What is Corporate Social Responsibility?

Corporate Social Responsibility (CSR) is a concept in the business world. In the late 20th century, a growing number of corporations began to think about their impacts on society at large, primarily because consumers became more aware of corporate activities around the world. Many of these corporations decided to embark on Social Responsibility programs designed to offset some of their effects on the world while also generally improving corporate practices. CSR has both fans and detractors, as one might imagine; the fact that the issue has become so publicized is viewed as a positive start by many people on both sides.

A company which has decided to establish a Corporate Social Responsibility program generally includes a discussion of the program in its mission statement and code of ethics, making the existence of the program transparent to stockholders and other interested parties. Most corporations also have a CSR department, which manages the company's social programs and make sure that the company's efforts remain in the eyes of the public.

The scope of a Corporate Social Responsibility program tends to be most varied. Many corporations start at home, by trying to include conditions for their employees, with offerings like higher wages and health benefits. The next step often addresses corporate suppliers, both at home and abroad, with a focus on creating a sustainable supply chain without the use of child labor and other ethically questionable practices.

Many corporations also add a charitable aspect to their Corporate Social Responsibility programs. For example, a company which sells coffee might sponsor community development initiatives in coffee producing regions, while an oil company might contribute to habitat restoration in an area historically used for resource extraction. Other companies simply donate large amounts of funds to charities of choice, commonly finding charities which tie in with their own work.

Fans of CSR suggest that these voluntary efforts on the part of corporations show a genuine desire to do business in an ethical and responsible way. Some more cynical fans also point out that corporations known for their CSR programs tend to retain employees longer and to have the pick of the crop when it comes to employees and suppliers, thanks to an interest in ethical business practices among many new graduates and small companies. Furthermore, because Corporate Social Responsibility is a growing topic of interest, companies which tout such programs often perform well on the market, with consumers actively seeking out their products.

Detractors believe, however, that Corporate Social Responsibility is simply a smokescreen or window dressing which covers up more egregious issues. By putting their ethical initiatives at the forefront, companies can bypass a great deal of consumer concern. For example, an automobile company might distract consumers with an ad campaign about an environmentally sustainable manufacturing plant, while continuing to produce extremely inefficient vehicles which rely on fossil fuels.