Corporative social responsibility: some aspects of the evolution of the concept

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Moscow state pedagogical university

Department of economics and management

Corporative social responsibility: some aspects of the evolution of the concept

Yang Yujing, Postgraduate

Moscow

Abstract

Socially responsible behavior of all subjects of society (state authorities, business structures, public organizations) is a guarantee of sustainable economic and social development, improvement of the quality of life in general because of joint efforts and social communications of business, government, and society. The author actualizes the problems of corporative social responsibility as a social, economic and ethic phenomenon. The author pays special attention to the analysis of the theoretical views of economists of the first half of the 20th century on the phenomenon of social responsibility of business (M. Clark, W. Shelton, G. Bowen, A. Carroll, etc.). Their contribution to the formation of the modern concept of corporate social responsibility is assessed.

Keywords: economy; business; society; state; social responsibility; corporative social responsibility; stakeholder.

Аннотация

Корпоративная социальная ответственность: некоторые аспекты эволюции концепции

Ян Юцзин, магистрант, кафедра экономической теории и менеджмента, Московский педагогический государственный университет, г. Москва

Социально ответственное поведение всех субъектов общества (органов государственной власти, бизнес-структур, общественных организаций) является гарантией устойчивого экономического и социального развития, повышения качества жизни в целом в результате совместных усилий и социальных коммуникаций бизнеса, власти и общества. Автор актуализирует проблемы корпоративной социальной ответственности как социального, экономического и этнического феномена. Особое внимание автор уделяет анализу теоретических взглядов экономистов первой половины 20 века на феномен социальной ответственности бизнеса (М. Кларк, У. Шелтон, Г. Боуэн, А. Кэрролл и др.). Оценивается их вклад в формирование современной концепции корпоративной социальной ответственности.

Ключевые слова: экономика; бизнес; общество; государство; социальная ответственность; корпоративная социальная ответственность; стейкхолдер.

One of the key roles in social and labor relations is played by the private sector, which is characterized by dynamic development and a special susceptibility to innovative and promising technologies, as well as having significant resources for this. The introduction of the principles of corporate social responsibility into the daily activities of enterprises involves the socialization of labor relations. It is significant for creating a positive image of enterprises in the regions of their presence, obtaining additional competitive advantages through socially responsible policies due to the processes of economic integration.

At the same time, despite the increasing commitment of global business to the principles of corporate social responsibility, there is a certain theoretical vacuum in Russia and in the other countries on the interpretation of corporative social responsibility principles, the variability of ideas about its essence, content, spheres, and forms of implementation of social responsibility of business [1; 6].

It is obvious that the content of the basic interests of business, authorities, and representatives of society from the point of view of sustainable development are in many ways similar, they are all interested in the socio-economic stability of the territory of their presence.

At the same time, there are several reasons that hinder the development of social responsibility of business. This is not only the orientation of a significant part of business structures to profit by any means (including illegal ones) and ignoring the social interests of employees and society. The economic crisis has exacerbated the problem of opportunistic behavior of business structures and the need to form an institutional environment that stimulates social development, both of their labor collectives and the home region. In these conditions, the problem of developing approaches to the harmonious interaction of all three subjects that contribute to improving the efficiency of the functioning of the economic complex of the region is acute. At the same time, it is important to assess the role and contribution of socially responsible business to the sustainable, progressive development of the administrative- territorial entity within which its main activities are carried out [1; 6].

As for the definition of the category “corporate social responsibility”, it should be mentioned that many experts and scientists have defined it from different methodological and theoretical positions [6].

The evolution of views on the essence of the economic category of corporate social responsibility has a long history.

One of the first manifestations of social responsibility, rooted in the past, can be considered charity. Initially, this phenomenon was of a private nature, since donations, financial assistance to the poor, guardianship of orphanages, hospitals were considered a God-pleasing matter for representatives of the wealthy class, industrialists, merchants. However, as the scale of industrial activity increased, the range of issues related to the sphere of social responsibility of business gradually expanded.

The industrial revolution of the late 18th and the 19th centuries, which led to the strengthening of competition and the growth of the labor movement, became the reason that prompted the owners of factories, factories, industrial companies to go to the softening of the working conditions of employees and the provision of additional guarantees to business partners.

The ideas of the need to combine the interests of business and society appeared during the development of industrial society as a reaction to the new requirements for human capital. So, at the beginning of the 20th century. In the business community there were ideas that companies were obliged to use their resources, ensuring the well-being of society. For example, A. Carnegie, an American steel industrialist and philanthropist of the beginning of the 20th century, founded more than two thousand public libraries in the USA. He was rightfully considered the founder of the doctrine of “capitalist charity”, which argued that profitable and successful organizations should donate a part of their funds for the benefit of society [1; 3].

The idea of corporate social responsibility was first proposed by M. Clark, a famous American economist.

In 1916, Clark discovered that the rapid development of industrialization had a serious impact on the social environment. To his mind, economic development and environmental protection were two problems that the whole society must face. He believed that these social problems were related to economic development, especially in conditions of rising unemployment, high crime rates and increasing environmental pollution.

M. Clark suggested that companies should be responsible for environmental protection and social assistance in the development of their economy.

In his opinion, the goal of governance was a “balanced society” in which private activity combined with government control could ensure a balance between selfish interests and public interests. He wrote that free people had to work together to ensure that a sense of responsibility prevailed. According to Clark, the economy was inextricably linked with the life of society, and the formation of socially oriented thinking based on ethical criteria could not but affect the new quality of work, and, accordingly, the economy. It was Clark who stated that the development of civilization based on social cooperation of people involved the active participation of the population and business in solving problems, both small local communities and communities at the national level [3; 6].

