CSR

Corporate social responsibility (CSR, also called corporate conscience, corporate

citizenship, social performance, or sustainable responsible business/ Responsible
Business) is a form of corporate self-regulation integrated into a business model.
CSR policy functions as a built-in, self-regulating mechanism whereby a business
monitors and ensures its active compliance with the spirit of the law, ethical standards,
and international norms. In some models, a firm's implementation of CSR goes beyond
compliance and engages in "actions that appear to further some social good, beyond the
interests of the firm and that which is required by law.
CSR is a process with the aim to embrace responsibility for the company's actions and
encourage a positive impact through its activities on the environment, consumers,
employees, communities, stakeholders and all other members of the public sphere who
may also be considered as stakeholders.
advantages of Business Ethics
1. Goodwill and Publicity
One of the major advantages of behaving in an ethical manner is the opportunity to foster
a sense of goodwill among the general public toward your business. Customers are
increasingly concerned with using products produced in an environmentally sustainable
manner and where the producers are paid a fair wage for their work -- for example, fair
trade coffee. Being seen as meeting your social and societal obligations will ingratiate
your business to the public and attract socially responsible consumers.
Shareholders and Investors
In most cases, it will be important to shareholders that your business is managed in an
ethical fashion. Transparent accounting practices and an engaging, consultative
relationship with your shareholders will encourage confidence in your business. Investors
will be more willing to put capital into a business that they can see is ethically managed,
because there is less chance that the business will be founded on unsafe practices.
Ethically minded investors may also be unwilling to invest in a business that they see as
socially or environmentally irresponsible.
Related Reading: The Meaning of Ethical Practice

Competitive Edge
Ethical behavior can serve to differentiate your brand from those of your competitors if
you operate in an oversubscribed market, offering you a competitive edge. Identifying
your product and business practices as being founded on strong ethical principles makes
your product or service more attractive to consumers -- a good example of this model
would be the Body Shop, a cosmetics company whose products are not tested on animals.
Moral Obligations
A powerful argument in favor of running your business in an ethical manner, aside from
the financial benefits that can be gained, are the moral obligations your business has
toward the community. A successful business takes from the community in the form of
profits, which are distributed among its employees, directors and shareholders in wages
and dividends. As an integral part of society, the business has a moral obligation to
behave in an ethical manner toward employees and third parties, and to be conscious of
its environmental impact.
Knock-On Effects
The knock-on effects of adopting a strong ethical ethos will benefit a business. Honest,
open accounting practices will help build a stronger financial base for the company and
may help avoid lawsuits or sanctions for malfeasance. The knock-on effect of fairly
compensating employees and meeting your tax liabilities will be a prosperous, more
robust local economy, which will benefit everyone in the long run.
2.
Businesses with integrity and high ethical standards establish long lasting relationships
with the customers they deal with. Many business make the mistake of putting profit
before customer satisfaction, while they might get away with it initially and appear
successful, in the long run, the business is bound to fail as no customer wants to feel
short-changed. It is important that a degree of transparency in all dealings be present and
ambiguity be eliminated. This is because even if the transaction was fair, the presence of
hidden expenses will generate distrust leading to bad will.

The business administrators have a duty to the shareholders, employees, and the
community; therefore, they need to keep to an ethical approach in all dealings. It is
important that set ethical standards be made part and parcel of the companies culture and
included in all dealings associated with the business.

Companies with good ethical policies earn:

Marketing advantages over their competitors. Customers readily invest in the
companies through shares and also want to establish long lasting business relations with
the company.
The performance of employees improves with good ethical policies present in a
company. Morale is high and employees feel obligated to put in their all to continue to
make it a success.
Reputation management: a bad reputation is created by unethical behaviour which
will eventually lead to a scandal. A scandal will result in falling stock prices, anxiety, and
low morale among employees as well as government and public scrutiny and inquests.
Legal and financial incentives: companies known for their high ethical standards and
education of employees on ethical polices are provided with strong legal and financial
incentives by regulatory bodies.
business ethics should be a course in universities
programs
1. Assist student in the formation of their personal values and moral ideas,
2. Introduce them to the broad range of moral problems facing their society and world,
3. Provide them contact with important ethical theories and moral traditions and
4. Give them the opportunity to wrestle with problems of applied business ethics, whether
personal or professional.

Doing Well by Doing Good
Although ethics is not the same as self interest, business executives often want to be
assured that it is the same. They want to make certain that one can do well by doing
good, meaning that one can succeed in business by being ethical.
There is no denying that one can often do well by doing good. An ethical company is
more likely to build a good reputation, which is more likely to bring financial rewards
over the long term. But good behavior cannot be grounded in tangible reward alone.
People who are interested only in reward will behave ethically when it suits their
purpose, but they will go astray whenever the incentives change.

The Duty to Make Money
Granting that a business persons ultimate objective is to make the world better, how is
this best achieved? A common view is that it is achieved by making as much money as
possible. The best thing business people can do for society is to be good business people,
which is to say, to maximize the companys profit. They should therefore stick to finance,
marketing and operations management rather than waste time with ethics.

The Rules of the Game
The task of business ethics, then, is to identify the duties that business people have as
business people. What are these duties? One can begin with the most basic ones
mentioned by Friedman: the duty to obey the law and the rules of the game, which
provide for open and free competition without deception or fraud.