Coporate Social Responsibility

merged cordial duty (CSR) Chapter 1 Introduction merged favorable Responsibility is a rapidly maturation, key problem wages. It is a apprehension that has attracted institutionwide assist. ref eonble to the demands for enhanced transp atomic result 18ncy and bodily citizenship, CSR started to embrace genial, ethical as s puff up as environsal ch t egress ensembleenges. Today, companies argon aw ar of the tender and environsal impacts of tabooside(a) production. It is accepted that Companies should non be only profitable, except as well as cracking integrated citizens.Through sphericalization of the economy, transnational companies ar increasingly involved with suppliers and customers realnesswide, peculiarly if they operate in evolution countries. The CSR schedule has a close valet de chambre relationship with international phylogenesis. CSR within international companies is seen as a vehicle through which larger, salutary cognize corporations passel contri b arlye to the well being of ontogeny countries by operate responsibly in terms of approachible and environmental issues. save, the promoted CSR in the ontogeny world by internationals is not real CSR, disrespect signifi corporationt contri exclusivelyion to learning in near show windows.Very critical is cognize close the companies CSR policies and comes in an international context, exploitation countries in particular. As human beingkind shows, near of the larger corporations ab wont the CSR and be poor boystantiate unethic onlyy and irresponsibly towards almost(prenominal) companionship and the environment. Issues much(prenominal) as unsafe scoreing conditions, unfair payment, sexual activity inequality, sexual harassment, toxic emissions and the hazardous pollution of water and soil strike all elevated fair allegations by consumers, non-goernmental organizations and the larger society. Famous orbicular brand names manage Nike, Coca-Cola, GAP and McDonalds are often under intense twinge from the state- reinforcered. Much of those pressures are referable to their unethical demeanour in growth countries, where their main operations scram turn up. Though companies operate in force countries, their account extends crossways numerous national boundaries. The actions of multinational companies in a host verdant crumb dress signifi derrieret loss of reputation in the genuine world, where the general public invite bring to a big(p)er extent sensitive to environmental issues and well-disposed impact.The public have the power to ostracise the goods and products of multinational corporations in baptistrys of unethical doings where organisations are thought not to fulfil their social and environmental obligations. However, international reputation side effects are not the only reason behind the potential increase level of social and environmental responsibilities faced by multinational companies at that home are much than drivers for the correct executing of CSR by dividing line entities. However, for m either companies, somatic reputation and brand image are the fundamental components of crease success. integrated neighborly Responsibility in develop countries represents the melodic phraseal and informal shipway in which multinational blood enterprises contri more everyplacee to improving the social, ethical and environmental conditions of the under essential countries in which they operate. However, the sage approach to the CSR in the growth world is diametrical from CSR in developed countries. For example, create countries represent the on liberation growth of the economy hence the most attractive growth grocery stores for m any un feeln companies.They try cheap aim, an absence of strong regulations and a rich availableness of re artificial lakes all life-or-death concerns for multinational enterprises for conducting their worryes in developing world. It has been found that the public and the g all overnment are not as critical of unethical clientele approach patterns within foreign companies. In step-up, developing countries are where globalization, economic growth, investments and business activities are deally to have both optimistic and negative social and environmental impacts. beca pulmonary tuberculosis, developing countries represent a assorted set of CSR agenda for multinational companies to those in operation(p) in the developed world. In this question overbold(a)spaper publisher the CSR practices of multinational corporations impart be examined. Their CSR payload as well as ircredit worth(predicate)y practices entrust be senior broad(prenominal) schoollighted. In the first chapter, there offer up be overview on the previous usages in this field. As CSR is a hot concept, especially in developing countries, the short history of the culture of CSR and main contributions get protrude be pres ented.Literature reexamination willing give us the background experience active CSR. In chapter two, interrogation methodological analysis and relating this to the airfield matter will be discussed. As research will be establishd on reason shoot, there will be whatsoever examples of multinational corporations experience in developing countries. The examples of their commitments towards environmental and social sustain skill as well as negative impacts ca employ by their unethical operations will be provided. The opinions and critics of analysts and experts will provide a bear nderstanding of companies CSR practices in the developing world. The well kn protest multinational companies like go up, Nike, KFC, apple iPod and many others will be examined for their ir obligated and unethical behaviour in developing countries much(prenominal) as China, Indonesia, India, Southeast Asia and Africa. For the main research point the Coca-Cola crisis in India has been chosen, as Coc a-cola, patronage its CSR commitment towards society and environment, has ca expenditured damages to both the community and environment where it operates.From the miscue film, we are able to make some conclusions counting CSR practices and make suggestions and recommendations for future tense of Corporate Social Responsibility, as it will undoubtedly increasingly become a major issue and integral part of business practise. Chapter 2 Literature review The 21st Century has seen much advancement in the issue of incorporate social office (CSR), and there has been particular liaison in the impact CSR could have globally. This publications review will gravel by defining what is meant by corporate social certificate of indebtedness. in that location are a lot of debates about the origins of CSR hitherto it is clear that CSR is a modern term, a consequence arising from the history of business province. The modern term is considered to have westbound origin however it has devel oped from divers(prenominal) countries inclinations and theories. This has created a number of definitions of CSR. This first baselife lead to confusion devising CSR less effective. It is rice beering to observe that none of the definitions actually defines the social responsibility of businesses, as so famously discussed by Milton Friedman (1970), but rather describe it as a phenomenon.The Government sees CSR as a business contribution to sustainable development. However, the modern concept of CSR has been influenced by world(a)ization and so CSR has developed and is throngn in different context worldwide. (Crane, Matten, Spence, 2008). In addition, organizations much(prenominal)(prenominal) as the European Union (EU) see CSR as a concept integrating social and environmental concerns in business operations and in their interactions with their s needholders on a voluntary basis.However, others like honourableity in Action Awards (2003), describe CSR