What is Corporate Responsibility?
Corporate responsibility, often referred to as corporate social responsibility, is a form of self-regulation instituted by companies by means of a formal integration into a respective business model. Corporate responsibility functions as a self-regulating, built-in mechanism where a business monitors and subsequently ensures its active compliance with the spirit of the law, international norms and the adhered of various ethical and environmental standards.
What is the goal of Corporate Responsibility?
The goal of corporate responsibility, the reason why it is practiced by all companies in the United States, is to embrace responsibility for the corporation’s actions and to encourage a positive impact through the company's production and various activities on the environment, the community, its employees, stakeholders and all other members of the public. Furthermore, corporate responsibility encourages public interest by encouraging community growth and development; corporate responsibility enables corporations to develop relationships with the communities in which they reside through the institution of community service projects and the elimination of practices that harm the environment and public sphere. Corporate responsibility is deliberately included in a corporation’s business model to honor a triple bottom line: people, planet, profit. Although the majority of companies in the United States seem to only be focused on making money, the majority of domestic companies exhibit socially-conscious maneuvers and utilize environmentally-friendly resources. Corporate responsibility aids an organization’s mission as well as elucidate to the public, regarding what the entity stands for and how it upholds its pledge to its consumer base.
Approaches to Corporate Responsibility:
A corporation can benefit and bring direct aid to a community in a variety of ways. An approach for corporate responsibility that is becoming more popular is a community-based development approach, where the corporation will work with local communities to better themselves. For example, corporations commonly set-up or fund educational facilities in poor communities as well as development centers for impoverished adults. Furthermore, Executive Officers of large corporations often donate exorbitant sums of money to children’s hospitals, throughout the world; this money is used to purchase vaccines or medical equipment.
The majority of corporate responsibility projects are established in impoverished nations or areas. An exceedingly common approach of corporate responsibility is philanthropy. This initiative includes monetary donations and aid given to local organizations and impoverished communities in developing areas. That being said, some organizations do not like this approach for it does not build the skills of the local people, whereas a community-based corporate responsibility initiative typically leads to a more sustained development.
Another common approach to corporate responsibility is to incorporate a socially-conscious strategy into the business model of the organization. This ability to seamlessly intertwine business with community outreach creates a model where the company’s resources and efforts to produce a profit are proportionately attached to sustaining and helping a community.
Perhaps the most common form of corporate responsibility is found in a simple process—corporations, especially now, should take responsibility for their impact on the environment and society. To do this, the corporation must incorporate social and environmental accounting into their day-to-day business model.