Positives and Negatives of Utilization of Corporate Social Responsibility

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Corporate Social Responsibility (CSR) is expressed as management practices that address the effects of an organization on a business, society and the environment while also seeking to crate positive value though the core business. CSR has the potential to help businesses build reputations for themselves as being a ‘responsible business’ which could result in an competitive advantage as some customers refuse to deal with businesses which are not responsible in CSR. All businesses should open their door to local communities, some businesses put social responsibility at the heart of their strategy, surprisingly today most companies are working on ways that they can improve the day to day lives of local residents where they farm. In the case study this was not the situation as the company is individually focusing on the profits they make, as they do not support the families obliging some children to work for survival and force them to live in unsanitary conditions. If the company respected CSR socially they would have the standpoint of assisting families with fair local jobs, assisting with training and supporting local associations.

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An example of a company doing CSR correctly would be Alstom, who in South Africa have a very big impact on local communities through broadening knowledge means on a daily level. Alstom provides locals with opportunities they would never of been offered before such as career development programs, granting scholarships, offering internships, vocational training and much more. Alstom would be positively affected by this as consumers would notice how their money is going towards helping people who are less fortunate. In the case study no means of social CSR is present, this in result will negatively affect the company as people will obtain a negative viewpoint of the company for not being a responsible business; as-well as workers not being motivated and having a high turnover rate.

Economically businesses should help develop local skills though making training courses and resources easily accessible to local businesses and people, this will create knowledgeable workers who are experienced as well as boosting the local economy. In the case study workers are forced to live in an unsanitary house while being paid one third of wages necessary to survive. Alstom have been providing local people with the ability to learn and become knowledgeable, providing them with opportunity to work in jobs which may have certain pre requisites. Providing locals with learning opportunities allows Alstom to have a new network of qualified sub-contractors, who will be able to meet Alstom’s needs and also meet other businesses needs they may end up in. The South African community will also benefit though having more people who are employable and employees, strengthening the local industry. Alstom will be saving money in searching for potential employees as now employees will be right in front of them and trained exactly how they need them to be. In my other case study the business does not do any of this they force locals to work in unfair conditions with less than minimal pay, as it may be cheap to do so it is not the most efficient and in the long run will end up being more expensive then supporting the local community and employing them fairly.

Environmentally businesses withhold the task to insure that as often as possible its businesses activates take into account the need to reduce its air, water and soil emissions to protect and enhance the ecosystem. Companies are able to work with employees and set up volunteer activities to take action to help the local environment by, teaching students about re-forestation, turning vacant areas into vegetable gardens, cleaning rivers, there are endless ways companies can help local communities in CSR. Companies which help in education in the environment like Alstom are proving to the public and consumers that they care about the environment and are doing something to help the environment rather than hurt it. Alstom will be viewed positively by all shareholders of the business, including employees being happy with how they are spending their money which will boost workers work ethic and motivation to do their best. For companies like the one in the case study they do not help the environment in any aspects, instead they force the workers to cut down more trees so they can harvest a larger area and have enough money to survive. When people find out about this they will not support the company, no matter how much cheaper they may be, “has already lost a portion of its market” this is a prime example.

There are many positives and negatives of CSR, positives mainly revolve around winning the public’s view on companies and making them support the companies due to their contributions to CSR. But then negatives mainly revolve around the cost and how money and time could be spent in other areas of the business to help them grow.

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