as a corporations obl igation to be accountable to all of its stakeholders in all operations and activities (Dahlsrud, 2006). There are a number of debates raised in academic literature over the issue of to whom the business must have responsibility. Various authors have referred to the putting surface approaches shareholder, stakeholder and social approaches. consort to shareholder approach, the classical view on CSR maximize the profits of shareholders (Friedman, 1962).This approach piece of tail similarly be interpreted as being that the company should make contributions to the extent, to which it can be connected with the grounding of vast value for the shareholders (Foley, 2000). From the stakeholder theory, it is obvious that organisations should be accountable towards other groups of stakeholders, who can put on or be affected by a companys objectives (Freeman, 1984). The perish approach, which is regarded to give the broader view on CSR, argues that the organisations should be pruden t to societies as a whole, of which they are an integral part.The aspiration of the following literature review is to chance upon the most valuable academic studies and important practical investigations. The field of Corporate Social Responsibility can be divided into some(prenominal)(prenominal) split definitions of CSR, analysis of CSR approaches, CSR in run cooking stove, CSR in developed countries as well as in developing ones, the physical contact between CSR and globalization and last, but not least(prenominal) the global understanding of CSR. The history of CSR The development concept of Corporate Social Responsibility (CSR) has been carried out mainly in westerly countries particularly in United States.Literature picks up the issue from the 1950s when attention was devoted to the responsibility of businessmen ( Bowen, 1953) to the 1980s when the argument with stakeholder theory took place (Freeman, 1984) and of course, to the 1990s when most studies were devoted t o the analysis of the relationship between CSR and corporate financial performance (Roman et al, 1999). In the beginning of the 1950s, Howard Bowen tried to give rational and systematic arguments in favour of CSR and its connection with big corporations and their influence on social consequences and undoubtedly, their primary societal responsibilities.The one of the earliest books on CSR, The Social Responsibilities of the Businessman, was written by Bowen in 1953. Bowens book was ad hocally relate with the doctrine of social responsibility. Bowen argued that social responsibility is not panacea for all business social problems, but that it contains an important truth that must steer business in the future (Asongu, 2007). Be urinate of Bowens early and very valuable formulate, Carroll has argued that Howard Bowen should be called the Father of Corporate Social Responsibility (Carroll, 2000).The decade of the 1960s is characterized as seeing a growing pastime in the formalizing or more(prenominal) precisely, defining the substance of CSR. One of the prominent writers in this period was Keith Davis, who ulterior extensively wrote about the topic in his business and society textbooks, later revisions and articles. He argued that social responsibility is a nebulous idea, but should be seen in a managerial context (Mahon, 1991). Another influential contributor to the early research into CSR was Friedman. The argument make by Friedman (1962) that the main corporations responsibility is toward shareholders has created much debate among academics.It was not until 1970, that Wallich and McGowan first made attempts to demonstrate the link between corporations social responsibility and shareholders interests. They argued that the aim of corporations long-term interest should be linked to the environment to which a corporation belongs. If society and environment became worse, a business would lose their critical give structure and customer base (Keim, 1978). I n the 1970s there are a wide vomit up of calculates, increasingly being made to corporate social responsiveness, corporate social performance as well as corporate social responsibility.In the 90s, literature tried to find out answers to questions such(prenominal)(prenominal) as why some companies are doing well and if CSR could be identified as a matched advantage. Most academics and scholars started to apply the stakeholder theory to CSR, because stakeholders, other than shareholders have interest in the well-being of a company in relation to employees, customers, governments and others. This model regenerate the interest in CSR and more research was devoted to this subject.Also, there is great interest in the linkage between CSR and corporate warlikeness but bbbthere is a shortcoming of quantitative translation of socially responsible practices into specific results affecting the income and loss of particular organization (Murillo and Lozano, 2006). Many scholars connect CSR with the competitive advantage that a company can imbibe. The most well- cognize engage in this field is Professor Michel Porters The competitive advantage of corporate benevolence in which he describes how a company is able to improve its long-term potential by linking financial and societal goals (Porter, 003). Further development in this area was made by Kramer (2003). Problems with CSR research We know very little about CSR initiatives and undoubtedly, there are some questions about both the cogency of CSR approaches and the tangible benefits for stakeholder groups. Also, we know very little about the social and environmental impacts of CSR initiatives. For example, many business schools study and devoted their works to analyze the contented of codes of conduct. They looked at specific issues such as child bray, but they poop outed to bring the wider societal impacts of CSR.The most notable analyze about societal impacts came from development see scholars, not from b usiness schools. The psychoanalyse by Barrientos and Smiths (2007) reviled that there are, in particular in those countries where empirical investigation took place such as South Africa, India, Vietnam and Costa Rica, some benefits from codes of conduct and initiatives go foring CSR by multinational companies. However there are failures in the areas of noncompliance and ensuring the improvement of operative(a) conditions.In addition to this, Barrientos and Smiths questioned the methods used by the business communities in investigating the societal impacts of CSR, wondering(a) the efficiency of the tools used to monitor CSR performance. Due to the lack of empirical fill and evidence regarding CSR impacts, there are tranquilize analytical limitations in the die hard CSR field. For example, some academics (Lantos, 2001) wrote about conceptualization of CSR, however, current field of CSR and business scholars fail to answer vital questions.For example, how can CSR tackle a dev elopment dispute like poverty, without an understanding of the negative influence caused by multinational companies operating in host communities? Even if there is agreement about societal benefits of CSR initiatives, there is inactive uncertainty about the way in which CSR should be studied and analyzed. Lockett, Moon and Wisser (2006) argued that CSR knowledge should be best described as a continuing state of emergence. Indeed, many scholars study CSR initiatives without any reference to theoretical perspectives.Milton Friedman and other authors highlighted the agency problem of CSR for a long period. For example, Friedman argued that the sake of societal and environmental objectives will undoubtedly hurt shareholders by sinister profits. However, other scholars like Margolis and Walsh (2003) oppose the arguments of Friedman. They found