Corporate Social Responsibility
CSR is an important factor that helps in establishing the image and the reputation of the company in the market. It is a form of continuous commitment that is done by the organization so that the local community can benefit from it as well as the surrounding environment. The aim of this research will be to analyse the relation between the brand of the organization and its CSR policies.
Background
Corporate Social Responsibility has helped in increasing the level of transparency among the citizens so that the company can function in a proper manner. The purchasing behaviour of the consumers also help in analysing the responsibilities that are taken up by the organization in the surrounding environment (Bhattacharya et al. 2017). The brands have to set the price of the products in a proper manner so that it can attract the customers. The use of CSR by the companies allows them in increasing the media coverage so that the consumers can be aware of the products that are developed by them (Schwartz 2017).
Background of the company
Rio Tinto is an organization that focuses mainly on mining and processing the mineral resources that are found on the Earth. The company as established in 1873 and has its headquarters located in Melbourne and London. It is the leader in extracting bauxite, iron ore, coal and copper. The company earned a revenue of $40.3 billion and has a equity capital amounting to $44.711 billion for the year 2017. The company employs more than 50,000 employees and is listed in the Australian and London stock exchanges (Riotinto.com 2018).
Problem statement
The company has been issuing its CSR report in a transparent manner in the recent period so that the customers can get to know about the responsibilities that are being taken up by the company (Bainton 2017). The survey conducted by Nielsen showed that almost half of the customers are attracted towards the companies that cares about the social and environmental well-being. The company deals in the metal industry and is engaged in the extraction of non-renewable resources. It has been criticized for its activities in the recent times due to the effects of global warming and degrading the environment (Smh.com.au 2018). The CSR rating of the organization can be seen as 54 on an average. The stopping of the mining activities in certain locations have caused a stir in the locations sue to the damage that has been done by the company. The company also did not clean up the activities after they stopped their activities in Papua New Guinea (Lasslett 2014).
The Pyramid of Corporate Social Responsibility
This research will help in finding the issues that are present in CSR in Rio Tinto, which has caused a problem in their brand value.
Research aim
The aim of the research is to show the impact of corporate social responsibility on the branding of the organisations; this research will narrowly focus on Rio Tinto.
The objectives are:
- To find out the importance of corporate social responsibility of an organisation
- To explain the strategies of the branding of organisations
- To explore the relationship between corporate social responsibilities and branding
- To recommend some possible solutions regarding issues of corporate social responsibilities and branding
Research questions
The research questions are:
- What is the importance of corporate social responsibility of an organisation?
- What are the strategies of the branding of organisations?
- What is the relationship between corporate social responsibilities and branding?
- What are the possible solutions regarding issues of corporate social responsibilities and branding?
Corporate Social Responsibility
It is the concept where the companies have to integrate the social and environmental concerns for the business by interacting with the stakeholders (Ruggie 2017). It helps the organization in maintaining a balance between the economic, social and environmental authoritative, which needs to meet the expectation of the shareholders. The organization in the recent times have to increase their capabilities so that it can understand the viability of the business (Grayson and Hodges 2017).
Triple Bottom Line Theory
This method helps the organization in making the business driven by the purpose of profit but by providing beneficial causes to the environment as well as the society. The main motive of the business is that it will not cause any harm to the environment and the human resources that are being deployed for the purpose of achieving profits. The responsibility of the company is that it has to make the work place in a desirable manner so that it can provide a better environment for the employees to work in. The sustainability of the environment will help in taking help of few resources so that the measures can be cost-effective in nature (Lins, Servaes and Tamayo 2014).
This pyramid helps in finding the four responsibilities that are present in the business organization. The economic purpose allows the business in making profits so that they can ensure its survival in the market. The legal responsibilities allow the business in abiding by the laws that are set in the region (matten and Moon 2008). The ethical responsibilities that are present in the business allows the organization in acting in an ethical and moral manner so that they can follow the laws properly. The suppliers and the employees need to be treated ethically by the company. The philanthropic responsibilities help the business to be responsible for giving back some of the profits to the society so that it can develop the surrounding environment (Cheng, Ioannou and Serafeim 2014).
