What are the Advantages of Corporate Social Responsibility?

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  • Written By: Jessica Ellis
  • Edited By: Bronwyn Harris
  • Last Modified Date: 15 October 2019
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Corporate social responsibility is a business philosophy gaining popularity in the 21st century. By taking social and environmental responsibility for their actions, some business are attempting to reduce environmental damage, human rights violations, and bad publicity created by their practices. In addition to contributing to social welfare, the advantages of corporate social responsibility may extend into the business realm as well. Since most companies are primarily concerned with turning a profit, it is important to understand the potential for business advantages of social responsibility.

One of the most important advantages of corporate social responsibility is the protection it provides against lawsuits and sanctions. Companies found in violation of environmental standards, for instance, may be subject to enormous fines that cut deeply into profit margins. Reducing wasted energy and pollution through retrofitting and use of alternative energy can not only help cut down on lawsuits and fines, but may help cut operating costs by reducing the amount spent on traditional utilities.


Public relations advantages of corporate social responsibility should not be overlooked. A company known to have fair wage and hiring laws, to be active in reducing pollution and assisting the community, may be more likely to attract qualified workers. If workers feel well-cared for and part of an organization that cares, they may have higher morale and be less likely to change jobs. Additionally, having a good social reputation can help build relationships with community officials, which can lead to enormous benefits for a company operating in a particular area.

Corporate social responsibility is not simply about moral philosophy, it is also strongly connected to the long-term future of a business. A logging company that does not take care to sustainably source its timber will eventually run out of trees. Companies that plan for long-term sustainability may be able to outlast competitive businesses that remain short-sighted. Moreover, the reduction of pollution and sustainable use of resources may contribute significantly to the future habitability of the entire planet, which is quite important to any company that plans to have customers, workers, or shareholders in the distant future.

In addition to the business advantages of corporate social responsibility, the social advantages should not be overlooked. Corporations with responsible labor policies can help improve human rights around the world by fighting against policies that allow slave and child labor. Though competitors that take advantage of poor international labor standards may have a higher profit margin in the short term, corporations that work with governments to improve labor standards worldwide may eventually eliminate or severely limit this morally dubious advantage. In terms of environmental policy, corporations have the opportunity to stand at the forefront of the speedily evolving alternative energy market, preventing them from tying their profits and productivity to the increasingly risky oil market.


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Post 3
@Columurne: This is true. One could definitely make that case. And I'm all for some good deeds over none! But certainly such activities coming from an authentic place of moral investment would be better than not? When one is truly invested, s/he might take it more seriously and make meaningful choices rather than say, slapping on a "good deed" sticker and calling it a day.
Post 2
@TruthRoller Re: moral compass - One might say that a good deed is still a good deed, no matter the reason.
Post 1
Nice overview provided here. I think there are certainly legal, tax and PR incentives for companies to engage in CSR, though I wonder how much is truly based on any kind of moral compass? For example, it seems that many companies do not consider the future habitability of the planet, choosing shortsighted profit-driven thinking over environmental consequences that are just 5 or 10 years down the line (if not sooner).

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