Competitive Advantage and Corporate Social Responsibility

Corporate social responsibility CSR are the responsibilities of the society taken up by the business in which it operates. The business is able to engage with the society by providing services that benefit the society without the aim of getting any profits. This includes creating jobs and wealth that benefit the society further. Competitive advantage plays a significant role in enhancing the business to conduct its operations in a healthy competitive environment (Porter & Kramer, 2014). It facilitates the business activities as it creates a reputable brand name for the organization. This helps it to maintain a competitive advantage over other companies. Competitive advantage strengthens the organization position as it is able to realize more profits. The main argument of 5-3 reading is despite the fact that many companies have improved their social and environmental activities it is important to create and maintain competitive advantage as it goes hand in hand with CSR.

The emergence of CSR can be considered not to be entirely voluntary as most companies ventured into CSR for the public response only. Most business had not thought that CSR is the organization responsibility. Nike was a victim of abusive labor practices that led to a massive boycott.  The operation of Shell Oil in the oil drill to sink the Brent spar was not a social responsibility as it posed some dangers to the people led to protest (Porter & Kramer, 2014). A pharmaceutical company was expected to be social responsible by responding to the AIDS pandemic despite the fact that the activity was removed from their primary production line. More similarly the fast food restaurants are now being held responsible for poor nutrition and obesity. In order to be social responsible and still maintain a competitive advantage over other companies in the same line of business it is important for the organization to practice activities that are of good to the people (Porter & Kramer, 2014).

However there are justifications as to why CSR exists. The argument includes sustainability, moral obligation, reputation and license to operate. Sustainability aims at environmental and community growth. The business moral obligation is to do things right and in the right way. License to operate give the business the authority to conduct business in which there are regulations. The impact of the business activities to the people creates the business reputation. This makes the business conduct operations that will be of a positive impact to the people.

Integrating the business and the society creates competitive advantage of the business. In this setting it CSR creates an interrelationship of the corporate and the society. It is true to say that most of the successful corporations have been able to integrate the business and the society well. This helps the organization to strike a good balance in a healthy society, education, and equal opportunity for all members of the society in order to have a productive workforce (Porter & Kramer, 2014). This leads to a socially responsible company that has a competitive advantage over other rival companies. Government regulations and policies facilitate integration which is essential for efficiency and innovation. The regulation standards by the government protect both the competitive businesses and consumers from exploitation. It is therefore true to say that the integration promotes a healthy society that creates demand for the business leading to expansion in order to meet the growing needs for the society (Porter & Kramer, 2014).

Social program are in line with the operation of the business that creates jobs, wealth and innovations that uplifts the living standard of the society. It is true to say that NGO’s operations to the society offer relief to the members of the society as they also creates job for the members. However the civil society and the NGO’s have concentrated so much on the friction between them rather than focusing on the principle of shared value. By focusing on the principle this means that both groups will benefit as they will in a better position to pursue the society policies. Integration creates a core framework in which business operates as it helps in creating competitive advantage (Porter & Kramer, 2014).

The business activities are meant to touch the lives of the communities. It is therefore true to say that these activities have a positive impact to the better as they benefits from them. The businesses have no intention of generating profits from such activities. As a result of integration businesses have become more aware of the social impact of their activities (Porter & Kramer, 2014). This has made business know the activities that are not harmful to the people and the environment and the people. With evolution of technology society has also changed. This implies that the business have to keep with the change in preference of the individuals of the society. CSR is one activity that has changed in order to help the society meet the right needs that will benefit them more (Porter & Kramer, 2014). It is true to say that CSR is a broad aspect of business that requires focus and integration in order to realize a real difference in the society. Therefore, competitive advantage and CSR plays an integral part of the business.

 

 

 

 

 

 

 

Reference

Porter, M. E & Kramer, M. R (2014). The Link Between Competitive Advantage And Corporate Social Responsibility. McGraw-Hill