Corporate social responsibility

The key elements of a pluralistic society are decentralization and diversity of power. The American Society consists of people from different races, nationalities and cultural and ethnic backgrounds.

This means that the culture of the American society is a collection of different cultures and this brings about Diversity not just in the people but also when it comes to power. Different positions of leadership are held by people from different ethnicities. The power system is heavily decentralized every locality having its own subsystem of leadership. American society may be correctly termed as a pluralistic society.

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The textbook says that when power gets out of balance, other forces are brought to bear so that balance is restored. Some of these forces include the power of the government. State policies and regulations are very powerful when enacted on any business entity. Every business organization must adhere to the set rules and regulations as pertains its operations.

In the event that it runs against them or outside the given dimensions, action is taken against the management authority. Another source of power balance in an organization comes from the shareholders. This may be exercised on the management directly by the shareholders or owners or the Board of Directors which represent the owners in many organizations.

When something goes wrong in the business operation the Board of Directors steps in to demand an explanation from the managers and in worst cases they can fire the one responsible for the mishap. The third source of force is the stakeholders in general.

For instance if a corporate body is operating in a manner that is likely to affect the balance of the ecosystems, then the stakeholders such as the community around the organizational premises stand up against the firm and if the organizational management does not take action, legal action can be taken against it.

A commercial bank as a corporation wields power immensely on the different spheres in which its impact as an organization is felt. First as a business its economic value comes first, it contributes to the economic growth by creating employment, paying taxes, funding projects and businesses via credit financing and others.

Second it is faced with the social responsibility of contributing to the societal wellbeing of the community in its environs and the stake holders in general. This is achieved by being actively involved in community empowerment programs, environmental conservation and giving its owners a return on their investments.

The other sphere is legal sphere. Being an independent entity, it is also a legal entity and therefore business should be operated in respect to the law. It is also entitled to legal rights, it can sue and be sued and this means that its operations and business activities, policies and practices should be carried out as guided by the laws of the land.

The final dimension is concerned with ethicality of the corporation in its day to day operations. All business practices should conform to the norms of the society and it should reflect the culture of the people. When all these are done the corporate body has successfully exercised its power in the spheres associated with its business.

Ecological damage sustainability is a common term in the field of environmental studies than it is in the business world. However, in the recent times conservation activists have come out and enlightened the word on the need to conserve our environment for our own tomorrow and for the generations to come; conducting business with this idea in mind results to adoption of sustainable business solutions such as waste recycling and enactment of environmental friendly policies.

When the management is actively involved in the ecological sustainability process, they set the context for their organizations and this becomes the business culture. The managers should cultivate the habit of carrying out business sustainably in them, by learning it and living it.

Ecological sustainability should be looked at as one of the managerial responsibilities. The employees are likely to follow what the leaders are doing and value that which their managers stand for.

The managers are in a positin to decide what is to be done and how it should be done. This gives them the power to encourage practices that save the resources for the future generations of human and non-human species.

Corporate Social Responsibility is founded on strong in-built self regulating policies. A company or Organization has an internal self-drive that ensures that the particular organization is compliant to the rules of the land and that its operations meet the expectations in terms of societal norms and ethicality.

Corporate Social Responsibility assumes accountability for the company’s actions by being in the frontline when it comes to positively impacting on the employees, the environment, stakeholders and the community at large. It sets a framework against which the organization’s impacts on economic, environmental and social aspects are measured.

Corporate citizenship is a measure of a Company’s responsibility in meeting the ethical, economic and legal expectations of its stakeholders. It is the degree to which an organization is expected to meet these responsibilities.

Corporate social responsiveness provides an insight into how an organization responds to the societal demands. It defines how an organization acts in relation to what the stakeholders and the larger society require of them.

Corporate social performance looks into the output or the outcomes of the organization’s actions in response to the societal expectations.

These ideas are closely related. Their main goal is to keep the society satisfied with the firm’s actions and hence get the support of the society. They only differ in the way they are implemented.

Stakeholders come into the business view with their own demands and expectations, some of which can affect the business positively and others negatively. Some groups of stakeholders have the potential to cooperate and others a potential to threat. The first group is in support of the firm and the second are against the firm.

They are viewed differently by different managers. On one side the stakeholders are viewed as a group to be managed for the benefit of the firm and its owners and on the other hand as a group to whom the firm has certain responsibilities equally important to those of owners.

Stakeholders are equally important to a firm as are the owners; however some stakeholders are not legitimate but what is most important is the legitimacy of their expectations. The firm, to a certain degree owes some accountability to stakeholders depending on their demands as they may cause the collapse of a business if their demands are not met.

Stakeholder management is a complex process. It is time consuming and it might be pretty difficult to determine the legitimacy of stakeholders. In addition, focusing on stakeholders’ issues too much may affect the original business goal and purpose.

Church groups consist of individuals with a common interest who come together and act as one. This gives them the power to exert pressure and wield influence on the stockholders. Small investors need to unionize and with the power of numbers and in a spirit of oneness, they can impact substantial influence.

In any voting system the choice of leadership is in the hands of the voters. The same case applies when business owners are changing their representatives in their business. Shareholder democracy comes into play during such elections. The power of the majority is what is applied here since the individuals with the majority votes win.

Shareholders who have voting rights by registration are the ones who cast their votes and this number is considered to represent all the shareholders. It works in most cases but the challenge is how to avoid instances of a single voter voting more than once. The voice of the shareholder is implemented by shareholder democracy; it is through this that the shareholders chose who they want to represent them in the firm.

As we all know shareholder democracy is applied in the process of voting representatives in the Board of Directors, which represents the owners of the business in the setting where ownership and control are distinguished. The shareholders are the owners and so they should be given a chance to make their choice. This strategy may be full of politics but in the long run it works in the best interest of the majority.


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