Corporate Social Responsibility: Carroll’s Pyramid
Discuss about the Role of Stakeholder Engagement and Dialogue.
The current report elucidates in detail about CSR activities as well as governance structures of the firm Wesfarmers Limited. The study intends to apply different analytical framework that is to say, Carroll’s Pyramid and Wartick and Cochrane’s Typology, present synthesis of notions and analyse behaviour of the management along with its implications. In this segment, the report also presents critical analysis of responses of the company Wesfarmers Limited to expectations of key stakeholders and highlights any gap that subsists between advocated as well as realised performance. Wesfarmers Limited is a leading Australian transnational firm, headquartered in Western Australia, with operational interests mostly in retail segment, market for chemicals and fertilisers, mining of coal, diverse industrial along with safety products of particularly Australian as well as New Zealand.
The study at hand intends to utilize secondary data and utilize qualitative mechanisms for analysing the data acquired from secondary sources such as official websites, reports, books, magazines as well as articles and journals (Micheli and Mari 2014).
The four-phase definition of Corporate Social Responsibility (CSR) was initially announced during the year 1979. During the year 1991, Carroll deduced four-staged definition and presented it in the structure of pyramid of CSR. In essence, the primary purpose of this pyramid was necessarily to single out specific definitional facets of CSR and to elucidate the building block feature of necessarily four part structure. Junior et al. (2014) asserts that the pyramid was chosen as a geometric design as it is uncomplicated, intuitive, and developed to survive the test of time.
Although the ethical accountability is presented in the pyramid as a detached kind of CSR, it can be observed as a facet which intersects and saturates the whole pyramid. Junior et al. (2014) suggests that ethical considerations are subsistent in each and every of the other accountability classifications as well. Essentially, in the category of economic responsibility, for instances, the pyramid supposes a capitalistic community in which the pursuit for profits is observed as a justifiable and just anticipation. Hahn and Kühnen (2013) mentions that capitalism, on the other hand, is essentially an economic system that believes of it as being morally appropriate that holders or else shareholders value a return on specific investments. However, under the category of Legal Responsibility, it hereby needs to be acknowledged that majority of the rules as well as regulations were generated founded on certain ethical way of thinking that they were fitting (Junior et al. 2014). The majority of the regulations were developed out of numerous ethical concerns, for example, apprehension for safety of consumers, safety of employees, the natural environment and many others. Therefore, once they get formalized they reflecting “codified ethics” especially for that particular community (Hahn and Kühnen 2013). And, certainly, the Ethical Responsibility reflects its own in this four staged model as a class that necessarily embraces several policies as well as exercises that many observe as standing at a superior level of anticipation than the minimums compulsory by law. Plainly speaking, regulations might be observed as passive conformity. Ethics, on the other hand, recommends a certain level of behaviour that might expect future regulations and in any incident make every effort to do that that is regarded above majority of laws and the one that is driven by morality. In the end, Philanthropic Responsibilities can be regarded to be every now and then ethically stimulated by corporations determined to do the correct thing. Despite the fact that some corporations practise philanthropic actions as a utilitarian choice (that is to say, strategic philanthropy) that can be observed as good corporate people,” also there are some who follow philanthropy as they believe it to be the righteous thing to carry out. Essentially, in the second analysis, philanthropy is considered to be ethically stimulated else wise altruistic in character (Buhr et al. 2014). Thus, in a summarised manner, it can be said that ethical inspiration and concerns evade and permeate the four phases of the CSR classes and consequently presume a crucial role in the entirety of CSR.
The Business Case for Corporate Social Responsibility
The particular business case on corporate social responsibility (abbreviated as CSR) refers to fundamental debates upholding else wise documenting the cause behind businesses to accept and progress the CSR practices. Basically, there are quite a lot of business case debates that have been undertaken in particularly literature, nonetheless, there are four effectual debates that mentioned in the literature. In itself, the basis for business case relating to Pyramid of mainly CSR is essentially to ameliorate diverse believed conflicts as well as tensions between and among particularly four different categories of accountabilities (Bonilla-Priego et al. 2014). In particular, there are diverse apprehensions as well as trade-offs shall keep on to be considerable decision points. In essence, they are not complete opposition to one another is often perceived.
