. The reason for choosing these sources is because most scholars who have conducted research on corporate social responsibility area tend to generalize this study to a wider view and not to how it relates to the ecological environment. This research will, therefore, review relevant literature on corporate social responsibility and ecological environment. The topics to be covered will be; the definitions in use, current approaches to corporate social responsibility, modern discoveries about the topic, key questions that are being asked, general conclusions that are being drawn and the application to organizations.
Definitions in use
There are various definitions used by different scholars. Corporate social responsibility covers the philanthropic, legal, economic and ethical expectations that the society has towards a given organization at a particular time (Carroll and Shabana, 2010, p.96). Another definition is that corporate social responsibility is doing more than what the law requires (Devinney, 2009, p.46). We can come to a conclusion based on the above definitions that corporate social responsibility is the voluntary obligation that the various organizations must have over their families and employees, the general public and the environment.
Companies being socially responsible acts like a social regulation which is incorporated in a company’s business model. It is viewed as very essential any given company and hence the adherence to corporate social responsibility is crucial for any business. The concept of being socially responsible is closely connected to ecology since every organization works in an ecosystem (Banerjee, 2008, p.55). Reducing the impact of the company on the environment should be the objective of corporate social responsibility. Discoveries have shown that many companies have emphasized on improved raw material procurement resulting in reduced industrial waste hence the impact of the waste on the environment is minimized. Nevertheless, it has been observed that many organizations seem to focus on the final production process and miss out on the major areas of concern. The practice of corporate social responsibility and its relation to industry ecology aim at reaching an optimum level of the various groupings which exist in an organization. The strategy is concerned with the exchange of industrial wastes where it is possible to do so. It has been observed that the residue for one person can be the raw material for the other company. There has also been increased emphasis in this ecological system on usage of recycling, shared services, rainwater harvesting and valorisation of the by-products (Banerjee, 2008, p.60).
Various governments are supporting corporate social responsibility by establishing industrial parks where the exchange of products and services can be achieved quickly without a major increase in cost. Although corporate social responsibility is an initiative that is voluntary, most organizations have used it for building its brand. The corporate social responsibility objective is to compensate for the harm done to the environment as a result of its activities. Many organizations and major stakeholders have developed a strategy towards corporate social responsibility and implemented it across the whole organization. Organizations are also becoming involved in corporate social responsibility because customers along the value chain are nowadays sensitive towards the ecology and the environment (Banerjee, 2008, p.68).
Various issues are being asked concerning corporate social responsibility, and they have been analysed by Montiel in his article. One of the questions is; what are the measures taken by businesses taken to ensure that they are acting as responsible members of the society? In an essential trend in management, companies have taken part in voluntary activities to increase their compliance with the law. They have done this by issuing codes of conduct implying their commitments in various areas of legal compliance and business ethics. The other step has been developing management systems to assist them with compliance of these commitments and standardizing the systems (Montiel, 2008, p.248).
Corporate social responsibility and shareholders reactions.
Businesses have not acted alone in implementing these initiatives. They have worked with labour unions, governments and non-governmental organizations. Involvement with these groups has helped companies to formulate management methods and principles for addressing various issues (Flammer, 2013, p.768). The other key question is; how can corporate social initiatives be meaningful if they are not based on formal enforcement and restrictive laws? Some people feel that for companies to conduct social responsibility, rules should be put in place so as to make it a requirement for every organization to engage in it. Various scholars have emphasized that any form of conduct or misconduct goes beyond the laws statutes and cannot be written down in international agreements or contracts. On the contrary, they are willing to comply with a norm because these they perceive that it is appropriate and necessary. Without implied consent and agreement, standards and rules would be very costly to implement using methods that are accepted by democratic society (Flammer, 2013, p.775).
Article the business case for social responsibility.
Various conclusions have been drawn about corporate social responsibility by Carrol and Shabana. This is based on different roles that it plays in the society. One of the conclusions that can be drawn is that corporate social responsibility develops closer ties between the community and the corporations. It helps corporations to be seen as social assets since the perception that organizations are places to get employment and producers of services and goods (Carroll and Shabana, 2010, p.96) the second conclusion that can be drawn that it assist in getting talents. Organizations which have reputable corporate social responsibility can take advantage of their status and make their appeal as an attractive employer strong. It is also observed that when employees take their company's engagement in socially responsible behaviour more positively which makes them be committed in other areas that are connected to better performance. Confidence in senior management is also boosted as employees rank their company high in engaging in socially responsible activities. An organization's success in the business environment is mostly influenced by the employees' perception and by its capacity for innovation. It is also an important factor in retaining and attracting talents (Carrol and Shabana, 2010, p.101). The third conclusion that can be drawn is that corporate social responsibility helps in environmental protection. Many companies have made a significant commitment to conserve the environment since they view that environmental and financial performance can work together to boost organizations social reputation and growth (Carrol and Shabana, 2010, p.103).
