In the contemporary world, corporations must demonstrate a high degree of recognition of their social responsibility to the community. Society requires the management of an organization to support community developments regardless of whether it generates profits to the major stakeholders. Primarily, the values of the shareholders in a company determine the extent to which it supports community-based activities in the area it operates. Consequently, the shareholders’ decision indicates the willingness of an organization to allocate funds to community development. In many cases, an organization directs considerable amounts of resources towards the support of social programs to alleviate the social pressures from particular interest groups. The increased public awareness of the role of a corporation in promoting community development magnifies the pressure the management face in actualizing their organization’s social responsibility.
In view of that, corporate social responsibility represents those actions which do not necessarily result in economic benefits to a firm. The implementation of a company’s CSR demonstrates its desire to reduce the negative impact it causes to the community. As such, a company utilizes its CSR to reinforce its positive effects on the community in which it operates.
Research Objectives and Questions
Currently, many corporations adopt CSR operations which guarantee environmental protection and conservation. The operations should generate the desired environmental state beyond the corporation’s primary interests. The actualization of an organization’s CSR results in both positive and adverse effects to the firm. However, businesses prioritize those activities of strategic importance rather than the actions generating societal and environmental benefits. The successful implementation of the CSR contributes towards a corporation’s competitive advantage and profitability as the potential customers view its actions positively. Therefore, this study focuses on the core aspects of corporate social responsibility and basic approached implemented to comply with the CSR principles. Further examination of CSR is observed based on the examples of Toyota global corporation and Fujitsu group.
In essence, this research aims to answer the following questions:
What are the core principles of CSR and corporate social performance (CSP and how companies demonstrate their compliance with the CSR norms and principles?
Which practices and CSR approaches are implemented by global companies?( Based on the case study of Toyota and Fujitsu Group).
Part I: Literature Review
According to Wettstein (2012), there are three correlating duties in the protection of human rights in an organization. It is necessary to perform the three functions to demonstrate the honor of an individual’s basic right (Wettstein, 2012). The existence of the three obligations ensures that the members of the workforce participate in the prevention of violations. CRS indicates the need for collaboration in respecting, guarding and realizing the occurrences of human rights violations (Wettstein, 2012). In this case, the obligation to ensure the completion of the three duties is spread throughout an organization. Essentially, Wettstein (2012) cites the difficulty in distributing the responsibilities as the greatest challenge facing the typology. The researcher indicates the necessity of the influential agents in an organization taking responsibility to find solutions to the existing human rights challenges. The approach provides flexibility as the determination of a solution happens at any level in a company. Moreover, Wettstein (2012) insists that the current global challenges require organizations to participate in human rights protection proactively. As a matter of fact, the researcher notes that rigid systems of sharing responsibility facilitate the persistence of organizational challenges.
Primarily, the elements of the capability-based approach include functions and capabilities of an organization. The approach focuses on an organization’s freedom to achieve its objectives and capacity to operate in a particular industry. In this case, a group utilizes several strategies to realize its goals in the market as it enjoys the freedom to achieve. A company’s ability to meet its objectives constitutes to capabilities while the achievement represents its functioning. Wettstein (2012) further claims that the capability-based model represents the structural importance of an organization to meet the constitutional rights which people enjoy in the society. The scholar cites the constitution to demonstrate that the design conforms to the public or political power rather than nobleness. Therefore, a corporation has a political responsibility to ensure that the human rights are universally protected and realized. The researcher’s interpretation connects the need to protect and recognize human rights to the corporate social responsibility. The need to safeguard people from the potential violations that arise from organizational operations dominates Wettstein’s (2012) discussion.
Further, the existence of human rights demands the appropriate actions from the members of the society to prevent possible violations. Wettstein (2012) suggests that the possibility of ensuring universal elimination of infringement on the fundamental rights depends on the level of collectiveness. The claim indicates that it is arguably impossible to protect people from the violations of their rights on an individual level. The process requires the population to accept a collective obligation to protect human rights. Since the members of the society have different capabilities to ensure the worldwide protection of human rights, it is necessary for the influential people to promote the availability of the privilege (Wettstein, 2012). The claim indicates the role of the sense of awareness among the members of society towards the ability to actualize their moral obligations towards others.
