Case Study Of Corporate Social Responsibility Management Essay

Introduction

In 21st century, due to planetary issues like, clime alteration, environmental debasement, human rights, energy issue and societal issue, there are turning demands of re-thinking about maps and responsibilities of international corporations. At meanwhile, the words ‘corporate societal duty ‘ ( CSR ) appear often in mainstream media and academic articles. In today ‘s universe, the corporations are expected non merely to maximise net income and pleasure their stockholders but besides to run within the ‘new moral market place ( Mustaffa, M, 2010 ) . In fact, more and more corporations begin to use CSR initials into their corporate schemes to derive competitory advantages ( Balmer, 2009 ) . The CSR phenomena seem to be a mainstream subject for long term ( Franklin, 2008 ) .

However, the different grounds drive those houses join in this tendency. Enhancing corporations ‘ repute is the chief motive for international concern? Or are they willing to take duty for planetary issues? Despite a broad scope of articles had a deeper discussed on CSR subject, the reply for these inquiries have non been proved. In this article, foremost it provides focussed sum-ups of the articles presented in the definition of CSR to to the full understand what CSR existent agencies. Then some surveies are listed that concentrating on above two specific inquiries. Finally, it illustrates general sentiments with mention to BP ‘s attack to CSR, and explains how BP suitably put CSR enterprises into the bosom of concern scheme and besides successfully enhances its repute.

Literature Review

2.1 Definition of Corporate Social Responsibility ( CSR )

In order to deeper understand and answer those tow inquiries mentioned above, we should foremost entree the construct of corporate societal duty.

CSR is defined as a comprehensive duty which including economic, legal, ethical, and discretional context, and it is a voluntary agency for profiting society which besides obey the societies ‘ ordinances ( Carroll, 1991 ) . However, this definition is non accepted by everyone. For blink of an eye, Friedman stated that any actions which can do involvements for corporations seen against the conceptualisation of CSR that are non been counted as act of CSR ( Friedman, 1970 ) . Similarly, Lichtnstein et Al. pointed that CSR as a house ‘s committedness to giving its net incomes to public and societal involvements ( Lichtnstein et al, 2004 )

These treatments suggest that several issues related to CSR definition have non been resolved. For illustration, while Mc Willians and Siegel ( 2001 ) defined CSR as actions that attack bettering the quality of society which is required by jurisprudence, others emphasized executive motives with saying it beyond any corporate involvements ( Baron, 2001 ; Swanson, 1995 ) . In fact, more researches have proved that CSR can be classified as be strategic, selfless or coerced ( Husted and Salazar, 2006 ; Baron, 2001 ) . Increasingly, some bookmans applied the theory of CSR into marketing context in order to make benefits for corporations. They considered CSR as direction of stakeholder concern for responsible and irresponsible Acts of the Apostless related to environmental, ethical and societal phenomena in a manner ( Vaaland et al. , 2008 ) .

To sum up, in order to reply two inquiries, in this article, I apply more specific conceptualisation of CSR which is defined as giving net incomes in the societal involvement ( Reinhardt, Stavins and Vietor, 2008 ) , which is voluntary activities. Therefore, if the company implements CSR chiefly to heighten its repute, this could be regarded as ‘relevant ‘ CSR.

2.2 Link between CSR and corporate repute

In this portion, some groundss are listed to turn out that prosecuting CSR has positive impacts on corporate repute edifice. It besides demonstrates that in some existent concern instances, houses apply CSR as strategic tools to heightening their images.

Based on anterior surveies, Worcester has stated that CSR is one of the cardinal factors in act uponing company repute ( Worcester, 2009 ) . Similarly, Cornelius et Al. besides pointed that CSR can be included in outstanding theoretical accounts impacting corporate repute and company image ( Cornelius et al. , 2007 ) .

Since the Link between CSR and company repute has been proved, many corporations bring CSR into their concern schemes with making favourable company image against today ‘s extremely competitory environment. In some concern, CSR is used as a strategic tool to react to societal outlooks to construct good images in public ( Jones, 2005 ) . Therefore, Mc Willians et Al. ( 2006 ) besides pointed out that CSR should be regarded as a type of strategic investing and besides considered as a agency of edifice or keeping corporate repute. Furthermore, Garbegy and Fombrun ( 2006 ) proved companies can derive repute by prosecuting CSR programmes ( Garbegy and Fombrun, 2006 ) . Therefore, heightening repute is considered as a cardinal motive for companies to implement CSR activities ( Fombrun, 2005 ) .

2.3 For repute or corporate committedness or others?

As we noted above, the companies ‘ repute can be influenced by its activities related to CSR. However, the existent motives of houses prosecuting CSR is more hard to place ( Baron, 2006 ) . Is it because of heightening repute? Or merely reflecting corporate commit? Or other grounds? There is no in agreement reply. Here I apply empirical grounds to explicate this trouble.

