Group 6_Mainstreaming CSR
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Transcript of Group 6_Mainstreaming CSR
Group 6, Section C
Faiz Shamsul Haque - 12P134
Rahul Kr. Gupta - 12P157 Vikas Jain - 12P178 Vishal Agarwal - 12P179
Manav Gupta - 12P146Kshitij Agrawal - 12P142
Submitted By -
Mainstreaming CSR:
Developing Markets for Virtue
Introduction• As of early 2007, more than 2900 of the best- known
brands have signed the UN Global Compact pledging to follow its 10 CSR principles
• Many business leaders claim to have taken CSR to heart and have set the mandate to “mainstream” it into their companies
• But when certain leading companies were investigated against mainstreaming of CSR activities into their daily activities, they revealed distinct orientations or profiles
Defining CSR• CSR refers to the “the obligations of the firm to
society” • But there is little consensus regarding the nature or
scope of these obligations• A broad definition of CSR encompasses three elements:
Internal initiatives and policies and processes that ensures company is responsible and ethical
External initiatives to contribute to and improve the community in which a company operates such as corporate philanthropy
Impact of both the company’s internal and external initiatives on society
Defining CSR (contd.)• CSR typically includes “beyond law” commitments and activities pertaining to a
wide range of programs
• CSR encompasses a diverse range of programs that includes corporate governance and ethics programs; health, safety, and environment programs; attention to human and labour rights; human resource management policies; community involvement; respect for indigenous groups and minorities; corporate philanthropy and employee volunteering; adherence to principles of fair competition, anti-bribery, and anti-corruption
measures; accountability, transparency and performance reporting; and responsible supplier relations
Mainstreaming CSR• The notion of “mainstreaming” is a somewhat
ambiguous construct• If something is mainstream, it must be– clearly seen on the company’s agenda in a legitimate,
credible and ongoing manner– incorporated into company’s day-to-day activities in
appropriate and relevant ways– included in the policy development, technical tools,
performance measures and political agenda – integrated or ‘coupled’ in a way that affects everyday
activities and actions of the company
Mainstreaming CSR (contd.)
Coupled CSR Activity
Typically integrated into marketing , philanthropy, and employee volunteer efforts on a continuing basis
Is well funded, has high visibility on the corporate agenda, and often becomes a part of the firm’s identity
Decoupled CSR Activity
Typically takes the form of a tactical cause related marketing campaign that is short termed in nature and easily terminated
Is not diffused through the other aspects and activities of the company
CSR Literature• The CSR literature has largely considered the management of
CSR initiatives from two perspectives:
Research emanating from marketing and focusing on how consumers respond to CSR at the individual level
• It has been found that CSR initiatives can have a positive effect on consumers’ attitudes toward a firm, its identity and its brands, their intentions to purchase, and their purchase behaviour
Research emanating from the management literature
• It has been found that there is a positive relationship between CSR and the financial bottom line, i.e. profitability
CSR Literature (contd.) Vogel’s Conceptualization CSR activity is a function of an external “market for virtue” Markets vary in their demand for CSR:
‘Socially Conscious’ Market: Markets in which a firm competes demand as well as handsomely reward CSR initiatives
‘Standard Economic’ Market: Markets (i.e., customers, key intermediaries, stakeholders, etc.) have little appetite for CSR and are sensitive to only standard economic factors like quality, service, price, etc.
Firms may vary in their motivation, ability, aptitude, or opportunity for CSR performance
CSR Literature (contd.) Vogel’s Conceptualization
MethodologyElite Interviews Apt when research objective is to understand complex interactions, perceptions, beliefs and values When one cannot be sure what interpretation, code, norm, affect or rule is guiding the actors
Elite Interviews Semi structured
Designed to ascertain decision makers’ understanding of the phenomenon
Broad questions, informants determined what kind of questions were the focus of discussion
The Two Stages . . . .
