The article speculates on the fundamental characteristics of corporate social responsibility (CSR) activities, their goals, and their importance to businesses. In the beginning, the authors state that CSR essentially pursues contributing to the well-being of the societies, within which a business operates. However, many companies share a vision that any corporate activities, including CSR, should generate tangible business results such as increased profit. Due to such an approach, the quality of CSR activities deteriorates, and their goals are not fully achieved (Rangan, Chase, and Karim 42). The authors suggest refocusing from business results to benefitting the society. This will ensure the CSR that is more effective on a broad scale and in the long term.
Analysis of CRS strategies and work revealed several weaknesses of CSR in various companies. According to the authors, the major weakness is poor coordination of CSR initiatives and activities (Rangan, Chase, and Karim 43). What can be qualified as CSR is sometimes run by different managers in different departments who report to different supervisors and usually are removed from the CEO. It is suggested that the efforts of these managers should be combined, coordinated, and supervised by the CEO. At the beginning of such restructuring, it is important to analyze everything that a company does in terms of CSR and divide it into three areas, or “theaters.”
The areas are philanthropy, improving operational effectiveness, and transforming the business model to create societal value (Ragan, Chase, and Karim 43). Philanthropy is charity, including donations and voluntary support. Such activities do not bring profit but can increase the company’s revenue later by creating a favorable image of the company among potential customers. Operational effectiveness modifications may include reducing emissions and improving working conditions to demonstrate environmental friendliness and care for employees. Transforming the business model is changing the very concept of a company in a way that is more beneficial to the society.
The authors base their argumentation on a qualitative analysis conducted in various companies in different countries. The companies’ areas included manufacturing, sales, mining, finances, mass media, and telecommunications. The total amount of studied CSR programs was 1,072 (Ragan, Chase, and Karim 45). The research methods were surveying, case studies, and in-depth interviews with managers. The authors present their research rather briefly, focusing on explaining the recommendations and providing examples of successfully implemented CSR strategies.
The article does not cite any previous studies in the area of CSR. Instead, it is a presentation of CSR problems in present-day businesses and suggestion of possible solutions. The authors convincingly recommend how a CSR strategy should be built. The word “should” is used seven times throughout the article, not only in the concluding part where it is usually found in academic papers. The evidence in the article includes several examples from existing businesses of their positive experiences of modifying CSR initiatives toward a more coordinated model.
The truth about CSR that is claimed in the title is that many businesses fail to acknowledge the fundamental goals of CSR and to implement CSR initiatives properly. The authors shortly explain how such goals should be set and then describe how the implementation should be conducted. Since the article effectively summarizes CSR-related issues, it can be useful to any business that considers CSR important and wants to advance in this area.
The way to apply the knowledge in the article to practical situations is described by authors in the four-step strategy (Ragan, Chase, and Karim 44-49). The first step is sorting all CSR initiatives and activities that a company already has by the three described areas: philanthropy, improving operational effectiveness, and transforming the business model. Such division is important because the goals and the assessment of activities depend on their area.
The second step is developing evaluation criteria for CSR activities. On this stage, it is important to recognize that CSR programs within one area should be connected. The criteria should be different across areas because charity, changes in operation, and business model transformation pursue different goals. The third step is coordinating activities across areas. Although separating CSR programs is one of the main recommendations for improving the coordination, it does not mean that programs from different areas should be conducted separately without any contribution or feedback from other areas.
Linking different CSR programs to each other and to the primary goal of CSR, which is contributing to the well-being of the society, is critical in building a coherent CSR strategy. Finally, the fourth step is developing an interdisciplinary CSR strategy. It requires managerial and leadership efforts for incorporating CSR programs to the company’s business model. The authors claim that the four steps are not to be necessarily taken in the given order. Depending on a company’s current CSR situation, it can start with step two or step four, but it is crucial that all four steps are taken in the end.
In conclusion, the authors state once again that the main point of CSR initiatives is that they should correspond to the business purpose of a company and the interests of the society in which the company works. The recommendations provided in the article are to ensure that these requirements are met.
Rangan, Kasturi, Lisa Chase, and Sohel Karim. “The Truth about CSR.” Harvard Business Review 93.1/2 (2015): 40-49. Print.