Post on 04-Jun-2018
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Mainstream Corporate Social
Responsibility: Developing Markets
for Virtue
By
Darshan Mehta 10P211
Mohit Bajaj 10P212Ashwin Nair 10P213
Nidhi Bhartia 10P214
Nikhil Gupta 10P215
Nisheet Pandey 10P216
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Defining CSR and Mainstream
Corporate Social Responsibility Internal initiatives and policies and
processes that ensures company is
responsible and ethical
External initative to contribute to andimprove the community in which the
organization operates
Impact of both internal and external
initiative on the society
Corporate Social
Responsibility
Law
Commitments
CSR is understood to be the way firms integrate their social, environmental, and
economic concerns into their values, culture, decision making, strategy and
operations in a transparent and accountable manner and thereby establish better
practices within the firms, create wealth and improve society
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Mainstream Seen to be on companys agenda in a legitimate, credible and ongoing
manner
Incorporated in companys day to day activity
Coupled in a way that affects day to day activity of the company
Defining CSR and Mainstream
Coupled(Well funded, Highly
visible, firms identity)
Decoupled
(Short term, easilyterminated, not diffused
in other aspects)
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CSR Literature
Management of CSR initiatives from 2 perspectives
Different views on CSR Milton Friedmanserved - Maximize wealth
Enterprise dependent and accountable to stakeholders
Firms go through different stages of CSR: Elementary, transformational, value-led programs
Focused on how customers respond to CSR at individual level
CSR have positive effect on consumer's attitude
Research emanating fromMarketing
Whether the firm should engage in CSR and its effect on financialbottom line
Positive relationship between CSR and profitability
Jantzi Social Index
Research emanating fromManagement Literature
Underlying assumption: There exists single, preferred way of developing and managing CSR
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Vogels Conceptualization CSR activity as a function of an externalmarket for virtue
Markets vary in their demand for CSR: Socially
conscious market& Social Economic Market
Firms may vary in their inclination towards
CSR performance: CSR sensitive suppliers &
Business as Usual Suppliers
Existence of Heterogeneity in market demand
and supply
Society has created varying demand for
business virtue & firms have responded,
rewarded accordingly
CSR Literature
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Methods Try to understand internal dynamics of org. through
managers (key informants) perceptions
97 elite interviews in two stages
Objectiveto understand interactions, processes, perceptions,beliefs and values that may be tacit
Try to evaluate decision makers understanding of the
phenomenon Semi structured, using broad questions as prompts
Stage 1
69 interviews with managers participating in a social alliance
11 alliances; 26 organizations (companies, non-profits,consultants) from North America
Questions about how partnership started, evolved, selection ofpartners, goals, challenges, and day-day workings, benefits, and
learning
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Methods (contd.) Stage 2
29 interviews to assess if conclusions from initial study
were supported and could be extended to a broad conceptualization of
CSR
Applicable outside North America
Questions about mainstreaming of CSR, reasons for starting,
evolution of CSR, challenges, factors for success, future of CSR
Also culture, process, and ways of thinking about CSR
3 authors analyze3d data using standard qualitative methods
Limitations
Qualitative research; subjectivity may be a matter of concern
Used an iterative process to agree upon commonality of themes
and perspectives
Use of multiple viewpoints within the same organization
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Findings Companies use 3 different frames/orientations towards CSR
BusinessCase Model
Social ValuesLed Model
Syncretic Stewardship model
Social Responsibility broadly framed to simultaneously serve multiple
stakeholders
Different orientations represent different perceptions of
External Market for Virtue
Internal Market for Virtue
Extent and manner in which CSR actions are encouraged and rewarded
within organization
Propensity of employees to deliver on CSR initiatives
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The Business Case Model
s
Lack of corporate social policy entrepreneurs
CSR Investment has to drive business results
Mainstreaming CSR means pursuing viable business opportunities with a CSRangle
Clear cut CSR standards so that socially conscious customer has unambiguousdecision criteria
CSR does not raise the consumers price dramatically
Companys core competency gets leveraged
Three characteristics of the business case
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Social Values Led Model
CSR is defined around a particular social issue
Non economic criteria and stakeholders associated
with them are considered important
Corporate social policy entrepreneurs placeemphasis on social and environmental bottom-lines
The primary challenge is to establish theauthenticity of its business purpose and goals
Evangelical zeal and a propensity for action characterize this moel
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Syncretic Stewardship
For business case and social values-led firms, incentivescan be developed that
encourage them to gravitate toward the Syncretic Stewardship orientation,
which may well represent the most sustainable dimension of CSR.
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SPICE (Society, Partner, Investor, Customer, Employee)
S
I,E
C,P
S PICE PICE S
Social Model Syncretic Model Business Case Model
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Internal Market for Virtue
Id never work for a company with CSR before.Now I wouldnt work for
a Company without CSR.
Bake in CSR
Demand and Supply of CSR Behavior
(from Case)
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Billionaire Shiv Nadar takes the brightest children from the poorest villages
of rural India and sends them to boarding school.
VidyaGyan - Nadar's philanthropic vision.
Investment- $400 million -Using his HCLdividends, proceeds from stock sales andinvestment gains.
another $600 million in next 5-7 Years
Nadar will join an elite group of tycoonsworldwide who have donated at least $1billion over their lifetimes
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CSR: From philanthropy to commercial interest ?
CSR today is basically linked to the broader issue of Corporate Governance and Strategy
A company entering a new market, for instance, will regard CSR as an image-building strategyin its bid to minimize the risk associated with investing in a geography or product line
Companies that are fairly well established, but for whom long-term sustainability of business is
the prime objective - ITC e-Choupal
Another school of corporate thought dwells on all stakeholders of the company shareholders,employees, customers, vendors, social organizations, regulators and the communities in whichit operates- TATA
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Degree to which organizational members use norms, rules or procedures to alleviate unpredictability
Business Case firms
Highest on uncertaintyavoidance
Planned extensively, hadto produce quarterlyresults
Followed well established
routines
Social Values led firms
The lowest on uncertaintyavoidance
Founders of the firmsmoved forward with astrong sense of missionnot understanding how toaccomplish it
Syncretic stewards
low on uncertaintyavoidance
Understood the possibilityof conflicting duties andproblems
Relied on negotiations
and creative approachesto problem solving
Business Case firms
These firms put profitsand timelines beforepeople
Social Values led firms
High on humanorientation
Focus on people and theirquality of life high
Syncretic stewards
High on humanorientation
Focus on people and theirquality of life high
Uncertainty avoidance
Humane orientation
Degree to which organization rewards individuals for being fair, altruistic and caring. It can be
judged by how the firm treats its employees, external stakeholders
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Degree to which individuals are confrontational or aggressive in their relationships
Business Case firms
High on assertiveness Highly confrontational
and competitiveinternally, pitting onegroup against the other
Social Values led firms
Highly assertive when itcame to making decisionsabout their focal issue,but were less aggressivein their approach
Syncretic stewards
Mixed and nuanced onassertiveness
Were less assertive whiledealing with stakeholdersbut more assertive withthe press or industrytrade groups
Business Case firms
low on future orientationand more short term intheir CSR planning
They need to be flexibleand adapt to changingmarket conditions quickly
Social Values led firms
Mid-range in futureorientation
Clearly understood theirlong term challenge ofdealing with a majorsocial issue
But often focused on
what could be done today
Syncretic stewards
highest in futureorientation
Saw the importance ofstakeholder engagementas a route to long-termlegitimacy and viability
Assertiveness
Future orientation
Degree to which organization encourages its members to plan for the future versus the present