Responsibility

Business today face increasingly complex, and often competing, motives and incentives in their decision making. In a recent Business Week/Harris Poll survey of the general population, 95 percent of respondents agreed with the following statement: “U. S. corporations should have more than one purpose. They also owe something to their workers and the communities in which they operate, and they should sometimes sacrifice some profit for the sake of making things better for their workers and communities.

” In an era of intense global competition and increasing media scrutiny, consumer activism, and government regulation, all types of organisations need to become effective and adept at fulfilling these expectations. As a trendy term, by comprising all those expectations, todays’ organisations social requirements are called as Corporate Social Responsibility (CSR). Many companies are trying, with varying results, to meet these diverse responsibilities they now face.

Satisfying those responsibilities is a never-ending process of continuous improvement that requires leadership from top management, involvement from employees, and good relationships across the community, industry, market, and government. Companies must properly plan, allocate, and use their resources in order to satisfy the demands placed on them by investors, employees, customers, business partners, the government, the community, and others. The subject of social responsibility is not just contemporary: it is insistent.

‘Social accountability’, ‘the responsibilities of business’, ‘the unacceptable face of capitalism’, ‘industrial democracy’: these and many other expressions have become in-phrases used widely in speeches by businessmen, politicians, trade union leaders and by other people in our society who are looking for evidence of change. As in most instances where existing practice is challenged by critics and reformers, the term ‘corporate social responsibility’ has been given several meanings and emphases by those who have written on the topic.

The common ground lies in the perception of a relative shift from government to companies as the source of social improvement and the means to promote specific items of social welfare. The World Business Council for Sustainable Development in its publication “Making Good Business Sense” by Lord Holme and Richard Watts, used the following definition. “Corporate Social Responsibility is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large”

The same report gave some evidence of the different perceptions of what this should mean from a number of different societies across the world. Definitions as different as “CSR is about capacity building for sustainable livelihoods. It respects cultural differences and finds the business opportunities in building the skills of employees, the community and the government” from Ghana, through to “CSR is about business giving back to society” from the Phillipines.

Many people believe that businesses should accept and abide by four types of reponsibility – economic, legal, ethical, and philanthropic – which are collectively known as corporate social responsibility. To varying degrees, the four types are required, expected, and/or desired by society. Furthermore, those responsibilities must be fulfilled simultaneously so that organisations can claim to be realising the core meaning of CSR. First of all, business have a responsibility to be economically viable so that they can provide a return on investment for their owners, create jobs for the community, and contribute goods and services to the economy.

The economy is influenced by the ways in which organisations relate to their stakeholders, their customers, their employees, their suppliers, their competitors, the community, and even the natural environment. For example, in nations with corrupt businesses and industries, the negative effects often pervade the entire society. Transperancy International, a German organisation dedicated to curbing national and international corruption, has conducted research on the effects of business and government corruption on a country’s economic growth and prospects.

The organisation reports that corruption reduces economic growth, inhibits foreign investment, and often channels investments and funds into “pet projects” that may create little benefit other than high returns to the corrupt decision makers. Thus, although business and society may be theoretically distinct, business has the opportunity to have a real economic impact on many people. Secondly, companies are required to obey laws and regulations that specify what is responsible business conduct. Society enforces its expectations regarding the behaviour of business through the legal system.

If a business chooses to behave in a way that customers, special-interest groups, or other businesses perceive as irresponsible, these groups may ask their elected representatives to draft legislation or regulate the firm’s behaviour, or they may sue the firm in a court of law in an effort to force it to “play by the rules. ” For example, many businesses have complained that Microsoft Corporation effectively had a monopoly in the computer operating system and Web browser markets and that the company acted illegally to maintain this dominance.

Their complaints were validated in 2000 when US District Judge Thomas Penfield Jackson ruled in a federal lawsuit that Microsoft had indeed used anticompetitive tactics to maintain its Windows monopoly in operating-system software and to attempt to dominate the Web browser market by illegally building its Internet Explorer Web browser into its Windows operating system. Microsoft, which vehemently denied the charges, appealed that decision. The election of George W. Bush and a court of appeal’s ruling to overturn Jackson’s decision shifted the focus to settlement talks, away from an earlier suggestion to break up the company.