that, between 1972 and 2002, at least 172 empirical studies investigated the positive relationship between social responsible behaviour of an organization and its financial performance. Levels of CSRAnother main contribution to the development of CSR made by Carroll (1991), considered the economic, heavy, ethical and philanthropic levels of CSR. These levels represent what is required, expected and desired for CSR strategies (Crane, Matten, Spence, 2008). According to Crane, Matten and Spence, Carrolls profit of CSR is the most widely accepted definition of CSR. Until the 1980s, environmental corporate responsibility was the part of social responsibility, which was used as a clay term that cut acrossed a wide field of ideas. However, corporations became to understand the grandeur of environmental responsibility.For this reason, the concept of corporate environmental responsibility has started to be used by researchers such as Rondinelli and Berry (2000) in parallel with the development of corporate social responsibility by Carroll (1998), Maignan and Ferrel (2000) and Zarkada-Fraser (2004). CSR and Corporate Socia l reportage The great number of scholars, who have since the 1970s (Fenn, Ackerman,), analyzed the complex issue of Corporate Social Responsibility and the advantage of reporting on a wider subdue, have given the possibility to evaluate social performance (Levis, 2006).The rootage of social reporting has been developed along with the CSR. The approach for researching reporting is different in comparison with past decades due to the growing number of organizations that have print a social report. (Belal, 2002 Bitcha, 2003 Weaver et al, 1999). The reason for the growing interest in this field is linked to progress in business morals (Donaldson, 1999) and the probative greatness of the stakeholder approach, which has led to an increase of interest in studying the causes and real meaning of the phenomenon.The present approach to social reporting activities can be divided into two parts fists, those who fluid think that it is a responsiveness approach and others, who argue that it is much more than communication it is a tool of strategic focussing. Research in CSR worldwide Cultural differences affect CSR dynamics as well as companies practising responsible behaviour. For instance, research by Juholin (2004) reviled that long-term profitability is the prominent driving force behind CSR in Finland. Research by Fulop et al. (2000) discovered differences in CSR orientations between large and gloomy firms.A similar study by Uhlaner et al. (2004) suggests a mixture of CSR perspectives (economic benefits, legal, ethical and philanthropic considerations) as useful in explaining variations in CSR orientations amongst Dutch firms. Despite cross-cultural and national differences, there are differences in the variety of methodologies adopted in examining and analyzing CSR. Some studies considered CSR as a philanthropic and ethical responsibility however other studies have made a distinction between CSR as simple legal compliance vs. CSR as conducting business with h igh regard for morality.As noted previously, the debate about CSR has existed since the 1950s. In the first academic papers, a narrow concept of corporate social responsibility was used. Most of the authors like Bragdon and Marlin (1972) and Spicer (1975), tried to approach CSR through the main social and environmental problems such as pollution and contributions to the local community. The selective information used for their analysis was ground on information issued by the Council on Economic Priorities. However they were not able to cover the whole aspects of CSR and their works were not valid for either industry (Dooley, 2004).Later, a broader valuation and examination was provided by Moskowitz (1972, 1975). In his work he tried to cover almost both aspect of corporate social responsibility such as equal example opportunities, compassionate contributions, fair dealing with customers, product quality and more. CSR in developing world Despite the great interest in ethical and responsible behaviour in business, very little is known of the practise of CSR in developing countries. For example, Belal (2001) notes that there are a wide range of academic publications, describing CSR in the context of developed countries such as Western Europe, the USA and Australia.Also that we still know too little about practices of corporate responsibility in ex-colonial, smaller and developing countries. He suggests doing more research into developing countries as it will give a valuable insight to the Hesperian meaning of CSR in context (Jamali, 2007). There are no large scale developmental studies of CSR in developing countries as there are in western countries. However, the CSR discussion traditionally revolved around the multinational companies operating in developing countries. The multinational companies response to CSR has great impact on the future global CSR agenda.The first notions of corporate social responsibility in developing countries emerged in the 1960s amongst American companies operating in developing countries, particularly in Asia and Africa. Perhaps a simple definition, truly reflecting the responsible behaviour of current multinational companies operating in developing countries is presented by Davies, who suggested CSR as a framework for the role of business in society. The intimation of this definition is that it includes any society in which the company operates, including the global society (Engle, 2006).Within the Asian context, most academics paid attention to describing the governance aspects of environmental responsibility (Hong Kong Hills and Welford China Bi The Philippines Forsyth). In contrast, in India, Mohan has focused on social responsibilities and corporate citizenships. Also, there is some research into the normative aspects of CSR such as the evolution of business ethics in Taiwanese companies (Wu). In the study of CSR in Malaysia, Teoh and Thong found that the most foreign multinational companies seemed more inclined to accept their responsibilities towards environment and society (Chapple, 2005).CSR in the Global background CSR and multinational corporations. Relatively little is known about management of corporate social responsibility by multinational companies (Gnyawali, 1996). In general, little is known about the management of CSR in multinational companies, either practically or academically. While many areas of research have examined the nature of cultural or business preference to social equality (Adler, 1997 George and Jones, 2002 Lantos, 2002), there has previously been no research regarding the role of CSR in the expansion of organizations into new territories or cultures.The prevailing theoretical approach to studying CSR practices among multinational companies, operating in developing countries, is the works of Bartlett and Ghoshal (1989) and Prahalad and Doz (1987), who tried to analyze general multinational companies management practices in CSR. This framework was consequently extended by Yip (1992) and Husted and every(prenominal)en (2006) to cover CSR practices (Geppert et al. , 2006). The studies of these researchers enabled interesting insights such as how CSR is being managed, the potential barriers to successful instruction execution of CSR practices within domestic places into operation among multinational corporations.However, mainstream research of CSR was concentrated particularly on domestic issues such as working class issues, racial discrimination, the coif of women and the environment. To date there has been limited analysis in the developing countries context, in particular regarding foreign multinational companies. Further detailed analysis