Corporate Social Responsibility Policy of Multi National Corporations Essay

Corporate Social Responsibility Policy of Multi National Corporations - Essay Example World Business Council for Sustainable Development defines Corporate Social Responsibility (CSR) as "The continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large." The European Commission advocates that CSR not only means fulfilling legal expectations, but also going beyond compliance and investing more into human capital, environment and relations with stakeholders." The need for Multi National Corporations to adopt Corporate Social Responsibility and implement it in spirit is immense in the current business scenario. The competition and corporate warfare in the business environment not only makes their focus very self-centered, but also robs them off all the attention they need to provide in the social context. It is this mad race, which needs to be controlled. It is because competition can catalyze the de-structuring of the social edifice based on values, morals and a sense of social responsibility. There have been grave losses to the environment, people and their lives as more and more MNCs are diversifying their areas and reach of operation. It is this concern that triggers a major thought process to streamline this chaos. Some method in this madness can only creep in if these big corporations begin to understand their role in a larger and more responsible perspective. The gamut of this perspective should not just limit to the stakeholders a lone, but involve the society as a whole. Survey of literature There have been many researches and studies on the concept of 'Corporate Social Responsibility'. There are many schools of thought on the subject. Some studies call CSR as an extension of the brand-building effort of the companies, while others attach a serious functional connotation to the concept. The Green Paper (2001) by the Commission of the European Communities identifies two main dimensions of CSR. One is the internal dimension that relates to the internal functions and processes of a company. The external dimension involves the external stakeholders. Several research-based studies have discussed the concept of 'Corporate Social Responsibility'. The different schools of thought explain it based on different experiences and consequences. One school of thought emphasizes on the model of collective action. According to Jarusri Jiravistakul of the Kenan Institute, who conducted studies on the collective action/institution model and its implementation in Thailand, Egypt and Indonesia the concept of CSR has succeeded in terms of business practices, environmental management and capacity development. This particular perspective talks about the operations of business enterprises as they affect a wide spectrum. The resources they make use of are not limited to those of the proprietors and the impact of their operations is felt by so many people who are in no way connected to them. They affect the shareholders, the suppliers of resources, the consumers, the local community and the society at large. George Goyder in The Future of Private Enterprise argues, "Industry in the twentieth century can no linger be