Corporate Social Responsibility and Sustainability Practices
Corporate social responsibility is the concept that argues about completing the responsibility of the business towards the society. It is related to the sustainability practices of the company. CSR is the approach that makes the company socially responsible in nature and following the sustainable approach is the part of being responsible for the society. It is the essay that discusses about the CSR practices and their relation with the sustainability approaches and actions of the company. The study is conducted on the company called IKEA. This is because it is considered as the most sustainable companies of all. The essay also focuses on examination of the stakeholder’s approach that deals with CSR practices of the companies. Triple bottom line approach has also been discussed in the essay. IKEA is the company that uses both these approaches by fulfilling the responsibilities of the stakeholders as well as being sustainable in terms of economy, environment and society.
In today’s era, corporate social responsibility has become the very integral part of business activities and functioning (Tai & Chuang, 2014). This is because of the interference and importance of society in earning the revenues. Any business that operates in any of the industry aims to serve the society in order to earn profit and it can only be possible if the society feels happy with the business activities. Thus, playing a part in benefitting the society is the responsibility of every business. Sustainable development can be defined as the practice that is not harmful to the society as well as the natural resources of the place. Sustainability is the need of the hours and need not be practiced by the business but the communities and common people are also responsible for practicing the activities that re sustainable in nature for the sake of the coming generations (Clapp & Rowlands, 2014). Sustainable development means constant practice of the activities of business that does not harm the society and the natural resources of the place and the resources are being saved for the suture generations to use. Sustainability needs to be practiced by the companies so that the future generation on this earth can get an environment to live a better life (Bank, 2014). A theory of CSR that integrates sustainability and CSR activities of the company is triple bottom line theory (Korschun, Bhattacharya & Swain, 2014). It is the theory that assumes that organisation is moral community and thus it has some social responsibilities (Pedersen, 2015). This theory also deals with sustainability and every organisation should weigh their actions and activities on the basis of three types of sustainability such as economic, social and environmental sustainability. When sustainability in terms of is concerned, it has been analysed that there are many stakeholders of the company who have different expectation from the company and being sustainable also forces the company to be responsible toward every stakeholder. Some of the common stakeholders of the companies are employees, shareholders, suppliers, community, customers, employees etc. the theory of stakeholder suggest that other than shareholders, there are many other parties which gets affected by the practices and actions of the company. Stakeholders are actually the group of people who gets harmed or benefitted by any of the action or the decision of the company (Kang, Chiang, Huangthanapan & Downing, 2015). From the perspective of the business, it has been analysed that stakeholder’s theory suggests that there are three elements that needs to be considered such as there are various stakeholders that affect the activities that occurred in the organisations, the interaction between the stakeholders and the activities affect the organisational policies and perceptions of the stakeholders also affect the strategic options of the company.
Theoretical Concepts Applied to Analyze Sustainability Practices of IKEA
Different stakeholder has different expectation from the company and thus company has to take the decision in such a way so that every stakeholder has benefits out of that. It becomes very difficult for the company to provide benefits to every art or stakeholder’s group. When the case of employees is considered, it has been analysed that they want growth, money, great working environment etc. from the company (Beske, Land & Seuring, 2014). Customers, who are again an important stakeholder’s, want the company to serve them with best services in low prices which is very contrasting to the expectations of the shareholders of the company who wants higher profits. This suggests that making the decision intelligently and as per the needs of each and every stakeholder is necessary to be taken by the companies. The stakeholder approach highlights the capability of the organisations to make the CSR policy that is very much favourable for all the stakeholders. Managing the stakeholders and engaging the CSR managers in the company can help the firm to realise the importance and needs of the stakeholders and make the policy accordingly.
IKEA is the company that deals with products like home appliances, furniture and kitchen accessories. It is the company that is very much sustainable in nature and try to practice the activities that are all sustainable so that it can serve the society with sustainable actions. Some of the sustainable strategy of the company is discussed below:
- The first strategy is about allowing the people and influencing them to live a life that is sustainable by offering the products that consume less energy and water in low prices. This helps the customers to buy the products in low price and save their money. Some of the product examples are LED lights that consumer less than 85% of electricity, some of the energy efficient appliances that can function easily and are environment friendly (Fröding & Lawrence, 2017).
