What is Corporate Social Responsibility?

Corporate Social responsibility can be defined as the obligation for an organization to commit resources and efforts in goals, activities and in some cases infrastructure that are in the higher interests of society as a whole. These investments are usually not directly related to profit or in creating financial wealth for the company. Besides, these are usually beyond the legal norms and economic principles.

This can involve a commitment from the organization to maintain high ethical standards and care for its employees and their families. In other words, corporate social responsibility is about how an organization dedicated to profit and shareholder wealth can have a positive effect on its immediate surroundings and society in addition to fulfilling its objectives.

Organizations can engage in a wide range of philanthropic activities such as building clinics, adopting a village in a third world country and providing it with clean drinking water and education, supporting environmental protection etc.

When an organization is said to be socially responsible, it means that the organization conducts its dealings with high standards of ethics and with the interests of the larger community in mind. It should respond to social expectations and to take a proactive step in addressing issues which concern society. To adopt strict measures in issues such as those pertaining to the environment or fair trade practices on its own instead of being forced to do so by a regulatory body.

In other words, corporate social responsibility is about the organizations’ duty and obligation to all its stakeholders and not just to its shareholders.
According to experts, there are many dimensions to the concept of corporate social responsibility. Some of them are 

- Economic: The company’s main objective is to create wealth for its shareholders. It must focus its efforts and energy in this direction. 

- Legal: The company must ensure that all the processes within the organization are in compliance with existing legislation. 

- Ethical: Being ethical involves performing actions which do not just have profit in mind by the higher ideal of right and wrong. 

- Philanthropic: contributing finances and efforts towards social welfare and wellbeing of the community. 

- Good corporate citizen: The company should have good relationship with the immediate surroundings and to the corporate world.

While social responsibility is considered to be a lofty ideal by some concerns, other organizations consider it unnecessary and look at it with disdain. They contend that the primary objective of the organization is to maximize shareholder wealth. They further assert that managers who have been put in charge of shareholders capital do not have the authority to give away money that belongs to the shareholders and say that correcting anomalies in society is the function of the government.

This opinion however is not widely held and the majority of companies believe that having a favorable public image will greatly help the organization in the long haul. For instance, corporate social responsibility has an influence in retaining staff that have a sense of respect towards the organization; it helps the environment and enables a company to be differentiated from its competitors.