2018
Corporate Social
Responsibility
ADA MORREN
,CORPORATE SOCIAL RESPONSIBILITY
N. Dentchev
TABLE OF CONTENT
CHAPTER 1: DEFINITIONS AND MEANING 3
How Corporate Social Responsibility is Defined: An Analysis of 37 Definitions 4
Corporate Social Responsibility Theories: Mapping the Territory 5
CHAPTER 2: CSR STRATEGY 6
Is there a Market for Virtue? The Business Case for Corporate Social Responsibility 7
Taming Trojan Horses: Identifying and Mitigating CSR Risks 8
CHAPTER 3: REPORTING 9
CHAPTER 4: STAKEHOLDER THEORIES 10
Magaging for stakeholders, stakeholder utility functions and competitive advantage 11
CHAPTER 5: THE SOCIAL ENTREPRENEURSHIP SUPPORT ECOSYSTEM 13
Cultivate your Ecosystem 15
CHAPTER 7: SHARED VALUE CREATION 17
Creating Shared Value 18
CHAPTER 8: ON VOLUNTARISM AND THE ROLE OF GOVERNMENTS IN CSR 20
On Voluntarism and the Role of Governments in CSR: Towards a Contingency Approach 21
CHAPTER 9: MANAGEMENT SYSTEMS AND ISO 26000 23
Integrated Management Systems – Three Different Levels of Integration 25
CHAPTER 10: GOVERNANCE 26
Disentangling Governance: A Synoptic View of Regulation by Government, Business and Civil
Society 27
CHAPTER 11: GUEST LECTURES JAN JONKER 29
CHAPTER 12: SUMMARY: A PORTFOLIO PERSPECTIVE 31
2
,CHAPTER 1: DEFINITIONS AND MEANING
People used to say that the only social responsibility of business was to create profit (Milton Friedman).
CSR à image, profit, risk,… BUT not only instrumental reasons à it is the right thing to do, it’s a choice
on how to do business.
Are there companies that are totally irresponsible?
- Banks: Everyone around them also irresponsible.
- Pharma: Buy rights to aids medicines.
à not 100% irresponsible BUT terrorist organizations, mafia, … (continuous process)
Profit is dependent of what you do at the end, including CSR. Don’t look for a link between CSR and
profit. It results from everything together; you can’t separate CSR from other activities. Earlier,
externalities had to be regulated by the government but this didn’t always work (poverty, climate
change, …).
There are differences between companies:
- Stock Exchange Quoted Companies make their decisions quarterly. Family owned businesses
are more concerned about their name.
- SME have a simpler environment. Multinationals can’t do what they want since there are
NGO’s watching their global operations.
- Contested business vs Social entreprise: Core of business model difficult to change in a
contested business (ex. Umicore)
- Private vs Public: Size, decision making, …
à People (be aware of the impact of everything you do)
à Governance
à CONTINUOUS IMPROVEMENT
The theory on CSR
Social issues can also be opportunities. Take all issues with stakeholders into account. There are other
objectives besides profit. Social goods can also be produced by private companies. Help others even
when it is not expected from you.
Critical to: Neoclassical economic approach to profit maximization & Public policy executed by
government only.
What is CSR?
A concept whereby companies integrate European social and environmental concerns in their business
operations and in their interaction with stakeholders on a voluntary basis. It is the responsibility of
enterprises for their impact on society.
Go beyond the law BUT government regulation still necessary (enforcement of law).
Pay attention to:
- Context (sector)
- Dynamics (“good and bad” change through time, alternatives differ between countries)
- Conflicts (make sure stakeholders remain pleased)
- System (change step by step, you can’t do this alone)
Management has to listen to stakeholders, be prepared, be honest and get inspired. But in the end
they are responsible to make a decision. It’s their business.
Very complex to manage CSR, many perceptions BUT not impossible with a strategic management
approach.
3
, How Corporate Social Responsibility is Defined: An Analysis of 37 Definitions
A. Daglsrud
There is a lot of confusion on how CSR should be defined. There exists an abundance of definitions,
often biased. When people talk differently about CSR, this prevents productive engagements. The CSR
definitions are describing a phenomenon, but fail to present any guidance on how to manage the
challenges within this phenomenon.
CSR is viewed as a social construction and, as such, it is not possible to develop an unbiased definition.
In this paper 5 dimensions of CSR are developed.
DIMENSIONS REFERS TO
ENVIRONMENTAL The natural environment
SOCIAL The relationship between business and environment
ECONOMIC Socio-economic or financial aspects
STAKEHOLDER Stakeholders (hard to define à be flexible)
VOLUNTARINESS Actions not prescribed by law. Doing things you believe can help
when no one expects you to do it.
All these dimensions are necessary in order to understand how CSR is defined. The social,
environmental and economic dimensions are merely different categories of impact from business. This
is a recognition that business, as a producer of economic wealth does not only have economic impacts.
Process for optimal performance?
The voluntariness dimension implies that the business should perform above regulatory requirements,
which will set the minimum performance level deemed acceptable. The optimal performance is
dependent on the stakeholders of the business. A succesful CSR strategy has to be context specific for
each individual business (what are the specific issues to be adressed and how to engage with the
stakeholders).
Business has always had social, environmental and economic impacts, been concerned with
stakeholders and dealt with regulations. This has been managed through patterns. But, due to
globalization, the context in which business operates is changing at an increasingly rapid pace. CSR
tools are needed in additon to the previously established patterns.
They conclude that the confusion is not so much about how CSR is defined but how CSR is socially
constructed in a specific context and how to take this into account when business strategies are
developed.