However in the first quarter of 2004, Microsoft has been fined $200 million for their unethical and illegal action. Thirdly, beyond the economic and legal dimensions of social responsibility, companies must decide what they consider to be just, fair, and right – the realm of business ethics. Business ethics refers to the principles and standars that guide behaviour in the world of business. These principles are determined and expected by the public, government regulators, special-interest groups, consumers, industry, and individual organisations.

The most basic of these principles have been codified into laws and regulations to require that companies conduct themselves in ways that conform to society’s expectations. Many firms and industries have chosen to go beyond these basic laws in an effort to act reponsibly. The Direct Selling Association (DSA), for example, has established a code of ethics that applies to all individual and company members of the association. Because direct selling, such as door-to-door selling, involves personal contact with consumers, there are many ethical issues that can arise.

For this reason, the DSA code directs the association’s members to go beyond the legal standards of conduct in areas such as product representation, appropriate ways of contacting consumers, and warranties and guarantees. In addition, the DSA actively works with government agencies and consumer groups to ensure that ethical standars are pervasive in the direct selling industry. The world Federation of Direct Sellling Associations (WFDSA) also maintains a code of conduct that provides guadiance for direct sellers around the world, in countries as diverse as Turkey, Argentina, Canada, Finland, Korea, and Poland.

Shell is actively involved in the area of corporate social responsibility or CSR. Shell believes that the millennium development goals of UN for example, poverty and illiteracy reduction cannot be achieved by governments alone and it requires an effective public private partnership. Therefore, shell is actively engaged in areas such as microfinance and entrepreneurship which are a means towards achieving the millennium development goals.

Shell has launched a microfinance program in Nigeria which helps to promote small and medium enterprises by providing them with adequate capital. BP makes direct contributions to communities by launching community programs. It spent around $134 million by donating it to UK charities and other small scale industries. BP also spends a significant portion of its revenue on education in developing and developed countries.

The main aim of this report is to explore the extent to which concept of corporate social responsibility can play a major role in positively influencing the operations of PPR. The concept of Corporate Social Responsibility has gained prominence during the contemporary period as there is growing concern that the organisations are supposed to be accountable for the impacts of their operations both socially and environmentally.

Whilst there is no universally agreed definition of the concept, this discussion particularly focused on the environmental as well as the social aspects of CSR strategy and how PPR can streamline its operations in order to operate sustainably without causing much damage to the environment while remaining viable in manufacturing its luxury brands. Findings It is undoubtedly true that every organisation operates in a physical environment with people from diverse cultural backgrounds and are likely to be affected directly or indirectly by the operations of such organisations.

It has been noted that there is need to establish goodwill with the values and norms of any given society the organisation would be operating in as a way of promoting mutual understanding. Thus, CSR entails doing good things to the society in which it would be operating in. It has also been noted that CSR strategy driven by leadership development is very effective in that it will stimulate positive employee performance while at the same time cultivating a sense of trust among the members of the community it will be operating in.

Conclusion and recommendations It has been recommended that Pinault’s PPR should streamline the operations of the organisation in such a way that the products retain their value and luster while at the same time striving to minimise the impacts of environmental degradation through its activities. This must be done in such a way that does not compromise on quality since luxury brands are meant for prestige. Why is corporate social responsibility (CSR) important to business during the contemporary period?

The concept of corporate social responsibility has become topical during the current period but there is no one agreed definition about the whole concept (Knights and Willmott (eds. ) 2007). CSR has been defined as a function that transcends but includes making profits, creating jobs and producing goods and services (Oketch 2005 as cited in Smith 2003). On the other hand, (Strydom 2004 p. 11) concurs that “Social responsibility is the concept that maintains that businesses are part of the larger society in which they exist and are accountable to the society for their operations.