Wettstein (2012) emphasizes that the distribution of the collective responsibility to protect the community from violations of human rights depends on the capabilities. Therefore, there is a possibility for the powerful agents to abuse their abilities and promote human rights abuses. In this case, it is important to limit the power a particular stakeholder wields over the potential victim (Wettstein, 2012). It occurs as a consequence of utilizing a moral connection as a compliment to the capability of an individual or an organization. Additionally, it is necessary to embrace reasonableness in the determination of moral obligations. Wettstein (2012) cites capability as a crucial element in an organization’s CSR, the commercial activities, and the human rights discussion. The combination of the factors encourages positive human rights obligations of companies. The scholar insists that the obligations depend on the capabilities in protecting the human capital from exploitation.
The outline of the capability-based system includes the corporate responsibilities of respecting, defending and realizing the personnel from the potential violations. The business responsibility in respecting human rights includes the tendencies of refraining from perpetrating dehumanizing acts against the members of the workforce. Wettstein (2012) demonstrates that the personnel can suffer from human rights violations which arise from such corporate partners as suppliers and contractors. Therefore, an organization should demonstrate the ability to protect its employees from both direct and indirect acts against humanity. As a matter of fact, the workforce suffers from a significant proportion of indirect violations. A company must cushion its employees against the breaches of human rights.
While it is necessary for a corporation to end its relations with those partners that exploit its personnel, the decision fails to meet the universal moral expectations. The public expects such companies to exert considerable amounts of pressure on the offenders to change their practices (Wettstein, 2012). It is necessary to demonstrate respect for human rights through encouraging the business partners to adopt a similar approach. Although the easiest alternative would be ending business relationships with human rights violators, it leaves the victims at the mercy of the offender (Wettstein, 2012). Notably, such a decision demonstrates the lack of willingness to protect the partner’s employees from violations. Additionally, the failure to pressurize the offenders into respecting the fundamental privileges of their personnel may indicate approval of the persistent dehumanizing situations.
According to Wettstein (2012), multinationals have an obligation to ensure the universal protection of human rights. The researcher indicates that the companies which have the power to show their disapproval of particular actions should utilize their position to pressurize the offender including a country to respect the rights of the workforce. The influence that the multinationals command in the world informs the public of their ability to stop dehumanizing practices. While the act of exposing violations in another country results in the perception of interfering with internal affairs of a country, Wettstein (2012) insists that silence dents the reputation of a multinational that remains silent as people suffer under deplorable workplace conditions. The scholar cites the incident involving Google and the Chinese government as an indication of the power the multinationals wield on the international scene.
A company demonstrates its social responsibility through the creation of value for the community. Sinkovics, Rudolf, Hoque, and Czaban (2015) claim that social value creation includes the positive impact of an organization’s activities to the community. The scholars acknowledge the broadness of the concept as it involves positive externalities arising from a firm’s activities. In this regard, the community must realize particular benefits to determine that an organization actualizes its social responsibility. The process then indicates that a corporation recognizes the opportunities in the society and produces products to create value for the community. Sinkovics et al. (2015) note that the recognition of opportunities arises from social conditioning. The scholars emphasize the role of the social context throughout the creation of value in the society. The corporations which utilize the concept of social entrepreneurship prioritize the societal value rather than the economic gains.
Although Wettstein (2012) emphasizes the political role of multinationals in promoting human rights in the world, Sinkovics et al. (2015) indicate that excessive indulgence into international matters can result in social destruction. Sinkovics et al. (2015) claim that a multinational company can utilize its power to manipulate the situation for its corporate benefits. The international companies enjoy high levels of political freedom as the population cannot vote them out of the market. On the other hand, the performance of a politician is subject to public evaluation, and those with dismal results get voted out of the system. Sinkovics et al. (2015) warn that the multinationals can take advantage of such freedoms to concentrate on its economic value.
