Corporate social responsibility

Executive Summary

"Corporate Social Responsibility", or CSR for short, is the buzzword for company’s voluntary initiatives involving a number of various activities and company’s programs. But the question is what does Corporate Social Responsibility really means and how is it implemented in German companies? Expectations are growing as the public at large and, increasingly, the financial markets want to know not just what a company does with its profits, but also how it earns them.

This assignment examines first in what extend ethical aspects are an essential condition for the justification of Corporate Social Responsibility. Therefore the basic aspects of CSR and the paradigms to ethics will be discussed in the first part. Afterwards before examining the situation of CSR in the German businesses landscape, the main elements to build up a program focussing on social responsibility will be listed. Then with the insight of what drives a CSR program, the question how is it implemented in German companies in order to meet stakeholders expectations will be answered. Several surveys conducted by agencies and the German ministry will be the basis for an objective reflection of the situation in Germany and illustrating the variety of initiatives and commitments. Final regards on the problems and risks connected with Corporate Social Responsibility are mentioned to close up the study.

Table of Contents

  Executive Summary  2

Table of Contents ......................................................................................................... 3

List of abbreviations...................................................................................................... 4

List of figures ................................................................................................................ 5

1.  Introduction  1

2.  Ethics and Corporate Social Responsibility  1

2.2  Roots of Corporate Social Responsibility  2

2.3  Business Ethics  2

2.4  Paradigms to ethics related to corporates  3

2.5  Effects of Social Responsibility for companies  4

3.  Designing CSR Management  5

3.1  Establishment within the organization  5

3.2  Creating a company s CSR policy  6

3.3  Utilizing management systems  6

4.  CSR in German Companies  7

4.1  Acceptance of European CSR policy  7

4.2  Public-private partnerships  7

4.3  Implementation rate of various CSR areas  8

4.4  Companies initiatives  9

4.5  Companies management tools  9

4.6  German ranking of company s CSR initiatives  10

4.7  Critical remarks  11

5.  Conclusions  11

  Bibliography  13

  ITM Checklist 360 Analysis  16

  Declaration  18

List of abbreviations

e.g. exempli gratia

EMAS European Eco-Management and Audit System

CC Corporate Citizenship

CEO Chief Executive Officer

CG Corporate Governance

CS Corporate Sustainability

CSR Corporate Social Responsibility

ISO International Organization for Standardization

US United States

List of figures

Figure 1: Survey of fond managers and analysts

Figure 2: Company’s activities in CSR’s areas

Figure 3: Percentage of companies using different environmental and social

management tools

1. Introduction If you follow the literature and daily press, marketers are verifying their relationships 1 is pointing out in his ‘Principles of

with social values and responsibilities. Philip Kotler Marketing’ that “as the worldwide consumerism and environmentalism movements mature, today’s marketers are being called upon to take greater responsibility for the social and environmental impact of their actions.” Demands in corporate ethics and social responsibility have become important topics for the companies. Only few companies can ignore this demanding change, but are being forced to take action when authorities and the public are claiming. More forward-looking businesses readily accept their role and seek ways to best serve the interests of their customer and communities. They are building social responsibility and action into their company goals and with that approach, they include concerns for individual and community welfare in their daily decisions.

In Germany as in other countries where hot topics such as globalization, production shut downs and high CEO salaries are currently being discussed and criticized, society expects companies to demonstrate their commitment in regards to social responsibility.

This working paper analyzes the structure and effects of Corporate Social Responsibility (CSR) and reflects the current situation of CSR implementation in German companies.

2. Ethics and Corporate Social Responsibility

Responsibility is not only anyone of those marketing tools. CSR describes rather a commitment of a company towards a social and worth living created society. That’s 2 . CSR is a long-run

why CSR is not restricted to e.g. philanthropy and donations

instrument incorporated in future-oriented company strategy to which the company benefits in terms of company and product value in a sustainable way. Therefore companies which want to implement CSR have to adjust their core-business towards the social responsibilities and have to communicate it to stakeholders. Then with an effective implementation of CSR, companies are able to increase their image and brand.

1 Kotler/Armstrong (2006), p. 25 2 Günther (2007)

Page 1