First, it is hard to prove whether companies are really voluntary to prosecute CSR beyond the ordinance required. This is because information on environmental public presentation are highly limited. Additionally, missing of appropriate counterfactuals besides result in the trouble of detecting that companies sacrifice net incomes. Furthermore, houses can do net incomes by puting in societal undertakings in assorted ways which is unobservable. For illustration, because of low pollution in high-technology sector, the perceived but inaccurate market agencies of societal responsible public presentation brought immense stock returns for those high- tech companies in 1990s. Finally, in short term some corporate actions seem to be voluntary but in fact they are profitable in long term. Therefore, it is exceptionally hard to find the existent motive of houses to implement CSR.

On the other manus, fortuitously, the purest signifier of CSR without any profitable motive has been proved in atom. Although corporation is allowed to maximise net incomes for stockholders, it still has responsibility to give net incomes for society voluntarily. Furthermore, there is possibility that some stockholders may be willing to portion parts of their net incomes. Once these investors fund CSR actions, the corporation will follow ( Baron, 2006, 2008 ) .

So, my points to inquiries are they may. Whether CSR enterprises are voluntary or loath, it depends on market force and societal outlooks ( Borck et al. , 2006 ) .

BP ‘s Approach to CSR

BP ( British crude oil ) is regarded as one of universe ‘s most admired company of societal duty. This award is precisely processing the values of BP ‘s trade name which are ‘performance ‘ , ‘green ‘ , ‘innovative ‘ and ‘progressive ‘ . This is non coinciding. It is because as largest oil company in the universe, BP is willing to acknowledge and perpetrate to planetary issues like clime alteration, human public assistance and communities ‘ sustainable development. Therefore, there is no surprise that BP is considered as an ideal illustration imitated by other international corporations, while a big figure of articles is associating to how successful BP ‘s CSR schemes. In balance of this article, it demonstrates BP ‘s actions in more item about how BP suitably builds CSR enterprises as company ‘s committedness to react planetary issues. These CSR activities cover in four kingdoms: alternate energy ; environment ; communicating development ; safety and human right.

3.1 BP and Alternative Energy

The planetary energy demand is set to turn in the hereafter. It will ensue in more serious issues of energy depletion and environment pollution. BP predicts this state of affairs advanced and in order to turn to those jobs, it takes great attention about development of alternate energy development.

BP is widely regarded as a taking place in ‘new ‘ energy development. Since foretelling the demand of energy is switching from oil to gas, BP resolutely changed its concern scheme in order to supplying sustainable energy for humanity. Besides, sing long term development, it shifted attending from C to hydrogen that promotes BP as a planetary leader in hydrogen economic system. In order to show and be understood by societal public about BP ‘s low-carbon concern, it even changed its name to ‘Beyond crude oil ‘ ( John, 2004 ) .

On the other manus, BP is invariably lending to renewable energy development. For illustration, BP already has been offering solar power for over 30 old ages and the concern is invariably germinating. In add-on, in order to do solar power within following decennary become cost-competitive, BP maintains decade-long attempts to concentrate on cut downing the outgo of photovoltaic panels, diminishing the cost of utilizing solar power. Besides, BP tried to larn about societal response to this engineering so that it invested 48 million dollars in Philippines ‘s undertaking to convey electrification to rural topographic points by utilizing solar engineering.

In biofuels country, BP worked together with life science and agricultural expertness, and to make a major new beginning of lower-carbon fuel. Feedstocks are the mail mark BP focused on, since they are non needed for nutrient and besides create zero nursery gas emanations. Beside of this, BP is concentrating its air current power concern. In US, since 2005 BP has built a gross bring forthing capacity of more than 1200 megawatts ( MW ) which is adequate to offer electricity for a metropolis like Wanshington DC.

3.2 BP and Environment

Climate Change and Global Warming

BP besides acts to turn to the issues of clime alteration and planetary heating. BP ‘s concern portfolio displacement from oil to gas and so to hydrogen. This is non merely because of resources deficit but besides sing about cut downing nursery emanations ( John, 2004 ) .

However, on the other manus, doing operations more energy efficient and making merchandises that help lower clients ‘ C footmarks are chief attacks for BP to treat. BP is working hard to pull off nursery gas emanations from its operations. It requires operations to integrate energy usage in corporate program and utilize engineerings to better. Since 2002, due to efficient operations, the entire decrease of emanations was 7.9 million metric tons by the terminal of 2009. BP besides seeks to bring forth hydrocarbons every bit expeditiously as possible. It works in partnership with vehicle industries like Ford to better the efficiency of fuels and lubricators so that contribute to decrease of C dioxide emanations.

Developing low-carbon energy is another agency for BP to against clime alteration. Biofuels, air current power, solar power and open uping power workss are all alternate energy good developed by BP. In add-on, BP plays an of import portion in the policy argument. It states regulate the monetary value of C and other low-carbon energy.

Waster Reduce

At facet of cut downing waste, BP has stated that it ca n’t cut down waste to zero but will utilize waste to profit society back. In Brazil, BP ‘s programme is recycling an recycling merchandise packaging, utilizing recycle stuffs for processing and purchasing tree seedling to works in province of Rio de Janeiro.

