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Understand the Importance of Ethics, CSR and Sustainability in Modern Organisations

Understand the Importance of Ethics, CSR and Sustainability in Modern Organisations
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One area that has become of increasing importance to businesses within the last few years, is ethical behavior and corporate social responsibility. Corporate social responsibility is based on the idea that businesses and organizations can’t afford to act in isolation without concern for their impact upon society as a whole. Let’s look at what corporate social responsibility means and how it has come to prominence in more detail. Corporate social responsibility, or CSR, is a concept that is underpinned by the idea that organizations can no longer act as isolated economic entities, which are detached from wider society. CSR therefore promotes the view that organizations have accountability to a wider range of stakeholders than the traditional view of shareholders and investors.
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Organizations who have CSR, are not only concerned with competitiveness, survival, and profitability, but with a wider range of issues. This view has resulted in a rise in organizational interest in areas such as environmental protection, sustainability, the wellness of employees, the community, and civil society, and ethical behavior. There are a number of reasons why CSR has developed in recent years. Some of the drivers include, one, the shrinking role of government. Two, demands for greater disclosure. Three, increased customer interest. Four, growing investor pressure. Five, competitive labor markets. Six, supplier relations. When CSR is implemented within an organization, there can be considered to be a number of benefits.
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For the company, the benefits of adopting a CSR approach include, improved financial performance, lower operating costs, enhance brand image and reputation, increased sales and customer loyalty, greater productivity and quality, better ability to attract and retain employees, reduced regulatory oversight, access to capital, workforce diversity, product safety, and decreased liability. In addition to company benefits, there can also be considered to be benefits to the community and the general public. Now these can include charitable contributions, employee volunteer programs, corporate involvement in community education, employment and homelessness programs, and product safety and quality. There are also expected to be a number of environmental benefits as a result of CSR.
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These can include greater material recyclability, better product durability and functionality, greater use of renewable resources, and the integration of environmental management tools into business plans; including lifecycle assessment and costing, environmental management standards and eco-labeling. One of the key issues organizations face when implementing CSR, is how to measure success within this area, as well as how to disseminate CSR strategies. One initiative that is seeking to try to create a common framework for voluntary reporting of the economic, environmental, and social areas of organization activity is the Global Reporting Initiative. The aim of this initiative is to improve the comparability of CSR and to increase the credibility of reporting worldwide. Let’s now briefly review what we have learned here.
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In our discussion here, we have explored the concept of corporate social responsibility and the way in which it is increasingly being used by organizations. We have seen that organizations are increasingly becoming aware that they do not only have a responsibility for ensuring profitability and competitiveness, but also that they have responsibility for a wider range of ethical, social, and environmental issues. We have also discussed that there are a wide range of benefits for organizations to adopt the CSR approach. These are for the company itself, for the community, and for the environment. Now let’s take a look at the five key points.
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One, CSR considers organizations to no longer be able to act as isolated economic entities which are detached from broader society. Two, CSR promotes that organizations take accountability for wider range of stakeholders. Three, CSR covers areas such as environmental protection, sustainability, the wellness of employees, the community and civil society and ethical behavior. Four, there are a number of benefits to the organization for adopting CSR. Five.

Let’s now find out a bit more about the importance of ethics, corporate social responsibility and sustainability in modern organisations. Watch this video from the University of Law Business School to find out more.

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