Learning Objectives

By the end of this section, you will be able to:

Define corporate social responsibility and the triple bottom line approach

Compare the sincere application of CSR and its use as merely a public relations tool

Explain why CSR ultimately benefits both companies and their stakeholders

Thus far, we have discussed stakeholders mostly as individuals and groups outside the organization.

This section focuses on the business firm as a stakeholder in its environment and examines the concept of a corporation as a socially responsible entity conscious of the influences it has on society.

That is, we look at the role companies, and large corporations in particular, play as active stakeholders in communities.

Corporations, by their sheer size, affect their local, regional, national, and global communities.

Creating a positive impact in these communities may mean providing jobs, strengthening economies, or driving innovation.

Negative impacts may include doing damage to the environment, forcing the exit of smaller competitors, and offering poor customer service, to name a few.

Lastly, this section examines the concept of a corporation as a socially responsible entity conscious of the influences it has on society.

In recent years, many organizations have embraced corporate social responsibility (CSR),

a philosophy (introduced in Why Ethics Matter,) in which the company’s expected actions include not only producing a reliable product,

charging a fair price with fair profit margins, and paying a fair wage to employees,

but also caring for the environment and acting on other social concerns.