In view of that, Sinkovics et al. (2015) claim that the corporate social performance (CSP) is a tool used to evaluate the social relevance of a company’s activities. The device determines the type of impact an organization’s activities exert on society. While the CSP determines the level of positivity and negativity of a corporation’s practices, it fails to recognize the diversity in social determinants for legitimacy (Sinkovics et al., 2015). The level of business acceptance in a region varies depending on their social values. It is hard to measure the impact of a company’s actions and strategies on a community using the CSP (Sinkovics et al., 2015). The CSP should recognize the dynamic definitions of the social determinants of acceptability.
The need to embrace the principles of globalization requires multinationals to develop inclusive strategies which facilitate the recruitment of qualified personnel from all parts of the world. Although multinationals can utilize the home country labor, it is necessary to have a diverse workforce which is capable of providing solutions to the customers. The potential consumers belong to different cultures, and the personal perceptions about particular products determine their purchasing power. Additionally, the obligations of a company in a diverse society require it to develop a holistic framework to meet the social needs of a community. The ISO 26000 standard provides the foundation for establishing a comprehensive CSR in an organization. The standard applies to all organizations regardless of type and geographical location. The ISO 26000 standard ensures sustainable production of goods and services. In particular, the standard ensures the satisfaction of customer needs, maintaining socially responsible operations, and protecting the environment from degradation.
The ISO 26000 standard contains particular sections which guide an organization in the development of its CSR as listed in this paper.
Terms and Definitions.
Understanding the Social Responsibility.
The Principles of Social Responsibility.
The recognition of Social Responsibility and engagement of stakeholders.
The Social Responsibility elements.
Implementing the Practices of Social Responsibility.
The ISO 26000 standard facilitates the integration of qualified personnel on the international level. The expertise works to identify the social needs an organization should meet internationally. The standard assists organizations to transform good intentions into appropriate actions in the community. It ensures uniformity in the frameworks that guide a corporation’s social responsibility.
Part II: Case Studies
While the innovation promotes the development of some of the most advanced automobiles, the products affect the society and environment differently. At the moment, it is necessary to consider the development of sustainable models so as to contribute towards the reduction of the emission of greenhouse gasses. Toyota strives to contribute towards sustainable development throughout its operations. It focuses on the development of innovative and quality products and services to improve the experiences of customers throughout the world. The company produces those automobiles which meet the customer specifications. The corporation seeks to create harmony among people, environment, and the society. Toyota ensures sustainable development of the society through the process of manufacturing. The company demonstrates its social responsibility throughout the ISO 26000 core subjects.
The Corporation utilizes its code of conduct to ensure the respect and protection of the human rights throughout its departments and subsidiaries. The code of conduct outlines the concept of protecting human rights of the personnel. Continuous improvement and respect for people make up the company’s pillars for sharing common values with the international business units. The personnel in the corporation is comprised of all stakeholders and the employees. Toyota has a human rights working group which facilitates the reinforcement and review of the issues that relate to human rights (“Toyota Global Site | Creating an Affluent Society,” 2017). The group consistently works on the international scene to determine the potential areas of improvement as well as reinforcement of existing successful practices.
Furthermore, the need for the production of quality products increases the demand for raw materials for the corporation’s activities. The extraction of minerals exposes the population to potential violations of human rights and environmental degradation. The company partners with the automotive organizations and suppliers to eliminate the occurrence of infringement on the personnel. In addition, the company continues to urge suppliers to participate in responsible processes during the procurement of materials. The exertion of pressure resonates with Wettstein’s (2012) assertion that corporations should indicate their displeasure regardless of the relationship they have with the offender. The company utilizes established policies and approaches to solving the issues arising from the mining activities.
The company demonstrates recognition of the relevance of employees in its business model through the adoption of management approaches that respect people. Such approaches facilitate employee engagement as the employees enjoy the freedom of demonstrating their creativity to contribute to society as well as self-actualization. The increased participation of employees in company practices motivates Toyota to stabilize employment and improve the workplace conditions.
Toyota utilizes several initiatives to ensure environmental protection from the potential sources of pollution arising from its operations. The New Vehicle Zero CO2 Emissions challenge inspires the company to prioritize the development of the next generation vehicles. The company intends to develop automobiles that emit little CO2 or those that do not release any greenhouse gasses. Essentially, the company appreciates that the distribution of the eco-friendly vehicles shall contribute towards environmental protection. Therefore, it pledges to collaborate with other stakeholders to develop the relevant infrastructure for the next generation automobiles.