” In other words, there is need for the organisations to strike a fine balance between the needs and interests of customers, needs of the environment and the need for businesses to realise their financial goals. This goes hand in hand with the concept of ethics, which is loosely defined as an attempt to differentiate between something good and bad. Thus, “a wide range of behaviours are classified under CSR including cause-related marketing, sponsoring charitable events, making charitable donations, utilizing environmental initiatives and demonstrating a commitment to health and safety issues,” (Maignan ; Ralston 2002 as cited in Smith 2003).

First and foremost, it is every company’s obligation to know that it is operating within a certain social set up with its own norms and values that play a vital role in maintaining the fabric of that society. According to Guarnieri, R. & Kao, T. (2008) there is need to establish goodwill with the values and norms of any given society it would be operating in as a way of promoting mutual understanding. The success of any given company would be determined by its willingness to observe the social norms of the areas it would be operating in. The success of any product would therefore depend on the amount of respect that exists between the two.

Pinault, whose firm PPR is the second-largest luxury goods conglomerate in the world has underscored to be proactive and take a leading role in putting measures that are meant to ensure a better environment that can sustain future development. In this case it seems as if PPR is more concerned with financial success through its luxury brands, the reason why there is need to adopt CSR initiatives as a way of creating goodwill to the people and environment. Randall (1994 p. 101) concurs that: “the better the relationship, the more trust that has been built up, the easier it will be to solve the difficult issues which may arise.

” Therefore, observing the norms of the society is the foundation of establishing mutual understanding which may lead to the success of whatever product. Corporate social responsibility also entails doing good things to the society in which it would be operating. For instance, the Company may take a leading role in promoting activities that promote a clean environment like using raw materials with less content of green house gases. This would benefit the members of the society health wise and also help build a clean environment.

Corporate Social Responsibility Being a company that prospers is very much different than a company that is consistently following a guided work ethic while making revenue. Companies these days may participate in under the table schemes or anything to make that extra buck. Very a few industries willingly follow corporate social responsibility. Corporate social responsibility (which will now be referred to as CSR) is a business firm’s intention, beyond its legal and economic obligations, to do the right things and act in ways that are good for society. Dell Inc. is a showcase example of companies that oblige by CSR.

Not only do they willingly do right by others, they were named Newsweek’s 2010 Greenest Company in America. Almost everything they use from building to shipping is completely recyclable. They ship and package everything in material made out of bamboo called “mushroom packaging. ” This sort of packaging is very durable and has the density to protect any heavy items in need of shipping. Mushroom packaging is very unique in the sense that it is grown and not manmade. Not only are they environment friendly in their use of the highly compostable mushroom packaging, they also give back.

Dell knows how important it is to donate to charity and they want to create a relationship with whom they are donating money to. As stated in the article, “Trisa Thompson, VP of Corporate Responsibility, offered that making a determination about which charitable, non-profit organizations to work with internationally must be undertaken with great care….. ‘These are long-term relationships, not short-term, and need to be entered into carefully and with sufficient due diligence. ’” Dell likes to donate 1% of all pre-tax revenue to charities that support children and education.

This company truly understands what it means to be successful. Rather than classifying successful as a company that earns substantial net income, they also put emphasis on using their power and money into making the world a better place. CSR is something every single company should take interest in but some CEO’s just don’t care for lack of a better word. They want to keep every penny for themselves. Cited Source 1) http://businessexecution. wordpress. com/2011/09/06/dell-issues-2011-corporate-social-responsibility-report/

One thing it has done is source a lot Of its products from local suppliers e. G. All Waitress fresh chicken, beef and pork, bacon, duck and goose are sourced room the [J which helps local communities as it increases the profits of the local suppliers and allows them to expand which allows them to increase their workforce. Increasing the suppliers workforce helps the community as it decreases unemployment rates and increases the amount of money that stays in the community.

This is very important to local communities as usually 95% of a business’s income is taken away from the local community but by altering its supply methods and improving its employee bonuses John Lewis removes a lot less. Another way the John Lewis Partnership has had a positive impact on the coal community is through its employee bonuses which are substantially larger than most other supermarkets. This helps the local community as it gives the employees more disposable income which is likely to be spent in the local community.