- The company also focuses on improving the usage of amount of energy in the operation so the company and reducing the sae by 20% (Simon & Wangsirilert, 2017).Continually developing the products of IKEA that are very sustainable in nature. In addition to it, the company also focuses on ensuring all main home furnishing materials, including packaging, are renewable, recyclable or recycled.
- The company has not only developed the sustainable products but also focuses on dealing with the suppliers that are following the sustainable practices. The company has gone beyond the reach of supply chain and encourage the suppliers to practice the sustainable actions in order to make the whole supply chain sustainable.
As far as the policies and strategies of IKEA are concerned, it has been analysed that the company has made the strategies that are considering the needs of each and every stakeholders of the company (Rangan, Toffel, Dessain & Lenhardt, 2014). Launching the products at low prices is helping the customers to save their money and use the appliances that are very much energy efficient in nature. This also allow the company to play their art for the society and the natural resources because the company is trying to use the energy very efficiently are that the natural resources cannot be exploited to that high extent. As far as anther strategy is concerned, it has been analysed that the company is not only producing the products that are energy efficient and sustainable but also practicing the activities that are reducing the use of energy in the functions and operations of the company (Komassi & Pal, 2015). The last strategy of the company suggests that the company wants to deal with the suppliers who are also sustainable in nature and also playing their part in making the suppliers sustainable. The sustainable supply chain of the company proves that it is one of the moat sustainable companies operating and continuously following the same sustainable approach to make the activities sustainable.
Stakeholder Theory in Relation to Sustainability Practices of IKEA
It is clearly evidenced in the discussion that CSR is the approach that makes the company socially responsible in nature and following the sustainable approach is the part of being responsible for the society. All the corporates have to play their part in sustainable development of the society by implementing some of the CSR activities and policies.
It has been concluded from the essay that CSR and sustainability are the approaches that are very much related to each other. This is because Corporate social responsibility is the capability of the company to be sustainable in their practices that they can provide sustainable products and services to the society which is in favour of the. IKEA is the company that deals with products like home appliances, furniture and kitchen accessories. It is the company that is very much sustainable in nature and try to practice the activities that are all sustainable so that it can serve the society with sustainable actions. IKEA is the company that allows follows the stakeholders approach or theory to take their sustainable and CSR policies so that they can consider and fulfil the needs of each and very stakeholders that includes the society as well.
References:
Bank, D. (2014). Corporate social responsibility. Fidelity Bank.
Beske, P., Land, A., & Seuring, S. (2014). Sustainable supply chain management practices and dynamic capabilities in the food industry: A critical analysis of the literature. International Journal of Production Economics, 152, 131-143.
Clapp, J., & Rowlands, I. H. (2014). Corporate social responsibility. The Essential Guide to Global Environmental Governance. Routledge: London, 42-44.
Corporate social responsibility, customer orientation, and the job performance of frontline employees. Journal of Marketing, 78(3), 20-37.
Fröding, K., & Lawrence, G. (2017). Sustainability at IKEA. Linnaeus Eco-Tech, 67-77.
Kang, J. S., Chiang, C. F., Huangthanapan, K., & Downing, S. (2015). Corporate social responsibility and sustainability balanced scorecard: The case study of family-owned hotels. International Journal of Hospitality Management, 48, 124-134.
Komassi, E., & Pal, R. (2015). Investigating short term strategies in product sustainability index implementation, a case study at IKEA. Universitätsverlag der TU Berlin.
Pedersen, E. R. G. (Ed.). (2015). Corporate social responsibility. Sage.
Rangan, V. K., Toffel, M. W., Dessain, V., & Lenhardt, J. (2014). Sustainability at IKEA Group.
Simon, L., & Wangsirilert, C. (2017). How large-scale companies and social enterprises improve the sustainability of their partnership?: The case study of IKEA and Doi Tung social enterprise in Thailand.
Strand, R., Freeman, R. E., & Hockerts, K. (2015). Corporate social responsibility and sustainability in Scandinavia: an overview. Journal of Business Ethics, 127(1), 1-15.
Tai, F. M., & Chuang, S. H. (2014). Corporate social responsibility. Ibusiness, 6(03), 117.
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