Corporate Social Responsibility To begin with; how would one define corporate social responsibility (CSR), is it merely morals and ethics or is it much more then that, and can companies reflect such values? Firstly a definition of CSR must be determined, and since there is no one definition in use around the highly globalised corporate world, it is necessary to review some of the existing ones and determine what should be used. The World Business Council for sustainable development defines CSR as the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce, their families and the local community and society at large.
Other definitions describe CSR to mean that companies should carry out their core functions of making profits by the provision of goods and services, but by doing this in a socially responsible way, so by reviewing these two definitions it can now be determined what is expected of businesses, that is to continue their core business and make profits but do so responsibly by behaving ethically, contributing to economic development and the quality of life in the community at large. In the 21st century the scope of doing business has changed tremendously, and profit maximization through cost cutting and sales at all costs is on the brink of extinction, this has come about due to the fact that businesses today are expected to fulfil ethical and social responsibilities in addition to being competitive, and profits are no longer the primary measure of business success.
(Watt, 2004, p8) A good example is James Hardie, and their cynical exercise to avoid moral and legal obligations on a massive scale to save profits, in the end this exercise did not work, due to a backlash against them by the community, and once the company realised the interests of their stakeholders, i.e.
asbestosis victims, and set up a more sufficient compensation fund, shareholders directly benefited through higher share values. (McAdam, 2003, 6) So being concise and to the point, the revision of the corporations act to clarify the extant to which interests of both parties should be taken into account when making corporate decisions is not necessary, as the directors duties at present are flexible enough to allow this, and the perception of what makes a profit is changing in the minds of both directors and shareholders, who now expect the adoption of responsible strategic approaches that return financial gain and ensure viability, in the end all it really comes down to is how CSR is integrated into the corporations structures, and that they realise that to make a profit, they need to rebuild the loss of public trust and respect, by communicating CSR policies to the public to eliminate the residue of suspicion still present due to past actions. The second point of this essay although similar to the first also concentrates on the revision of the Corporations Act 2001, but not on the clarification of the act; instead the focus is whether or not it should be changed to require directors to take into account the specific interests of both parties, i.e.
shareholders and stakeholders other than shareholders when making corporate decisions. Most views on this issue reject government intervention in the implementation process of CSR, while a minority support such action.
The community business partnership scheme employs tax measures to entice businesses to fulfil mutual obligation responsibility by engaging in forms of philanthropic activities in partnership with communities, and thus giving corporations a chance to integrate CSR practices into their corporate structures. (Reich, 2008, 3-17)