CORPORATE SOCIAL RESPONSIBILITY
AND
GOOD CORPORATE GOVERNANCE
Corporate Social Responsibility as a concept is the expectation that businesses have
responsibilities to all its interest groups/stakeholders. CSR is about the relationship between the
business – (corporate) and– social(society) and how the business impacts on the society within
which it operates. In other words, it refers to management’s obligation to protect and promote
the welfare of all stakeholders. It means the business is managed in a way that ensures its
commercial sustainability while acting in a manner that will meet all the stakeholder’s expectations
by contributing to the community and the environment in which it operates. The idea is that the
business should not be focused only on making a profit but also on its responsibility towards the
people and the planet.
Also referred to as the TRIPLE BOTTOM LINE – Financial. Social and Environmental also
referred to as the 3 P’S of Business …. People, Planet and Profit.
1. Citizenship Roles and Responsibilities
Both individuals and businesses have a duty to contribute to building the economy and helping the
people in their communities to live the best possible lives they can.
1.1 Individual Citizens and Citizenship
A citizen is an individual who belongs to a political community and enjoys the rights associated
with being a member of that community while also assuming certain responsibilities and duties.
When you are a citizen of a country you enjoy certain rights, but you also have duties and
responsibilities. For example, all SA citizens have the right to education, the right to be kept safe
and the right to own property. A citizen’s rights are protected by the laws of a country. In return for
these rights you also have certain responsibilities. For example, the responsibility to respect the
rights of others, comply with the country’s laws and pay taxes. Any individual who is part of the
EAP (economically active population) is contributing towards creating products and services which
provide jobs and build the economy.
1.2 Corporate Citizens
Most large businesses have their own Corporate Social Responsibility/Corporate Social
Investment departments and have particular projects that they work on, especially as it counts
towards their Integrated Reporting and, for public companies listed on the JSE it enhances their
Social Responsibility Index (SRI) points. Smaller businesses, with fewer resources to offer, often
prefer to assist NGO’s and Community Based Organisations (CBO’s) unless they have specific
small projects that they can address on their own.
Good corporate citizenship involves responsible actions being taken by businesses in terms of
economic involvement through day-to-day business activities, fulfilling legal obligations, acting in
an ethical manner and by giving something back to society. Corporate citizenship is often seen as
the business acting in a corporate socially responsible manner by making charitable donations and
encouraging employee involvement in poorer communities. These efforts by businesses are often
focused on promoting self-interest through public relations, but are unfortunately not enough to
make them responsible citizens.
1.3 The roles of businesses in the community
Businesses have social responsibilities to the communities in which they operate. CSR is about
how companies manage the business process to produce an overall positive impact on the
community. CSI is the investment in development projects that will uplift the community.
Being socially responsible means that a business tries to reconcile the interests of the different
stakeholders with each other. The business's main objective has always been to make a profit,
however the consumers are mainly interested in quality products at affordable prices. This is
, clearly a conflict of interest, so you often find that the business acts “irresponsibly” towards the
consumer in an effort to best serve the interests of the owners of the business.
The economic wealth of a community depends upon particular businesses. They provide jobs in
the local communities and in return support other businesses where the wages are spent.
● A few businesses play an important role in their communities by supporting local charities
or getting involved with schools and colleges, or even by providing housing for their
employees.
● Putting something back into the community such as taking on extra workers during peak
season as well as providing training for both employees and the unemployed makes good
business sense, since the community becomes empowered to be more economically
active.
Activity: Citizenship
Citizenship is one of the most valuable privileges a nation can bestow on, or give to, a person. In a
sense, it is also one of the greatest commitments a person can make. For many people, citizenship is
acquired at birth. If you are born in South Africa, for example, you will be given South African citizenship
and it is likely that you will retain this citizenship throughout your life.
