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Corporate Social Responsibility in brief October 31, 2011

Corporate Social Responsibility (CSR) is the idea that companies should be concerned with and responsible for the social impacts of their actions and products, that they should care about their stakeholders, not just their shareholders. It has become more important in recent years as corporations have grown larger and multi-national, making it harder for governments to regulate them. Transparency is a key part of CSR because if companies have to divulge all of their “dirty little secrets,” they are less likely to have so many. Some companies try to be more aware of their impact on workers, human rights, or the environment. How corporations deal with the environment “responsibly” can range from Google’s recent

announcement to encourage transparency by revealing their carbon footprint to companies incorporating climate change into their business strategy. Google’s carbon footprint turns out to be 1.5 million tons per year. This may seem like an awful lot, but it is significantly less than that of the internet as a whole, which produces 300 million tons a year. The 10th annual Carbon Disclosure Project found that 45% of the 396 businesses surveyed (which were some of the largest in the world) had reduced their greenhouse gases, compared to only 19% who reported doing so last year. Businesses also try to be socially responsible by donating their time or money to causes they believe in.

The controversy over corporate social responsibility is whether or not businesses do it for the environment and the good of the people they affect, or just for the positive image. Regardless of why they do it, CSR doesn’t replace businesses’ desire to make profits, so changes that they make are limited by their budget. For businesses that truly do want to make a difference, CSR provides various ways for them to do so and makes them more appealing to potential customers and clients. And for those that want to move past it, there are ways of incorporating CSR into corporate strategy and culture which can make the company not only a better steward of the earth and the communities it impacts, but also increase its financial bottom line. The goal, long-term, is for CSR to be included in everyday business and no longer called out as a separate project or initiative.

Photo Courtesy of InventorSpot


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