1. Corporate Social Responsibility
LECTURE 1:
Corporate Social Responsibility
MGT 610

2. Corporate Social Responsibility
Course Objectives:
Capture the urgent and immediate need of social responsibility at all levels
Increase manifestation of CSR practices through increased awareness and motivation
How organizations can use CSR to become globally competitive and locally effective.

3. Corporate Social Responsibility
Course Policy
Course Description:
Understanding Corporate Social Responsibility (CSR)
Evolution of company and CSR
Stakeholders theory
Role of various institutions in CSR
Creating CSR framework
Framework for rating CSR
Sustainability and its challenges
Global CSR
The road ahead

4. Corporate Social Responsibility
Course Policy (Contd.)
Marks Distribution:
Marks
Assignments : 10%
Quiz : 10%
GDB : 5%
Midterm Exam : 25%
Internal Marks : 50
5. Final Examination : 50
Total : 100
Passing Marks 60 %

5. Corporate Social Responsibility
Course Policy (Contd.)
Text Book:
Corporate Social Responsibility
Oxford Higher Education
Madhumita Chatterji
Reference Text:
Globalization and Corporate Social Responsbility
Compiled by Gustavo Guzman
Jon Synott
Archie B. Carrol
Ann K. Buchholtz

6. Corporate Social Responsibility
Chapter 1:
Understanding Corporate Social Responsibility

7. Corporate Social Responsibility
After studying this chapter you should be able to:
understand organizations as living systems and assess their purpose
Get an overview of the concept of modern business
Get a glimpse of CSR
Define CSR as a concept
Analyze the different dimensions of CSR

8. Corporate Social Responsibility
The word organization is a combination of two words
Organic
Ization
Both words combined – bringing a process to life
Organizations are living systems that interact internally and externally
Organizations are made up of
Human aspect
Technical aspect
The technical aspect if also driven by the human aspect
The human aspect defines the purpose of the organizations and means of achieving it through the technical aspect 8

9. Corporate Social Responsibility
Purpose of the business
Achieving the purpose requires processes which are called functional areas of business
Market research
Finance
Production and operation
Source raw material
Design
Produce
Distribute
Sales and marketing
HR to take care of employees
While achieving the purpose, socio economic as well as political structure of the nation gets affected 9

10. Corporate Social Responsibility
Globalization has further increased the impact of businesses
The entire process requires human intervention and in each step moral questions are to be answered
Only human are gifted with the power of discriminating between moral and immoral
New management jargon such as ambitious , survival of the fittest have glorified unethical activities
Corporate sins are justified as long as profits are earned
Ethics VS Profits (market driven economy)
Ethics versus Progress (creating new wants and needs and complementary products ) 10

11. Corporate Social Responsibility
LECTURE 2:
Corporate Social Responsibility
MGT 610

12. Corporate Social Responsibility
Chapter 1:
Understanding Corporate Social Responsibility

13. Corporate Social Responsibility
After studying this chapter you should be able to:
understand organizations as living systems and assess their purpose
Get an overview of the concept of modern business
Get a glimpse of CSR
Define CSR as a concept
Analyze the different dimensions of CSR

14. Corporate Social Responsibility
What is business
Activity related to buying, selling and trade
Create utility
Command a price for utility
Demand has to be more than the supply
Gap results in manipulation by corporations to earn profits
Four types of utilities
Form utility
Converting the input in to output
Place utility
Transported to a destinations and value is added as a consequence
Time utility
Value added as a result of time factor
Knowledge utility
Development in the field of advance learning 14

15. Corporate Social Responsibility
Development of business
Ancient market places at borders of settlement
Barter system
Trade was the foundation for countries like England, Spain, Portugal and France
Business enterprise
Sole proprietor
Partnership firms
Joint stock companies
Company can be defined as an association of persons coming together voluntarily to pursue a certain economic activity with the motive to make profit
Entity apart from the owner
Capable of rights and duties of its own
Company is a legal device for the attainment of any social or economic end and to large extent this is done publicly and by being socially responsible
Company is a combined political, social, economic and legal institution. 15

16. Corporate Social Responsibility
Corporations derive wealth from society, create wealth for society and earn profit by dealing with the wealth of society 16

17. Corporate Social Responsibility
Society gives permission to the business to operate and earn money
Share the wealth that it earns from society
Corporate behavior encompass those activities of the corporation that ensures just and responsible behavior
Four dimensions to corporate behavior
Setting boundaries to learning, accountability and responsiveness
Building activities that form basis of learning
Creating measures that validate and make knowledge effective – form basis of decision making
Institutionalizing trust in ways that creates a virtuous circle of practice and further engagement with stakeholders 17

18. Corporate Social Responsibility
Values are essential to organizational function and dynamics
Organizations are nothing but the collective consciousness of all the members contributing to its activities
Human aspect is more important than the objective as the objective is achieved through the efforts of the human
Question
Is the human for industry-technology or vice versa
CSR – WHICH IS ABOUT THE BUSINESS TAKING IN TO ACCOUNT THEIR TOTAL IMPACT ON SOCIETY AND THE NATURAL ENVIRONMENT 18

19. Corporate Social Responsibility
Businesses have ability to bring economic prosperity to communities
The corporate community universal influence makes it very unlikely that society can wish it away
The need is to transform instead trying to constraint, tame or offer general solutions
The above aspect is relevant today because of the modern economy which has the following features:
Speed of change
Increased importance of knowledge, innovation and communication
Importance of intangible assets
Diversity
To mage the modern economy it is important to establish values, leading to trust and integrity among physically dispersed staff 19

20. Corporate Social Responsibility
Relationship between businesses and society be based upon trust
Survive only if everyone can operate with self esteem
If trust is lost then we will not have an organization but only automation
Democratization of politics there should be democratization of economics
Product of the people, by the people and for the people
This is where the responsibility of corporate world becomes pronounced
CSR provides the framework of boundary for the free market to operate responsibly 20

21. Corporate Social Responsibility
CSR, most misunderstood concept – lack relationship with the internal concepts
No formal structure
Defined vaguely
Ad hoc management policies
Definitions of CSR
Idea of legal responsibility
Social responsible behavior in an ethical eay
Charitable contribution 21

22. Corporate Social Responsibility
The World Business Council for Sustainable Development definition of CSR
The continuing commitment of business to behave ethically and contribute to economic development while improving the quality of life of their workforce and their families as well as the local community and society at large
President of WBCSD said
“there is no universal definition of CSR because the concept is always being redefined it is up to the companies to find their magnetic north’
The values and principals are the companies internal compass that help the company to stay on the ethical path. 22

23. Corporate Social Responsibility
Milton Friedman said
“there is one and only one social responsibility of business – to use resources and engage in activities designed to create profit so long as it stays within the rule of the game which is to say engage in open and free competition without deception and fraud’
Shortcomings
Lack of morals among the practitioners of business
Well ordered civil society in which business operate
Less importance to production and distribution as compared to exchange and free economy concept is violated which says free entry and free exit and equal sharing of information 23

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