Evaluating Corporate Social Responsibility of Microsoft Inc., Google Inc., and The Walt Disney Company - Case Study Example

Evaluating Corporate Social Responsibility and Department al Affiliation Introduction In orderto evaluate the relationships between business’ ability to act realistically in socially responsible manner and the products produced by that company, this paper evaluates Microsoft Inc., Google Inc., and The Walt Disney Company. This evaluation seeks to analyse the merits and demerits of each of the approaches used by the three companies for their involvement in Corporate Social Responsibility. Understanding each of these approaches is a crucial way of ensuring that one understands and chooses one brand over the other. In order to demonstrate the growing significance of Corporate Social Responsibility and issues of sustainability for consumers, a study by Reputation Institute (2014) indicated that about 60% of consumer perceptions othe companys reputationon determine the consumers’ willingness to work for, invest, or recommend a company while 40% is due to the consumers’ perception of the product or services sold by that company. For this study, the major considerations are the main benefits of CSR in relation to costs for the business; the significance of CSR in relation to other objectives; the major determinants of responsibilities that are accepted by a business and those that are not; the factors that determine the extent to which business is socially responsible, and the extent of government influence on CSR,. Potential Benefits of CSR Relative to the Costs for the Businesses At Microsoft, there is a continuing commitment to work to fulfil public responsibilities and to serve the needs of people in communities worldwide. However, for Microsoft, the fundamental obligation is the role Microsoft serves as an accountable universal corporate citizen (Smith, 2012). In addition, Microsoft earned the best CSR reputation through initiatives such as Citizenship Leads throughout the world working every day in collaboration to with a huge stakeholder’s base and with regards to numerous issues crucial to local communities. Microsoft Green is also another CSR initiative aimed at emphasizing Microsoft’s Environmental Sustainability Team. In order to implement its CSR initiatives, Microsoft works with investors, non-profits, governments, and other organizations, including the Boston College Center, CSR Europe, Net Impact, World Economic Forum, and Clinton Global Initiative. For more than 51% of Google consumers across the 15 universal markets, working at Google is great (Smith, 2013). With such perceptions, Google has managed to successfully establish a caring perception around the world to ensure that they are a company that not only treats people well, but one that ranks first in the worlds, thus a great platform to turn to. One of Google’s most renowned initiatives is Google Giving that works to give back to the society to motivate the company and individuals. The initiative involves working with social entrepreneurs using technology to crack the code of the world’s greatest problems. For instance, in 2013, Google invested in tech efforts aimed at curbing poaching, and preventing illegal human trafficking and poverty reduction. Furthermore, Google invests in Googlers from different fields, including engineers and marketers to assist non-profit teams with their responsibilities and roles. In its capacity, Walt Disney has been evaluated as the world’s most established company in the citizenship category for its efforts in the environment and philanthropy (USA Business Review, 2013). Through its Citizenship initiative, Walt Disney seeks to provide continued commitment to being the most desired world companies through the quality of its entertainment and the integrity of its employees. Consequently, Walt Disney seeks to ensure that each child experiences happiness and well-being through being inspired to join Disney Citizenships for their future well-being. In its efforts, Disney works with the United Nations Child Fund or UNCF, KaBOOM, and Child Life Council. The initiative by Walt Disney involves volunteering where free tickets to a million people in exchange for a day of volunteer service at their preferred organization. In its efforts to protect the environment, Disney facilitates environmental education through sharing compelling stories in the natural world using Disneynature films such as Earth, African Cats, and Oceans. In the end, Disney expects that through its CSR efforts, its brand and image would be built while building customer loyalty and trust. The Importance of Corporate Social Responsibility Relative to Other Corporate Objective Microsoft Inc. like any other corporation engages in corporate social responsibility for competitive reasons such as ethical and economic considerations, innovation and learning, reputation or brand, cost savings, enhancing marketing position and brand, and for employee motivation and risk reduction (Carroll & Shabana, 2010, p. 86). Microsoft’s major investment involves innovation and learning such that its long term self-interests guarantee