The model of Wartick and Cochrane on corporate social performance focuses on principles, procedures and policies. The principles of corporate social responsibilities include economic, legal, ethical as well as discretionary. Corporate social responsiveness indicates towards reactive, defensive, accommodative along with proactive. Again, social issues management includes issues identification, issues analysis and responsive development. Bebbington et al. (2014) suggests that corporate social responsibilities are directed at social contract of businesses and business as particularly a moral agent. In addition to this, corporate social responsiveness are directed at the capacity to respond to altering societal conditions as well as managerial approaches to developing responses, Furthermore, social issues management include identification of issues, analysis of identified issues and development of responses. Particularly, these are directed at minimizing different contingencies and ascertaining effectual corporate social strategies.
Based on the sustainability pronouncement of the firm Wesfarmers Limited, it can be hereby observed that the company keeps on generating values for diverse future actions (Barkemeyer et al. 2015). However, based on the report published by the firm it can be observed that this business concern makes commitment towards proactively dealing with the society along with environmental influence (Alonso?Almeida et al. 2014). Different activities related to CSR of Wesfarmers can be classified as under:
People- In this case it can be seen that Wesfarmers Limited is committed towards maintenance of relentless concentration on delivering safe place of work. Furthermore, diversity at particularly Wesfarmers Limited concentrate on generating inclusive environment for working by remaining attentive towards diversity of gender and inclusion of people of different backgrounds namely people of Aboriginal and Torres Strait Islander classes (Alonso?Almeida et al. 2014).Based on Wartick and Cochrane’s Typology notions it can be said that the company pursues the CSR principles and is responsive (in a way accommodative) to identified management of social concerns. As per the premises of Wartick and Cochrane’s Typology, it can be hereby mentioned that the management of Wesfarmers has formulated a principle that is economic, legal, ethical and has been accommodative in embracing gender and ethnic diversity and in a way has strived to address the identified social issue. This CSR action of the firm as per the Carrol’s Pyramid can be said to satisfy all the four stages (Rinaldi et al. 2014). By concentrating towards people, the firm is satisfying economic accountabilities that are required by the community, obeying the rules and regulations (thereby satisfying legal responsibilities towards people), carrying out what is just as well as fair (indicating ethical responsibilities), thereby establishing as a good corporate citizen (referring to philanthropic responsibilities).
Wartick and Cochrane’s Typology
Sourcing- The processes of sourcing of Wesfarmers also includes different suppliers and ethical conducts of sourcing that necessarily is taken into account by the management of Wesfarmers Limited. In essence, suppliers also commits strongly towards developing strong along with respectful associations with varied suppliers. Furthermore, system of ethical sourcing system also strives towards sourcing in an accountable manner by functioning properly with various suppliers and enhancing social along with environmental exercises (Micheli and Mari 2014). Thus as per the notions of pyramid of Carrol, it can be said to be a practice that is just as well as hair averting farms and in a way is said to satisfy ethical accountabilities expected by the community.
Community- In essence, Wesfarmers Limited also contributes affirmatively towards society by striving towards maintenance of product safety in an effectual manner. Maintenance of product safety can be said to satisfy economic, philanthropist, ethical as well as legal accountabilities.
Environment- The Company Wesfarmers Limited thrives towards reduction of harmful emissions of corporations and augmentation of overall resilience to various climatic alterations (Junior et al. 2014). Furthermore, the company also undertakes CSR activity of Waste management and water usage for lessening overall waste for filling of land and usage of water to the extent possible. This can help in augmentation of conditions of the environment in which the company operates.
Governance- The business concern Wesfarmers Limited intends to maintain vigorous corporate governance strategies in different respects of business actions (Hahn and Lülfs 2014).
In essence, the firm Wesfarmers Limited makes commitment towards generation of value for different stakeholders of the firm, societies and workforces operating in an corporation. This corporation supposes long-term value generation and serve to different communities in superlative ways. In essence, sustainability refers to comprehending and handling the manners that make certain appropriate actions for creation of specific values in the upcoming future (Hahn and Kühnen 2013). This company commits towards minimizing specific carbon footprint and offer probable solutions by aiding consumers along with community on the whole.
Application of the above mentioned two different framework of CSR analysis helps in analysing the CSR as well as corporate governance structure of the current business case on Wesfarmers Limited. Evaluation of the sustainability declaration of the business concern Wesfarmers also plainly suggests about constructive contribution of the entity towards the society in which the firm functions and the manner in which the entire business concern dutifully offers safe products to all their consumers in conformity with the Australian Consumer Law (Child 2015). Reports reveal that the business concern has augmented overall safety of their products with usage of coin with button cell batteries that can help in reduction of product-linked injuries. In addition to this, the brand named “Target” of the firm Wesfarmers has supposed values of best practice to adhere by both global along with Australian directives and regulations. Thorough analysis of reports on corporate social responsibility expresses the fact that announcements made by the firm suitably covers different sustainability issues related to business environment. Also, the current report aptly elucidates the manner in which the business concern Wesfarmers is striving to reduce the intensity and extent of harmful emissions and augmenting the suppleness of the firm to different climatic transformations (Buhr et al. 2014). Furthermore, the report elaborately asserts about the handling of emissions by means of textual, tabular along with graphical representations.