Stage 1•One type of corporate Social Responsibility Initiative – Social Alliance•26 Organisations – 10 companies, 11 nonprofits and 5 consulting firms•Companies – $800 million to $100 million, Nonprofits - $6 million to $900 million•How partnership started, goals, problems and challenges, day to day activities, etc
Stage 2•Assess conclusions drawn from stage 1 and extend to markets beyond North America•29 interviews, 8 countries•Both large and small companies - $600,000 to $74.7 billion•How CSR was mainstreamed, evolution over time, factors leading to success or failure, projections about future growth within firm, etc
97 elite interviews with managers and consultants involved in CSR initiatives
Business Case Model
Syncretic Stewardship
Model
Social values led Model
Findings
The Business Case ModelAll of the outcomes that really mattered to the firm and its management were economic
CSR was only relevant when it translated unambiguously to a competitive advantage for the firm
CSR did not raise consumer’s price dramatically
CSR expands market for narrow socially conscious niche market
Mainstreaming CSR meant aggressively pursuing viable business opportunities with a CSR dimension
Identify and evaluate CSR opportunities and then argue their business cases as appropriate
Social Values Led ModelCSR is defined around a particular social issue
Non economic criteria and stakeholders associated with them are considered important
Corporate social policy entrepreneurs place emphasis on social and environmental bottom-lines
The primary challenge is to establish the authenticity of its business purpose and goals
SYNCRETIC STEWARDSHIP CASEFeature Syncretic Stewardship Case
Role of the external virtue Market Important, integrated influencer of CSR
Role of the Internal virtue Market Important, integrated influencer of CSR
Objective Economic and Non-Economic
Bottom Line Multiple, Balanced, Mixed Economic and Non Economic Criteria
Key Challenge Balancing and integrating economic and non economic criteria
Prevalence and role of social entrepreneurs Common, Visible and Integral
CSR Leadership Philosophy Servant of Diverse Stakeholders
Narrative Interdependence between social and economic
Desirability Of Diffusion Of CSR support among competitors
Yes, heighten Salience of noneconomic imperative, create level playing field to share costs create primary demand
INTERNAL MARKET FOR VIRTUE
Standard Self Interest
Syncretic Stewards
Business Oriented
Value Led
Socially Conscious
Social Entrepreneurs
Cultures of CSRRelation between dimensions of organizational culture and firm’s CSR orientation
Six dimensions of organizational culture related to CSR orientation– Performance Orientation– Power Distance– Uncertainty Avoidance– Humane Orientation– Assertiveness– Future Orientation
Performance Orientation• The degree to which performance
improvement or excellence is rewardedBusiness Case Social values-led Syncretic stewards
Rewarded primarily on economic goals
Rewarded primarily on non-economic goals
Triple bottom line focus i.e. economic, social and environmental
Power distance• Degree to which members of collective expect
power is distributed unequallyBusiness Case Social values-led Syncretic stewards
Power distance is high
Power Distance is mixed
Power distance low
Considerable power distance between the organization and non-profit partner
Founder wields decision-making within organization especially in issues surrounding core mission
Participation of internal and external stakeholders important.
Uncertainty Avoidance• Degree to which rules and norms are used to
avoid unpredictabilityBusiness Case Social values-led Syncretic stewards
Uncertainty Avoidance is highest
Uncertainty Avoidance is lowest of the three orientations
Uncertanty Avoidance low but not as low as Social-values led orientation
Extensive planning and well-established routines
Strong sense of mission but little understanding of how to accomplish them
Forgo normal planning in face of emergency
Humane Orientation• Degree to which the organization rewards
individuals for being fair, altruistic and kind to others
Business Case Social values-led Syncretic stewards
Humane orientation is low
Humane orientation is high
Humane orientation is high
Assertiveness• Degree to which individuals are
confrontational and aggressive in their relationship with others both inside and outside the firm
Business Case Social values-led Syncretic stewards
Highly assertive Highly assertive on focal issues but less aggressive than business case
Mixed and sophisticated in their approach. Depends on who they deal with.
ConclusionDemands for external market alone, esp financial
market, are insufficient to explain the variance in 3 orientations
CSR cultures & orientations are stable, yet a firm could migrate
No ‘best normative CSR approach’, however Syncretic Stewardship approach seems sustainable over long term