The Impact of Corporate Social Responsibility on Business Performance - Essay Example

Corporate social responsibility is a prevalent practice with far-reaching implications in nearly all sectors of society be they; academic, business, or public sectors. Two distinct studies all base their research on the subject although with different approaches and purposes. 

The key questions asked within the study include; whether from the consumer’s perspective, corporations have to be socially responsible to society; the nature of this responsibility; how much knowledge consumers think they have on the level of the social responsibility of the firms; if the consumers care of the firm’s social responsibilities and what motive consumers attribute to corporations that participate actively in society’s affairs. The paper uses several methods including in-depth interviews and has the purpose of coming up with a clear understanding of what the public expects of these corporations about social responsibility, (Mohr and Webb, 2005).

The second study titled ‘Corporate Social and Financial Performance: A Meta-analysis’ by Orlitzky, Schmidt, and Rynes uses a quantitative approach to assessing the relationship between corporate social performance and the resulting financial performance. The quantitative study conducts a meta-analysis of 52 studies with a total sample size of 33,878 observations, (Orlitzky, Schmidt, and Rynes, 2003). The study’s specific objectives were to provide a statistical integration of accumulated research between CSP and CFP, examine key determinants of both CSP and CFP and integrate empirical research in the cont, ext of diverse studies.

The Hypothesis stated that ‘Corporate Social Performance and Financial performance are generally related across a wide variety of industry and study contexts.’ Their results indicated that corporate social responsibility was likely to pay off since there was a generally positive association between corporate social performance and corporate financial performance, (Orlitzky, Schmidt, and Rynes, 2003). The StudyIn this study, the researcher will focus on the topic: Evaluating the Impact of Corporate Social Responsibility on Business Performance.

The research will specifically focus on defining the existing trends of measuring business performance about strategy, the key indicators of business performance more specifically; shareholder value, market share, and revenue, and how they are directly or indirectly affected by Corporate Social Responsibility and approaches that can be used to measure the impact of Corporate Social Responsibility on actual business performance. The article by Orlitzky, Schmidt, and Rynes (2003) supposes that an organization’s corporate social responsiveness coupled with its policies and programs often has a direct observable outcome on its actual performance.

This is also supported by Mohr and Webb, who argue that CSR programs initiated by firms, changes positively, the image of the company in the eyes of consumers. The research questions are selected to narrow the focus of the study, (Creswell, 2002). Conceptual Theoretical FrameworkConceptually, corporate social responsibility can either be defined based on delineating the major responsibilities of companies or based on the concept of societal marketing, (Mohr and Webb, 2005 and Smith and Langford, 2009).

Based on the first approach, CSR is analyzed on the key responsibilities which includes economic, ethical, legal, and philantincludeith each of the dimension,s being viewed about the companies’ customers, employees, owners, and the public. The second approach views CSR as a measure of doing business in ways that improve or maintain the well-being of society. Business performance will theoretically be analyzed based on a business’ state of affairs including its successes, future outlook, and development.

The study will be guided under the framework of establishing both the direct and indirect approaches to measuring the impact of CSR on business performance. SummaryIn summary, the research will focus on key issues such as the nature of social responsibility within organizations, consumers’ perceptions of a firm’s corporate social responsibility practices, and the relationship between these practices and actual business performance. The currently existing trends of measuring business performance, the key indicators of business performance about strategic options, and the approaches used to measure the impact of corporate social responsibility on business performance will be the focus of the study.