Legal Responsibility in Csr Example

Legal Responsibility in Csr Example

Carroll`s pyramid assesses the importance of each CSR dimension. According to Carroll, economic responsibilities are the most important for a company. Then there is legal and ethical responsibility. Philanthropic responsibilities are considered the least important. Roger Cox`s (“Urganda”) case note is particularly interesting for those of us concerned about climate change. While scientific evidence suggests that global greenhouse gas (GHG) emissions must be drastically reduced to prevent dangerous climate change, lawmakers and businesses are still unwilling to take action that could result in the drastic reductions needed. Cox points out that many states have made legal commitments to reduce greenhouse gases.24 The question posed in his case note is whether a European state can be held accountable for not adequately addressing this global problem. On 20 November 2013, the Dutch NGO Urgenda25 and 886 citizens summoned the Dutch state to hold the Netherlands accountable for its role in dangerous global climate change. The aim of the measure is to obtain an injunction obliging the Dutch state to take measures to reduce greenhouse gas emissions before 2020. Cox is counsel for the plaintiffs. In that case, it sets out the arguments put forward against the Netherlands State.

In particular, tort and duty of care and the principle of multiple or proportionate liability as applied in Dutch law are clarified. Cox argues that other European countries have taken similar approaches26 and that Urgenda`s claims could also be invoked against other European countries. On the link between climate change and human rights, Cox explains: “According to the United Nations Human Rights Council (Resolution 10/4 of 2009), the threat of climate change, and in particular climate change above 2 degrees, poses a threat to human rights in the world, in particular the right to life and the right to health. Carroll`s four-part definition of CSR was originally as follows: Corporate social responsibility encompasses the economic, legal, ethical, and discretionary (philanthropic) expectations that society places on organizations at any given time. This set of four responsibilities creates a foundation or infrastructure that helps to delineate in detail and define or characterize the nature of companies` responsibilities to the society to which they belong. In the first research study with all four categories, it was found that the substantial validity of the design and instrument that evaluated it was valid. The study found that experts were able to distinguish between the four components. In addition, the factor analysis concluded that there are four empirically interdependent but conceptually independent components of corporate social responsibility. This study also found that the relative values or weights of each component, as implicitly represented by Carroll, roughly matched the relative degree of importance that the 241 executives surveyed attached to the four components – economic = 3.5; legal = 2.54; ethics = 2.22; and discretionary/philanthropic = 1.30. Subsequent research confirmed that Aupperle`s instrument for measuring CSR using Carroll`s four categories was valid and useful.

In short, the specificity and usefulness of the four categories of research have been demonstrated by a number of empirical research projects. Here is a brief overview of each of the four CSR categories. Before Carroll, definitions of CSR varied. Some were vague, saying companies should simply consider their impact on society. Others were more focused and explicit about a company`s legal and ethical position. Finally, corporate social responsibility initiatives inherently require leaders to examine practices related to hiring and managing employees, sourcing products or components, and creating value for customers. Each of the four components of accountability addresses different stakeholders with respect to different priorities that may impact stakeholders. Economic responsibility has the most dramatic impact on shareholders and employees, because if the company is not financially viable, both groups will be significantly affected. While legal responsibilities to owners are important, in today`s litigious society, the risk of litigation against businesses most often comes from employees and consumer stakeholders. Ethical responsibilities affect all stakeholders.

Shareholder lawsuits are a growing category. When looking at the ethical issues facing companies today, they typically involve employees, customers, and the environment. Finally, philanthropic responsibilities affect the community and non-profit organizations the most, but also employees, as some research has concluded that the morale and commitment of a company`s employees are significantly related to its philanthropic commitment. Companies that do not meet minimum legal requirements face costly lawsuits and damaged branding. Environmental responsibility refers to the belief that organizations should behave as environmentally friendly as possible. It is one of the most common forms of corporate social responsibility. Some companies use the term “environmental stewardship” to refer to such initiatives. Archie Carroll`s Corporate Social Responsibility (CSR) pyramid is a model increasingly used to define corporate social responsibility. Since then, dozens of definitions of corporate social responsibility have emerged. In a study published in 2006, Dahlsrud identified and analyzed 37 different definitions of CSR, and his study did not cover them all (Dahlsrud 2006).

Corporate social responsibility initiatives, for example, can be a powerful marketing tool that helps a company position itself favorably in the eyes of consumers, investors and regulators. CSR initiatives can also improve employee engagement and satisfaction – important measures that help retain employees. Such initiatives can even attract potential employees who have strong personal beliefs that align with those of the organization. Ethical responsibility is about ensuring that an organization operates fairly and ethically.

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