The concept of branding is that it helps the company in gaining popularity in the market with the help of symbols so that it can be differentiated from its competitors. The use of brands help the products to be identifiable as well as differentiable in the market (Leekha, Chhabra and Sharma 2014). It is the mixture of the properties that allows the products to be given a particular identity so that it can be separated from the other products that are available. Additionally the use of logos, colours and ambassadors help the service to improve within the company (Herstein et al. 2017).
Branding
CSR helps in taking a positive outlook in the surrounding environment. It is the activities that needs to be done so that there is a positive impact on the community. This leads the customers to be encouraged in taking up decisions to purchase the products from the organization (Carroll 2016). The use of CSR helps the organization in supporting the professional and personal development of the organization so that it can help the company to be responsible towards the society (Pai et al. 2015).
It helps the customers in influencing their decision to purchase the products. The brand image of the company also gets restored in the market so that it can attract more number of customers (Edinger-Schons et al. 2018). It will also help in controlling the flow of the resources towards the right direction so that it can be utilized to the full extent. It will also help the company in being more transparent with respect to the products that they are supplying in the market. The use of CSR activities will also result in turning the losses of the company in to a profitable venture (Rezvanpour and Bayat 2017).
The research has been done through the positivism philosophy so that it can help in gathering the data in a scientific manner along with the facts of the data as well. This philosophy has allowed in gathering qualitative and quantitative data and the data will be highly structured (Taylor, Bogdan and DeVault 2015).
The deductive approach has been used by the researcher, as the data that has been gathered has been based on the theories, which has helped in analysing the data in a proper manner. It has allowed the researcher in developing the concept as well (Lewis 2015).
The researcher has also used the descriptive design so that the data can be collected in a proper manner. It allowed in understanding the necessary features that are present within the population (Flick 2015).
The research has been conducted on a sample population of 360 employees and the size of the sample has been limited to 80 so that the research can be done in an efficient way. The simple random technique has been used by the researcher so that it can provide an equal opportunity to the respondents to be a part of the research process. The data has been analysed with the help of bar charts created in MS-Excel so that it can represent the data in s visual manner (Silverman 2016).
Impact of CSR on Branding
Demographic factors
It can be seen from the collection of the data that majority of the responses that were collected were form the female employees who are within the age group of 25-30 years and has an experience of 1.1-3 years within the organization. This has helped the researcher in narrowing down the observation to these factors so that the research can be conducted in a proper manner.
The respondents have stated that the company maintains CSR policies in an effective manner, which has helped them in gaining a strong foothold in the areas where they are operating. It has also resulted in increasing the corporate image of the company in the local environment as well. Maintaining the policies in a better manner will help the company in gaining an advantage in the market, as the customers will be attracted towards the company. The policies of the company needs to be set in accordance to the activities that they are carrying out in the market so that it can help them in gaining an overall advantage in the market. The policies will also restrict the operations of the company so that they do not do any activity that may harm the external environment and increase the level of liability among the customers. This may also lead to a downfall of the brand image in the market, as the customers will try to shift away from the products. The impact of the policies that are framed within the organization needs to be positive so that it can allow the company in gaining a competitive advantage in the market.
Most of the female respondents between the age group of 25-30 years and having an experience of 1.1-3 years have stated that the main function of the company with respect to increasing its CSR activities in the local environment is that it will help in building the image. The increase in the image of the company within the market will result in increasing the consumption of the products in the market as well. Since the company focusses mainly on extraction of non-renewable resources, it can be seen that improving its image in the market will result in giving them a better chance of selling the products. This will also result in increasing its chances of gaining a better level of profit from the market. The image of the company will also be built by improving its CSR activities in the market. The image of the company plays an important part in attracting the customers so that it can increase its sale in the market, which will result in increasing its level of profit. The image also helps the customers in understanding the products with which the company is dealing due to the increased awareness of its brand in the market.
Research Methodology
The female respondents have stated that the company has a separate fund, which is used for meeting all the requirements in its Corporate Social Responsibility activities. It can be seen that 43 percent of the responses have stated that the company maintains a separate fund that allows them in carrying out the CSR activities. This is due to the fact that the company can be able to maintain its activities in the local environment in a better manner. The allocation of the funds need to be done in the beginning of the financial year from the profits that has been earned so that it can help in carrying out the activities in a proper way. This will help the company in understanding the needs that are present in the market based on which the funds need to be allocated. The allocation of the funds will also help in keeping a check on the resources that are being used by the company towards the activities. The resources that are allocated help in providing a better understanding of the activities that needs to be taken up by the organization so that the funds can be utilized in a proper way.
