Social Responsibility

Social responsibility is an ethical framework and suggests that an entity, be it an organization or individual, has an obligation to act for the benefit of society at large. Social responsibility is a duty every individual has to perform so as to maintain a balance between the economy and the ecosystems. A trade-off may exist between economic development, in the material sense, and the welfare of the society and environment,^[1] though this has been challenged by many reports over the past decade.^{[2] [3]}  Social responsibility means sustaining the equilibrium between the two. It pertains not only to business organizations but also to everyone whose any action impacts the environment.^[4] This responsibility can be passive, by avoiding engaging in socially harmful acts, or active, by performing activities that directly advance social goals.

Businesses can use ethical decision making to secure their businesses by making decisions that allow for government agencies to minimize their involvement with the corporation.^[5] For instance if a company follows the United States Environmental Protection Agency (EPA) guidelines for emissions on dangerous pollutants and even goes an extra step to get involved in the community and address those concerns that the public might have; they would be less likely to have the EPA investigate them for environmental concerns.^[6] "A significant element of current thinking about privacy, however, stresses "self-regulation" rather than market or government mechanisms for protecting personal information".^[7] According to some experts, most rules and regulations are formed due to public outcry, which threatens profit maximization and therefore the well-being of the shareholder, and that if there is not outcry there often will be limited regulation.^[8]

Some critics argue that corporate social responsibility (CSR) distracts from the fundamental economic role of businesses; others argue that it is nothing more than superficial window-dressing, or "greenwashing";^[9] others argue that it is an attempt to pre-empt the role of governments as a watchdog over powerful corporations though there is no systematic evidence to support these criticisms. A significant number of studies have shown no negative influence on shareholder results from CSR but rather a slightly negative correlation with improved shareholder returns.^[10]

Corporate social responsibility

Corporate social responsibility or CSR has been defined by Lord Holme and Richard Watts in the World Business Council for Sustainable Development's publication "Making Good Business Sense" as "…the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as the local community and society at large." CSR is one of the newest management strategies where companies try to create a positive impact on society while doing business. Evidence suggests that CSR taken on voluntarily by companies will be much more effective than CSR mandated by governments. ^[11]  There is no clear-cut definition of what CSR comprises. Every company has different CSR objectives though the main motive is the same. All companies have a two-point agenda—to improve qualitatively (the management of people and processes) and quantitatively (the impact on society). The second is as important as the first and stake holders of every company are increasingly taking an interest in "the outer circle"-the activities of the company and how these are impacting the environment and society.^[12] The other motive behind this is that the companies should not be focused only on maximization of profits.

While many corporations include social responsibility in their operations, it is still important for those procuring the goods and services to ensure the products are socially sustainable. Verification tools are available from a multitude of entities internationally,^[13] such as the Underwriters Laboratories environmental standards, BIFMA, BioPreferred, and Green Seal. These resources help corporations and their consumers identify potential risks associated with a product's lifecycle and enable end users to confirm the corporation's practices adhere to social responsibility ideals.