is postulate of what instrumental, moral and relational motives exist in systems very different to the western context in which they were developed. CSR and Globalization With Globalization, CSR has been propelled into a global context.Ruggie (2004) identified trinity particular asp ects of social responsibility in the context of global governance. Firstly, forthwith it is expected that multinational companies will build new capacities and take care of issues such as workings conditions, healthcare and education as well as respect human rights. So that, if corporations insist on setting up in developing countries, they are forced to consider challenges, unremarkably associated with developing countries like poverty or child labour. Nowadays, most multinational companies face a lot of new and challenging problems in this era of Globalization.According to Weber, Lawrence and Post, multinational companies are able to solve such problems. They have introduced the idea of Three sector world, com vivid multinational companies, non governmental organizations and community. In their research, they compared both strengths and weaknesses of each sector and analyzed their contributions to solving global problems. The research method was based on comparing attempts o f two multinational companies in implementing CSR in developing countries (Young, 2008).Based on their findings, it is obvious that a collaborative league with community and non governmental organizations can carry better results in implementing CSR. Therefore CSR in the global context involves more than business implementation, it needs business cooperation with other organizations whose focus is greater on CSR. From the vast majority of literature, it is clear that CSR has gained major significance in the era of Globalization and multinational companies should take responsibilities for their actions worldwide, especially in developing countries.Multinational corporations should behave as a moral leader in an area where there are no legal requirements (Scherer and Smid, 2000). CSR is considered a Western idea, which has now to be applied to problems in the developing world (Scherer and Smid, 2000). The literature review is an account of what has been promulgated on corporate socia l responsibility it acknowledges the critical points highlighted by scholars and researchers. The literature review conveys what knowledge and ideas have been established on corporate social responsibility and it enables elevate research to compare and contrast these ideas in put up to create new theories.Therefore a literature review provides the basis for the analytical framework of this research (Bryman, 2004). It has in addition helped with the interpretation of the results and has led to other questions being asked. The literature review also highlighted that there had been little research carried out on the societal impacts of CSR and implementation of CSR by multinational companies in developing world. This gives further importance and emphasis to the analysis of literature in giving rise to new questions and theories.The literature review has provided the framework of following deep research about corporate social responsibility of multinational companies in developing c ountries, in particular the problems and benefits of implementing of CSR and the role of huge corporations in this issue. The literature review has helped to station key themes within CSR by multinationals and from this more questions have evolved. Chapter 3 methodological analysis In this research paper the case study was employed as the research dodging.Usually descriptive or exploratory research is associated with the case study, and this nix be particularly useful when the phenomenon under investigation is difficult to study outside its natural setting. Using case study research methodology is also helpful when the concepts and variables need to be considered where experimental or check into methods are regarded to be inappropriate (Yin, 1994). Case study is used particularly in looking at the specific questions such as how and why that is set in the contemporary environment (Yin, 1989) Case study methodology has a lot of advantages over some other methodologies.First, it allows the use of duplex information accrual techniques in state to build a more comprehensive picture of the case being investigated. Second, this in turn leads to the ability to capture both qualitative and quantitative data. Case studies can provide a solid understanding required for hypothesis development that then leads to improved theory development. The main advantage of case based research is that results are considered to be interesting and important and can shift the focus of investigation towards a new area of interest (Scapens, 1990).The case study is usually considered more accurate, diverse and rich, if it is based on several sources of data (Alasuutari, 2000). Advantages of using secondary winding data for research purposes As the research is have-to doe with with multinational companies operating internationally, secondary data will probably provide the main source of necessary information. As our research strategy is case study, it is better to use compiled da ta that have already been sorted or summarised (Kervin, 1999).Secondary data can be obtained from different sources aimed at the same geographical area, where our case study takes place such as the Coca-Colas crisis in India. Area-based twofold sources of data are usually easily available in different forms, especially in published forms. Also tracking the original source of secondary data is much easier, especially when time restrictions are severe. As it will be a case study, it is even preferable to use newspapers, journals and media on a regular basis, as they may provide novel events within the business world. Research will concern the specific country i. . India, data from government sources are also useful due to their high quality. Because of time constraints, secondary data can be obtained very quickly, in addition they have better quality standards in comparison with stack away own data (Stewart and Kamins, 1993). Using secondary data within collection also has a wide range of benefits, as they have already been collected and analyzed (Cowton, 1998). Unlike the data collected by myself, secondary data are permanently available and easily accessible, so that it can be checked relatively easily to others (Denscombe, 1998).Problems with collecting primary data for research purposes Access for some primary data can be problematic and difficult. Therefore it is unlikely that gaining permission for physical access will be easy and will be time consuming. As an wonder is way for collecting primary data, however it is difficult to seek access to a range of participants such as employees, suppliers, customers and other stakeholder groups. The main cause might be restricted access to companys data either nowadays or indirectly (Bunchanan et. al. , 1998 Raimond, 1993).As a full time master student, you are not able to have prior contact with huge multinational companies and you will be required to negotiate in severalise to gain any access to each level of information. Also, the major obstacle in obtaining primary data is time constrains. There is not sufficient time for all methods of collecting primary data, as physical access may take weeks or even months (Bunchanan et. al. , 1998). Even, if there are time allowances, null can guarantee that replies will be quick and contain all necessary information.In case of opportunities for conducting interviews, undertaking questionnaires or engaging in observation, unfortunately, this would take several weeks. Whichever method will be chosen, almost all methods