Some people emigrate, which means that they deliberately leave their country of birth and take up
residence in another country. They may be trying to escape a discriminatory environment, for example or
may believe that they can make a better living elsewhere. Not long ago, certain countries welcomed
immigrants, who are people moving in from other countries. These countries’ immigration policies were
inclusive and non-discriminatory and they allowed people to enter if they could meet a few simple criteria.
Today, however, immigration is much more difficult. Some countries have exclusive immigration policies,
which means that they discourage or even actively prevent certain people from entering their country.
There are many political, social and economic reasons for this.
1. Explain in detail what is meant by the term “citizen” (in your own words).
2. Differentiate between the term “emigration” and “immigration”.
3. Explain why some individuals choose to leave the country in which they were born.
4. Explain why you think a country might have strict rules about the people to whom they grant
citizenship?
5. Do you think South Africa should be inclusive or exclusive with its immigration policy? Explain
your answer?
2. Interest Groups / Stakeholders of a Business.
Different interest groups or stakeholders and the moral or financial demands placed on the
organisation by each, often leads to conflict. This is due to the fact that serving the interests of one
party may be detrimental to another.
A. Primary Social Responsibility
● Investors, shareholders and owners have contributed the capital to finance the business
and they expect a return on their investment. A business has certain obligations to its
investors such as, considering the long term over the short term as well as to ensure that
profits are projected as they should be.
● Employees: the financial performance of the business influences their remuneration. It is
also the businesses responsibility to ensure that employees have a proper and fair code of
conduct and ensure that the workplace is a safe and healthy environment. As well as
ensure there is equality without any discrimination on the basis of creed, race, gender and
religion, age, sexual orientation, culture…amongst others.
● Suppliers: may include suppliers of raw materials, capital goods or even financial
resources. They expect prompt payments from the business. This may conflict with the
business’s interest as delaying payments may mean a better cash flow for the business
and therefore a better financial performance.
● Consumers: place demands on businesses to be provided with good quality products at
the lowest prices possible. There are many ethical and social responsibility issues that
confront businesses in their dealings with consumers, but these revolve mainly around
marketing actions (product, price and marketing communication).
AND
GOOD CORPORATE GOVERNANCE
Corporate Social Responsibility as a concept is the expectation that businesses have
responsibilities to all its interest groups/stakeholders. CSR is about the relationship between the
business – (corporate) and– social(society) and how the business impacts on the society within
which it operates. In other words, it refers to management’s obligation to protect and promote
the welfare of all stakeholders. It means the business is managed in a way that ensures its
commercial sustainability while acting in a manner that will meet all the stakeholder’s expectations
by contributing to the community and the environment in which it operates. The idea is that the
business should not be focused only on making a profit but also on its responsibility towards the
people and the planet.
Also referred to as the TRIPLE BOTTOM LINE – Financial. Social and Environmental also
referred to as the 3 P’S of Business …. People, Planet and Profit.
1. Citizenship Roles and Responsibilities
Both individuals and businesses have a duty to contribute to building the economy and helping the
people in their communities to live the best possible lives they can.
1.1 Individual Citizens and Citizenship
A citizen is an individual who belongs to a political community and enjoys the rights associated
with being a member of that community while also assuming certain responsibilities and duties.
When you are a citizen of a country you enjoy certain rights, but you also have duties and
responsibilities. For example, all SA citizens have the right to education, the right to be kept safe
and the right to own property. A citizen’s rights are protected by the laws of a country. In return for
these rights you also have certain responsibilities. For example, the responsibility to respect the
rights of others, comply with the country’s laws and pay taxes. Any individual who is part of the
EAP (economically active population) is contributing towards creating products and services which
provide jobs and build the economy.
1.2 Corporate Citizens
Most large businesses have their own Corporate Social Responsibility/Corporate Social
Investment departments and have particular projects that they work on, especially as it counts
towards their Integrated Reporting and, for public companies listed on the JSE it enhances their
Social Responsibility Index (SRI) points. Smaller businesses, with fewer resources to offer, often
prefer to assist NGO’s and Community Based Organisations (CBO’s) unless they have specific
small projects that they can address on their own.
