Corporate Social Responsibility (CSR) essay

Also Porter Michael E. and Kramer Mark R. (2006) point out the link between corporate social responsibility and competitive advantage of the company, arguing that no company nowadays can achieve success in the highly competitive markets without SCR.

Maignan I. and Ferrell O. (2001) argue that the long history of charity and philanthropy in the 21 century are transformed into social marketing activities of companies. New approaches do not exclude the traditional charity, but allow companies to make it profitable for themselves, for the community, for the city. Today, social marketing activities of a company are not only aimed at solving social problems, but also for economic benefit, expressed in increasing sales, increasing customer loyalty, strengthening its position in the market. (Maignan, I. and Ferrell O., 2001)

Thus, marketing initiatives are closely linked to CSR. So in the event marketing is often used sponsorship of charitable events. Sponsoring any charity event, the organization primarily want to increase its own reputation in the eyes of the consumer. The company also gets other benefits. To see this, you need to contact the website for any organization engaged in carrying out charitable activities and attracting sponsors for their funding. For example, as suggested by the organizer, sponsoring a charity event, the company can:

hold its promo-action;

distribute its information materials;

put its logo and message of the company on the promotional materials of the project;

get a mention in the reports and press releases;

organize its btl-activities under the project;

use the fact of participation in the project in its PR-campaigns.

However, charity activities are closely connected with event marketing and can certainly improve the image of the company, and are certainly an effective tool for PR.

Hohnen P. and Potts J. (2007) identify five steps in the development of social marketing strategy of any organization:

1) Charity, which is reflected in the support of citizens and public organizations without any benefits, or marketing or promotion component.

2) Sponsorship of socially significant events and projects. The distinctive features of sponsorship are clear obligations on both sides. The sponsor has access to its target audience, a package of advertising media and distribution channels. At this stage, the activity has no systematic, permanent character, aimed at development. However, for many socially responsible companies, which mainly middle and small businesses, sponsorship is the basic and most popular tool of socially responsible marketing. Thus, the sponsorship allows to pursue not only commercial but also social objectives and to obtain the desired result.

3) Determining the priorities of the company with a clear focus on social activities, which becomes part of the company’s image, creating an additional intangible assets, loyalty and preferences.

4) Development of the charity policy as part of the strategy of the company, which provides stability and financial sustainability of social development and helps to solve social problems.

5) a corporate charity policy, which aims to addressing social problems of employees and company, as well as objectives of the enterprise.

The social-marketing projects can be an effective means of brand promotion and also an instrument of addressing pressing social problems. Here are some business benefits from social activities:

– strengthening of the reputation and image of the company;

– strengthening of relationships with customers;

– increasing customer and staff loyalty;

– improved relations with local authorities;

– advantage over competitors;

– additional opportunities for sales promotion, PR and advertising;

– increase of the investment attractiveness of the company. (Visser et al., 2004)

Visser (2004) points out several areas of social projects and programs:

1. Sound business practice – it is the direction of the social programs of the company, which aims to promote the adoption of good business practices among suppliers, business partners and customers.
2. Environmental protection – is a direction of social programs, which is carried on the company’s initiative to reduce harmful effects on the environment (program for the economical use of natural resources, recycling, pollution prevention, environmentally friendly production processes, organization of environmentally friendly transport, etc).
3. Community development – this area of ​​social programs of the company is intended to contribute to the development of local society: social programs and actions in support of socially disadvantaged groups; support for the preservation and development of housing and communal services and objects of cultural and historical significance; sponsorship of local cultural, educational and sports organizations and activities; support of socially significant research and campaigns, participation in charity events).
4. Staff development strategies, aimed to attract and retain talented employees (training and professional development, the use of motivational pay schemes, the creation of conditions for leisure and recreation, internal communication system within the organization, employee participation in management decision making).
5. Socially responsible investing, which is aimed not only at financial results, but also at realization of social goals. (Visser et al., 2004)

According to Sanford (2011), all these social projects and programs are aimed at creating a positive reputation and image of the company. The company’s image is a kind of correlation between the perception, which the company wants to establish itself in the eyes of the target groups, and the perception of the company which already exists. Consequently, for the efficient formation of the social image the company  must take into account the opinion of key stakeholders about the level of responsibility of the company at the moment. For example, if the company has unfair practices with employees and begins to actively implement the external social projects,  such actions are not likely to effectively influence public opinion, as the original “good” goal will be very controversially perceived by various stakeholders, that ultimately will cause the public dissonance regarding the activities of the company. (Sanford 2011)

Morsing M. and Schultz M. (2006) argue that it is important to take into account the expectations of all  stakeholders in general, that is fundamental to the  implementation of programs of social responsibility. Depending on the sphere in which the company operates, the public puts certain expectations associated with social problems, specific to this sector. This is especially true for companies which activity is controversially perceived by public. For example, in oil, metals and tobacco industries virtually no company can do without social projects, as these activities have a direct negative impact on different groups of public (on environment, people’s health). (Morsing M. and Schultz M. 2006)

Dowling D. (2001) stress the fact that social responsibility often helps to prevent or at least “smooth” the negative effects of scandals that could damage the image and reputation of the company. This is especially important for companies which own expensive retail brands, as they often  become targets of attacks in the press, of various kinds of activists, environmentalists and consumer advocates. (Dowling D., 2001)