The Impact of Corporate Social Responsibility on the Organizational Performance and Worker’s Productivity

Paper Topic: The Impact of Corporate Social Responsibility on the Organizational Performance and Worker’s Productivity

Introduction

Corporate Social Responsibility has been one of the most discussed and most trending topic throughout these years. This term refers to a broad set of ideas and themes in context of any organization and its business. The terms corporate social responsibility and business ethics are strongly interrelated. With that, the term can be defined as a specific concept of management where companies integrate the environmental, social and economic factors in the business operations and to interact with their stakeholders. Some other terms used for this concept may include the corporate citizenship, corporate conscience or the responsible business.

This essay uses relevant data and analyzes the literature to have an in-depth overview of the impact of corporate social responsibility on the organizational performance and worker’s productivity.

Corporate Social Responsibility and Business Ethics

Corporate Social Responsibility is not something that organizations should try hard to achieve. Instead of that, it should be a natural act of corporations. A business organization has some certain responsibilities in a society (Hill, 2014). The CSR policy sometimes functions as a self-regulatory mechanism about monitoring and ensuring of the compliance about business, by an organization. The compliance should meet with the spirit of law, the international norms and the business ethical standards. While defining the corporate social responsibility, the Business Dictionary states that it is actually the sense of responsibility of a company towards the environment, community and society. Through the waste and pollution reduction tactics and practices, the companies can express their corporate social behavior. With that, they can also contribute to the educational and social programs and can earn adequate returns on the employed resources, for showing their corporate social behaviors. Hence this thing refers the corporate social responsibility to that of business ethics.

Impact of CSR on Stakeholders Relationships, Social Responsibility and Corporate Governance

Organizations have to be socially responsible corporate citizens. In context of social responsibility, it is the moral obligation of every organization to act for the benefit of society. To maintain a balance between the economy and ecosystem, there is always a need for organizations to be socially responsible citizens (Yoon, Gürhan-Canli, & Schwarz, 2006). The society welfare requirements of every organization can be met by adapting certain actions and strategies. There are number of reasons that support this stance. One of the main reasons is the employee’s and customer’s engagement in organization.

International Chamber of Commerce argues that if organizations behave ethically, they can contribute to the economic development of the society and in this way, they can be socially responsible corporate citizens. Hence it can be said that organizations have to be socially responsible because they have the moral and ethical obligations to participate in economic development and societal welfare.

An organization should contribute to the overall economy by providing opportunities to its employees and stakeholders. Besides, an organization should create the job opportunities for people and it should be involved in charitable contributions and services. The sole aim of the organizations should not be about earning a good profit but they should also focus on providing quality services to its consumers. Another corporate social responsibility of organizations is to develop a good quality of workforce (Valmohammadi, 2014).

Impact on Organizational Effectiveness and Workers’ Productivity

In terms of the business performance, corporate social responsibility is not only about benefitting the society in different ways, but it also works as a strong agent to get benefits for different firms and companies practicing it. As mentioned earlier, the very first benefit for a business may include to win the trust of its customers, as a result of corporate social responsible behavior (Kaufmann, 2012). With that, it can also help the companies to maintain a good will in the market followed by the strong market shares and financial success. When impact of corporate social responsibility is seen in terms of ethical responsibility and then its benefits for the corporations, it can be stated as follows:

Emerging Business Ethical Issues

It is a matter of solid fact that corporations across the globe face a number of issues in terms of business ethical issues. Sometimes, such strategies are used by the companies which are considered against the business ethics. In such a case, practicing the corporate social responsibility can go an additional mile for these companies as it can improve the organizational effectiveness and customers can prefer that company over others. Hence, in such a general context, corporate social responsibility can be said as important because it plays a vital role in the organizational performance and thus, the companies can maximize their revenues and market shares (Farooq, Payaud, Merunka, & Valette-Florence, 2014).

Ethical Decision Making and Ethical Leadership

When companies practice the corporate social responsibility, they are more likely to undergo the process of ethical decision making and ethical leadership. Leadership is undoubtedly one of the main problems which most of the companies facing all around the globe. In such a way that companies practice the corporate social responsibility, it can help them to overcome the leadership issues and to introduce the ethical leadership within the company. This would enhance their performance and thus, such an organization would work effectively and in a better way as compared to others (Alawiye-Adams & Afolabi, 2014).

Workers’ Productivity and Ethics in Workplace

Workers’ productivity and creativity is one of the main things which companies target and look at. Corporate social responsibility is a practice which can help the companies to improve their worker productivity in terms of ethics in workplace. If the business ethics are studied deeply, a number of research studies prove it that organizations which are socially responsibility citizens, they have an improve productivity of their workers in the workplace (Nwaneri, 2015).

Additionally, when a corporation is socially responsible, it trains and teaches its workers about how to behave ethically and how to meet with the objectives and aims of it. Thus, it results in improving their productivity.

Conclusion

Corporate social responsibility can be defined as the corporately social behaviors of the organizations which may help a society to develop and have some better facilities out there. The corporate social responsibility is said to be the duty of every organization and it is also believed that it should be the common practice of every organization. In terms of the benefits of corporate social responsibility, it is clearly evident that such a behavior by organizations goes in an extra mile for them and they can enjoy increased business performance and success on different levels.

Additionally, a company would benefit from corporate social responsibility practices on the scales of workers’ productivity, improvement in their organizational effectiveness and hence, making it run better.

Bibliography

Alawiye-Adams, A. A., & Afolabi, B. (2014). Effects of Corporate Social Responsibility on Organisational Performance: Evidence from Nigeria . Social Science Research Network .

Farooq, O., Payaud, M., Merunka, D., & Valette-Florence, P. (2014). The Impact of Corporate Social Responsibility on Organizational Commitment: Exploring Multiple Mediation Mechanisms . Journal of Business Ethics, 125(4), 563-580.

Hill, B. (2014). The Impact of Corporate Social Responsibility on Organizational Stability . Small Business chronicle .

Kaufmann, M. (2012). THE IMPACT OF CORPORATE SOCIAL RESPONSIBILITY ON BUSINESS PERFORMANCE – CAN IT BE MEASURED, AND IF SO, HOW? . The Berlin International Economics Congress.

Nwaneri, E. C. (2015). The Impact of Corporate Social Responsibility (CSR) on Organization Profitability . International Journal of Business and Management, 10(9).

Valmohammadi, C. (2014). Impact of corporate social responsibility practices on organizational performance: an ISO 26000 perspective . Social Responsibility Journal, 10(3), 455-479.

Yoon, Y., Gürhan-Canli, Z., & Schwarz, N. (2006). The Effect of Corporate Social Responsibility (CSR) Activities on Companies With Bad Reputations. Journal of Consumer Psychology, 16(4), 377-390.