Overview Of Corporate Social Responsibility

32 Pages 7880 Words

oyees, community organizations, and the news media - are asking companies to be accountable not only for their own performance but for the performance of their entire supply chain, and for an ever-changing set of CSR issues. All of this is taking place against the backdrop an ever more complex global economy with continuing economic, social and environmental inequities.

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There is a growing body of data - quantitative and qualitative - that demonstrates the bottom-line benefits of socially responsible corporate performance.

Improved Financial Performance: Business and investment communities have long debated whether there is a real connection between socially responsible business practices and positive financial performance. In the last decade an increasing number of studies have been conducted to examine this link. One of the more recent analyses - a 2002 DePaul University study - showed that overall financial performance of the 2001 Business Ethics Best Citizen companies was significantly better than that of the remaining companies in the S&P 500 Index, based on the 2001 BusinessWeek ranking of total financial performance. The ranking was based on eight statistical criteria, including total return, sales growth, and profit growth over the one-year and three-year periods, as well as net profit margins and return on equity. The Best Citizens scored ten percentile points higher that the mean ranking of the remainder of the S&P 500 companies.

Reduced Operating Costs: Some CSR initiatives can reduce operating costs dramatically. For example, many initiatives aimed at improving environmental performance - such as reducing emissions of gases that contribute to global climate change or reducing use of agrochemicals - also lower costs. Many recycling initiatives cut waste-disposal costs and generate income by selling recycled materials. In the human resources arena, flexible scheduling and oth...