Tobacco Industry is considered to be a controversial industry as it does not provide any benefits for the general public (Adam et al. 2012). In fact the product it produces causes harm to the health of humans. In the era of Corporate Social Responsibility (CSR) implementations and World Health Organization (WHO) norms on health standards, Tobacco Industry is trying to fulfil its CSR requirements along with follow WHO and other health organisations standards in their business strategies. However many health organisations including WHO questions the credibility of CSR strategies followed by Tobacco Industry. Therefore there is a requirement of redefining the social, environmental, ethical and responsible standards of such Industry.
Corporate Social Responsibility states that every business has a responsibility towards the society whether it is environmental, social or even towards its stakeholders including employees, suppliers, shareholders and community at large. The tobacco Industry also falls under the CSR rules and they claim that they are following such rules. In such case the question arises: How can an organization which produces a harmful product maintain socially responsible standards? Another question which arises is that whether CSR strategies are actually being followed or whether it is just a scam to fool the stakeholders? And what the Industry is actually giving back to the society? It is crucial for such industry to fulfil their CSR responsibility and play their part in protection of consumers and environment. The main purpose of this research proposal is to determine how Tobacco industry can manage its CSR responsibilities and how it can implement the effectively.
Tobacco Industry has started implementing CSR strategies in business in order to enhance its image in public (Gary et al. 2011). Tobacco Industry is engaged in manufacturing of cigarettes and other products which uses tobacco which is harmful for health. Thus Tobacco industry is criticized by different Non Governmental Organisation (NGOs) when it comes to CSR engagements. As per WHO, the Corporate social responsibility of tobacco industry has contradictions cause the main business of tobacco industry is against public health policy.
The attempts made by tobacco industry towards implementation of CSR are mainly focused on improving its reputation. The CSR policies which Tobacco companies follow is claimed by many NGOs as a marketing tactic and public relation strategy which is only there to advertise and promote the product. A lot of questions have been raised by researchers who have previously worked in this topic whether credibility of CSR concepts and its implementation really apply to such industries which produce products which are harmful for health.
This research will be aiming to provide a clear idea of the context, nature and development of CSR policies and its relations with public responsibility. Besides, this research will focus on a detailed study of CSR policies of Tobacco industry and its impact on the tobacco company as well as the society.
Objective of the Research
The objectives of this research are closely related with the research questions which are pointed out below:
- The importance of CSR policy implementation in tobacco industry and what are the challenges it faces in implementation?
- The credibility of the selected CSR policies of tobacco companies and the reliability of the policies with respect to social benefits.
- If corporate image and public opinion affect CSR activities and its credibility? If yes then how far can it impact the industry, both short term and long term perspective.
- A study showing how effective CSR policy can benefit or bring changes in a tobacco industry.
This research studies the feasibility of CSR in tobacco industry based on secondary source of data. A detail analysis will be conducted on various journal and articles of different authors from where findings, discussions and facts will be taken. Both qualitative and quantitative analysis will be considered in this research.
Taking the journal and articles done by other author as base, this research will deduce the way CSR policies can be used to addresses community needs as well as construct a positive image of itself as well. The tobacco industry needs to portray what it wants to accomplish with its CSR policy and the same should be expressed by it to stakeholders. Another thing is that tobacco companies should be accountable to the society and also try to produce a positive impact on society in order to mitigate the harmful effects of its product. The research will further aim to establish how tobacco companies can create a positive impact on the society.
In the following discussion, the features of the manufactured product of tobacco companies and their activities based on CSR are discussed to determine the relevance and credibility of implementing CSR in their business.
Corporate Social responsibility means the responsibility which every business have towards it society. These may be social, environmental, economical responsibilities which a business must fulfil for the betterment of the society and must be accountable for the same (Hack, Kenyon and Wood 2014). As per recent study the purpose of CSR in controversial industries is to enhance their image and also their business value.
Most of the business try to follow CSR policies mainly aiming to create certain amount of value for general public or social benefits along with improve the company’s reputation and social image. Tobacco companies also fall under this category. According to WHO, an area where every tobacco company invest as a investment in CSR policy is publicity and advertisement of youth smoking prevention programmes (World Health Organization, 2013). These programs are created to discourage youth’s from smoking habits but in most of the case the desired result does not happen.
The program mentioned above is ineffective in most of the cases as youth take the negative publicity as a challenge and continue their smoking habits. A study shows that the smoking of cigarettes has increased from 4.8% to around 22.3% in America as per 2014 update. The study further shows that around 20.5% of men and 15.9% of women continue smoking even though they have heart problems and bad health (Go et al. 2014). Thus it can be said the program of youth prevention of smoking habits is not bearing fruits as desired by the tobacco industry. The program actually aims at producing negative publicity by advertising smoking kills or it is injurious to health (Hiilamo, Crosbie and Glantz 2014). However the program becomes ineffective as people simply ignores the warning and continues with smoking.
Thus tobacco companies need to stress a little more than the program to stop youth from consumption of cigarettes. Medical experts also advice against use of tobacco and it is considered as harmful product and it is often linked with health related problems. As per medical professionals smoking at minimum causes respiratory problems and problems of deposits of tar in lungs and in extreme cases it can cause cancer (Heydari et al. 2015).
Therefore it is a must that attempts should be made by tobacco companies to revise it certain policies and critically deal with its CSR’s activities which are necessary to properly run the business. Various articles and study shows that wherever proper CSR standards are not maintained rigid governmental regulations come into force and are not easily removed. In simple words, if businesses does not maintain required standards as per the society than government introduces strict regulations in order to bring the company in right tracks which may not be suitable for the company (Armstrong and Green 2013). Another study shows that indirectly the survival of a business depends on how well a company delivers its social obligations. In other words, a company which is socially responsible towards society, stakeholders must fulfil their obligations meeting the expectations of the stakeholders and society. Otherwise the company cannot operate within the society for a long time ignoring its social obligations. This is applicable in case of tobacco companies as even the product they produce are harmful to society (Palazzo and Richter 2005.). Therefore it is a necessity that tobacco companies come up with effective CSR strategies to keep the society at large happy.
There are certain advantages which a company enjoys when it effectively follows CSR policies and responds to the needs of the society. Any company which follows CSR policies effectively can be not only improve its image but also achieve brand equity and recognition. This helps when the company wants to diversify its business and enter new markets, example ITC (Hur, Kim and Woo 2014). Tobacco companies can also achieve the same and a lot of such companies have diversified in product range. ITC is a prime example.
Generally, the public perceived CSR is more closely aligned with a public relations perspective, and may be defined as “moral, ethical, and social obligations that provide the bridges where there is mutually beneficial exchanges between an organization and its publics. Studies show that companies which follow CSR policies are rewarded with higher market shares. For a controversial industry like tobacco companies who apply the CSR strategies, the public tend to associate the corporation with higher values. Therefore it will be in the benefit of tobacco companies to implement an effective CSR policy.
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