for meeting primary data are very time consuming (Bryman, 1988). However, due to the growing significance of the topic, many researchers have used primary data to conduct research. They collected primary data through interviews, observation and questionnaires. There are some examples of case study based research approaches.The implementation of CSR in developing countries was examined by Christina L. Anderson and Rebecca L. Bien iaszewska in the paper The Role of Corporate Social Responsibility in Oil Companys Expansion into New Territories. The aims of the study were to analyse the role of CSR in British Petroleums overall business strategy and to examin the benefits of employing CSR as a part of business strategy when it was operating in new territories and cultures. The case study approach was conducted through providing interviews with representatives from BP, social auditing and story specialists.Recent company reports and website information were also examined. Another example came from Richard Welford and Stephen Frosts research that provides an overview of CSR practices in Asia. The aim of the research paper is to review the benefits of the implementation of CSR in allow for chains and arising obstacles. In order to collect data for research purposes, interviews were undertaken with hexad CSR managers working for well-known brand corporations, ten factory managers and eight CSR experts. Interview s were held confidentiality and anonymously.All participants have extensive experience of CSR issues and provide a good overview of the challenges for CSR by multinational companies in Asia. The case study based approach showed that multinational corporations such as Gap, Nike, Reebok, operating in Asia, are still continuing to be criticized because they were not 100% perfect, failing in proper implementation of CSR as well as monitoring. Another example of a research case study came from Ian Harwood and Stuart Humby from the University of Southampton in their research paper Embedding corporate responsibility into supply A snapshot of progress.Their research adopts a case study methodology, with specific focus on an exploratory cross-case analysis. Along with the revising literature review, methods included nine semi-structured interviews (1. 5 hours each), followed by conversations with different public and nonpublic organisations, which concerned CSR issues as well as dialogues with other universities working in the field of corporate responsibility both locally and internationally. Some participants asked about anonymity and confidentiality. Consequently, ethical issues were considered during the process of gathering data.Nine companies were large enterprises, operating in multinational markets. The respondents were senior managers and managers in either procurement or CSR tie in roles. The aim of research was to identify the CSR practices in companies, the processes of implementing CSR in supply chain including the management of risk and performance management. Also, views on the problems for future development of CSR were analyzed. Corporate Social Responsibility became an important issue in the late twentieth century. However, there are still several large companies, behaving unethically within society.Many companies have punctuate that they govern their social responsibility and behaviour, but more often than not, this is only on paper. There are c ountless cases that can be examined for corporate social responsibility of multinational companies in developing countries. Ten well known companies were chosen, because all of them were criticised for corporate social irresponsibleness and failures in fulfilling their obligations towards society and environment. Reebok case I do not know that anybody has bought a pair of Reebok clothes because of its human rights programme.But we are a global corporation and we have an obligation to give back to the communities in which we live and work. -Doug Cahn, Director of gay Rights Programmes, Reebok international limited slashplay US-based Reebok International restrict (Reebok) is one of the leading footwear companies in the world. With over a hundred years of operations in the footwear industry, Reebok has operations in over 170 countries across the world, most of which in developing world (Reebok, 2009). Reebok has its own Corporate Social responsibility however Reebok joined the companies that were incriminate of human right issues.Reebok instituted a mandate of Conduct, also known as Reeboks Human Right Production (appendix 1) to regulate working conditions, especially in developing countries. However, despite measures and regulations taken by the company, the company still have several allegations against them concerning human rapes, for example in Chinese factories. Analysts mat that the measures taken by company were not appropriate and that Reebok should regulate this problem in order to enhance its image as a socially responsible company (Aaron, 1999). CSR of ReebokReebok established and become a member of Business for Social Responsibility they monitored human right abuse through audit and video tv camera facilities. They launched a project called Educational Assistance in Pakistan and Workers Communication governance in Indonesia in order to avoid working violence and conducted breeding programs for factories in developing countries. All these s initiatives helped the company improve its social image. Reeboks problems in China Like most of its competitors, Reebok has a wide range of sub-contractors in China due to low production costs.Independent research agencies reported violations occurred in most Chinese factories. They highlighted the ineffectiveness of Reeboks monitoring system. They revealed that wages were not paid according to laws, overtime wages were also profaned, women were not treated the right way and the absence of any workers unions. It was also found that children aged between 13 and 15 were being employed. In addition workers suffered not only mentally, but also physically due to the lack of any appropriate conditions at work and unsuitable accommodation (China Labour match, 2002).All of these issues deprived workers of their human rights. Criticisms Since such problems were identified, Reebok tried to take measures immediately. Through these measures Reebok attempted to solve the problems including f orced labour, low wages, child labour, physical and other types of abuse. However, many reports continued to be published showing human violence in factories. For example, China Labour Watch argued that in order to prevent human abuse, the actions were not sufficient and violations were still occurring (China Labour Watch, 2002).KFC (Kentucky Fried Chicken) case The moaner they serve is full of chemicals, and the birds are given hormones, antibiotics and arsenic chemicals to fatten them quickly -Nanjundaswamy, founder-leader of the Karnataka Rajya Ryota Sangha. Background By 2004, KFC emerged as one of the worlds most popular chicken restaurant chains. With more than 11,000 restaurants in nearly 80 countries, KFC served nearly eight million customers worldwide every day (KFC, 2009). KFC in India KFC is one of the multinational companies entering the Indian market.However, a lot of economists and nutritionists opposed and criticised KFC for many reasons. They argued that first it wa s threat to domestic business and a cultural invasion Secondly it would cause a high rate of obesity, heart disease and cancer due to the sodium and cholesterol contained in fast food. For example, the Municipal Food Inspector found out that some of KFCs chicken contained trey times more monosodium glutamate than regular chicken (Ray, 1995). For the first time, KFC was charge processing Junk food in a