Good corporate citizenship involves responsible actions being taken by businesses in terms of
economic involvement through day-to-day business activities, fulfilling legal obligations, acting in
an ethical manner and by giving something back to society. Corporate citizenship is often seen as
the business acting in a corporate socially responsible manner by making charitable donations and
encouraging employee involvement in poorer communities. These efforts by businesses are often
focused on promoting self-interest through public relations, but are unfortunately not enough to
make them responsible citizens.
1.3 The roles of businesses in the community
Businesses have social responsibilities to the communities in which they operate. CSR is about
how companies manage the business process to produce an overall positive impact on the
community. CSI is the investment in development projects that will uplift the community.
Being socially responsible means that a business tries to reconcile the interests of the different
stakeholders with each other. The business's main objective has always been to make a profit,
however the consumers are mainly interested in quality products at affordable prices. This is
, clearly a conflict of interest, so you often find that the business acts “irresponsibly” towards the
consumer in an effort to best serve the interests of the owners of the business.
The economic wealth of a community depends upon particular businesses. They provide jobs in
the local communities and in return support other businesses where the wages are spent.
● A few businesses play an important role in their communities by supporting local charities
or getting involved with schools and colleges, or even by providing housing for their
employees.
● Putting something back into the community such as taking on extra workers during peak
season as well as providing training for both employees and the unemployed makes good
business sense, since the community becomes empowered to be more economically
active.
Activity: Citizenship
Citizenship is one of the most valuable privileges a nation can bestow on, or give to, a person. In a
sense, it is also one of the greatest commitments a person can make. For many people, citizenship is
acquired at birth. If you are born in South Africa, for example, you will be given South African citizenship
and it is likely that you will retain this citizenship throughout your life.
Some people emigrate, which means that they deliberately leave their country of birth and take up
residence in another country. They may be trying to escape a discriminatory environment, for example or
may believe that they can make a better living elsewhere. Not long ago, certain countries welcomed
immigrants, who are people moving in from other countries. These countries’ immigration policies were
inclusive and non-discriminatory and they allowed people to enter if they could meet a few simple criteria.
Today, however, immigration is much more difficult. Some countries have exclusive immigration policies,
which means that they discourage or even actively prevent certain people from entering their country.
There are many political, social and economic reasons for this.
1. Explain in detail what is meant by the term “citizen” (in your own words).
2. Differentiate between the term “emigration” and “immigration”.
3. Explain why some individuals choose to leave the country in which they were born.
4. Explain why you think a country might have strict rules about the people to whom they grant
citizenship?
5. Do you think South Africa should be inclusive or exclusive with its immigration policy? Explain
your answer?
2. Interest Groups / Stakeholders of a Business.
Different interest groups or stakeholders and the moral or financial demands placed on the
organisation by each, often leads to conflict. This is due to the fact that serving the interests of one
party may be detrimental to another.
A. Primary Social Responsibility
● Investors, shareholders and owners have contributed the capital to finance the business
and they expect a return on their investment. A business has certain obligations to its
investors such as, considering the long term over the short term as well as to ensure that
profits are projected as they should be.
● Employees: the financial performance of the business influences their remuneration. It is
also the businesses responsibility to ensure that employees have a proper and fair code of
conduct and ensure that the workplace is a safe and healthy environment. As well as
ensure there is equality without any discrimination on the basis of creed, race, gender and
religion, age, sexual orientation, culture…amongst others.
● Suppliers: may include suppliers of raw materials, capital goods or even financial
resources. They expect prompt payments from the business. This may conflict with the
business’s interest as delaying payments may mean a better cash flow for the business
and therefore a better financial performance.
● Consumers: place demands on businesses to be provided with good quality products at
the lowest prices possible. There are many ethical and social responsibility issues that
confront businesses in their dealings with consumers, but these revolve mainly around
marketing actions (product, price and marketing communication).
