Corporate Social Responsibility Essay example

974 Words Nov 23rd, 2010 4 Pages
Corporate social responsibility statements are effective ways of ensuring multi-national companies act ethically. Discuss

For the past few years there has been lots of discussion about Corporate Social Responsibility. Most of the multinational companies issue every year a report on their practices. They try to get involved into communities, fight the poverty in the third world countries and donate millions of ponds every year to charities to as they say “build the better future”. But are their corporate social responsibility statements effective ways of ensuring that multinational entities act ethically? From my point of view, CSR statements do not ensure that practices of companies obey the rules of business ethics and I am going to
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It creates an issue around it because who can ensure that the information provided by the corporations in the annual reports is credible? Thirdly, there is a lack formal monitoring structure beyond already established human rights organisation and lack of one consistent enforcement mechanism beyond ILO, UNCHR and National Human Rights bodies, which would ensure the uniformity of measures and standards.

What is more, Corporate Social Responsibility is sometimes highly criticised as one of the marketing tools and Public Relations. Many of the companies claiming to promote equal opportunities or considering environmental impact important rarely collected the data on these topics. CSR can be also an insurance policy and a risk mitigating strategy for a company with well – known brands against reputation damage in case something goes wrong.
CSR is a costly activity for multinational companies, especially in the current economic climate. The problem is if the CSR agenda is going to survive the financial crisis. During World Economic Forum in Davos this year, CSR taking very important place in discussion so far, was replaced by the state of economy and recession. What is more, CSR is seen as another way of doing business by companies. CSR critic and economist Milton Friedman said “There is one and only one social responsibility of business - to use its resources and engage in activities designed to increase its profits”.

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