How corporate responsibility can enhance sustainability of the corporation

By | May 1, 2014

This Assignment Is Published With Permission From The Author For Online Review Only
All Rights Reserved @ ChinaAbout.Net

1.        How corporate responsibility can enhance sustainability of the corporation. Used real life illustration to support your views

 

While the conclusion to the above question is that the host country should provide relatively stable political environment for the foreign companies to engage in the long term based investment and business activities, if the MNCs are force to engage in the quick payback activities they have other ways to achieve the balance between a quick payback and good CSR (corporate social responsibility) performance, in the part of the assignment we will discuss the positive relationship between the corporate responsibility performance and the enhancement of the sustainability of the corporation.

 

1.1    Basic concept of corporate responsibility & sustainability of the corporation

 

Corporate responsibility involves the search for an effective “fit” between business and the societies in which they operate. The notion of “fit” recognizes the mutual dependence of business and society – a business sector can not prosper if the society in which it operates is failing and a failing business sector in the market will inevitably detracts from general wellbeing. The term “corporate responsibility” refers to the actions taken by business to nurture and enhance this symbiotic relationship (OECD 2001, p. 8).

 

While there are similarities between the term “corporate sustainability” and “corporate social responsibility (CSR)”, however, according to M. A. Quaddus and M. A. B. Siddique (2010, p. 1) these two term are separate as corporate sustainability involves the integration of social and environmental factor into the business administration which is still essentially a business decision to maximize profits by simply ensuring the continued survival of the firm while CSR on the other hand is the voluntary inclusion of social and environmental concerns into business based on the mere good will stemming from the managers’ ethical obligation to be a responsible entity n the society.

 

1.2    Stakeholder view and corporate sustainability

 

A stakeholder is a person or group with an interest in seeing an endeavor succeed and without whose support the endeavor would fail (Werner & DeSimone 2009, p. 213). Stakeholder theory suggests that the purpose of a business is to create as much value as possible for stakeholders rather than the shareholders alone. In order to succeed and be sustainable over time, executives must keep the interests of customers, suppliers, employees, communities and shareholders aligned and going in the same direction (ft.com 2009). According to Dyllick and Hockerts (2002, p. 223) the stakeholder approach could be used to support corporate sustainability which concerns a firm’s long-term success and survival. As the stakeholder view considers a firm as a value creation network, moving towards creating value for all stakeholders involved. And corporate sustainability depends on sustainable relationships between the firm and its multiple stakeholders. Therefore, based on this view we can see that corporate sustainability is actually based on the sustainable relationship the companies build up with the key stakeholders. Below we will analyze a case to reflect the importance of the corporate responsibility performance by caring the stakeholders to the corporate sustainability.

 

1.3    Case analysis: Wal-Mart Stores, Inc.

 

Wal-Mart Stores, Inc. is an American public corporation that runs a chain of large, discount department stores. It is the world’s largest public corporation by revenue and is founded by Sam Walton in 1962. The company has a good record in the corporate responsibility which enhances its business success in the long term basis. For instance, at Walmart, the company knows that being an efficient and profitable business and being a good steward of the environment are goals that can work together. The company’s broad environmental goals at Walmart are simple and straightforward: (a) To be supplied 100 percent by renewable energy; (b) To create zero waste; and (3) To sell products that sustain people and the environment. To achieve these targets, the company has used techniques such as the Supplier Sustainability Assessment, Lifecycle Analysis Database and Information Disclosure to Customers to make the environmental goals achievable, shared by the upstream suppliers and known by the downstream customers. Especially the company has report the corporate responsibility in term of “Global Responsibility Report” to update the customers with the company’s effort in improving the environment. Such report system will enhance the company’s position as a CSR top performer and thus enhance the business success because customers tend to add value to such good CSR performers.