The Life Cycle Zero CO2 Emissions Challenge includes Toyota’s determination to eliminate the production of greenhouse gasses at all stages of production. The initiative arises from the need to identify and eliminate the sources of environmental pollution. The company targets such sources of pollution throughout the production chain as disposal and recycling of vehicles (“Toyota Global Site | Creating an Affluent Society,” 2017). Interestingly, the company intends to invest in the manufacture of automobiles that can be easily disassembled. The corporation intends to monitor the level of emissions at every stage of vehicle development. It uses the Eco-Vehicle Assessment System to assess the environmental impact throughout the development until the time for disposal.
The Plant Zero CO2 Emissions Challenge indicates Toyota’s resolve to reduce the production of greenhouse gasses during the process of manufacturing vehicles. It utilizes advanced technology and different forms of energy to minimize the production of CO2. The manufacturing technology contributes towards the reduction of greenhouse emissions through the shortening of the manufacturing process. The high efficiency of the technological applications reduces the rate of CO2 emissions.
Finally, Toyota aims at establishing a recycle-based society to ensure sustainable consumption of resources. The challenge arises from the population increase in the world and the need for economic growth. The ever-rising demand for finished products shall result in the depletion of natural resources. For this reason, Toyota uses the recycle-based society and systems to prevent the destruction of the environment. In particular, Toyota intends to have vehicle dismantling facilities throughout the world (“Toyota Global Site | Creating an Affluent Society,” 2017). The facilities shall encourage the consumers to surrender the out of service vehicles for the company to recollect the resources.
Community Involvement and Development
Toyota contributes towards the improvement of traffic safety through education and utilization of technologies which save lives during accidents. The company promotes the development of safe infrastructure to improve road safety. The road safety program is a product of integrating three components namely people, vehicles, and the traffic environment. The company utilizes the knowledge of the components to develop safe vehicles and reduce road fatalities. The corporation develops many interrelated technologies which work to protect the user from causing accidents as well as provide protection during unavoidable situations.
The company contributes towards the development of an affluent society through facilitating life enhancing projects in the community. The company collaborates with governments and other companies to develop sustainable communities. In particular, Toyota participates in the development of the environmentally friendly communities. Additionally, the corporation sponsors sporting events.
The Fujitsu Group
The company boasts a history of using innovation to foster progress and a competitive advantage in the industry. The Fujitsu Group diversifies into new global markets to provide quality products and services to the people all over the world. The corporation registers excellent performances due to the proper coordination of activities. The employees and management interact through training sessions aimed at the development of capabilities. The corporation contributes towards sustainable development in the society and the planet as a whole. The Fujitsu group corporate responsibility initiatives concentrate on five challenges. It organizes the issues as areas of priority in its operations.
List of Fujitsu Group Priorities
Priority 1: To provide opportunities and security using ICT.The company ensures that the population has access to opportunities through ICT to realize their dreams. The priority thrives on the possibilities created by technological products.
Priority 2: To protect the global environment. Fujitsu seeks to prevent environmental degradation through a reduction of its pollutants as well as using ICT to find appropriate solutions.
Priority 3: To embrace diversity and inclusion. The company appreciates the need for an inclusive workforce in the place of work. It concentrates promoting diversity regardless of an individual’s gender, race, and values. The company focuses on using diversity to foster growth.
Priority 4: To develop the human resources for societal contribution. The corporation acknowledges the role of the employees in its growth and utilizes development strategies to increase their engagement in organizational activities.
Priority 5: To communicate and collaborate with the stakeholders. The company uses exchanges information with the stakeholders to determine their needs and use business techniques to meet their demands.
Corporate Social Responsibility
Fujitsu utilizes the ISO 26000 to implement its CSR activities in group companies located in Japan and other countries. The company maintains oversight over its subsidiaries to ensure that the risk mitigation and value creation occurs at all levels (“Corporate Responsibility – Fujitsu Global,” 2017). The monitoring process ensures that all operations represent the company’s values and beliefs. Fujitsu’s risk mitigation initiative ensures the protection of human and labor rights at all stages of operations. In particular, the corporation uses the risk reduction initiative to sustain its corporate value. Fujitsu utilizes its value creation initiative to contribute towards solving the societal challenges. The company organizes its departments to take charge of the seven core subjects in the ISO 26000 standard.