its long-term viability. This is because through its innovations, Microsoft ensures that it remains viable in the future, given its reservoir of management talent, functional expertise and capital. Through innovation, Microsoft also seeks to have a world where societys problems are not just resolved using reaction to poor outcomes, but also due to pro-acting problems through anticipation, initiating, and planning. Pro-acting to problems is considered less costly since it does not involve waiting for social issues to arise in order to resolve them (Carroll & Shabana, 2010, pp. 87-88). At Google Inc. CSR is an inevitable and inescapable business priority and objective. In addition, Google faces pressure to promote issues both environmentally and socially. Through its CSR programs, Google seeks to ensure that it does not only impact on its nonfinancial and financial performance, thus impacting on its competitiveness (Palmer, 2015, p. 181). Google understands that through vaguely defined CSR approaches, there will be a disconnection from other business objectives, thus obscuring numerous opportunities that the company could use to benefit the society while raising its profits. Through CSR, Google consumers also expect enhanced business practices, and this means soliciting ideas from the consumers and funding viable business ideas for implementation. Based on Sampada (2010) research findings, Google’s corporate social responsibility is defined as a self-regulating tool for monitoring and ensuring that it actively complies with the ethical standard laws, and universal norms. It is for this reason that Google has defined Google CSR initiatives for different world regions such as Google China Social Innovation Cup for College Students or Google Africa Program, and initiatives in the world like Google challenges where students are expected to participate from around the world. Through its CSR program on Disney Citizenship, Walt Disney now understands that besides being in business for a profit, investors are also attracted to work with responsible businesses as this reduces their risks while addressing the investor’s concerns (Fenn, 2013). For Disney, CSR has also contributed to its growth from just being a cartoon making firm to a company that influences a huge number of consumers through its business network that includes resorts, publishing, ABC network, and ESPN businesses. Disney also uses its CSR to set environmental performance targets that are closely measured using ambitious financial goals. For instance with more than 60,000 employees, Disney managed to use Green Standard initiative to motivate environmental conservation aspect in employees during work, travel, or over lunch hours. Through their corporation, Disney managed to have everyone work towards similar direction. One benefit of clearly stated corporate social responsibility is a 10% reduction in electricity consumption among three of their theme parks annually. Influences determining which responsibilities are accepted by business and those that are not As corporations seek to become responsible to the community and shareholders through their operations and actions, CSR policies aimed at demonstrating the objective of valuing ethical values and respecting consumers, the environment, and the community are inevitable. Some of the shared influences that determine what is accepted by business and what is not include profitability and value, costs and customer relations (Ferrell & Ferrell, 2014, pp. 5-7). For any CSR policy regardless of the industry or sector that an organization operates, improving company profitability is crucial. In most cases, profitability improvement involves introducing waste recycling, and other forms of efficient energy use to minimize company operating costs. Again, businesses get into CSR to elevate their transparency and accountability with the media and investment analysts, the society, and shareholders. Consequently, the company’s reputation is enhanced among investors that integrate CSR into their stock. While operating in the modern day business environment, the external power subjected to a business from stakeholders is inevitable. Investors are investing their money in the shares of a firm which makes them a fundamental aspect of any decision making process within the organization. For instance, in 2013, Walt Disney shareholders voted against having to split the positions of Chief Executive Officer and chairman (Miller, 2013). Out of the cast votes, only 35.5% were non-binding and supporting the proposed to split the CEO position while only 39.5% shareholders cast non-binding vote in favour of splitting chairman position. The move was aimed at reducing the expenses spent paying additional CEO and chairmen instead of cutting costs to maximize profitability and shareholders’ return on investment. Finally, consumers are a very powerful stakeholder since they can fail a company by withholding their purchase of company products, thus threatening any globalized company such as Microsoft Inc. and Google (Ferrell & Ferrell, 2014, p. 8). For instance, consumers whose culture or beliefs supports environmental