 

 

List of references

 

Alkhafaji, A. F. 2003, Strategic Management: Formulation, Implementation, and Control in a Dynamic Environment. Binghamton, NY: Rougtledge. p. 172

 

Andreosso-O’Callaghan, B. & Zolin, B. M. 2010, Current Issues in Economic Integration: Can Asia Inspire the “West”? Surrey, GU: Ashgate Publishing Limited. p. 138

 

Arouri, M. E. H., Jawadi, F. & Nguyen, D. K. 2010, The Dynamics of Emerging Stock Markets: Empirical Assessments and Implications. New York: Springer Heidelberg. p. 2

 

aseansec.org 2002 GLOBALIZATION’S CHALLENGE TO REGIONAL ECONOMIC INTEGRATION. Accessed on 6 Jun 2012 [online] available: http://www.aseansec.org/2781.htm

 

aseansec.org 2011. ESTABLISHMENT. Accessed on 6 Jun 2012 [online] available: http://www.aseansec.org/64.htm

 

Broyles, J. 2003, Financial Management and Real Options. West Sussex: John Wiley & Sons Ltd. p. 85

 

Cook, T., Alston, R. & Raia, K. 2004, Mastering Import and Export Management. New York: Amacom. p. 61

 

Dyllick, T. & Hockerts, K. 2002, Beyond the business case for corporate sustainability. Business strategy and the environment. 11, 130-141

 

europa.eu 2010. Corporate Social Responsibility (CSR) in the EU. Accessed on 6 Jun 2012 [online] available: http://ec.europa.eu/social/main.jsp?catId=331&langId=en

 

Ey.com 2010. Emerging markets increase their global power. Accessed on 6 Jun 2012 [online] available: http://www.ey.com/GL/en/Issues/Business-environment/Six-global-trends-shaping-the-business-world—Emerging-markets-increase-their-global-power

 

Ft.com 2009. stakeholder theory. Accessed on 6 Jun 2012 [online] available: http://lexicon.ft.com/Term?term=stakeholder-theory

 

Longley, R. 2007. US Seeks WTO Help in Lowering Chinese Trade Barriers. Accessed on 6 Jun 2012 [online] available: http://usgovinfo.about.com/b/2007/10/16/us-seeks-wto-help-in-lowering-chinese-trade-barriers.htm

 

nytimes.com 2012. Foxconn Technology. Accessed on 6 Jun 2012 [online] available: http://topics.nytimes.com/top/news/business/companies/foxconn_technology/index.html

 

oecd.org 2010. Economy : Developing countries set to account for nearly 60% of world GDP by 2030, according to new estimates. Accessed on 6 Jun 2012 [online] available: http://www.oecd.org/document/14/0,3343,en_2649_33959_45467980_1_1_1_1,00.html

 

oecd.org 2007. Moving Up the Value Chain: Staying Competitive in the Global Economy. Accessed on 6 Jun 2012 [online] available: http://www.oecd.org/dataoecd/24/35/38558080.pdf

 

OECD 2001, Corporate Responsibility: Private Initiatives and Public Goals. New York: OECD Publishing. p. 8

 

Pan, C. 2009. What is Chinese about Chinese business? Locating the rise of China in global production network. Journal of Contemporary China. 18 (58), 7 – 25

 

Peng, M. W. 2009, Global Business. Mason: South Western Cengage Learning. p. 39

 

Quaddus, M. A. & Siddique, M. A. B. 2010, Handbook of Corporate Sustainability: Frameworks, Strategies and Tools. Northampton: Edward Elgar Publishing, Inc. p. 1

 

shell.com 2011. Social performance. Accessed on 6 Jun 2012 [online] available: http://www.shell.com/home/content/environment_society/society/nigeria/social_performance/

 

time.com 2012. Apple Agrees to Labor Reforms After ‘Serious’ Foxconn Violations. Accessed on 6 Jun 2012 [online] available: http://business.time.com/2012/03/29/apple-agrees-to-labor-reforms-after-serious-foxconn-violations/

 

Werner, J. M. & DeSimone, R. L. 2009, Human Resource Development. Mason: South-Western Cengage Learning. p. 213

Appendix 1.0 Criteria for emerging countries