It also helps employees to maintain financial stability through the Christmas period which would help the community as there would not be as many community members in debt after Christmas. The John Lewis Partnership has also helped the local community through its community matters scheme which offers its employees the opportunity to work with the community on local projects. This combined with their investment of Ell million into the local community has benefited their local communities a lot.

This helps the local community as it not only gives them the funds to make a change but access to a large workforce to get it done. The final way the John Lewis Partnership helps the local community is by using diverse recruitment methods which helps different parts of the local community to learn about each other’s cultures and helps people who would find it hard to get a job. An example of this is their elderly recruitment which provides jobs to elderly people who normally would find it hard to get a job.

This would also set an example for other business in the area and so increase diverse recruitment methods in other businesses. The John Lewis Partnership also has a negative impact on local communities as its Waitress products are often a higher price than other supermarkets which could cause problems for people with money troubles as they would not be able to afford as much. This may also cause a class divide in some areas as some would be financially able to shop at John Lewis or Waitress whereas other would not and so this may split the community.

The John Lewis Partnership has also been linked to an increase in house rises as people are willing to pay more for a house located near a Waitress. This effect has been noticed by estate agents in areas that a Waitress has been built nearby with some claiming it increases house prices by up to 25%. This would affect people who want to move into the area as they may find fewer houses in their budget. This would also affect the diversity of the local community as it would reduce the amount of people who have a lower income in the area.

This would however have a positive impact on people already living in the area as their house value would increase. The final negative impact that Waitress has had is that in some communities it has caused traffic problems as people from the local area flock in to use the store. This would affect the environment as some of these people would have driven further than normal so that they can use Waitress rather than a different store. This would also affect the local area which would become more congested and would have to spend Moore to maintain the roads.

Overall I think that the John Lewis partnership is good for the local community as it offers the local community a range of high quality products and has advanced ethical consumerism a lot. Also the main negative impacts John Lewis has are difficult for them to change and they are still trying to improve on these effects such as offering a value range to make Waitress a more affordable option and looking to decrease its impact on congestion such as at its Guilford site which is located near a large junction they have paid for the council to improve the roads.

McDonald’s McDonald’s is probably the most improved business I have researched as it has received a lot of negative publicity on its CAR choices in the past but is now trying to improve its public image. One way it has done this is by advertising its various green schemes that reduce the impact they have on the environment. The most visual form of this environmental change is their packaging which has been altered so it is now more biodegradable and smaller.

This helps the local community as it makes it easier for the council to deal with any litter that is dropped by a customer and it reduces the amount of waste McDonald’s contributes to the local land fill. Another way McDonald’s green schemes have helped the local community is that it has increased its local product sourcing. This decreases the air miles of he food and reduces the amount of money that is removed from the local community. This helps support local agriculture which is at threat due to other companies sourcing products from overseas.

This also helps to support the local economy as a transnational corporation usually removes a lot of money from local communities and so the more money it spends on local produce the less impact it has on the local economy. McDonald’s also helps the local community by bringing a lot of jobs to their community and hiring people with little or no experience which helps some members of the local community improve their ability to work. This also helps people in higher education as often McDonald’s working hours are quite flexible and so they can work their without it affecting their education.

The final way they are trying to help the local community is by decreasing the amount of litter found around the community. They are doing this by funding local council bins and putting litter bins outside of their restaurants. This helps the local community as it makes it a cleaner place and improves its image which would increase the amount of people who would want to visit the area. This also helps reduce the cost for the council when dealing with an areas litter problem. McDonald’s has had substantial negative impacts on the local community as well.

The main impact it has had is on the health of the local people as many of their best selling products are unhealthy and the products that are healthy have been criticized as they often do not appeal to their customer base. This is shown in a daily mail article called “McDonald’s shares fall as customers shun new healthier items on the menu” that links recent price drops to customers rejecting the healthier McDonald’s products. Although McDonald’s are trying to combat litter in their local communities, they are one of the main causers of it. This is shown by a 2009 survey that McDonald’s packaging makes up for a third of the Auk’s litter.

