Using your research, to what extent do you think the benefits of CSR outweigh the costs for a business and its stakeholders?
The Benefits of CSR (2-3 developed with examples):
· Whilst others do not offer goods or services which make use of recognised CSR production methods or ingredients, there is a clear marketing advantage that consumers are happy to pay a premium for.
o USP, higher prices and increased profit margins, relevant B2B as well due to importance of supply chain
· Social responsibility is an internal benefit to a business – the fundamentals to most motivation theories is based around the concept of a responsible and socially inclusive approach by suppliers.
o Higher productivity due to motivation and so more competitive
· The impacts of negative publicity surrounding poor CSR are long lived; good CSR is a long term investment that reaps long-term rewards.
o Affect conscious consumer purchasing habits
· A firm recognised for being green, or having a positive impact on its stakeholders can attract finance much easier due to a greater range of sources being available – including some which incur little cost of borrowing or are even ‘gifts’ or incentives for green behaviour.
o Greater choice of finance options, including investors whom are likely to be short-termists and so will enable reinvestment and growth (LT benefit)
The Costs of CSR (2-3 developed with examples):
· Increased costs of production leading to higher prices or reduced corporate profits and so decreased competitiveness. True in short term but dependent on strength of supplier relative to buyer so how ‘unfair’ the normal is, so how much there is to lose by fairer costs
o Therefore less price competitiveness
· The significant sums of money spent by firms on CSR are often dictated by few directors and may not reflect how shareholders want their money spent.
o Therefore a certain degree...