This document discusses the concepts and history of corporate social responsibility (CSR). It defines CSR as companies voluntarily contributing to society and the environment through business activities and social investments. The concept of CSR gained popularity in the 1990s when a German pharmaceutical company implemented CSR strategies to differentiate itself. The document outlines the economic, legal, ethical, and discretionary responsibilities that make up CSR and examines arguments for and against companies adopting CSR practices. It concludes that CSR should demonstrate a commitment to societal values by addressing issues caused by business operations.

1. CORPORATE SOCIAL RESPONSIBILITY
Prepared by:
Mallikarjun M. Maradi
Assistant Professor,
Department of Studies in Commerce
Rani Channamma University, PG Centre, Bijapur

2. Corporate Citizenship Concepts
• Its also known as social responsibility, corporate citizenship, responsible business,
sustainable responsible business or corporate social performance, is a form of corporate
self regulation integrated into a business model. The impact of a company’s actions on
society
• Corporate social responsibility – emphasizes obligation and accountability to society
• Corporate social responsiveness – emphasizes action, activity
• Corporate social performance – emphasizes outcomes, results

3. Corporate Social Responsibility (CSR)
Corporate social responsibility is basically a concept whereby companies decide voluntarily to
contribute to a better society and a cleaner environment. Corporate social responsibility is
represented by the contributions undertaken by companies to society through its business
activities and its social investment.
From the 1950’s to the present the concept of CSR has gained considerable acceptance and the
meaning has been broadened to include additional components. The concept of Corporate Social
Responsibility was first mentioned 1953 in the publication ‘Social Responsibilities of the
Businessman’ by William J. Bowen. However, the term CSR became only popular in the 1990s,
when the German Betapharm, a generic pharmaceutical company decided to implement CSR.
The generic market is characterized by an interchangeability of products. In 1997 a halt in sales
growth led the company to the realization that in the generic drugs market companies could not
differentiate on price or quality. This was the introduction for the company to adopt CSR as an
expression of the company’s values and as a part of its corporate strategies. By using strategic and
social commitment for families with chronically ill children , Betapharm took a strategic advantage.

4. Business Criticism/ Social Response Cycle
Factors in the Societal Environment
Criticism of
Business
Increased concern
for the Social Environment
A Changed
Social Contract
Business Assumption of Corporate Social Responsibility
Social Responsiveness, Social Performance, Corporate Citizenship
A More Satisfied Society
Fewer Factors Leading
to Business Criticism
Increased Expectations Leading
to More Criticism

5. • CSR encompasses the economic, legal, ethical and discretionary (philanthropic)
expectations that society has of organizations at a given point in time
An Idea whereby companies integrate economic, social and
environmental concerns in their business operations.
 Not only charity and sponsoring.
 Universal concept with a different approach (depending on
countries and environment).
 Corporate, professional and personal responsibility.
 To be committed to achieve results.
 The impact of a company’s actions on society.

6. Understanding the Four Components
Responsibility Societal
Expectation
Examples
Economic Required Be profitable. Maximize sales, minimize
costs, etc.
Legal Required Obey laws and regulations.
Ethical Expected Do what is right, fair and just.
Discretionary
(Philanthropic)
Desired/
Expected
Be a good corporate citizen.

7. Pyramid of CSR

8. Economic and Legal Components of Corporate Social
Responsibility
Economic Components (Responsibilities) Legal Components (Responsibilities)
1. It is important to perform in a manner consistent
with maximizing earnings per share
1. It is important to perform in a manner consistent
with expectations of government and law.
2. It is important to be committed to being as
profitable as possible.
2. It is important to comply with various federal,
state, and local regulations.
3. It is important to maintain a strong competitive
position.
3. It is important to be a law-abiding(Honest)
corporate citizen.
4. It is important to maintain a high level of
operating efficiency.
4. It is important that a successful firm be defined as
one that fulfills its legal obligations.
5. It is important that a successful firm be defined as
one that is consistently profitable.
5. It is important to provide goods and services that
at least meet minimal legal requirements.

9. Ethical and Philanthropic Components of Corporate Social Responsibility
Ethical Components (Responsibilities) Philanthropic Components (Responsibilities)
1. It is important to perform in a manner consistent with
expectations of societal mores and ethical norms.
1. It is important to perform in a manner consistent with
the philanthropic(humanitarian) and charitable
expectations of society.
2. It is important to recognize and respect new or evolving
ethical moral norms adopted by society.
2. It is important to assist the fine and performing arts.
3. It is important to prevent ethical norms from being
compromised in order to achieve corporate goals.
3. It is important that managers and employees participate
in voluntary and charitable activities within their local
communities.
4. It is important that good corporate citizenship be
defined as doing what is expected morally or ethically.
4. It is important to provide assistance to private and public
educational institutions.
5. It is important to recognize that corporate integrity and
ethical behavior go beyond mere compliance with laws and
regulations.
5. It is important to assist voluntarily those projects that
enhance a community’s "quality of life."

10. Corporate Social Responsibility (CSR)
Arguments Against
• Restricts the free market goal of profit
maximization
• Business is not equipped to handle social
activities
• Dilutes the primary aim of business
Arguments For
• Addresses social issues business caused
and allows business to be part of the
solution
• Protects business self-interest
Arguments Against
• Increase business power
• Limits the ability to compete in a global
marketplace
Arguments For
• Limits future government intervention
• Addresses issues by using business
resources and expertise
• Addresses issues by being proactive

11. Business Responsibilities in the 21st Century
• Demonstrate a commitment to society’s values and contribute to society’s social,
environmental, and economic goals through action.
• Insulate society from the negative impacts of company operations, products and services.
• Share benefits of company activities with key stakeholders as well as with shareholders.
• Demonstrate that the company can make more money by doing the right thing.

12. Limitations of CSR
INAPPROPRIATE FUNDS
 A NEW CONCEPT IN INDIA
 TRANSFERING COMPETENCIES TO INDIVIDUAL COMPANIES
 RAISING FURTHER AWARENESS OF CSR
 BUILDING CAPABILITIES
 INAPPROPRIATE RESPONSES TO GLOBALIZATION
 GAPS IN CSR PRACTICES

13. Conclusion
 ESTABLISHMENT OF GLOBAL CORPORATE CITIZENSHIP INITIATIVE
 IMPACT ON ECONOMY, ENVIRONMENT & SOCIETY
 NOT ONLY FOR CUSTOMERS BUY ALSO FOR EMPLOYEES
 HUMAN RIGHTS & CSR GO HAND IN HAND
 CSR GOES BEYOND CHARITY
 AN INDUSTRY IN ITS OWN RIGHT AND A PROFESSION AS WELL