This website uses cookies to ensure you have the best experience. Learn more

The Link Between Competitive Advantage & Corporate Social Responsibility

4434 words - 18 pages

The Link Between Competitive Advantage & Corporate Social Responsibility |
Business and Society |
|

There is currently growing interest in corporate social responsibility (CSR) among both companies and managers. It has become an important topic of theoretical concentration and one of the most widely accepted business concepts. The major issues in the field of CSR concern stakeholder analysis and corporate strategic management. Numerous attempts have been made to link CSR and financial performance. While the debate over CSR continues, it reveals that some additional research can be done on the link between CSR and competitive advantage (CA).
CSR is understood to be the way ...view middle of the document...

Creating and sustaining competitive advantage involves proactively exploiting advantages such that the organization is able to obstruct any efforts on the part of competing organizations to achieve the same competitive advantage (Ma, 1999).
Harrison asserts that: “Competitive advantage implies more than merely creating value. Rather, the key is to create more value than competitors are able to create. A firm is said to have a competitive advantage if it creates and appropriates more value than the least efficient rival capable of breaking even. Simply extending the prior logic, this occurs when the firm drives a wedge between the willingness to pay it generates among buyers and the costs it incurs and then collects returns in excess of its own opportunity costs” (Harrison, 2007).
With a basic overview of CSR and CA provided, it is now possible to consider how CSR can be effectively utilized for the purposes of creating CA in the organization. Focusing on the relative conditions most important to their industries and strategies, companies ensure that their corporate capabilities will be particularly well suited to helping grantees create greater value (Porter, 2002). By enhancing the value produced by philanthropic efforts in their fields, the companies gain greater improvements in competitive context. Corporate philanthropy should be deeply rooted in a firm’s competences and linked to its business environment (Porter, 2002).
Over the course of the last two decades, there have been a number of incidents that have shaped how organizations respond to social issues and larger relationships with external stakeholders (Porter, 2006). For instance, Nike was boycotted after it was revealed that the company had been engaged into abusive labor practices (Porter, 2006). As a consequence many organizations soon came to realize that in order to ensure that they could preserve their image and maintain a positive relationship with customers, these social issues had to be addressed in the context of their business practices (Porter, Strategy & Society: The link between Competitive Advantage and Coroporate Social Resposibility, 2006). This would improve operations in the organization and allow actions based on ethical business practices (Porter, 2006).
According to Porter and Kramer (2006) organizations developed four unique frameworks for conceptualizing and applying corporate social responsibility programs.
These include:
• Moral Appeals: Many organizations adopted CSR programs because they believed that it was simply the right thing to do.
• Sustainability: Some organizations chose to adopt CSR as a principle means to ensure the sustainability of operations over the long-term.
• License to Operate: Organizations adopting this approach recognized the interconnectedness of business operations and larger external regulation set by governments, communities and stakeholders.
• Reputation: Organizations came to realize that CSR initiatives could be...

Other Essays Like The Link Between Competitive Advantage & Corporate Social Responsibility

Corporate Social Responsibility Essay

5036 words - 21 pages organizations finds the greatest challenge in managing the stakeholder’s demands, which results in complex in the competitive market. So, here the corporate takes up social responsibility as a commitment and engage themselves in the society development. Corporate Social Responsibility (CSR) is a commitment by the business organizations in improving the society through their business activities and its contribution in community development. CSR is an

corporate social responsibility Essay

1159 words - 5 pages Introduction Benjamin Franklin once said “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.” The 21st century is moving corporate social responsibility (CSR) to new levels. With social media in today’s world, it can have positive or negative impacts on an organization. There is now more focus on operating and processes ensuring ethical behavior within the

Corporate Social Responsibility

1333 words - 6 pages Corporate Social Responsibility JOSEPH G. GIBSON University of Maryland University College AMBA 610 /9243 Dr. George Nixon June, 2009 In the wake of today’s globalization, most companies have become amazingly aware of the social and environmental aspects of producing internationally. The fact that companies today have to be profitable does not negate that they also have to be good corporate citizens. Due to pressure from

Corporate Social Responsibility

2047 words - 9 pages Running head: TITLE RUNNING HEAD Use “Update Page Layout” to Change the Title Corporate Social Responsibility   Business organizations in a capitalist economy operate in a fiercely competitive environment. What they believe to be the aims of a capitalist corporation and what they consider to be their duty is defined by two major norms. The “free market” theory claims that the job of any free organization is to maximize profit with a

Corporate Social Responsibility - 2443 words

2443 words - 10 pages aims to improve corporate governance, simplify regulations, enhance the interest of minority investors and for the first time legislate the roles of whistle blowers. The 2013 Act has introduced several provisions which would change the way Indian corporates do business and one such provision is spending on activities of Corporate Social Responsibility. The importance of Corporate Social Responsibility is increasing in Indian Corporate scenario