3.3 Community and Development

BP besides takes great attention to guarantee that its long-run societal effects in a state are managed to the advantage of those communities.

Fiscal Support for Local community

In Trinidad and Tobago, BP created a micro-credit programme called MIPPED to supply fiscal support towards employment creative activity and societal development. As the consequence MIPED has enabled and encouraged an entrepreneurial spirit among local people – particularly valuable in the current planetary economic downswing and attendant occupation losingss. It ‘s besides created important good will for BP in Mayaro, which has helped better concern consequences. We have had no community-led break against our operations in the past twosome of old ages. The HOPE loan theoretical account has now spread widely to other rural communities, funded by the authorities and private sector companies.

BP and Education

Education for BP seems to be an of import activity. Not merely it portions experience and technological accomplishments the industry required but besides brings benefits to local societies. For illustration, in Trinidad and Tobago, BP invests universities in West of indie to put up geosciences programmes which aimed to assist developing geological human resources from local. Since 2001, there are more than 100 pupils holding graduated by acquiring aid organize BP ‘s strategy and the entire investing for this prorammes is over one million dollars. In Azerbaijan, BP helps Azerbaijani pupils to analyze geology in universities worldwide through funding an Oil and Gas scholarship programme.

BP besides promotes experts to put seminars and conferences in Universities and the pupils are expected to use for internships. In add-on, BP works with UK universities such as Cambridge University and Imperial College to back up instruction and patrons for immature people ( Lars H and Arid, 2007 ) .

In host state UK, BP ‘s activities for instruction have last for over 40 old ages.

Since 1968, in order to trip more immature pupil to analyze in scientific discipline and technology country, BP work in partnership with other several houses to associate up with local schools. Based on this partnership, BP set up Schools nexus programme, which is concerned as one of the cardinal elements of BP ‘s instruction support strategy. More immature people gain chance to see BP ‘s workss and research labs, and to derive experiences at BP sites.

Help Local Governments

In worldwide, BP is set to assist authoritiess develop local economic systems sustainably through supplying their professional cognition and fiscal aid. BP economic experts squad has visited many states to portion the their expertness on economic system, universe energy and scheme. Its operation in Azerbaijan is a critical illustration. A undertaking named ‘the Advisory Programme ‘ is set up by BP, which toward for Macroeconomic Management and Institutional Reforms. This programme improves the proficient advice provided to policy-makers and provides proficient aid to the Ministry of Economic Development thought developing on mold and econometrics. While, in Trinidad and Tobago, BP suggested authorities a sustainable manner that sing energy efficiency and renewable energy.

In add-on, BP supports greater transparence with related to company and authorities dockets so that the information populace can entree. BP commit to the Extractive Industries Transparency Initiatives ( EITI ) which supports the creative activity of a standardised procedure for crystalline coverage of company payments and authorities grosss for oil, gas and excavation.

3.4 Safety and Human Right

Safety, people and public presentation are BP ‘s top precedences. This committedness crosses through the BP ‘s whole organisation signifier leading to frond-line staff. In order to implement the safety enterprise, BP ‘s operating direction system ( OMS ) is designed with a individual model for all operations to follow which covers the procedure safety, personal wellness and environmental public presentation. In procedure of operation, good design rules applied and patterns care to do certain safe operation. Besides, BP builds runing safety demand into the HSE and Operations Integrity Report to supervise the demand of any future criterions. Beside of this, BP organizes its ain laager audit squad which is responsible for safety and operations to against company ‘s current demand and state of affairs.

On the other manus, in respond to the human deaths and incidents happened in operating, BP improves its safety and operations risk direction at its operations worldwide. It set up operations risk commission to discussed those incidents and uses probes to larn experience and takes action to forestall return. As the consequence, Since 1999, hurt rates and spills have reduced by about 75 % .

BP besides acts as the critical illustration to esteem human right as its committedness of back uping for UDHR ( the Universal Declaration of Human Rights ) . The company builds this committedness into their concern activities. For illustration, BP strongly obeys employment reasonably and every bit in worldwide. Equally good as, BP battles against the usage of kid labor and mandatory labor.

Decision

In this article, it has discussed the motives for international houses prosecuting CSR activities, with peculiar focal point on two inquiries. Enhancing corporations ‘ repute is the chief motive for international concern? Or are they willing to take duty for planetary issues? Although it has been proved that CSR can be used to heighten houses ‘ repute, it is exceptionally hard to find the existent motive of houses to implement CSR because of the trouble of separating voluntary actions form ‘reluctant ‘ CSR. Therefore, my points to inquiries are they may. Whether CSR enterprises are voluntary or loath, it depends on market force and societal outlooks.

However, through analyzing the BP instance, I realize that the company ‘s planetary repute can be gained from successfully implementing CSR enterprises as corporate committedness. It means CSR likely can reflect houses ‘ committedness to planetary issues and better their planetary image at the same clip. Furthermore, BP instance could supply theoretical accounts for other industries around the universe.