The female respondents have stated that the company uses the funds for promoting its CSR activities so that the poverty in the area can be alleviated. The company is located in major regions around the world where the economic conditions are not good. In a place like Papua New Guinea, where the company operates it can be seen that the economic condition is not up to the standard, which have resulted in decreasing the level of poverty in the region. This will allow the company in increasing its brand image so that the products can be purchased by the potential customers. The decrease in the level of poverty among the region will also result in increasing the brand image, as more number of customers will have a better power of purchasing the goods form the company. The decrease in the level of poverty has also allowed the place to improve its level of economy so that the people of the local community can lead a proper life.
The female employees of the company have stated that the resource that has been allocated by the company are done mostly through monetary benefits so that it can provide instant benefits through its CSR activities. The monetary resources that will be allocated will also help in sanctioning the activities that are undertaken by the company within the local environment. This will result in increasing its share in the market as well. The allocation of monetary funds will also help in dispersing it whenever required so that the company can increase its CSR activities in the market.
The female employees aged between 25-30 years and having an experience of 1.1-3 years have stated that the customers are the primary stakeholders of the company, as they help in increasing the level of the sales for the company. The customers form an important part of the stakeholder, as they help in providing better feedbacks regarding the products after it has been used. The feedback of the customers allow the company in making necessary changes so that it can help in improving the products in the market as well. This will result in increasing the level of satisfaction among the customers.
The female employees have stated that the company published its CSR report on an annual basis so that it can help the customers and other stakeholders in knowing the activities that has been undertaken by them. This helps the company in gaining a competitive advantage in the market, which allows them in increasing their level of profit in the market. The report that is published by the company also reflects the amount that they have spent on the activities that will help in alleviating the level of poverty in the markets where they are operating. It also helps the company in gathering the level of trust among the stakeholders so that they can be accountable towards the organization. It also helps the company in taking the decisions in a proper manner so that the cost of the production can be reduced to a great extent and the waste materials can be controlled as well. The resources of the company can be used in an efficient manner so that it does not get wasted and the company can gain a competitive advantage in the market.
Conclusion
This chapter will help in linking the objectives that has been taken up in the research so that proper recommendations can be provided with the help of the analysis that has been done. The objectives need to be linked so that it can provide a better approach to the research and it can help in providing the recommendations as well.
To find out the importance of corporate social responsibility of an organisation
CSR is an important part of the organization, as it will help in increasing the importance of the company in the market where they are operating. It will help the company in making a better connection with the customers by increasing the level of awareness among the customers. The use of the CSR activities will also help the company in being responsible towards the environment so that it can result in caring for the surrounding environment. The importance of CSR in the organization is that it will also help the customers in being aware of the products that the company is dealing with so that there can be an increase in the level of purchases.
To explain the strategies of the branding of organisations
The major strategies that needs to be taken up by the organization is the use of the promotional activities so that it can spread awareness among the customers. The use of branding by the company with respect to the special logos and designs will result in understanding the importance of the company in the market. This will allow the company is associating themselves with the customers who are present in the market.
To explore the relationship between corporate social responsibilities and branding
The relationship between the branding of the organization and the corporate social responsibility is that the use of the CSR activities will result in increasing the level of awareness among the customers regarding the products that are provided by the company. It will also help the customers in associating themselves with the brand so that the products can be sold in a better way within the market. The pricing strategies that will be taken up by the organization will also result in gaining a competitive advantage in the market.
To recommend some possible solutions regarding issues of corporate social responsibilities and branding
The recommendations for improving the CSR activities in the market so that the brand of the company can increase is that the company needs to inform the stakeholders regarding the work that they are doing within the local environment so that the society can be uplifted. This will result in gaining the trust of the stakeholders and the functions of the company can be efficient as well. It will also result in efficiently managing the level of production so that the company can use the available resources and the waste products can be recycled as well. This will allow the company in increasing its level of production in the market, which will also help in providing a competitive advantage to the firm.
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