Corporate social responsibility (CSR) is a business model that emphasizes compliance with the law, high ethical standards, and positive actions towards the environment and public interest. Companies following the CSR model adhere to the “triple bottom line” of “People, Planet, Profit”. Critics suggest that government should take the lead in addressing social and environmental concerns through regulation, but CSR advocates respond that consumers and stakeholders put healthy pressure on companies to act responsibly. Many companies submit annual sustainability reports to inform the public and stakeholders about their efforts to improve environmental and social values.
Ethics are an important component of the global approach to corporate responsibility, sometimes called corporate social responsibility (CSR). CSR is a business model that began to emerge in the late 1960s and early 1970s. In the CSR model, corporate responsibility and ethics are considered intertwined.
The CSR philosophy places emphasis on compliance with the law and high ethical standards towards consumers and the public. It also foresees positive actions in the fields of the environment and the public interest. It promotes the active elimination of harmful business practices even when they are outside the realm of government regulation.
Other areas where corporate responsibility and ethics overlap in the CSR model is the inclusion of public interest and environmental concerns in corporate planning and decision-making. Corporate responsibility includes establishing voluntary ethical and environmental standards and developing projects for community growth. Companies that follow the CSR model adhere to the “triple bottom line” slogan of “People, Planet, Profit”.
Some commentators believe that corporate responsibility and ethics intersect with consumer ethics as more and more people become aware of their individual impact on the environment and the world. As more and more consumers start making their choices based on social and environmental concerns, companies are strengthening their commitment to these issues. As a company practices corporate social responsibility, the result can become part of its corporate identity. Some observers point out that operating according to a CSR model increases corporate profits in the long run.
Some critics of the CSR model suggest that corporate social and environmental concerns are only superficial and that government should take the lead in addressing these concerns through regulation. They note that taxpayers already pay the government to ensure that businesses operate in ways that are safe and beneficial to the public. CSR advocates respond that consumers and stakeholders put a natural and healthy pressure on companies to act responsibly.
Stakeholders are not just shareholders and investors. They include social and financial institutions, government regulators and foreign governments. Professional institutions, trade union organizations and academic institutions also influence and have an interest in socially responsible corporate behavior.
Many companies seem committed to promoting corporate responsibility and ethics as understood in the CSR model. A large number of companies around the world submit annual corporate sustainability reports with the international Global Report Initiative. Sustainability reports inform the public and stakeholders about a company’s efforts to improve environmental and social values and advance the public interest. The reports usually contain information on how these efforts have maintained or increased profits.
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