Be a good neighbour!

November 15, 2006

Corporate social responsibility (CSR) takes on several definitions but fundamentally, it refers to business decision-making that is based on ethical values, compliance with legal standards, and solicitude for human dignity, communities, the environment, and other stakeholders of business (Source: Jose Mario B Maximiano, CSR Integration into Core Business: among Selected Firms in the Philippines).  CSR requires that businesses account for and measure the actual or potential economic, social and environmental impacts of their decisions. 

The advent of CSR as some experts claim, can be traced back since the ancient times.  Of course, it wasn’t called CSR then, but as old as trade and business itself, social and environmental concern about business has been in existence.  From those times until today, CSR has evolved into an essential component of enterprises.  Businesses have taken cognizance of the fact that the pursuit of economic growth and increased competitiveness are correlated with environmental protection and social responsibility.  Nowadays, CSR covers a wide spectrum of discipline among which are Community, Environment, Business Ethics, Human Rights, Marketing, Corporate Vision and Values and the Workforce.  

In the context of community, let me share a few excerpts from an article by the Business in the Community (BITC).  BITC is is a unique independent business led charity whose purpose is to inspire, engage, and support and challenge companies, to continually improve the impact they have on society: 

All businesses, large or small, have an impact on the communities in which they operate. Managed well, this impact can bring significant benefits to both the community and the business concerned. Business has a positive impact on the community because of the employment the company provides. It also produces goods and services which may be consumed locally. 

A company can add an extra dimension to this by taking the initiative, and by supporting and building the community through a programme of corporate community investment. This programme can take the form of charitable donations, staff volunteering and providing other resources, such as the use of professional skills or the use of equipment and premises. It can be the most visible part of a company’s approach to social responsibility, and one of the most satisfying. 

Of course a business may also have a negative impact. This might include disruption and noise from the day to day operation of a site and poor relationships with key local stakeholders. A good community programme should go hand in hand with measures to keep these negative impacts to a minimum. 

Companies are increasingly developing positive relationships with local communities. This not only helps the community, they find it can also support the objectives of a whole range of business functions such as: 

Marketing – building brand familiarity and reputation; sales promotions

Human Resources – boosting staff morale; developing team building skills; management development and training

Public Affairs – creating platforms for dialogue with national or local opinion makers

 Public Relations – generating positive media coverage; retaining “license to operate” relationships 

Community investment is like any other form of investment. Done well, and linked with business goals, it will both assist the community, and support and strengthen the business. 

8 Responses to “Be a good neighbour!”

  1. dwinnix Says:

    bai, before a company decides to venture into full-blast CSR, they must make sure its employees are well-compensated first and are generally satisfied with the benefits they are getting from the company. otherwise, they will just treat this corporate act a means to reduce income tax payments.🙂

  2. ericdc Says:

    Most companies would usually implement CSR to boost its image as being a responsible party in the community or society. However, past experiences will show that too much image boosting usually has a hidden agenda particularly in the political climate. One way to avoid such suspicion is by allowing employees living in the same location as the company to become stakeholders. This will mean that the company will become not just a party in community’s development and growth but also a part of the social responsibilty of the community. But that’s an ideal scenario. Wealth generation is usually reserved to the few. Tell that to the MNC’s and you’ll get mixed reactions.

  3. ruprup Says:

    i sincerely think that CSR is a way for companies to put up a good image. it’s a marketing tool to tell the consumers that “hey we think of you in every step we take in the conduct of our business”. but for me, it’s a big hypocrisy on their part. look inside their own fences and you’ll see great social injustices. i don’t know. i am not a fan of CSR.

