citizens expect them to generate a profit and conduct themselves in an ethical and socially responsible manner.ĬSR strategies encourage the company to make a positive impact on the environment and stakeholders-that is, all of the parties who have a stake in the performance and output of the corporation. The result was a new movement known as corporate social responsibility, or CSR.ĬSR Defined Corporate social responsibility (CSR) can be simply and broadly defined as the ethical role of the corporation in society. The aim of CSR is to increase long-term profits and shareholder trust through positive public relations and high ethical standards to reduce business and legal risk by taking responsibility for corporate actions. It isn't enough for companies to generate a profit and merely meet the letter of the law in their business operations. and around the world began calls for more action from private enterprise on these social issues-beyond compliance with regulations and traditional charity-related work. Starting a few years ago, many citizens in the U.S. This is because the scale of economic activity grows every year, despite environmental improvements by individual enterprises. And now there are even larger problems on the horizon.Įven though businesses today are more efficient and use fewer resources to make goods-thanks to technological advances- many ecosystems continue to suffer. But despite these regulations, controlling pollution continues to be a challenge. Those laws had positive effects and are now vital parts of the American regulatory framework. The result was a wave of legislation designed to reduce the pollution produced by business activity. But starting in the 1960s and 1970s, the environmental impact of an ever-expanding economy was generating more and more protest from citizens. President Coolidge, like many American presidents before and since, kept government out of the affairs of business as much as possible. Today we discuss the idea of "corporate social responsibility." This trend reflects the view that companies ought to do more than simply meet the letter of the law and the bare minimum of ethical business behavior. Now, more than ever, private enterprise is being called upon to exercise social responsibility, especially when it comes to the environment. History of Corporate Social ResponsibilityĪmerican President Calvin Coolidge said in the 1920s that “the chief business of the American people is business.” It was a popular observation in a time of economic prosperity, when issues such as energy security and climate change were practically nonexistent.Īlmost a century later, things are very different. Give examples of corporate social responsibility.Describe the impact of CSR on direct and indirect stakeholders.Define corporate social responsibility (CSR).
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