Every company has to have objectified outcomes that through effective conduction of business operations and proper management of the human resources. The productivity as well as the profitability is definitely the determinants of the performance of a company. However, performance of any corporate company is determined on the basis of many dimensions and facets which have to be analyzed from the perspective of the shareholders (Abe & Freeman, 2014).
The drivers of performance of a company have to be further analyzed by various parameters and indicators such as economic value, accounting profitability and shareholder value. In order to accomplish the objectives and aim of a business organization, the corporate has to imbibe varied, disciplined and strategic approach in the orientation of the objectives of the company (Abell, Engel & Wynn, 2015).
It is a fact that business integrates the ways in which the suppliers, customers, stockholders, financiers, banks, bondholders, media, and managers have interaction along with creation of value. Stakeholders definitely have major contribution to the practice and thinking of the management. The concept of the stakeholders is a key aspect of the corporate governance and management of any business organization. The obligation of any corporate business to serve the interest of all the stakeholders is mostly termed as stakeholder’s management (Alshareef & Sandhu, 2015).
This obligation to serve the stakeholders is also found to have ignored the other vital groups that interest a corporate organization. It has been observed that the advocates of management of stockholders consider that the modern business corporation that are oriented for profit need to serve objectives and interest of all the collective stakeholders. However, it is observed that the management of the stakeholders goes wrong in the failure to identify that a corporate organization in which the managers are acting in regards to the interest of the stakeholders can also orient in providing benefits to all the stakeholders (ArAs, 2016).
The managements of stakeholders and all other activities in any business organization can be effectively conducted through the incorporation of ethics as well as effective strategy. It is an unending fact that every business organization tries to make attempts for accomplishing certain objectives through a system approach. Right from the social and economic level of perception, it is found that the business which operates on the basis of the ethics and culture, ultimately achieves success. It is mandatory thing for the business organization to consider the aspects such as “what”, “when” and “how”. It has to be noted that any individual in a society has some sort of responsibilities towards the society (Brammer & Pavelin, 2013).
According to Choi, Lee & Park, the fact that corporation has to be considered as an artificial person can be accepted as any corporation would have artificial responsibilities which it may or may not look forward to meet. However, in the regards to business cannot be mandated to have any kind of responsibilities (Choi, Lee & Park, 2013). It can be very well explain that the business organizations who think of conducting certain activities in orientation of betterment of society and environment happen to have an extra edge in the competitive environment of business. The fact that a corporate executive is an individual who works for working for the business organization has the certain kind of responsibilities to the society.
The business organizations need to have the integration of the social responsibilities along with meeting the needs and interested of the stakeholders altogether (de Graaf & Stoelhorst, 2013). This is only found to be achieved through the incorporation of social responsibilities with the objective of productivity. The individuals which are involved in working in a business organization, apart from having other personal responsibilities need to work towards meeting the requirements of the society.
The business organization, when realize that their contribution has a big impact on the development of the society as a where the products and the services that the company can design can be in accordance to the requirements of the society as a whole in most of the business organizations which have been successful in adding value to the society have spent a good amount of money in the improvisation of the their products and services in the ways which would make the operations as well as the products to be eco-friendly or customer friendly who are one of the stakeholders groups (Devinney, Schwalbach & Williams, 2013).
It has also been noted that the stakeholders, employees or the customers can even separately spend money on any action that is intending to enhance the condition of the society at any scale. The issues or more so challenges have been observed to arise in conducting the social responsibilities in the private organization where the prime focus revolves around the employees to be more accountable for their own actions which further make it’s more complicated to do good for the society (Dias, Rodrigues & Craig, 2017).
However, with the evolution in the business organization and the way business has been conducted have observed that changes in the business operation of private organization which are now working in accordance to the corporate social responsibilities is that they need to mete and report ate every end of financial year. It is also observed that the prime role of the business organization always has to be in terms of meeting the objective sand requirements of the stakeholders (Ferrero?Ferrero, Fernández?Izquierdo & Muñoz?Torres, 2015).
The categorization of the stakeholders facilitates the management of stakeholders to be more convenient which goes both ways in addressing the requirements of the stakeholders as well as having effective strategies on ethical grounds. The primary stakeholders are generally observed to have invested in the performance or the business corporate and the action that the organization engages for the conduction of business (Filatotchev & Nakajima, 2014).
The fact that the primary stakeholders have direct impact on the success or failure of any business venture made by the company is very true. The secondary stakeholders are observed to have influence in the action taken by the business corporate in both ways. The secondary stakeholders can make it difficult for the company in succeeding by enforcing more regulations. The business organization need to cater to the stakeholders and at this time can take one step at a time to address the issues or requirements of the society. As a matter of fact, corporate social responsibility can also be referred to as one of the ethical practices of any business organizations which can act as a mechanism that is self-regulated (Habbash, 2017).