  4. tivo Says:

    eric and dwinnix cases are true, before anything else the enterprise needs to be profitable at least and employees with smiley faces before embarking into CSR. The program itself will incur cost anyway, its not practical to operate in the red with additional operating cost . On the otherhand, head honchos will then, decide — we’re on the black our people are happy, what to do next?
    Successful enterprises reaches a point that in whatever they do whether it’s unorthodox marketing, government collaboration, introducing a new product or even in this case CSR, it has something to do with their bottomline. They are not charitable institutions anyway, but their intentions can only be justified when credible third party auditor (which specializes on CSR) says — Co. A has improved the lives of Barangay A or Co. B has a sustainable program that they are on the 10th year into the program and still growing. Or peers acknowledge the companies’ efforts that they are given honors to what they are doing.
    I’d like to give special mention to companies that implement CSR programs that complement their core competencies. I mean these are the experts in their fields let them do their stuff. I don’t have against actors but don’t you hate them when they build a house with makeups. Unless you’re Harison Ford who in his first life is a carpenter.
    Back to the case, when the company is in the black, when you spend something and the result helps the company to stay in black, ain’t that competetive strategy instead of marketing. Anyway uplifting the lives of the community makes the chances of the company to operate longer.

  5. ojiels Says:

    CSR is not done “exclusively” to improve a company’s image nor to obtain tax perks or incentives. Rather than doing CSR for self-serving interests, CSR has become a pragmatic response to “consumer and civil society PRESSURES.”

    Citing from a UNDP study, “Accusations by governments and civil society alike, of environmental pollution, human rights abuses, and exploitation of labour in supply chains, has pressured companies into becoming more environmentally and socially responsible. However, companies have quickly recognised the strategic value of being more responsible and are beginning to align products and business relationships accordingly, in particular through their supply chains, .”

    Now, unless you’ll say that UNDP is a biased and an unitegrable organization and support that with compelling evidence, I will tend to subscribe to this observation.

    CSR has evolved from a mere philantrophic excersice (which i have to admit, may or may not be goaded to obtain pogi points) to a more meaningful and significant part of strategic planning for several companies aside from seeing it as a way of creating sustainable value. Being a good neighbour (or corporate citizen) is actually not a diffcult task, one only needs to do what is right and appropriate. And what is right and appropriate in this present world is to be aware of environmental and social impacts in the way you do business.

    I do hope ruprup could give CSR a chance. Perhaps this is a good opportunity to “think outside the box” and take another look at CSR because it does help people and the community.

  6. ericdc Says:

    CSR has good intentions. I am not against it. But it would be good to include and involve the same community that the company is trying to attract as partners in the business.

    It would be like having a company deciding to put up a factory then telling the community that’s affected not to worry because the company shall strictly follow all laws regarding environment and pollution; provide employment; spend for schools, medical, social events, and roads leading to the factory; then declare all of it is for the benefit of the community.

    That may be true, but who are you to tell them what is good to them or not?
    Then when things turn out bad, the company closes and leaves the community in the dark only to tell them sorry?

    I don’t think that is social responsibility. Seems to me it’s more like taking advantage of the community.

  7. ojiels Says:

    The very essence of CSR in the context of community is getting the community involved and making the same as the direct beneficiary. In fact, doing so will ensure the sustainability of whatever CSR initiatives that companies have. In later postings, i will cite a few cases related to this.

    But generally, community in CSR parlance does not necessarily mean the immediate locality of where a business operates but can also mean a region or a country. Yes, i agree that nobody has the right to tell anybody what is and what is not good for them. But hey, lets admit it that there is still a great number of people or community that needs somebody who will teach and guide them towards having a better existence. And i believe that this is a universal law regardless of creed, religion, social status or race. And besides, getting free heatlh service or infrastructure from people or organizations instead of from the government who should be doing it in the first place, is not at all a bad thing no matter how you look at it.

    Companies who feign social responsiveness through reactive or temporary activities fell way short of what the essence and purpose of CSR should be. CSR for those companies who meant doing it, has and will be a critical part of their existence. CSR has been an important consideration during strategic planning. CSR has also been a part of their culture in some sense.

  8. ericdc Says:

    It’s in the news bro. Quoted from Manila Bulletin 11/18/06:
    “The corporate social responsibility (CSR) program of Philippine pharmaceutical industry leader United Laboratories, Inc. (Unilab) received major focus and citation in the sixth International Symposium on Catholic Social Thought and Management Education recently held in this city. …”
    Read the rest of the issue in: http://www.mb.com.ph/BSNS2006111880011.html
    One case to emphasize CSR.🙂


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