Corporate Social Responsibility - 820 words

820 words - 4 pages Corporate Social Responsibility Corporate social responsibility refers to a business practice that involves participating in initiatives that benefit society. Liz Maw, CEO of nonprofit organization Net Impact, noted that CSR is becoming more mainstream as forward-thinking companies embed sustainability into the core of their business operations to create shared value for business and society. Sustainability isn’t just important for people and

Microsoft Corporate Social Responsibility

525 words - 3 pages Microsoft Corporate Social Responsibility ETH/361 July 21, 2014 Lorece Tietjen Microsoft Corporate Social Responsibility: Introduction The Microsoft office was ranked number one company for their Corporate Social Responsibility reported by Reputation Institute’s 2012 CSR Rep Trak 100 Report, around the world. This study was conducted via various indications such as Citizenship, Governance and Workplace and Microsoft received

Corporate Social Responsibility - 709 words

709 words - 3 pages Corporate Social Responsibility Laura M Taylor MGMT215 April 20, 2015 Ryan Tipton Corporate Social Responsibility The Corporate Social Responsibility is a form of corporate self-regulation. The policies function as a self regulatory model where the business monitors and ensures that it is in active compliance with the spirit of the law and ethical standards. There are four types of social responsibility that make up a pyramid of CSR

Management Corporate Social Responsibility

1929 words - 8 pages ANTENERO, JAN KENNETH D. MANAGEMENT205 A MARCH 31, 2014 A. Part 1: Test on Understanding (40%) 1. TRUE. 2. TRUE. 3. FALSE. The given statement is false because it was wrongful to say that enactment of laws by government legislative bodies and initiatives related to voluntary industry practices and the like are some of the many ways to promote corporate governance, well in fact it should be PUBLIC GOVERNANCE. By definition

The Competitive Advantage of Nations

674 words - 3 pages In his HBR article: “The Competitive Advantage of Nations”, Michael E. Porter describes how some countries are able to achieve long term national prosperity through the creation of a competitive advantage in certain industries. This prosperity is created through constant innovation and upgrading in the driving industries. Porter does not believe that on a national level labor costs, interest rates and economies of scale; and on a company level

Quality And Financial Performance Are Intimately Related. A Fundamental Responsibility Of POM Is To Produce A Competitive Product Or Service Based On A Balance Between Quality And Costs Of Quality

805 words - 4 pages Cost of QualityQuality and financial performance are intimately related. A fundamental responsibility of POM is to produce a competitive product or service based on a balance between quality and costs of quality. Most companies have the slightest idea on how much firms have spend on COQ, it can be as high as 20 to 40% of sales. Since the numbers are typically much higher than profits in some firms, a reduction on COQ can have a significant

Related Papers

Entreprenuership And Intrapreneurship As Sources Of Competitive Advantage In A Corporate Lit Review

2027 words - 9 pages persistent: high growth in the past does not necessarily lead to high growth in the future. They find a negative linear relationship between firm size and firm growth. 5.1 CHARACTERISTICS OF GROWING FIRMS Crijns & Ooghe (1997) state the following characteristics of growing organisations • Market Domination • Differentiation • Product Leadership • Flexibility • Innovation • Future oriented • Export • Related Growth 6 CORPORATE ENTREPRENEURSHIP

Corporate Social Responsibility: The Indian Perspective

1013 words - 5 pages CORPORATE SOCIA RESPONSIBI ITY(CSR) SOCIAL RESPONSIBILITY(CSR) The Indian Perspective p October 16, 2008 to HE Mr Hideaki Domichi, Hon’ble Ambassador of Japan & Members of JCCI by Ajay Sethi, Director Corporate C t l t I di Pvt Ltd C t Catalyst India P t OUTLINE A walk through history Key considerations y Business case for CSR Case studies Key steps in your CSR roadmap A Walk Through History CSR – A NEW OUTLOOK CSR

Corporate Social Responsibility Essay 3346 Words

3346 words - 14 pages Philanthropy. In Harvard Business Review on Corporate Responsibility (pp. 27). Boston: Harvard Business School Publishing Corporation. Porter, M. E., & Kramer, M. R. 2007. Strategy and Society: The Link Between Competitive Advantage and Corporate Social Responsibility, Harvard Business Review (Vol. 85, pp. 136-137): Harvard Business School Publication Corp. Rice, P. L., & Ezzy, D. 1999. Qualitative Research Methods: a Health Focus: Oxford University

Corporate Social Responsibility Essay 1186 Words

1186 words - 5 pages Corporate social responsibility (CSR) has be become increasing relevant to businesses within the 21st century. In the 1820s in the industrial revolution efficiency was key, creating the most amount of resources in the cheapest and quickest way possible. However, since the coining of social responsibility in the 1950's there as been an increased emphasis on philanthropy . Now businesses have to show more effort to improve society or in reality