1. Corporate social responsibility literature

1. Corporate social responsibility literature

In order to have a better view of what Corporate social responsibility (CSR) is (or is not) we provide a complete view of the literature.

First of all, it is important to provide a clear view of the different definitions about CSR. Shifting the focus to different field of studies CSR can have different meanings and practical implications. Indeed, Corporate social responsibility is a prominent feature of the business and society literature that address business ethics, corporate social performance, stakeholder management. According to several authors “CSR means a quantitatively higher empowerment of a wider array of special interest groups’ role in the particular company”(Soukupova et al., 2008 and 2009). Indeed, the several interactions between firms and their environment can not be classified as a new phenomenon in theory and in practice. In the past all the firm behaviour that encompassed social characteristics corresponded with CSR (Carrol and Shabana, 2010). Indeed, they agree to the traditional idea according whom firms endeavour is to maximize profits without try to provide any social goal. This behaviour corresponds to the company owners’ goals. The traditional theory contemplates that economic entities behave rationally. In light of this fact we can treat the company owners as persons whose decision-making influences the company in all fundamental aspects; therefore they also decide whether the company will carry out the socially responsible behaviour.

There are many definitions of corporate social responsibility (CSR). One of the most popular in literature is the one of Lea (2002), according whom corporate Social Responsibility is “the integration of social and environmental concerns in business operations, including dealings with stakeholders”.

What should be noted is that, despite the various definitions are distinguished by different shades, there is still the possibility to identify some common traits known as “CSR Dimensions”. According to Dahlsrud (2006) it is possible to find five main CSR dimensions:

1. the environmental dimension. This dimension refers to the impact of firms on the external environment. The goal, as a socially responsible company, is to engage in business practices that can create benefits for the environment. For example, firms could choose to use recycled papers for packaging or use renewable energy sources like solar power for their factory.
2. the social dimension. The social dimension of corporate responsibility refers to the relationship between firm activity and the society. This could involve sourcing fair trade products, for example, or agreeing to pay bonus to employees.
3. The economic dimension. The economic dimension refers to the effect that corporate social responsibility has on the finances of firms. In an ideal world, where corporate social responsibility had no costs, there would be no reason to limit it. But in the real world it is important to recognize the financial impact that these actions have and to balance being a good corporate citizen with making a profit.
4. The stakeholder dimension. The stakeholders are all the people affected by the actions of the firms. These dimension include suppliers, employees, managers, bankers, members of the public and all the people that should have contact with the firm. When considering the stakeholder dimension of corporate social responsibility, consider how and how much firm decisions affect these groups. For example, the management should be able to increase the output having employees that work more, but they also should take into account the impact it will have on them in the middle-long period.
5. The voluntariness dimension. All the actions that fall into the voluntariness dimension are not required to do. These actions are based in what firms believes is the correct thing to do. They may be based in specific ethical values that your company holds. For example, firms may believe that using organic products is the right thing to do even if they are not required to do so. This dimension creates a connection with the ethical debate.

This definition is the most diffused and used in literature but not the only one. For a question of clarity the following table propose the other most diffused definitions and the dimensions.

Table 1. Definitions and CSR Dimensions

Alongside this definition many other authors made strong critiques to CSR. For example Malik and Nadeem (2014) stated that CSR is “largely a smokescreen designed to distract governments from their proper role in regulating for market failure”. In particular, this could include how organizations interact with their workers, suppliers, customers and the communities in which they operate, as well as the extent they try to protect and keep the environment. Also, Kahrim et al. (2013) and Yusof et al. (2015) stated that all CSR activities are just marketing activities creates by firms to have a better images on financial market. In this view Corporate Social Responsibility has become an important part of planning to gain and sustain the competitive advantage in the globally competitive organizations.

Furthermore, no one can adequately define what it means to be socially responsible, and so no one can apply standards to determine whether a corporation is or is not socially responsible. Therefore, corporate social responsibility ends up being littler more than obeying the law, acts as a whitewash for a moral business practice, and hides the real ethical and moral responsibilities of business.