Later, in 1923, the British economist W. Shelton introduced the category corporate social responsibility into scientific circulation and gave a general description of the meaning of this concept. He urged to “be bigger than ourselves, to give back to our community, and to our state, and even to our nation.” He reminded that there were multiple opportunities to do this in small and large ways.

W. Shelton argued that corporate social responsibility was inherent in the relationship between business and people if the business fully met the needs of people both in the enterprise and outside it. He believed that corporate social responsibility meant that, while achieving economic goals, enterprises continued to meet the needs of the relevant stakeholders of the enterprise. Corporate social responsibility should solve ethical problems.

With the deepening understanding of corporate social responsibility, the definition of this phenomenon was becoming more and more standardized.

For example, the British economist G. Bowen in his article “Social Responsibility of Businessmen” elaborated on the analysis of the essence of the category of corporate social responsibility. He believes that the social responsibility of an enterprise or businessman referred to the obligation of an enterprise or businessman to comprehensively consider social values when formulating a corporate development strategy. Entrepreneurs or businessmen should be responsible for the consequences of their actions based on compliance with the law. principle corporate social responsibility business

Later, A. Carroll used a three-dimensional model to describe corporate social responsibility. He believed that corporate social responsibility referred to the economic, legal, ethical, and charitable social responsibilities that companies had to fulfill while developing themselves [7; 8].

A. Carroll believes that the four levels of social responsibility he described are like a pyramid. At the bottom of the pyramid there is the economic responsibility of the enterprise - an important responsibility that the company must bear, and it is also the responsibility that the company must bear for its own development, shareholders, and employees. In addition, there is responsibility at the legal level. This is the basis of enterprise management, which means that the management of the enterprise must be carried out within the limits permitted by law and must comply with discipline and the law in the process of work. In addition, there is an ethical responsibility of the enterprise. Businesses must have ethics and morale. The top of the tower is the charitable responsibility of the enterprise. Charitable responsibility is a type of responsibility that businesses perform voluntarily. It is supported by the ethics of the enterprise and is not mandatory [6; 7; 8].

A significant public response was caused by the instantly classic work of A. Berle and G. Minz intitled as “Modern Corporation and Private Property” (1932). According to the authors, large corporations should turn into a completely neutral technocracy, balancing the diversity of demands of various groups in society and securing a part of the income stream for each of them based on public policy, not private greed. Since the 1950s, there has been a rapid rethinking of classical ideas about the role of economic activity in the direction of increasing social obligations. From that moment to the present, a series of concepts related to the problem of responsibility of business and entrepreneurs themselves have appeared in the world literature on management, among which the most famous concepts are corporate social responsibility, stakeholders, participants in sustainable development, etc. Consistently developing, these concepts, without replacing each other, accumulated the achievements of the previous ones.

The term collective social responsibility was introduced in 1953 by the American scientist G. Bowen in his monograph “Social responsibility of a businessman”.

The World Organization of Enterprises believes that corporate social responsibility refers to the fact that, while ensuring their own economic interests, enterprises should comprehensively consider socially beneficial development methods to promote harmonious economic development and environmental protection [4; 9].

The World Business Council for Sustainable Development also conducted a study on corporate social responsibility. The Board believes that by ensuring its own development, the company should continue to provide economic benefits to the company's employees, shareholders, and the communities in which the company is located, in order to improve the standard of living in general. This is the main responsibility of the company [4; 9].

The British Government describes corporate social responsibility in terms of sustainable development. They believe that if an enterprise wants to support sustainable development, it must ensure the coordinated development of the economy, society, and the environment, and this should be used as a development strategy [9].

In the new century, people's understanding of corporate social responsibility has deepened even more, and research in the field of corporate social responsibility has also changed from general to standardized. In recent years, the theory of corporate social responsibility strategy has gradually received widespread attention. Strategy theory refers to the behavior of enterprises when fully utilizing their own resources to meet the needs of relevant stakeholders, and the development goals of enterprises contribute to and influence each other. In other words, corporate social responsibility is considered as an enterprise development strategy. This can be understood from several aspects: firstly, the active implementation of corporate social responsibility can increase customer awareness and trust in the company and increase customer loyalty, so that the company can further increase the basic competitiveness of the company by fulfilling its social responsibilities; secondly, the implementation of corporate social responsibility is an important idea for the transformation of enterprise management, which can not only increase the level of enterprise management, but also contribute to the development of the entire industry; thirdly, the active implementation of corporate social responsibility can enhance the reputation of the brand of the enterprise and increase the competitiveness of the enterprise in the market, which corresponds to the development strategy of the enterprise; fourth, the company actively fulfills its social responsibilities, it can not only increase the recognition and sympathy of internal employees of the enterprise, maintain the stability of the enterprise team, can attract outstanding talents to join and provide important personnel support to the enterprise [1; 2].

It was also found that corporate social responsibility and corporate development interact and influence each other, since the organization, the enterprise is not isolated, but is in a social network, and it will inevitably interact with various stakeholders in the social network.

Thus, corporate social responsibility refers to the comprehensive responsibility of an enterprise to various stakeholders. This type of responsibility includes corporate economic responsibility, legal responsibility, ethical responsibility, and charitable responsibility.

References / Список литературы

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5. Bowen H. (1953). Social responsibility of the businessman. Harper and Row. New York.

6. Camilleri M.A. (2017). Corporate Social Responsibility: Theoretical Underprinnings and Conceptual Developments.

7. Carroll A.B. (1991). The Pyramid of Corporate Social Responsibility: Toward the Moral Management of Organizational Stakeholders. Business Horizons, 34. Pp. 39-48.

8. Carroll A.B. (1999). Corporate social responsibility. Business and Society, 38 (3). Pp. 268-295.

9. Committee for Economic Development (1971). Social responsibilities of business corporations. New York; [Electronic Resource].

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