Outline and discuss the evolution of CSR (Corporate Social Essay

Outline and discuss the evolution of CSR (Corporate Social Responsibility), including its history, role in the financial crisis - Essay Example Among the many corporate strategies that have been adopted in the corporate world, to ensure both sustainability and profitability is the concept of Corporate Social Responsibility (CSR), which has gradually achieved massive popularity and significance in businesses world over. Corporate Social Responsibility simply refers to the manner in which businesses behave towards the society or conduct their affairs, in accordance to acceptable standards of operation; all businesses have an obligation to pay attention to, or to be responsive to social and environmental issues (Montiel 2008, p.245), rather than merely focusing on making profits. An understanding and integration of both societal needs and business needs is particularly important to business management in the recent times due to the increasing awareness of social challenges and the emphasis on social responsiveness. In that respect, Corporate Social Responsibility entails engaging in business practices and activities that promot e societal goals, thus, is one of the basic means of achieving competitive advantage in the complex and competitive global market environment. Historical background of CSR The concept of Corporate Social Responsibility dates awhile back in history and it has been in existence for more than a decade now, though its prominence and application in the corporate world is largely a present phenomenon for many corporations were not familiar with it until about the mid 1970’s. The pioneers of the concept observed that businesses ought to pursue policies and take decisions or actions that are desirable not only in terms of the objectives but also in terms of the values of society (Archie 1999, p.270). Initial academic debates that led to the development of this concept were the heated exchanges between Adolf Berle, who contended that managers were only responsible to their shareholders, and Merrick Dodd, who maintained that managers were responsible to the public as a whole and not ju st to the shareholders alone. Dodd further developed his contention by positing that besides the economic responsibilities owed to shareholders, managers have social responsibilities to the society as well; businesses serve a purpose in society and are not merely a source of profit to their owners (Snider, Hill & Martin 2003 p.176). Modern activist movements in the 1950’s and ‘60’s particularly in the US gave the debate a new momentum by turning media attention to business practices that they considered to be unethical or irresponsible, and in the wake of 1070’s focus had shifted to Corporate Social Responsiveness. This gave rise to yet another concept, Corporate Social Responsiveness, which refers to the notion that firms have to respond pragmatically to social pressures while paying considerable attention to their social obligations. A new development that took place in this era was the birth of modern corporate philanthropy, which involved corporations making huge donations for purposes not directly linked with immediate corporate profit. A further development in the concept was the shift from mere corporate philanthropy to strategic corporate philant