preservation can withhold using products or actions from a company that negatively impact on the environment. This means that in case customers are frustrated, it is easy to influence the decision of shareholders such that their customers are happy and satisfied for the sake of higher profit margins. Factors That Determine the Extent to Which a Business Is Socially Responsible These factors are the minimum legal requirements, company structure, and competitor activities (Zu, 2009, p. 43). In markets where competitor activities gain positive media attention and greater stakeholders’ interests, the company is highly likely to take similar stances for the competitor to lose their competitive edge. In return, the company can also adopt product differentiation whereby their goods belong to a given ethical ground, and use responsible rivalry and successful business whose CSR strategy does not match that of the rival company. Additionally, the legal structure of any company such as director’s duties and accountability to shareholders determines the identity of the company especially in terms of shareholders’ power and decisions. For instance, Walt Disney, Microsoft, and Google are not a limited liability and this means that its involvement in CSR friendly is voluntary as opposed to limited liabilities that limit their participation in CSR for lack of accountability to shareholders for their investment (Zu, 2009). The extent to which government should influence Corporate Social Responsibility For any organization pursuing corporate social responsibility, the chosen responsibilities must align with legally enforced laws (Sandoval, 2014, p. 207). This is because the government is responsible for ensuring that any business adheres to minimum legal requirements set out on CSR through the use of national governments hard and soft policies driven by either international or domestic pressure. For instance, operating in American means that Microsoft, the Walt Disney Company, and Google have to adhere to 1999 Employment law as evident in the minimum wage act. The act specifies that any employee must be above 18 years and can only be paid a minimum 5 pounds an hour. This means that being multinational; Google and Microsoft would have to be keen to differences in county legislation as these would affect their costs for employees and suppliers. In addition, organizations must be on the lookout for government-led incentives, tax concessions and subsidies aimed at encouraging them to accept CSR development by example such as renewable power and energy sources. For instance, Microsoft, Google, and The Walt Disney have demonstrated intense concern over the environment by engaging in both environment preservation initiatives, and energy conservation (Palmer, 2015, p. 182). Conclusion In conclusion, corporate social responsibility of a company is a key factor in consumers’ chosen product besides comparison of prices, reputation, and quality of each product. This is because consumers’ product choices are also heavily dependent on their understanding of the company’s ethics, engagement with local communities, and the company’s treatment of its employees. Corporate social responsibility as embraced in Google, Microsoft, and Walt Disney indicates factors such as shareholders, the government, community, and consumers are crucial in determining the extent of CSR and the accepted business responsibilities during CSR. References Carroll, A. & Shabana, K., 2010. The Business Case for Corporate Social Responsibility: A Review of Concepts Research, and Practice. International Journal of Management Reviews, pp. 85-105. Fenn, R., 2013. Benefits of Corporate Social Responsibility. [Online] Available at: http://www.sustainablebusinesstoolkit.com/benefits-of-corporate-social-responsibility/ Ferrell, O. & Ferrell, J., 2014. Business Ethics: Ethical Decision Making & Cases. United States: Cengage Learning. Institute, R., 2014. 2014 CSR RepTrak 100 Study. United States: Reputation Institute. Miller, D., 2013. Disney shareholders vote against splitting CEO, chairman positions. LA Times, 06 March. Palmer, D. I. G., 2015. Handbook of research on business ethics and corporate responsibilities. Pennsylvania: IGI Global. Sampada, M., 2010. Corporate Social Responsibility - A study of key features, benefits, criticism and the various initiatives. Internaational Journal of Managment Sociology and Humanity, pp. 193-207. Sandoval, M., 2014. From Corporate to Social Media: Critical Perspectives on Corporate Social Responsibility in Media and Communication Industries. London: Routledge. Smith, J., 2012. The Companies With the Best CSR Reputations. Forbes, 12 October. Smith, J., 2013. The Companies With the Best CSR Reputations. Forbes, 10 February. USA Business Review, 2013. The Walt Disney Company - A Leader In Corporate Social Responsibility. [Online] Available at: http://www.businessreviewusa.com/leadership/3827/The-Walt-Disney-Company-A-Leader-In-Corporate-Social-Responsibility Zu, L., 2009. Corporate social responsibility, corporate restructuring and firms performance : empirical evidence from Chinese enterprises. London: Springer. Read More