poor country like India, where malnutrition problems are severe.PETA (People for Ethical Treatment of Animals) incriminate KFC of reprehensiblety to chickens and not providing care for the birds in its factories despite the fact that KFC has published standards to guarantee humane treatment for its birds. PETA also said that because of such cruel attitudes towards living creatures, KFC must not enter India (Ecologist, 1995). As Pankaj Batra, director of Indian sub -continent pointed out that KFC was obligated to require its suppliers to follow the welfare guidelines for proper an imal treatment (Thaiindian press, 2003).However, some opponents like the Indian Government tried to beg off KFC by saying that multinational companies like KFC would create more employment and improve infrastructure. Though, in reality as Nanjundaswamy argued, fast-food companies brought line of businesss only for a smattering of educated mass and the poorest people are left without job opportunities. away from the threat to local agriculture, there is another threat as mentioned by Nanjundaswamy. This is that the company gives chemicals and antibiotics to the chickens in order to fatten them quickly.He called the chicken chemically poisoned (Newindpress, 2003). Ecologists also participated in the activities against KFC. They claimed that opening new fast food outlets meant more bit like paper cups, bags and plastics on the streets. Wal-Mart case As one of the largest companies in the world, with an expanding global presence, environmental problems are our problems. -H. Lee S cott, prexy & chief executive officer, Wal-Mart Stores, Inc. We dont know whether Wal-Marts environmental changes are real or a Machiavellian attempt to green-wash a declining public image.But its long record of irresponsible behaviour forces one to be sceptical -Chris Kofinis, Communications Director, wakeupwalmart. com Background Wal-Mart, the worlds large retailer, operates in many developed countries as well as developing ones like China, Costa-Rica, Honduras and others. Its ultimate aim is being a fully environmentally sustainable business. The company think to use more renewable sources of energy, recycle waste, and sell more constitutional food in its store. However, analysts highlighted that Wal-Marts international operations had mixed results.There are a lot of criticisms from environmentalist, traders and even politicians. Wal-Mart was accused of violating environmental laws, indulging anti-trade union policies, paying(a) low wages, sourcing cheaper products from outsi de US and indulging in sex discrimination (Butler, 2006). Wal-Marts initiatives As a leading world retailer, Wal-Mart launched many programmes and initiatives in order to achieve its goal to be sustainable towards society and environment. They established sustainable value networks, started to sell organic food at prices that were lower in comparison with its competitors and formed health oriented programmes.Experts opinions Some critics saw Wal-Marts activities as a tool, an investment in its reputation rather than in sustainability. They felt that the sustainability measures were the tool to divert public criticisms such as environment abuse, violation of air and water pollution laws, which faced the company. They argued that company lacked its long-term commitment to the cause (Butler, 2006). However, in spite of some criticisms, some environmentalists were truly upbeat that Wal-Mart was going to become an environmentally sustainable entity.Also many analysts urged the company t o work toward better wages and healthcare benefits. Wal-Mart has to show the results on the ground in order to prove its commitment towards sustainability and continue with sustainability initiatives, if it wants to improve its image as a corporate socially responsible multinational enterprise (Roberts, 2006). cling to case As a responsible food company, I dont like to have an image that I am behaving unethically? Peter Braberk, CEO of hold close, 2003 Background Nestle is one of the largest multinationals, with over 200 factories worldwide.Nestle had been accused several times of selling genetically modified products without appropriate labelling, for supporting the use of child labour in some factories and for other reasons. Most of the controversies that Nestle was embodied have involved developing countries. Nestle in its corporate social standards, committed itself as a responsible, sustainable business entity, promising good working conditions, health, nutrition, and suppor t for the community. However, as reality shows, Nestle carried out socially irresponsible practices in most developing countries.Nestles social irresponsibleness Analysts argued that the main reason practicing corporate social irresponsibility by Nestle in the developing world was overlooked was because laws and procedures are considerably more lax compared to those in more developed countries. The company was criticized for its unethical practices such as using infant milk powder (which is harmful to health) in developing countries. By providing free samples, Nestle exerted itself as being socially responsible and doing it for the benefit of poor women in developing countries.Also, Nestle failed in providing good working conditions, as it had promised previously as well as child labour was employed on plantations (Megan, 2001). For example, UNICEF studies revealed that over 200,000 children worked on the plantations during the pull together of hot umber and coffee beans (Unicef , 2008). One of the more disturbing revelations was that most of the workers had been trafficked i. e. bought and sold, making them practically slave labour. Nestle purchased deep brown from these farms despite its awareness of the conditions of the labourers.Nestle was also accused of reselling products rejected in Europe to developing Asian countries (Sinha, 2000). Kimberly-Clark great deal case This is a company that claims to be a leader on the environment front. Unfortunately, when you dig into the claims, you come up with a very different story -Richard Brooks, a campaign coordinator at Greenpeace, 2006 Background Kimberly-Clark Corporation (K-C), the paper-based consumer case goods giant, take a top position in the Dow Jones Sustainability World major power (Faircompanies, 2008). K-C has a good history of CSR and takes a leadership position in corporate sustainability.However, it has faced a lot of criticisms from its stakeholders and in particular from environmental pro tection groups such as Greenpeace who alleged that the company used gross(a) fibre from forests or else of using recycled fibres (Baue, 2005). CSR of Kimberly-Clark Corporation As any multinational company Kimberly-Clark has policies protecting the environment such as development an environment plan from product design to disposal. The company also adopted energy conservation programs, churl Labour and Worker exploitation policies in most developing countries.In each report, K-C outlines its responsibilities as a good corporate citizen. K-C emphasized that sustainability and good environmental practices are keys to doing good business. Criticisms Despite many environmental initiatives, K-C had been accused of destroying ancient forests for manufacturing, using only 19% recycled material instead of 60% used by other companies (Greanpeace, 2008). For such attacks K-C defended itself by reason that they used virgin fibre only for producing facial tissues. There are some anomalies b etween that claim made by the company in its environmental reports and its actual record.It appeared that in reality, they used wood fibres from ecologically significant established areas, though the company previously considered it as protecting such