Corporate Social Responsibility Defined

The material presented so far in this chapter has dealt pri­marily with the behavior of individuals in organizations and the ethical ramifications of that behavior. This section deals with the issue of corporate behavior and its attendant ethical ramifications.

Business scandals tend to undermine the credibility of businesses in general by eroding public trust and confidence. In an attempt to stem the tide of unethical behavior in busi­ness, the International Organization for Standardization (ISO)—the same organization that developed the interna­tional quality management guidelines known as ISO 9000 and the international environmental management guidelines known as ISO 14000—has taken on the issue of corporate social responsibility (CSR). The ISO defines CSR as follows:

[CSR is] a balanced approach for organizations to address economic, social and environmental issues in a way that aims to benefit people, communities and society.3

Key elements of CSR include the ethical aspects of the following business and workplace issues:

  1. Human rights
  2. Occupational safety and health
  3. Business practices (fair or unfair)
  4. Governance
  5. Environmental management
  6. Consumer relations
  7. Marketplace activities
  8. Community involvement
  9. Social development

The CSR is critical because the credibility and, in turn, suc­cess of a free-market economic system rest on a founda­tion of trust. All the principles of total quality—continual improvement, competition, strategic management, and so on—are inextricably linked with free-market practices. Undermine that foundation of the free-market system and you undermine the entire system. When public trust is un­dermined, it is replaced by fear, suspicion, and protectionist attitudes. Businesses cannot survive and thrive in such an environment.

Source: Goetsch David L., Davis Stanley B. (2016), Quality Management for organizational excellence introduction to total Quality, Pearson; 8th edition.

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