The core objective and mission of any business organization would definitely imbibe corporate social responsibilities as to support the success along with extending the commitments and accountability that it has to its secondary stakeholders and various other members of the overall society in general in having corporate social responsibility through effective organizational actions have been observed to reflect positive effects on the society which includes the people, environmental and communities as a whole (Jain & Jamali, 2016). The business organization that have adopted corporate social responsibilities as major aspects of ethical, discretionary and moral responsibilities are found to have a broader view of legal and economic obligations. It cannot be denied that such organization have a wider perspectives regarding the accountability which includes both the primary and secondary stakeholders (Jizi, et al., 2014).
How society could benefit from a broader view of the firm
Corporate social responsibility assists in creating strategic value for the business organizations. At the same time, the engagement of the stakeholders is mostly perceived as secondary and non-essential to the agenda of corporate social responsibility. Apart from the economic responsibilities that any business organizations need to be aware and conscious of which has to the prime responsibility of any company. Further, every business organization needs to inculcate ethics in the business structure and frameworks so as to have long terms sustainability in the business both in the context of operations and productivity. Ethics would include the responsibilities and the norms which are very much essential for the overall success of the organizations (Kathyayini & Carol, 2013).
The ethics would encompass the ethical accountability that would include the strategies which are environmental friendly approaches to provide service s and products. The society can very well benefit from the corporate social responsibilities of the business organizations through the processes incorporated by the business organization in negotiating their participation in the development of the society. The society can benefit from the comprehensive approach taken by the business organizations that would also result in exceeding or meeting the expectations of the stakeholders after meeting the latter’s objectives in terms of profit, legal and revenue obligations. The society can be able to derive benefits from the investments in the community, preservance of human rights and ethical conduct in the form of activities associated with corporate social responsibilities conducted by the business organization (Khan, Muttakin & Siddiqui, 2013).
Various business organizations are found to be conducting activities associated with corporate social responsibilities which have also become a mandatory aspect for every corporate business to follow. These activities are associated with the developmental activities such as providing education to children belonging to the poorer sections of the society by setting up free educational camps, having plantations, providing poor people with necessities, setting up health camps, nourishment and many other activities. The society, at large will be able to reap benefits which can bring significant changes in the condition of lives of people. The corporate social responsibilities conducted by the business organization are also directed towards the development of the environment which has become a prime factor of concern presently.
This way the society can have upgrades in the environment by the plantation or cleaning programs which are conducted in the form of social corporate activities (Manasakis, Mitrokostas & Petrakis, 2014). The outcomes that are derived from such corporate social responsibilities provide added value to the business organization in terms of enhanced productivity and satisfaction among the customers. The customers who basically form the society get an improved image of the brand through such corporate social activities (Mason & Simmons, 2014).
Developments have been and would continue to take place by the continuous conduction of such corporate social activities in the society. The business organizations once able to perceive the benefits in their business due to such ethical strategies in their business, would continue to out in increased efforts in the conduction of better and more number of activities associated with corporate social responsibilities that will eventually benefit the society at large (Mehta & Chandani, 2015).
Theory of justice
According to the theory of justice, the concepts of the equality and freedom are not exclusive mutually. The provision of justice has to be simply just. In this context of only meeting the requirements and the objectives of both primary and secondary stakeholders, the analysis would refer to as prevailing of justice as according to the theory of justice, all aspects involved in the conduction of business along with the productivity derived from any business needs to be treated equally. Thus, engaging in the social development through the activities such as corporate social responsibilities would refer to the engagement of the business organization in not only meeting the requirements objectives of the stakeholders but also addressing the needs of the society at large (Rahim & Alam, 2014).
The business organizations that engage in the cooperation to the society choose the principles that are related to the basic duties and rights with determination of categorization of social benefits. According to Rodriguez-Fernandez, if the wealth in terms of profits and revenue would be distributed equally among all the stakeholders and society at large, economy would be improved and have stability in the society as a whole (Rodriguez-Fernandez, 2016). In regards to the ethical conduction of business, the fairness of the position of equality would relate to the provision of service and benefits to all the stakeholders along with the society at large. However, it has to be conceived that according to normative theory of ethics, the right and ring regarding the conduction of business and provision of benefits as well as conducting activities associated with social responsibilities can be analyzed.
According to the Utilitarianism theory, any business action can be stated to be right if it happens to cause the good consequences in a satisfactory manner as compared to the other actions that would be chosen in terms of meeting the expectations of the stakeholders and the need to address the society (Sharif & Rashid, 2014). Focusing only on deriving benefits and productivity and meeting the expectations of the stakeholders at all levels by ignoring the accountability of the business organization towards the society at large cannot be termed to be in accordance to the normative theories.