Devinney in his article address different areas where corporate social responsibility is applied in organizations. These areas are; sociology, economy, ethics and environment. On the area of economics, most scholars differ on the definition of what the company’s liability involves. Devinney emphasizes the importance of the organization increasing profits instead of solving the social problems. The view is often criticized for one- dimensional view of its mission as well as simplifying the role of the business in the economic environment. Most researchers claim that the main role of the organization is supposed to be the need to have relevant skills so as to survive in an environment that is subject to change. Secondly, to have improvement that is ongoing. Third, they should be able to compete favourably. Fourth, creating an image of the company that is positive and ensure the quality use of innovative behaviour in the market (Devinney, 2009, p.47). Corporate social responsibility implementation results to parameters such as; the flow of investments and returns, the employment, manufacture of goods, transfer of technology and development of local entrepreneurship among others.
The social area of corporate social responsibility covers the organization’s responsibility towards the society taking into consideration the interests of customers, employees, suppliers, local community, and investors. The various business activities in this area should be concerned about issues such as job creation, social welfare, education and skills of employees and workplace safety. Human resources should be considered as valuable assets in every organization. The management of employees exposes the company to its staff a process aimed at making sure that the company has the right number of staff with necessary qualifications and also creating conditions which stimulate positive organizational behaviour (Devinney, 2009, p.52).
Author; Basu and Palazzo; Article; corporate social responsibility
The other in the area in which corporate social responsibility is applied in organizations is ecology. Contemporary change in the approach to protection of the environment is of fundamental importance. It takes into consideration both aesthetic qualities of the landscape and health conditions of life on earth. Today, the concern about the value of people’s lives and the natural environment is termed to be one of the essential social objectives. Implementation of social responsibility can be used to anticipate consequences of the future which are as a result of degradation of the environment and to avoid actions which might have an adverse impact on the environment. As a result of improved environmental awareness and the human society becoming sensitive on the issue of the environment, most companies have taken initiatives to protect the natural environment which has resulted in a positive corporate image (Basu and Palazzo, 2008, p.127).
The ethical dimension focuses on organizations ethical and moral aspects. The ethical part of the organization involves focusing on the consequences of the various decisions made and being responsible for the consequences and is mostly motivated by the benefits that will be obtained by many even when it means losing some of its profits. In companies, ethics is normally known for introducing rules which are formal which are made in line with the law. Establishment of patterns of ethics of behaviour in an organization is a process that not only should guide on the acceptable targets and equip the human resources with the necessary skills in this area but should also control those activities and design an open communication system that is effective. (Basu and Palazzo, 2008, p.134).
Various researchers differ in various areas of corporate social responsibility. Most of them agree that corporate social responsibility is of fundamental significance hence should be embraced by all businesses. The scholars identify that leads to a good corporate image of the organization. However, there are various areas where the various scholars differ. Some feel that there should be a law that should be put in place so as to make the businesses more socially responsible. On the contrary, others believe that the business should do it out of personal conviction and should not be forced to do so (Banerjee, 2008, p.72).
Various conclusions are being drawn about corporate social responsibility. The conclusions are that it assists the corporations to develop closer ties with the environment. This helps the society to look organizations as social assets rather that a source of employment and provider of goods and services. The other conclusion is that corporate social responsibility assists in developing talent as there is more innovation in companies that motivate their employees to improve their capabilities. A conclusion can be reached that being socially responsible helps in environmental protection as various organizations consider the effects of their actions on the surrounding environment (Flammer, 2013, p.773).
Corporate social responsibility can be applied in different areas in organizations. The areas where it is applied include economic, ethical, sociology and ecology. The social area focuses on the company’s responsibility towards its stakeholders (Devinney, 2009, p.52).The ecological area deals with how an organization deals with is environment it operates in. This enables a company to be more conscious when carrying out its processes. For instance, every company must have an environmentally friendly way of sewage disposal (Basu and Palazzo, 2008, p.127). In the economic area, business is viewed as not only for the purpose of making profits. It is supposed to give back to the society (Devinney, 2009, p.47). The ethical area involves the company taking responsibility for its actions no matter how negative they may be (Basu and Palazzo, 2008, p.134). A conclusion can be reached that businesses being socially responsible is very critical in today's business environment and hence any company which aims to remain competitive must embrace it.
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