environmentally significant areas (Ethical Consumer, 2007). Nike case Nike is being hypocritical in its support of childrens programs in public schools while exploiting child labour in its factories -The Canadian Catholic Organization for Development and Peace Background Nike is the one of the biggest sports shoe manufacturers, having suppliers around the world, mostly in developing countries.Nike repeatedly claimed that it was not going to tolerate worker maltreatment in its Asian factories. It had its own Code of Conduct and required its suppliers to obey on issues like wages and working conditions, written into the companys corporate standards. However, Nike did not show any real interest in manoeuvreing those issues. It was accuse d of unethical treatment of workers by supervisors, of payment that is beneath the legal minimum wage and sexual abuse of several egg-producing(prenominal) workers at Nike shoe factories. In addition, Nike did not take adequate health and safety measures and turned a blind eye to child labour.Nike violated overtime wages, night shift wages and weekend and holiday wages. Nike had been accused by Californias consumer law agency that it had mislead the public about working conditions for its Vietnamese, Chinese and Indonesian workers. For example, female workers in Vietnam were abused physically, verbally and sexually by factory managers (Vietnam Labour Watch Report, 1997). Nike response Nike, as a famous, well known, multinational corporation, denied that it employed unfair labour practices. In order to defend itself, Nike tried to convince the public that they operated in socially responsible manner.Nike showed videos of working practices in Indonesia, Thailand, China and Vietnam f actories. As Nikes manager said, they are a very open company and do not have anything to pass over from the public and community in which Nike operates (www. nike. com). But in spite its initiatives, Nike was not effective in monitoring and regulating. In reality Despite Nikes claims about sustainability, Nike workers were still paid wages that were below that legal minimum. As Leila Salazar, Global Exchanges corporate accountability director said, Nike still abuses workers right like harassment, violence, long overtime hours and others (Richman, 2001).Analysts said that in spite of its good image in the USA, Nike was a very different company in Asian countries (Herbert, 1997). According to Patrick Coughlin, one of the lawyers, fighting against Nike, argued that Nike has to either disclose its attitudes towards workers or change working conditions (Josh, 2001) Apple iPod case Apple has a zero tolerance polity of any instance, isolated or not, of any treatment of workers that coul d be interpreted as harsh -International Herald Tribune (IHT, 2006) BackgroundApple is the worlds leading multinational enterprise, producing and selling electronic products such as computers, software and other electronic equipment. As any large corporation, Apple has its own manufacturers in China and as practice shows, Apple has received a lot of criticisms from civil society organizations regarding body of work standards. Criticisms on iPod in China Despite the fact that Apple was nerve-wracking to ensure that its working standards were implemented in all factories, there is still evidence about working hours, payment and other workplace issues including the use of hazardous chemicals.The Mail on Sunday in June 2006 alleged that iPods were made in poor working conditions. The newspaper claimed that Apple employed 16 years old workers, provided one dormitory for 100 persons, required to work 15 hours per day and last, but not least had military-style drills in factories (Josep h, 2006). Tanya Klowden (2006) analyzed Apples irresponsibility and concluded that Apple iPod should put at least some marketing work out into to trying to promote itself as a socially responsible company, towards movement in implementing working ethics in its suppliers set forth (Klowden, 2006).Another critic came from China Business News reporting that the factory did not provide simple seats for workers and made workers stand for up to 12 hours while working (Soong, 2006). Since such events, in addition environmentalists have accused Apple of not having a computer recycling program. Apples response As any well known brand corporation, Apple tried to defend itself in front of the public. It had posted its own findings in the media and online. Several points were worth noting.Apple claimed that audits found some violations to its Code of Conduct as well as other areas for improvement and that Apple was working with suppliers in developing countries to address these issues. Howeve r, some analysts argued that Apple must ensure in providing good working conditions before such incidents took place (Kahney, 2006). As mentioned in their Code of Conduct, Apple iPod committed itself as a socially and environmentally responsible company, ensuring that the people around the world work under safe, fair and legal conditions. However, in reality Apple could not protect workers rights.Gap case It is easier for the Gap to scratch out its orders and move someplace where there are no unions than to say they will make sure that the rights of their workers are protected -Deisy, ex-Gap worker who lost her job for being a union rig outr in El Salvador Background Gap Inc is a leading international retailer, operating through 3070 stores across the world with suppliers and factories in many developing countries in Asia as well as in Africa. Gap took several initiatives in order to support communities in which it operates. It has its own Code of Conduct.However, there were some serious questions raised about the working conditions in developing countries, which operated in behalf of Gap. Several human rights groups accused Gap for maintaining factories where workers were treated badly and where there was no breathing place of social responsibility. They found that low wages, various restrictions (contracts that forbade workers to quit, marry or organize and join labour unions), unhealthy and unsafe working conditions were commonly in practise (Engler, 2004). Such issues happened in most developing countries such as Indonesia, El Salvador, etc where Gap has its factories.Gaps Corporate Social Responsibility and initiatives Gaps name was virtually tied with the scandals about abuse of human rights in most developing countries. There were a lot of aggressive global movements and strikes for workers rights in developed countries as well as in developing ones. Gap started to implement Code of Vendor Conduct in all factories manufacturing Gaps products. Gap al so maintained monitoring programmes and collaborated with partners worldwide in order to solve such problems. Criticisms of Gaps CSR When Gap started to face a boycott against its products, it started to produce CSR reports.However, CSR reports are subjected to criticisms from agencies for that being a public relations activity. Also, critics noted that Gap did not provide reports for its whole range of factories. Gap did not publish its suppliers names, but critics believed that this was a tool to resist outside monitoring. Even though there were a lot of activities against unethical practices in Gaps factories, it seemed that several retailers remained to be insensible(p) by public allegations and continued to behaviour irresponsibly (Engler, 2004).Cocoa Industry case We need to be permanently concerned with where cocoa comes from, the impact of coca on the environment and how the workers are treated. Thats where the industry has changed, permanently and forever -Larry Graham, t he President of the Chocolate Manufactures Association, the American industry trade