Providing happiness both the stakeholders would be considered as good while the sufferings of certain sections of the society would be considered to be bad if not addressed by the business organization through its corporate social responsibilities that can be very conveniently conducted by the companies (Young & Thyil, 2014). However, defining any strategic approach to the delivery of satisfactory benefits to one category of stakeholders cannot be termed to be satisfactory to another. Further, the approach of categorical imperative paves the ways for the business organization to act in a way that is in accordance to the universal law.
The business organizations need to project organizational behavior that is very rational in approach for every category of stakeholders and all the sections of society. The approaches regarding providing equal importance to the meeting the requirements of the stakeholders and the responsibilities towards the society needs to be in orientating to the motivations principle which would guide the strategies in regards to the conduction of both the business and corporate social responsibilities in an ethical manner (Zhao, Chen & Xiong, 2016).
In accordance to the Aristitolian Virtue Ethics, the business organization should intend to also strategies the approaches regarding provisions of benefits both to its stakeholders and society at large by considering the promotion of individual happiness and propagate the ways on which individuals associated at any scale would make ways to their personal happiness. The stakeholder theory facilitates the ways in which the business organizations need to make the business decisions in a manner of considering the stakeholders’ interests in any company. The management of stakeholders form ethical ways of conduction of business in the orientation of providing equal benefits and assisting the society in its development should be categorized as a good approach.
The accountability along with the legal obligation of the business organizations also vets in the omission of the causes or elements that happen to harm or not cause any benefit to the stakeholders and overall society. The aspect of duty of care has to be very well cared by the auditors of the business organization who will be able to provide more convenience in the categorization and distribution of the revenue and profits equally and correctly (Sharif & Rashid, 2014). His would further relate to the ethical ways in which the rights of the individuals associated with the business of the company would be restored and protected.
Identification of other theories
The theories such as Creating shared values integrates the policies of the business organization and the practices that would be undertaken by the business organizations in terms of catering sustainability in the business by the approach of corporate social responsibility and even sharing of the revenue and profit among the shareholders equally is directly related to the enhancement of the competitiveness in the global market. Through this approach the business organization will be able to assist in the advancement of the economic and social condition of the society at large.
This would also encompass the development of the communities in which the business organizations conducts its selling and buying operations (Young & Thyil, 2014). However, it is to be noted that the difference in creating shared values and the corporate social responsibilities of a business organizations need to be integrated into one aspect which would assist in having business operation on ethical principles. The practices and policies that are included within the creation of shared values would facilitate the strengthening the community at the time of advancement of business in the lien so economic objectives. On the other hand, the advantage that the corporate social responsibility provides to the business organizations along with the stakeholders and society is that it strengthens the context of competitiveness in which the company is operational. However, it has been observed that there are numerous ways in which the business organizational can make money out of the resolution of social issues (Zhao, Chen & Xiong, 2016).
This approach cannot be considered as a philanthropically approach which is simply because of the fact shared value cannot be considered as a donation or contribution made to the society. In fact, the initiatives that are taken by the business organizations are in the orientation of making profit solely. On the other hand, the initiatives associated with the corporate social responsibilities of the company directly relate to a philanthropic approach to the company’s approach in delivering productivity and benefits to the society as a whole. If the company creates products and services that are designed in orientation to provide and promote sustainability would definitely increase the economic benefits for the business organizations. In the cases when the business organizations create products and services that re for the benefits and resolution of the issues of the society, the value of the company gets heightened along with the increase in productivity.
The approach of creation of shared value should be integrated by the business organization which will strengthen the positioning of the company in the competitive market and increase the profitability for both the stakeholders and the society at large (Young & Thyil, 2014). The shared value would provide tremendous opportunities for the business organization to reach to new heights of profits along with adding value and addressing to the social obligations on ethical norms. Forward thinking will be enhanced by the integration of creation of shared value approach which would be aimed at changing the way in which business organization are operating. This would integrate the aspects such as people, strategy, structure, rewards and processes which will deliver the returns in manifolds (Zhao, Chen & Xiong, 2016).
Conclusions and recommendations
The managers and the higher authorities of business organization need to understand the significance of conducting corporate social responsibility which would enhance the image of the barn dine the eyes of the society which encompasses the customer base in a specific market. Further, the integration of creation of shared value in regards to adopting sustainable business approaches would provide greater benefits to the stakeholders at all levels along with having positive implications on the society.
In order to have effective and long term productivity in the business, companies need to inculcate the strategic approaches in orientation to provide enhanced services and improved products which would add greater value to the ethics of business followed by the company. Using the theory of creation of shared values would assist the company in devising the next higher objective of the company which would facilitate the company in having a competitive edge in the both the domestic and international market.
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