Corporate social responsibility

Corporate social responsibility

The notion that corporations should go above and beyond the legal obligations of running a business. In other words, corporations are expected to be environmentally responsible, ethical in their activity while also contributing to the community and being financially responsible. The triple bottom line principle, which often goes hand in hand with CSR focuses on a business framework operating around three main P’s: profit, people, planet.

Social audit

A formal evaluation of an organization's progress and processes toward implementing socially responsible and responsive programs often associated with Corporate Social Responsibility. It is optional, however, whether the record is released to the public or used internally.

- Health and safety records

- Pollution levels

- Contribution to local community

- Proportion of supplies from ethical sources

- Employee benefit schemes

- Feedback from customers and suppliers on ethical nature of activities

- Annual targets for social responsibility measures

- Worker pay and benefits

Benefits of social audits

1. Identify what socially responsible targets are being achieved, and what still needs to be achieved

2. Managers set targets for improvement by comparing audits

3. Improving company's public image, and serves as a marketing tool

Limitations of social audits

1. If the social audit is not independently checked, it may not be taken seriously by stakeholders

2. Detailed social audits require time and money

3. Some consumers are just interested in cheap goods, not whether the businesses they buy from are socially responsible or not