Corporate Social Responsibility -- Internal as well as External CSR
Examine corporate social responsibility (CSR) from internal and external perspectives. Discuss the importance of CSR in advertising and critically examine some companies that may use CSR in a cynical context: for example, some companies are projecting the following attitude: Look at how ethical and community-minded we are, hence, you should buy our products because we really care more than our competitors.
Corporate Social Responsibility - Introduction
The idea of corporations becoming socially responsible and accountable to the communities in which they operate -- and to their stakeholders, including their customers -- is not a new concept. In fact, as Professor Craig Smith of the London Business School points out, the idea that businesses had "societal obligations" became "evident" back in the 19th century (Smith, 2003). In the aftermath of the Industrial Revolution British business leaders like George Cadbury (1879) and William Lever (1888) built modern factory towns so their workers wouldn't have to struggle to survive in slums (Smith, 1).
Professor Smith correctly points out that one of the drivers of CSR is the "criticism" that businesses have been receiving -- more "far-reaching than ever before" -- which is based in part on the "failure of governments" to solve social problems, and also in part on the public's uneasiness with globalization and the longer reach of corporate interests, which sometimes take on questionable ethical aspects (Smith, 6). Indeed, CSR is a powerful theme repeated constantly in today's globalized marketplace. In fact corporate social responsibility (CSR) has become a key part of many company's marketing programs because, as an article in the journal Business Ethics: A European Review points out, messages about strong ethical behavior and socially responsible actions "…are likely to evoke strong and often positive reactions among stakeholders" (Morsing, et al., 2006).
There certainly are "business benefits" to be reaped when companies boldly point out their good deeds, but those deeds and messages can also "…attract critical stakeholder attention," Morsing explains on page 323. In fact, that "critical" attention given to companies that present messages to the public about their ethics and support for social change is one of the key reasons for this paper. This paper makes a clear distinction between the "business case" for CSR and the "normative case" for CSR; the normative case would include having a corporation do what's right and what is ethical, while the business case refers to the helpful public image a corporation expects to receive from CSR, whether the CSR is sincere or not.
Corporate Social Responsibility -- Advertising
Life insurance companies in Taiwan are often engaged in advertising their CSR initiatives for several reasons. For one, being socially responsible is seen as "an ethical issue in Taiwan" (Hsu, 2012). For another, life insurance companies are importantly viewed as "respecting the benefits of stakeholders" and protecting policyholder's rights; and for a third reason, the life insurance industry is seen by citizens in Taiwan as "earning abnormal profits" (Hsu, 190). Hence, CSR is "especially important" to members of the public who have high expectations for wealthy companies -- especially those seen as very wealthy (Hsu, 190).
Corporate Social Responsibility also means using advertising to support groups that are otherwise being marginalized by government. An example is the 2014 Winter Olympics in Russia; a law was passed essentially banning gay relationships in public, and the outcry by not only gay and lesbian groups but by the United States, caused Olympic sponsors to use advertising to defend their interests. McDonald's, a corporate sponsor of the Olympics for 37 years, advertised that it believes "…sport is a human right and the Olympic Games should be open to all, free of discrimination, and that applies to spectators, media, and athletes" (Taylor, 2014). Since McDonald's is one of ten firms that pay $100 million each four-year cycle to be very visible at the Olympics, it was vital for the fast-food behemoth to take a stand through advertising.
Corporate Social Responsibility -- Internal Marketing - Examples
Isabel Sanchez-Hernandez and David Grayson (2012) note in their peer-reviewed piece that both "altruistic and strategic views" regarding CSR do certainly co-exist. Making smart choices vis-a-vis CSR may give a "competitive advantage" to a firm, but the authors posit that just putting out a good image to consumers and the public in general does not necessarily mean that the company is fully engaging its own employee workforce (Sanchez-Hernandez, 2012). In other words, companies extolling their virtues to the outside world (external) should also be actively engaging their employees (internal) as well. In other words, internal marketing (IM) has a role to play in terms of "transforming an organization into a responsibility-focused entity" (Sanchez-Hernandez).
Almost everyone can agree that a "responsible firm" should work hard to do the following four things that Sanchez-Hernandez mentions: a) be profitable; b) follow existing laws; c) "be ethical"; and d) "be a good corporate citizen." But what does it entail to be a good corporate citizen? In this article the authors believe it entails engaging employees to exemplify internally what the managers and executives are putting out there externally.
The authors are careful to differentiate between just conducting internal marketing in order to "objectify employees" -- and using internal marketing to "engage employees in an interactive relationship" designed to align worker goals with corporate goals (Sanchez-Hernandez). The idea of IM is to motivate employees, of course, but it is also pivotal in the IM process to "generate cross-functional coordination efforts" in order to achieve the important objective of customer satisfaction (Sanchez-Hernandez).
By using traditional marketing strategies managers can engage employees in an internal marketing effort in three ways: a) first identifying what employees really need and want, and how the company may be able to satisfy those needs and wants; b) how the needs and wants of different groups of employees differ, in a diversity environment; and c) how then can a company create a structure (using an internal marketing focus) that is set apart in positive ways from its competitors, and becomes "an employer of choice" which can attract and retain "the best talent available in the labor market" (Sanchez, Hernandez).
In other words, it is not enough for a corporation to conduct external CSR campaigns without examining what it is doing internally. To wit, if the folks that work for a company are not also engaged in the overall process, and if their quality of life is not being enhanced as well, it becomes a stagnant, bleak work environment. However, word will certainly get out when a company is treating its employees with dignity, with good ethical practices, and by giving them: a) flexible and broader roles on the job to develop good citizenship behavior; b) "learning opportunities" in order to acquire new skills and to better manage time; c) offering rewards with "recognition premiums" for good corporate citizenship within the company; and d) "creating a smart work environment" (giving sabbaticals or other breaks so employees can have an opportunity to do community volunteering work and to fully "embrace CSR principals" in their own lives (Sanchez, Hernandez).
Corporate Social Responsibility -- Internal / External Marketing -- Pro-Sports Teams
While most of the focus of the CSR-themed literature has been on corporations' CSR initiatives and the ramifications of those initiatives, in the Journal of Sport Management the authors point out that professional sporting organizations have entered into the CSR milieu "at a rapid pace" (Babiak, et al., 2009). The issues and strategies that motivate professional sports organizations to get involved in "socially responsible activities" are the same ones that motivate corporations, Babiak points out (720). From Nike and Reebok, to the NFL, the NBA, and NASCAR -- among a myriad of other sports entities -- the CSR implemented generally includes publically announced community outreach to youth organizations, professional players visiting hospitals and showing up at events designed to help underprivileged boys and girls -- and to community environmental issues as well.
These of course are external programs, and the authors suggest there are four factors that make the external CSR in sports different from the typical corporate CSR: one: "passion" (ticket-buying soccer fans have passion, Red Sox fans / consumers have passion, quite different from people who buy breakfast cereal or Tylenol); two: "economics" (many players make millions of dollars; the NFL is worth billions of dollars; sports teams have "special protections from the government" and hence the perception of arrogance can be balanced when sports teams and league engage in CSR); three: "transparency" (the outrageously high level of earnings is "open knowledge" in sports, unlike other industries, so sports teams "engage in CSR as insurance against negative reactions"; to wit, would the NFL have helped the Society for the Prevention of Cruelty to Animals (SPCA) if star quarterback Michael Vick had not been involved in dog fighting?; and four: "stakeholder management" (the media, fans, sponsors, levels of government, and communities, all benefit from CSR activities) Babiak, 722-23).
By conducting in-depth interviews with executives and PR…