Corporate Social Responsibility and Enhancement of Competitive Essay

Corporate Social Responsibility and Enhancement of Competitive Advantage of Companies - Essay Example This paper is aimed at providing a detailed study of the fact that Corporate Social responsibility is a business strategy which can be used by business organisations to enhance their competitive advantage in markets for various goods and services. The concept of Corporate Social Responsibility and its importance: In a study, conducted in 2005, it has been revealed by more than 80 percent of respondents (who were business executives in different organisations) that, business strategies related to Corporate Social Responsibility is extremely essential for their businesses (Blowfield, Blowfield and Murray, 2011, p.10). The phrase Corporate Social Responsibility has been described in modern businesses as one of the most important business practices. With the help of this responsibility multinational corporations are redefining their function in the society and their functional responsibilities to rights of the human beings and the environment. Ethical as well as environmental aspects, al ong with effective business strategies are important components of Corporate Social Responsibility. ... According to few companies the practice of corporate social responsibilities business organisation can acquire greater profits through greater market shares (Forcese, 2008, pp.153-154). It is sometimes argued by business organisations that as long as they are paying taxes to the government and wages to their employees and even maintaining regulations related to health and safety needs they are acting as good corporate citizens. Economists like Milton Friedman (1970) supported this view of doing businesses or running corporate organisations. The problem associated with this business strategy came into effect when economists argued that in this method certain sections of the society (mainly poor people) are getting marginalised. Therefore these economists, including John Gregory Mankiw, have suggested to incorporate the government to provide goods and services to these deprived people and hence to protect these people from corporate strategies. By the end of 1980s this corporate busine ss strategies have been criticised by many economists and environmentalists. A rapid revolution started during this time in regard to greater environmental protection against unethical corporate practices. As a result of these environmental movements Union Carbide had to withdraw its business from Bhopal, India, General Motors to stop ‘selling vehicles with military application to the apartheid government in South Africa’ and many other large businesses, like Nestle, to change their business strategies. In the 2000s these changes started to include oil and gas industry across the globe, making significant changes in applications of business ethics by large number of multinational corporations all over the world. In this time, mainly after 2000, many multinational