1.4 Sustainability and Corporate Responsibility



The definition of sustainability is complicated further in the corporate context rather than clarified. Corporations talk of sustainability in a variety of ways applying to a broad range of topics – financial, social or environmental. Purists would argue that it is often applied inappropriately to encompass notions of durability and resource efficiency. Perhaps even more confusing is the use by many business leaders of the term interchangeably with notions of corporate responsibility (CR) and corporate social responsibility (CSR).

Corporate social responsibility (CSR, also called corporate conscience, corporate citizenship, social performance, or sustainable responsible business/Responsible Business) is a form of corporate self-regulation integrated into a business model. CSR policy functions as a built-in, self-regulating mechanism whereby a business monitors and ensures its active compliance with the spirit of the law, ethical standards, and international norms. The goal of CSR is to embrace responsibility for the company's actions and encourage a positive impact through its activities on the environment, consumers, employees, communities, stakeholders and all other members of the public sphere who may also be considered as stakeholders.

The term "corporate social responsibility" came into common use in the late 1960s and early 1970s after many multinational corporations formed the term stakeholder, meaning those on whom an organization's activities have an impact. It was used to describe corporate owners beyond shareholders as a result of an influential book by R. Edward Freeman, Strategic management: a stakeholder approach in 1984.[2] Proponents argue that corporations make more long term profits by operating with a perspective, while critics argue that CSR distracts from the economic role of businesses. Others argue CSR is merely window-dressing, or an attempt to pre-empt the role of governments as a watchdog over powerful multinational corporations.

CSR is titled to aid an organization's mission as well as a guide to what the company stands for and will uphold to its consumers. Development business ethics is one of the forms of applied ethics that examines ethical principles and moral or ethical problems that can arise in a business environment. ISO 26000 is the recognized international standard for CSR. Public sector organizations (the United Nations for example) adhere to the triple bottom line (TBL). It is widely accepted that CSR adheres to similar principles but with no formal act of legislation. The UN has developed the Principles for Responsible Investment as guidelines for investing entities.

Above text sourced from
Wikipedia under a Creative Commons Attribution-ShareAlike License on 25/07/12



Activity 4

Take 30 minutes to read about sustainability and CSR in Crowther and Aras (2010) available as a free e-book from bookboon.com. Download the book and read pages 7-13 inclusive and 38-49 inclusive. Making a new entry in your learning diary, answer the ‘Self-Test Questions’ on page 50.

Remember, this is just one perspective on sustainability. As we have learned, sustainability remains a challenging concept to define and means different things to different people.