UGBA 10 Lecture Notes - Lecture 16: Corporate Social Responsibility, Resource Consumption, Crisis Management
Sustainability I March 7
I. Corporate social responsibility (CSR)
• CSR: obligation required by the law to pursue long-term goals that are good for the
society. Done correctly, it can be a source of opportunity, innovation, and competitive
advantage rather than a cost, constraint, or charitable deed.
o Previous years: focus on shareholders (people who own the company)
o No: shift i fous o pleasig the stakeholders NGO’s, ouity, ustoers
• Why do corporations adopt CSR and sustainability? To serve the needs about more
informed consumers and to protect their brand. Sustainability is important because it
ifluees all aspets of a opay’s operatios.
• Activist organizations have grown more aggressive and effective in applying public
pressure on corporations to adopt good practices.
• Five driving forces to adopt CSR: (GEGMB)
1. Growing affluence: CSR issues tend to gain a foothold in societies that are more
affluent.
• More affluence = more resource consumption = greater environmental
impact (estimated 33% increase in global energy demand by 2035)
2. Ecological sustainability: realization of the ecological changes and acclimating to
the indifferent changes due to criticism from stakeholders.
3. Globalization: corporations operate in a global business environment and most
environmental phenomena involve regional of global impacts.
4. Media: access to media is easier nowadays; it is harder for companies to hide
things from consumers.
5. Brand: focal point of corporate success that is protected by the company. It pays
to do good business to minimize the risks associated with your business brand.
• CSR can be used for positive brand building and crisis management
II. Mapping social and environmental opportunities
• Understanding the value chain:
o Primary activities: every single activity is adding value to the product or company
• Inside out (inside opay’s effet o the outside eiroet ad alue hai:
actions to understand the effect of business operations and social impact on society
and the environment.
o Support activities: use of natural resources, education and job training,
transparency, recycling, ethical research
o Primary activities: transportation impacts (emissions, logging), waste,
biodiversity impacts, energy and water usage, truthful advertising, customer
privacy
• Outside i outside eiroet’s effet o the iside opay ad diamond
framework: understanding the effect of external social and environmental issues to the
usiess ad its aility to opete ie: oditios at a opay’s loatio suh as
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Sustainability i march 7: corporate social responsibility (csr, csr: obligation required by the law to pursue long-term goals that are good for the society. To serve the needs about more informed consumers and to protect their brand. It pays to do good business to minimize the risks associated with your business brand: csr can be used for positive brand building and crisis management. Mapping social and environmental opportunities: understanding the value chain, primary activities: every single activity is adding value to the product or company. Strategic csr is more sustainable than philanthropic efforts. Their sales increased by 6% in one year: example: whirlpool is a brand that did not market all their csr achievements. They are philanthropic by giving appliances to homes that are renovated by. Ho(cid:449)e(cid:448)er, they do(cid:374)"t ha(cid:448)e it tied to their (cid:271)ra(cid:374)d perfe(cid:272)tly: example: kfc leveraged a c r (cid:272)a(cid:373)paig(cid:374) that (cid:449)as(cid:374)"t a(cid:272)tually sustai(cid:374)a(cid:271)le (cid:894)ie: gi(cid:448)es (cid:272)usto(cid:373)ers a pi(cid:374)k (cid:271)u(cid:272)ket for (cid:272)a(cid:374)(cid:272)er a(cid:449)are(cid:374)ess (cid:373)o(cid:374)th(cid:895).