4
Corporate Social
Responsibility
ADA MORREN
,CORPORATE SOCIAL RESPONSIBILITY
N. Dentchev
TABLE OF CONTENT
CHAPTER 1: DEFINITIONS AND MEANING 3
How Corporate Social Responsibility is Defined: An Analysis of 37 Definitions 4
Corporate Social Responsibility Theories: Mapping the Territory 5
CHAPTER 2: CSR STRATEGY 6
Is there a Market for Virtue? The Business Case for Corporate Social Responsibility 7
Taming Trojan Horses: Identifying and Mitigating CSR Risks 8
CHAPTER 3: REPORTING 9
CHAPTER 4: STAKEHOLDER THEORIES 10
Magaging for stakeholders, stakeholder utility functions and competitive advantage 11
CHAPTER 5: THE SOCIAL ENTREPRENEURSHIP SUPPORT ECOSYSTEM 13
Cultivate your Ecosystem 15
CHAPTER 7: SHARED VALUE CREATION 17
Creating Shared Value 18
CHAPTER 8: ON VOLUNTARISM AND THE ROLE OF GOVERNMENTS IN CSR 20
On Voluntarism and the Role of Governments in CSR: Towards a Contingency Approach 21
CHAPTER 9: MANAGEMENT SYSTEMS AND ISO 26000 23
Integrated Management Systems – Three Different Levels of Integration 25
CHAPTER 10: GOVERNANCE 26
Disentangling Governance: A Synoptic View of Regulation by Government, Business and Civil
Society 27
CHAPTER 11: GUEST LECTURES JAN JONKER 29
CHAPTER 12: SUMMARY: A PORTFOLIO PERSPECTIVE 31
2
,CHAPTER 1: DEFINITIONS AND MEANING
People used to say that the only social responsibility of business was to create profit (Milton Friedman).
CSR à image, profit, risk,… BUT not only instrumental reasons à it is the right thing to do, it’s a choice
on how to do business.
Are there companies that are totally irresponsible?
- Banks: Everyone around them also irresponsible.
- Pharma: Buy rights to aids medicines.
à not 100% irresponsible BUT terrorist organizations, mafia, … (continuous process)
Profit is dependent of what you do at the end, including CSR. Don’t look for a link between CSR and
profit. It results from everything together; you can’t separate CSR from other activities. Earlier,
externalities had to be regulated by the government but this didn’t always work (poverty, climate
change, …).
There are differences between companies:
- Stock Exchange Quoted Companies make their decisions quarterly. Family owned businesses
are more concerned about their name.
- SME have a simpler environment. Multinationals can’t do what they want since there are
NGO’s watching their global operations.
- Contested business vs Social entreprise: Core of business model difficult to change in a
contested business (ex. Umicore)
- Private vs Public: Size, decision making, …
à People (be aware of the impact of everything you do)
à Governance
à CONTINUOUS IMPROVEMENT
The theory on CSR
Social issues can also be opportunities. Take all issues with stakeholders into account. There are other
objectives besides profit. Social goods can also be produced by private companies. Help others even
when it is not expected from you.
Critical to: Neoclassical economic approach to profit maximization & Public policy executed by
government only.
What is CSR?
A concept whereby companies integrate European social and environmental concerns in their business
operations and in their interaction with stakeholders on a voluntary basis. It is the responsibility of
enterprises for their impact on society.
Go beyond the law BUT government regulation still necessary (enforcement of law).
Pay attention to:
- Context (sector)
- Dynamics (“good and bad” change through time, alternatives differ between countries)
- Conflicts (make sure stakeholders remain pleased)
- System (change step by step, you can’t do this alone)
Management has to listen to stakeholders, be prepared, be honest and get inspired. But in the end
they are responsible to make a decision. It’s their business.
Very complex to manage CSR, many perceptions BUT not impossible with a strategic management
approach.
3
, How Corporate Social Responsibility is Defined: An Analysis of 37 Definitions
A. Daglsrud
There is a lot of confusion on how CSR should be defined. There exists an abundance of definitions,
often biased. When people talk differently about CSR, this prevents productive engagements. The CSR
definitions are describing a phenomenon, but fail to present any guidance on how to manage the
challenges within this phenomenon.
CSR is viewed as a social construction and, as such, it is not possible to develop an unbiased definition.
In this paper 5 dimensions of CSR are developed.
DIMENSIONS REFERS TO
ENVIRONMENTAL The natural environment
SOCIAL The relationship between business and environment
ECONOMIC Socio-economic or financial aspects
STAKEHOLDER Stakeholders (hard to define à be flexible)
VOLUNTARINESS Actions not prescribed by law. Doing things you believe can help
when no one expects you to do it.
All these dimensions are necessary in order to understand how CSR is defined. The social,
environmental and economic dimensions are merely different categories of impact from business. This
is a recognition that business, as a producer of economic wealth does not only have economic impacts.
Process for optimal performance?
The voluntariness dimension implies that the business should perform above regulatory requirements,
which will set the minimum performance level deemed acceptable. The optimal performance is
dependent on the stakeholders of the business. A succesful CSR strategy has to be context specific for
each individual business (what are the specific issues to be adressed and how to engage with the
stakeholders).
Business has always had social, environmental and economic impacts, been concerned with
stakeholders and dealt with regulations. This has been managed through patterns. But, due to
globalization, the context in which business operates is changing at an increasingly rapid pace. CSR
tools are needed in additon to the previously established patterns.
They conclude that the confusion is not so much about how CSR is defined but how CSR is socially
constructed in a specific context and how to take this into account when business strategies are
developed.
4