Also a lot of their delivery packaging contributes to local landfills which if filled would have to be expanded or a new local site would have to be created which would decrease the appeal of the local area. Overall I think that McDonald’s is bad for the local community as although it is trying to reduce its impact on the local community it still has a strong impact on the local populations’ health and the cleanliness of the surrounding area. This would decrease the appeal of the area which may lead to problems such s a decrease in house prices, less tourism and less people visiting the area to use the local shops.

As I have mentioned above, McDonald’s is often criticized for it negative effects on the customer’s health and its low sales in its healthy options. To decrease these negative effects McDonald’s should look to invest in research on improving the nutritional value of their food. This research should include trials of various food ideas in some of their stores so that they can work out which ones to spread chain wide and which to improve on. After improving the healthiness of their product range they should then Penn a large amount of money on a new advertising campaign that advertises the largest changes e. . A large decrease in calories or saturated fat in their burgers. This should also include a look at their Other positive improvements such as their care for the environment and anything else related to the welfare of their customers and the environment they live in. Due to McDonald’s advertisement of its healthier product range the company’s image should improve. This should help to set up a business deal with a new healthy food partner such as Real Foods, Weight watchers, Wellness Foods or another healthy food company who would be happier to e associated with a healthier McDonald’s.

With one of these healthy food company McDonald’s should work with them to try and improve the taste of their healthier product range so that it seems a more attractive option to customers. This would allow McDonald’s to gain a larger customer base as then only other large fast food chain that can advertise the healthiness of its food is subway who McDonald’s could take customers from. This could also be used to try and appeal to a larger customer base as some organizations, such as weight watchers, offer their own food range for people who are dieting.

If they sold weight watchers dieting products or certified some of their own products as recommended by a healthy food company then they would probably attract a lot of new customers as their main competition, KEF and Burger King do not offer any specific dieting products. Another benefit of this is that they could work with a company such as Real Foods to increase the amount of special diet foods on their menu. This would increase their customer base as it would attract people that are vegetarian, vegan or have an allergy to things like gluten or wheat.

This improvement would greatly improve McDonald’s image as they would come the market leader in healthy fast food which, with its environmental work, would alter the view of groups such as PETA who would not target them as much. This image change would also increase the amount of children (one of their prime demographics) that go to McDonald’s as parents would be happier to take them if they had healthy food. SAD SAD benefits the local community mainly through its SAD foundation program which supports a lot of small charities located around the ILK.

This is especially helpful to the local community as most businesses only support arguer charities but as SAD has this program it can donate to smaller charities that need the money to improve their functionality in the local community. So far this year the program has donated almost E3000000 to a wide variety of charities which often offer specialist support for members of the community. Another way SAD is helping the local community is through its new plan to give Store space to local authorities, businesses, voluntary groups and educational services.

It is giving this space as a lot more customers are buying online and so the stores do not need as much space for stock. This helps the local community as it means that customers are more likely to find out about various groups and community projects in their community. The final way SAD has had a positive impact on the local community is through its community life program which offers customers the opportunity to vote on what SAD should do with the money it plans on investing in the local community. This helps the local community as it increases the relativity of the changes for the local community.

This also encourages other groups to consult the community more due to the increased advertisement they receive from voters. SAD has also had a negative community due to where it’s building. A lot of Sad’s stores are deliberately located near another supermarket to try and reduce its profits. The problem with this is that often they can’t find a suitable site near enough and so use planning loopholes and other methods such as paying for an improved transport system to secure sites that aren’t meant to be built on.

This affects the community negatively because it is likely that there would have been a reason for the council not wanting the supermarket being built there (e. G. The site had natural beauty). This also effects where the average shopper purchases goods as many of these stores are located out of town or on the edge of towns many people are drawn away from the shopping area Of the town and so are less likely to purchase something from that area. Due to Sad’s delivery service many of their Lorries have to go into smaller towns to make deliveries.

