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The Concept of Corporate Social Responsibility (CSR)


In the contemporary world, the number of multinational corporations coming up is at an all-time high. This can be attributable to various factors, including the increased use of information communication technology that has become a common phenomenon in the 21st century. The use of modern technology has enabled most of these companies open branches in other foreign countries, while the management and control is being done in the country of origin. In addition, the financial institutions have lessened their strict conditions for financial assistance to business organizations. As a result, companies seeking their financial assistance have increased and hence the numerous expansions of businesses being witnessed in the modern day world. However, there have been concerns from the local people that some of these companies have become profit oriented at the expense of their welfare.

The concept of Corporate Social Responsibility (CSR) has gained much publicity recently. Besides being widely researched on, the business fraternity has increasingly recognized it as one of the key elements in determining the competitiveness of any business; which if not taken into consideration may permanently affect its long-term viability. In recent years, businesses are focusing on the responsibilities of a firm so the key question that arises is whether businesses should concentrate only on profit maximization or should also engage in activities that go beyond the financial aspect. This paper will dig in the veracity of the statement that it is not enough for a multinational corporation to be socially responsible, and that it must be a triple bottom line company to meet its ethical obligations.

Triple Bottom Line Concepts

According to Mele (2009), the capitalistic nature of the modern day world has made many organizations concentrate on making more profits at the expense of looking at the welfare of its employees as well as other key stakeholders. Mele (2009), in his research, stated that in the 21st century most multinational corporations have concentrated their effort on making establishments in the developing world, Asia and Africa, which according to the World Bank and International Monetary Fund, are experiencing rapid economic growth compared to the developed world.

Silvius (2013), in his studies, observed that the triple bottom line zeroes in on three areas that contribute to the success of any organization. According to him, the first in this category is the individuals who either work in the organization or supply raw materials. Silvius observes that the welfare of the people should be given the first priority because they participate in one of two ways in the success of such an organization. To this effect, it should be the responsibility of the company to make sure that the welfare of its people is given a thoughtful consideration. Such issues may include health care, conducive working environment and working hours. In addition, the working environment should allow employees in particular to be given a chance to have further training and also make sure there is no child labor in the organization. According to Silvius, once these objectives have been addressed, the employees become a happy lot and hence carry out their duties in an effective and efficient manner. In the long run, the company operations will be smooth and hence more returns are expected.

The triple-bottom line also focusses on how well the organization might help in preserving planet earth. For example, the organization has an obligation of making sure that there is no pollution in the water or in the air. It has to look at the most convenient way of making its operations environment friendly. Mele (2009) has suggested that most of these organizations have become aware of the need of going green. He has argued that the use of renewable sources of energy, and disposing off toxic wastes have taken center stage during the business establishment. This is because many organizations have appreciated the need not to produce products that are hazardous and unhealthy to the environment. Johnson (2012) says that if the mother-nature is not protected, there is likelihood that at some point, it is going to reciprocate and hence affect the operations of the organization negatively in the long run.

The last one is the profit that will be gained by the organization. This is the main objective of any organization operating within the capitalistic economy. However, in order to achieve this one, the first two have to be achieved as well because without putting a thorough consideration to former, the organization might not be able to reach its anticipated profit margins. Mele (2009) has observed that when looking at profit from triple line-bottom line perspective, part of the profit should trickle down to people in the society. This means that the welfare of the people around the area occupied by the organization should also benefit from its presence. This is normally realized under the Corporate Social Responsibility (CSR).

Stead (2004) argues that as an organization grows, it needs to appreciate the need to give back to the community as a way of acknowledging the support given by people to the company during the years it has been operating. According to him, the organization can arrange different activities for such people in order to make them feel part and parcel of the company. This goes a long way in ensuring that there is a peaceful coexistence between the people and the organization. However, Silvius (2013) argues that it is not mandatory for the company to carry out corporate social responsibility initiatives. This is solely discretion of the directors of the company to determine. This means that an organization can decide either to ignore the people around it or not. Building brand equity and enhancing customer loyalty have been deemed as the most sustainable means towards long-term profitability and competitiveness. Customer relationship management (CRM) is termed as a multidimensional process where various information technologies are applied.

CRM focuses on a proper understanding of client’s needs, wishes, wants and behavior and thereafter addressing them effectively. It helps businesses or companies understand the present and future needs of their clients, which allow proper planning (Crane, 2008). On the other hand, the triple bottom line concept looks at how to improve the welfare of the people working towards improving the organizational performance. This means that an organization zeroes in from the lowly ranked employee to the chief executive officer and its suppliers. As a result, it may not be concerned with the welfare of people living around it so long as its operations are not affected. Corporate social responsibility does not concern itself with the welfare of the employees as they are taken care of within the company operating structures.

Ryan (2015) argues that in the highly competitive business world, the issue of distributive justice has featured prominently in many organizations. This has only been occasioned by the fact that organizations lack standard ways of remunerating its employees. As a result, there are employees working in the same position, doing the same jobs but salaried differently. This has often led to tension amongst such employees as this has been interpreted as favoritism in such organizations. As a result, the performance of the organization is affected in a great way because the lowly paid employees revert to having a negative attitude towards their organization. This should be avoided at all costs as the performance of the company, as well as its reputation may be damaged in the eyes of the outside world.

In today’s business world, the consumer population has become more and more educated, and this has presented new challenges along with the opportunities for organizations. The dynamic business environment has forced corporations to operate beyond the bottom line. Corporations are required to establish an emotional connection between their products or services and clients. Clients can influence business actions through their purchasing behavior. For instance, they can refuse to purchase a firm’s products and also reinforce positive business practices by encouraging others to purchase products from organizations that respond to their demands. Thus, organizations must recognize their responsibility to clients and to society. If clients are dissatisfied with the business practices, they will cease from purchasing the company’s product. Organizational leaders must take control of ethical values, while at the same time, be committed to corporate social responsibility (CSR). Therefore, it is not enough for a multinational corporation to be socially responsible; they must be a triple bottom line company to meet their ethical obligations.


Prior to the formation of an organization, there are certain things that people behind its formation have to consider in order the company’s operations are not affected by the challenges that may come along the way. When business adheres to the triple-bottom line concept it can go a long way in creating conducive environment for employees, who are the main drivers in the success of such an organization. Whenever an employee feels appreciated by the company he works for, he performs his duties effectively and enthusiastically. In addition, the organization should make sure that employees are remunerated the same being on the same position. Uneven remuneration is one of the ways a company might spoil its reputation amongst its employees and to the others who may want to seek employment opportunities.

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