CHAPTER 6

Business Policy for Corporate Social Responsibility

Social Responsibility
 Can be both from the individual as well as organizational perspective.
 Responsibility is the ‘quality or state of being answerable for one’s act or decision’.
 Responsibility and accountability are interchangeable. i.e. when one answerable for his
action or decision, he is also accountable for its consequences.

Responsibility of the corporation:

 To have vitality and dynamism, to add positive economic value, and to be able to carry out
their corporate mission and vision;
 To render genuine service to stakeholders, and
 To make a positive and meaningful contribution to the broader business and economic
environment.

Strategy as Expression of Philosophy and Values

Mission Statement
A public declaration of identity. This is precisely the reason why such statement should carefully
formulated, and should be the outcome of a process that allows everyone’s participation.

Vision Statement
The vision statement articulates the collective aspirations of people in the organization. It is
normally an aspiration for a better ‘state of being’ in the future. It is a future state of being that
is desired by the corporation as an organization.

Business Policy for CSR

 CSR is viewed as comprehensive set of policies, practices and programs that are
integrated into business operations, supply chains, and decision-making processes
throughout the company.
 Policies are important in that they guide the actions and decisions of the people.

Strategic CSR

 The value of CSR can be made real to the corporation if there is conscious effort to
actualize this in terms of tangible and measurable activities.
 From the strategic standpoint, CSR can be used as a competitive advantage.
 A company that has CSR programs in place can provide evidences to show that they in
fact really care for the customers and they are not just in business for the sake of profit.
 CSR has to manifest in the form of strategies.
  Strategic Management, is define as the process of specifying and organization’s
objectives, developing policies and plans to achieve these objectives, and allocating
resources so as to implement the plans.
 It is the highest level of managerial activity, usually performed by the company’s CEO
and executive team. For CSR to be strategic, it must be the initiative of top
management.
 A good corporate strategy should integrate an organization’s goal, policies, and action
sequences (tactics) into a cohesive whole.
 Strategic Management can be seen as a combination of strategy formulation and
strategy implementation. Strategy formulation involves:
a. Situation Analysis
b. Objectives Setting; and
c. Strategic Planning.

Situation Analysis – the analysis of the external and internal environment informs top
management of opportunities and threats from the external environment to the firm as well as
firm’s strength and weaknesses.

Forces in the external environment: (+ or - )

 Trends in politics, economics, demographics and culture.

Areas in performing situation analysis:

a. Environment
b. Community Relations
c. Employee Relations
d. Diversity
e. Customer Relations

Objective Setting – aside from setting financial objectives and objectives for the functional
areas (marketing, human resources, and operations), objectives relative to CSR must also be
set.

Quantifiable objectives must be set in order that they may be measure.

Strategic Planning – Once quantifiable objectives have been set, the plan may be formulated. It
is helpful to begin the planning process with ‘performance indicators’ per objective.

Performance indicator, when properly identified make the formulation of strategy easier.

CSR Bottom-Line Benefits

 Improve financial performance

 Reduced operating costs
 Enhanced brand image and reputation
 Increased sales and customer loyalty
 Increased productivity and quality
 Increased ability to attract and retain employees
 Reduced regulatory oversight
 Access to capital