This poses problems for the local community as they may not have the infrastructure needed for Lorries to travel through their town which could cause damage to the roads and congestion. This effects the local community as the council would have to pay for any damage one to the road and the local people may find it harder to get to their destination. Like other supermarkets, SAD cause 2 main problems, increased traffic and a decrease in business for local shops.

Thought out time judicial review’s responsibility had been to ensure there is no conflate to the “supreme law of the land” (The constitution) and it’s democratic values. In Order to make sure that the system does not get influence from the elected officials. Our founding fathers have deliberately put in place judicial review in to the system. But in turn the judicial review itself is not democratic. Because the nine “independent ” black robe elites have bias, and can not be remove. A Supreme Court justice is appointed by the president and must be confirmed by the senate.

When the President appoints a court justice he usually appointed someone who is highly educated and have a close ideology as he, because he wants to influence the courts. But soon after they are appointed they loss ties with any political influence. Because they’re appointed for life. No matter how bad of job they are doing, they are protected by the constitution. And can only be impeach if they have commended high crimes such as treason and bribery. In our history only five federal court judges have ever been impeached. In order for the courts to judge the case without any favorites, there is no room for any bias.

If the court have bias they well not be able to give a good interpretation of the constitution. Insested courts often give inference on the cases. And putting the case in there own perspective. During 1933-1937 the Roosevelt’s presidency (D&Z chapter 13 Page 347) the courts still had a philosophy of rugged individualism. The courts thou out the national industrial recovery administration, railroad retirement act, national farm mortgage act, agricultural adjustment act, And denied the federal government the power to regulate manufacturing, petroleum, mining, agriculture, and labor conditions.

Only after National labor relations board V. Jones & laughlin Steel Corporation. How can the court say one thing and does another? The court says, “no person in the country should be denied equal protection of the law”. That give the blacks the right to vote, to attend integrated schools, to receive equal justice in the courts, and give congress the power to protect blacks from discrimination in public accommodations, employment, voting, and housing. But in (D&Z page 348) “Dennis V, United States the courts permitted the prosecution of communists for merely “advocating” the overthrow of the government and in communist government party.

U. S. A V. Subversive activities control board it upheld the right to require registration of “subversive” organizations. It permitted congressional committees to interrogate citizens about their political view and upheld loyalty oaths and loyalty-security programs How can people say that courts are always right? And above all they are unbiased? That can not be the truth. As human beings we all have ideas and bias because at a very young age we learned and developed bias from our parents and friends.

Some say that you could change the bias and idea if you get an good education you’ll be able to have a higher tolerate but education only could change you so much. As beings we could only tolerate so much. When in crises and the issues are against us, we’ll thou tolerate out to the window and take some form of action to suppress the opponent. That applies to all the mass, the elites, and even the courts. Then how can judicial reviews be democratic? how did the outcome of the American civil war impact modern America? American had not all way been an industrialize nation or a major player in the international market.

In fact prior to the civil war American was this back ward predominate cotton-growing base south with an emerging industrializing north-east and a west that is the land of free farmers. Having a Combination of capitalism and feudalism in the cotton-growing south, where there are the halves (master) and the have-nots (slaves). The slaves do not own anything and are commended to the masters. This system is similar to feudalism, where the lords and servants have a close tied with each other.

The southerner justerful it by saying:” it is natural form of human society, beneficial both to the slave and the master. the emerging industrializing northeast had an ideology of a more democratic and capitalistic idea. Last, but not the lease, the west of the free, their ideology are very close to the industrializing northeast. The ending of the war gave the north the power to unite the union as a whole. Because of a rapid growth in the textile industry the north was in need of laborers. The demand for laborers has sprouted emerging of a middle class. This enables the slaves to have the mobility to move up on the social structure. We must give credit to the middle class.

Because they were the ones that really wanted to have the up bond mobility. With the help of education they created technologic advancements. That had created a growing industry with importing and exporting of goods. With a rapid growth of the industries the union was in shortage of laborers, and never before had the union depend more on the free slaves. Many of the free slaves have migrated from the south to the northeast and west creating their own communities. In order for the west to move their goods to the northeast and south, a good and suffusion transportation system is needed.