CSR Activities of Wesfarmers Limited
Wesfarmers Limited has enhanced transparency of diverse operations in particularly the supply chain in over and above 3200 warehouses in specific audit. The business concern concentrates primarily on ethical sourcing such as transparency of supply chain in the upcoming period. In essence, this can aid in reinforcing associations with prospective suppliers by making certain positivity in diverse operational actions for the business concern. Particularly, at the business concern Wesfarmers Limited, there are intentions to reduce emissions of greenhouse gas by approximately 2% for future (Bonilla-Priego et al. 2014). The report declared by the business concerns reveals that approximately 37% emissions are lessened in the past 5 years (Bebbington et al. 2014).
By itself, the sustainability statement also clearly asserts about different ways in which the business concern is determines to reduce waste of the business concern to landfill along with water usage. Moreover, sustainability reports of Wesfarmers also explicate comprehensively regarding preservation of corporate governance stratagems in different the operations of the business (Barkemeyer et al. 2015). Nevertheless, comprehensive analysis of the sustainability reports discloses the fact that sustainability pronouncements do not deliver aptly the targets of different emissions that Wesfarmers intended to attain and overall percentage that it has necessarily attained. Therefore, it can be hereby mentioned that the pronouncements also do not mention about gaps between particularly target as well as actual numerals that subsequently can aid in recognizing diverse things that get in the way (Amran et al. 2014).
Corporate governance framework: The firm follow the suggestions presented in the ASX Principles declared on particularly March 27, 2014. In essence, this Corporate Governance assertion is present as on the date of the firm’s 2016 yearly declaration, and has been sanctioned by the entire Board. The company has an anti-bribery framework, risk management framework, remuneration policies, board succession planning and role of board as well as (Alonso?Almeida et al. 2014).
The management of the firm Wesfarmers can work towards establishment of targets that in future can be used as goal to be accomplished. The company follows ten different principles as an approach towards sustainable development of the business. In this case, it can be said that the principles and approaches can be reviewed from time to time in association to expectations of the community. The expectations of the community and the social issues might alter with time and accordingly the approaches of CSR activities need to be modified.
References
Alonso?Almeida, M., Llach, J. and Marimon, F., 2014. A closer look at the ‘Global Reporting Initiative’sustainability reporting as a tool to implement environmental and social policies: A worldwide sector analysis. Corporate Social Responsibility and Environmental Management, 21(6), pp.318-335.
Amran, A., Lee, S.P. and Devi, S.S., 2014. The influence of governance structure and strategic corporate social responsibility toward sustainability reporting quality. Business Strategy and the Environment, 23(4), pp.217-235.
Barkemeyer, R., Preuss, L. and Lee, L., 2015. On the effectiveness of private transnational governance regimes—Evaluating corporate sustainability reporting according to the Global Reporting Initiative. Journal of World Business, 50(2), pp.312-325.
Bebbington, J., Unerman, J. and O’Dwyer, B. eds., 2014. Sustainability accounting and accountability. Routledge.
Bonilla-Priego, M.J., Font, X. and del Rosario Pacheco-Olivares, M., 2014. Corporate sustainability reporting index and baseline data for the cruise industry. Tourism Management, 44, pp.149-160.
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Child, J., 2015. Organization: contemporary principles and practice. John Wiley & Sons.
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Hahn, R. and Lülfs, R., 2014. Legitimizing negative aspects in GRI-oriented sustainability reporting: A qualitative analysis of corporate disclosure strategies. Journal of Business Ethics, 123(3), pp.401-420.
Junior, R.M., Best, P.J. and Cotter, J., 2014. Sustainability reporting and assurance: A historical analysis on a world-wide phenomenon. Journal of Business Ethics, 120(1), pp.1-11.
Micheli, P. and Mari, L., 2014. The theory and practice of performance measurement. Management accounting research, 25(2), pp.147-156.
Rinaldi, L., Unerman, J. and Tilt, C., 2014. The role of stakeholder engagement and dialogue within the sustainability accounting and reporting process. Sustainability accounting and accountability, pp.86-107.
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