The Human Rights Approach
The company promotes human rights protection as a central component of its international social responsibility. The human rights statement ensures continuous respect for the fundamental privileges of people. Fujitsu strives to ensure that its group of companies demonstrates respect for human rights throughout their operations. The company organizes its human rights statement into four parts namely the global approach, human rights due to diligence, responsibilities as an ICT Corporation, and embedding human rights.
The need for businesses to utilize sustainable practices in their operations informs Fujitsu’s environmental philosophy and mission. The company prioritizes sustainability through the provision of their services. It ensures durability to protect the biodiversity as well as mitigate the effects of the climate change. As such, the company commits to solving the prevailing environmental challenges in the world. In addition, the company approaches its sustainability initiative in two scopes namely the deployment of ICT throughout the world and reduction of the environmental burden arising from the business operations.
The Fujitsu Company facilitates many social activities to assists people realize their dreams. It contributes to the community through sports, disaster relief programs, promoting learning, and the employee volunteer support. It approaches the community through value creation and information sharing (“Corporate Responsibility – Fujitsu Global,” 2017). The company actualizes its community involvement through collaboration with the customers and the world populations. In addition, their employees participate in the community activities actively. The company’s determination to promote social activities arises from the desire to facilitate sustainable development on earth. The social activities are based on four pillars namely ICT for everyone, challenges, environment, and community engagement. Moreover, the company encourages the employees to join the volunteer activity support as an opportunity to contribute towards the society.
Chart 1: The Proportion of Fujitsu’s Investments for social activities for the year 2015.
As shown in the chart, the company commits a considerable amount of money in social activities. The company founded the Fujitsu-JAIMS Foundation to ensure that it ties with the people of Asia promotes sales in the region for a long time (“Corporate Responsibility – Fujitsu Global,” 2017). The school provides the graduate level education. It is an area that encourages learning and socialization as the Western and Eastern cultures interact throughout the course.
In general, Toyota and Fujitsu demonstrate a high sense of social responsibility through their programs in the communities they operate. The Toyota automobile utilizes technology to increase the efficiency of the vehicles and reduce the emissions of the greenhouse gasses. On the other hand, Fujitsu believes that the availability of ICT enables the communities to solve the environmental challenges. While the companies contribute to society differently, their human rights philosophies ensure the universal protection of their employees. As a matter of fact, the Toyota Company extends its role in protecting human rights through urging its associates to adopt humane practices. The company recognizes that it is unethical to allow the suppliers violate human rights throughout their operations. Toyota demonstrates environmental conservation through the implementation of programs that reduce the emissions. The development of efficient vehicles indicates the company’s role in sustainability development. On the other hand, the Fujitsu Group transforms communities through the financial support directed towards such programs as sports, education, health, and social welfare.
The ISO 26000 standard provides the guidelines for the development of CSR similar to those of the Toyota automobile and the Fujitsu Group. The companies demonstrate an awareness of the various societal needs in the areas they operate. Both entities have established systems to protect their personnel from inhumane treatment in the workplace. The Fujitsu and Toyota ensure continuous improvements to keep up with the ever-changing customer preferences and environmental condition.
Corporate Responsibility – Fujitsu Global. (2017). Fujitsu.com. Retrieved 23 March 2017, from http://www.fujitsu.com/global/about/csr/
Sinkovics, N., Sinkovics, R. R., Hoque, S. F., & Czaban, L. (2015). A reconceptualization of social value creation as social constraint alleviation. Critical Perspectives on International Business, Vol. 11, No.3/4, pp. 340-363.
Toyota Global Site | Creating an Affluent Society. (2017). Toyota Motor Corporation Global Website. Retrieved 23 March 2017, from http://www.toyota-global.com/sustainability/society/future/
Wettstein, F. (2012). CSR and the debate on business and human rights: Bridging the great divide. Business Ethics Quarterly, Vol.22, No.04, pp. 739-770.