This document discusses definitions and types of corporate social responsibility (CSR). It provides 3 main definitions of CSR: 1) the relationship between corporations, governments, and individuals, 2) the relationship between a corporation and the local society it operates in, and 3) the relationship between a corporation and its stakeholders. While there is no universal definition, CSR generally refers to ethical and transparent business practices that respect people, communities, and the environment beyond just making profits. The document then discusses types of CSR activities like philanthropy and environmental sustainability practices. It provides examples of specific CSR practices corporations can implement, such as social auditing, sustainability reporting, and ethical accounting statements.

1. FACULTY OF BUSINESS &
ACCOUNTANCY
Corporate Social Responsibility
Chapter 1,2

2. Definitions of CSR
• The relationship between global corporations, governments
of
countries and individual
• The relationship between a corporation and local society in
which it resides or operates .
• The relationship between a corporation and its stakeholders

3. While there 3 no universal definition of corporate social responsibility , it
generally refers to transparent business practices that are based on - ethlcal
values, compliance with legal requirements, and respect for people,
communities, and the environment. Thus, beyond making profits,
companies are responslbe for the totality of their impact on people and the
planet.
"People " constitute the company's stakeholders : its employees, customers
business partners , Investors, suppliers and vendors . the government, and
the community Increasingly, stakeholders expect that companies should be
more erwironmentatlv and socially resporurble in conducting their business
. In the business community, CSR Is aitein.;iti~· ~ ly referred to as corporate
citrzenship,“ which essentia ly means that a company should be a " good
neighbor " within its host community .

4. The effects of Organisational Activity
 It is apparent ofcourse that any actions which an organisation
undertakes will have an effect not just upon itself but also upon
the external environment within which that organisation resides.
 In considering the effect of the organisation upon its external
environment it must be recognised that this environment
includes both the business envir- onment in which the firm is
operating, the local societal environment in which the
organisation is located and the wider global environment.

5. - The utilisation of natural resources as a part of its production processes .
- The effects of competition between it self and other organisations in the
same market.
- The enrichment of a local community through the creation of employment
opportunities.
- Transformation of the land scape due to raw material extraction or waste
product storage.
- The distribution of wealth created with in the firm to the owners of that
firm (via dividends) and the workers of that firm (through wages) and the
effect o f this upon the welfare of individuals .

6. Types of corporate social responsibility
~ Philanthropy : Businesses also practice social responsibility by donating to
national and local charities. Whether It Involves giving money or time,
businesses have a lot of resources that can benefit charities and local
community programs. Philanthropy (or corporate giving) is considered as a
specific type of CSR activity . It refers to the act of corporations donating
profits or resources to non-profit organisations . Corporations most
commonly donate cash, but also can donate the use of facilities, property,
services and advertising support .
~ Some corporations set up employee volunteer groups who donate their
time to specific projects. Corporate giving is often handled by the
corporation directly; however it may also be donet through a company
foundation. the environment. Businesses , both large and small, have a large
carbon fool print. Any steps they can take to reduce those foot prints are
considered both good for the company and society as a whole.

7. CSR practices help not only the company, but the Industry the company is in, by
ralsting the bar of expected behavior cvetell. Investors, seeing one company
adopt CSR policies will be naturally inclined to invest In that company,
having seen it demonstrate responsibility. Other companies In the same
field, seeing the benefits to CSR, w111 adopt similar policies as an act of
competition, and the attitude of the industry will gradually change. This
saves economics from suffering declines through fraudulent business
practices.
Social: As a company Integrates CSR practices Into its structure, the way
it treats employees will Inevitably change. Individual interests .are
treated with more respect in CSR-conscicous companies, and concerns
such as employee health and family relations are considered, Employees,
benefiting from Increased care from the company [ln whatever form it
takes), carry the. positive Influence home, influencing their families and
society as well.

8. Ethical labor practices: By treating employees fairly and ethically,
companies can also demonstrate their corporate social
responsibility. Example: This Is especially true of businesses that
operate In international locations with labor laws that differ from
those In the United States

9. Specific CSR Practice
Capital valuation Is the practice of defining and publishing the various types
of capital a company has. This refers not only to financial assets, but
social, environmental, human, moral, and intellectual capital as well.
Defining the types of capital a company has not only shows investors and
customers that the company is aware of the connections it has to
the people and communities around it, but it also gives the company
several starting places to begin CSR initiatives.
Corporate community involvement reporting Is the practice of assembling
periodic reports concerning community outreach and activities, such
as financial aid and employee volunteer movements. The reports usually
contain the activities, descriptions of the effects produced, and future
plans. Some form of measurement Is often included, whether by how
much time or money was spent ln community lnvolvement, or how much
Involvement the company has compared to competitors.

10. Ethical accounting statements are reports made directly to the Investors concerning the ethics
of the company's financial controls and practices. Since ethical activity can be debatable,
EASs should be the result of a continuing dialogue between the Investors and the
company as to what ethical matters are important to both, and hew the company can meet its
· ethical standards. The EA5 is used primarily as a planning tool, documenting the company's
Intentions for future practices
Ethical auditing Is the practice of hiring an outside firm to conduct an audit of the
company's policies, focused on ethical standards that the Investors and the company
have: previously developed. The auditing process examines primarily the company's
performance in social and environmental settings.
Social auditing ls similar to ethical auditing but focuses only on the social performance of the
company, and ls more common.

11. Social balance is an accounting practice designed to assemble all CSR financial activity from
across-the company and combine it in one report. This report usually classifies the
financial data in forms that are useful to CSR regulators In the company, showing
where funds where allocated regarding social activities, how much separate
departments have spent, and where the company stands as a whore in terms of social
aid.
Value-added statements are created In order to show the investors the added benefits
certain company activities have. Investors may not be aware of CSR practices by the
company, and this statement allows the company to show its social activity In succinct
form. Other Investors may not understand how certain company policies are socially
responsible or lead to added value. This report is designed to summarize and show the
effects of the company's CSR activity

12. Statements of principles and values are created by the company to give focus and enthusiasm
to CSR policies. Akin to a mission statement, a statement of principles and values dearly
states what the company's social, environmental, and financial responsibilities are, and how
it Intends to fulfill those responsibilities. Such responsibility statements are becoming a more
common tool, and are useful for companies beginning CSR movements. Statements of
principle s and value should be easily accessible by customers, so that the public can see
what the company's soda! goals are at any time.
Sustainability reporting Involves a company's goals of sustainability, and the policies it has in
place to meet them. Production companies often have goals of creating more recyclable
products with renewable energy sources. Others may have a goal of becoming a paperless
business by a certain date, or of adopting a new technology. Whatever the sustainability goal
may be, sustainability reporting is a periodic assessment of the company's current
endeavors to reach the goal, and its success In attaining sustainability .

13. Organizations Involved In CSR
These nine principles Include:
- To support and respect internationally proclaimed human rights.
- To avoid complicity in human rights abuses.
- To uphold freedom of association and the right to collective bargaining.
- To eliminate all forms or forced labor.
- To abolish child labor.
- To eliminate discrimination in regard to business hiring and occupation.
- To support a cautionary approach to environmental challenges

14. END OF CHAPTER 1,2