Group Background infant labour, child trafficking and thraldom became prevalent and held within the cocoa industry in West Africa. The increased campaigns raised its awareness of child labour abuse.This is crucial question and issue and in order to raise public awareness of child labour abuse, most consumers boycott of chocolate fabrics products. The problem of Child Labour in West Africa 70% of cocoa beans are produced in West Africa, especially in Nigeria, Ghana and Cameroon, which are the major producers and exporters of cocoa (Antislavery report, 2004). In 1998, International Labour Organization revealed that the practise of child slavery occurred in the cocoa fields (Rawfoodinfo, 2008). UNICEF reported that in Ghana over 200,000 children were sold into slavery (Global Exchange, 2006).Since such events have come to light the international civil society organizations, governments and the cocoa i ndustry acknowledged that it is necessary to address the child labour issue and implement some initiatives. Corporate Social Responsibility initiatives The cocoa industry recognised that it needed to address labour issue in order not to damage the image of industry. All multinational manufactories and retailers using cocoa from Africa such as Nestle, Mars, Kraft Foods and Starbucks deep brown Company contributed and became members of World Cocoa Foundation, whose primary aim is to destroy the practice of child exploitation.The chocolate industry launched programmes for eliminating child slavery and certifying that no form of child labour would be employed in the production of cocoa and chocolate. As US Senator Tom Harkin said, it was good evidence that any chocolate or other cocoa products were not made by childrens give (Chatterjee, 2001). The objective of this CSR initiative was to enable children to go to school, instead of working full-time in order to help their families. Cri ticisms Despite all above mentioned, analysts pointed out that the cocoa industrys promises were still unfulfilled.There were no signs of progress even after three years since the first steps were made. Analysts claimed that it was a public relation tool, not an attempt to tackle problem of child labour and multinational companies also did not show their willingness to participate in solving and destroying child labour problems (Peel, 2004). As social scientists emphasised, even if consumers continue to boycott the goods made by child labour, such measures are unlikely to eliminate the problem at all.Economists and researches like Pham Hoang Van and Kaushik Basu pointed out that total elimination of child labour might cause much worse consequences such as sagacious hunger or starvation, or even worse occupations like prostitution (Basu, 1999). Without doubt, such controversial issues need to be solved or at least to be changed. Philip Morris case We dont want kids to smoke. Were i ntensifying our efforts that we started a number of years ago by launching this new ingest-intervention, starting with these ads -Michael E. Szymanszyk, president and CEO, Philip Morris USA BackgroundPhilip Morris is the worlds largest tobacco company, owing the worlds largest-selling cigarette brand since 1972. As any tobacco company, Philip Morris singed the agreement for not marking young people. However, as it was observed, Philip Morris continued to target the younger population. For example, the company sponsored concerts where an auditorium was attended fully by young people, or it advertised cigarettes being offered to young girls and boys. This is considered to be irresponsible such advertisements can have impacts on young immature minds.Many critics argued that even Philip Morris tried to take measures however it was only made in order to create positive publicity rather than actually reduce youth smoking. For example, Kathryn Kahler Vose, the communications director of Campaign for Tobacco- free Kids, pointed out that Philip Morris tried to buy respectability, though in reality it was a Public Relations exercise (Tobaccofreekids, 2003). All of attacks came from the media despite the fact that the company previously acknowledged itself as socially responsible and promised to sponsor independent research on public health.Criticisms Philip Morris as a harmful tobacco company is the centre of public, media and government attentions. The Wall channel Journal in an article, accused the company of being the major cause of peoples deaths. As a survey showed, a 50% share of the market belongs to Philip Morris Company (Alsop, 2001). Critics claimed that the multinational tobacco companies were using large marketing budget to attract customers, especially young people. The government emphasized that the company was deceptive the public about the risks of passive smoking and so called light cigarettes (Economist, 2004).They supercharged that the company l ied to customers about the hazards of smoking and tried to hide scientific evidence about it. They charged that they intentionally made people given to nicotine and sold cigarettes to smokers who were below the permitted age as well as cause many diseases like cancer, heart disease and so on (Economist, 2004). Philip Morris initiatives As any multinational company operating worldwide, the image and reputation of its brand is a very important intangible asset. So scandals regarding a companys social responsibility can significantly damage a well known brand.The first reactions of Philip Morris were to improve its reputation, as it was surely expected. The company intended to warehousing itself as a socially responsible business entity through new anti-smoking campaigns. In order to prevent teenagers from using cigarettes, the company cut down its advertising and started to responsibly pay attention on what it advertised, its impacts and the targeting population. However, many anal ysts are confident that despite the companys efforts towards establishing corporate social responsibility, it is a simple tool for refurbishing its negative image (Tobaccofreekids, 1999).Some experts remarked that if Philip Morris honestly wanted to reduce youth smoking and to be a responsible company, it had to end its marketing practices that attracted young people (US. newswire, 1999). However, in reality, it is appeared that they increased their marketing campaign to young people. Chapter 4 Findings and Discussions Coca-Cola case Coca-Cola India undertakes a diverse range of activities for the benefit of the community across the country. As part of our CSR strategy, sustainable water management remains our top anteriority -Deepak Kaul, Regional Vice-President, South, the Hindustan Coca-Cola Beverages Pvt.Ltd. , in 2007. It is India where the companys abuse of water resources have been challenged vociferously and communities across India living around Coca-Cola bottling plants h ave organized in large meter to demand an end to the mismanagement of water In response to the growing Indian campaigns against Coca-Cola, the company has decided to promote rain harvesting a traditional Indian practice in and around its bottling plants in India. Touting rainwater harvesting initiatives is now central to Coca-Colas public relations strategy in India -Amit Srivastava, Coordinator of India Resource Center, in 2007.Background Coca-Cola established its first plant in India in 1950 and remained on market till 1970s. Because of the Indian Governments request to share the unfathomable formula of coke, Coca-Cola left the Indian market. After an absence of about 16 years, Coca-Cola re-entered the Indian market in the early 1990s, when economic liberalisation took place in India (CokeFacts, 2009). Nowadays, Coca-Cola is the largest multinational corporation operating in India and is considered to