In many of the modern nation they all have one thing in common with each other. They have a effusion transportation system, if you’re want to be a major player you must have an mean of moving your products in a fast effusion and cheap way. The out come of the civil war is a chain reaction. By having the north wining the war, it brought down the last of the feudal system to its keens. The nation evolves from capitalism and feudalism to liberalism. From the liberalism it is destine that we are going to be come an industrialize nation.

Because the north have won and the north is an emerging industrializing north. From an emergent-fueled nation demanded more labors. The once that don’t have job now have. The ones that did not have an opportunity to have a wage-earning job now do. It gives the next generation an education. From the demanded labors the economy have sprout an never before seen middle class. Because of the education and the opportunity it go technologic advancement. By have all though things in the new and reform government it give everyone mobility. The impact comes in differn forms shape and sizes.

Corporate Social Responsibility in South Africa and Ghana: a comparison of successes, failures and futures in a “developed” and an “undeveloped” African country Few industries affect the social, economic and environmental sectors to the extent that the mining industry does. As minerals development expanded, so the international awareness of its impacts grew. Mining-related legislation, both internationally and nationally, has evolved significantly in the past two decades, actively aimed at ensuring Corporate Social Responsibility (CSR), where companies are held accountable for their actions.

In developing countries like South Africa and Ghana that are heavily dependent on gold trade and the associated international investment, the challenge is to ensure that environmental and social impacts of mining are mitigated, that non-renewable resources are converted into national wealth and that mining-generated revenue is claimed and disbursed. In this paper the evolution of CSR in South Africa, a more developed African Nation, and Ghana, a less developed African nation, are compared.

Recommendations are made as to potential avenues for CSR progression. The objectives of international mining policy reform have changed dramatically in the past few decades. During the 1970s the aim of mining policy was to increase government control. During the 1980s the aims of reform became to increase investment and to mitigate the socio-economic impacts of mining. This was attempted through the Growth Employment and Reconstruction plan in SA (Fig, 2005), and the Economic Recovery Plan in Ghana (Hilson, 2002).

Both plans advocated more privatization, trade liberalization and deregulation. Although the general international trend was to redefine the role of the state, particularly in industrial areas, the adoption of this ambition by African countries has proven detrimental. Biersteker (1990) argues that the reduction of the state greatly reduced its function to govern, particularly undercutting its regulatory ability, its function as a mediator in civil disputes and its ability to regulate and collaborate with the private sector.

Campbell (2005) poses that this is because the legislative and regulatory reform adopted by many developing mining-dependent African countries during the past few decades has undermined the role of the state and has proved incompatible with the challenges of the countries concerned. This has impaired the ability of these governments to exert CSR pressure on mining companies. CSR in Africa has grown parallel to these changes in the role of the state, and international mining legislation has had varying impacts on SA and Ghanaian regulations.

Despite being based on a non-renewable resource, the main theme in changing international legislation is that of sustainable development, particularly in developing countries in which a large percentage of mining is done by foreign companies. It is, however, the sovereign right of a state to exploit its natural resources. This sovereignty was vehemently upheld by post-colonial developing nations that rely on mineral resources, two prominent examples of which being SA and Ghana.

It has become apparent, however, that mining has far-reaching impacts that often have transboundary degrading effects, resulting in international attempts at regulation. CSR in South Africa The formal terms of CSR in SA were originally raised in 1972 and the view taken by many businesses was that they should not have to take responsibility for Apartheid, but should rather improve social standards within their respective businesses.

These concepts were formalized in the Sullivan Principles, which were aimed at entrenching non-discrimination in the workplace into the core business activities, particularly in SA-based US companies (Visser, 2005). Although other CSR groups formed, like the Consultative Business Movement, the move away from philanthropy only really became evident after the first democratic elections in 1994, and when the Black Economic Empowerment Programme (BEE) was introduced. The aim of BEE is to promote equal racial ownership, education, training and local economic development.

In 2002 the goal for black ownership in the mining sector was set at 26% within 10 years (Fig, 2005). BEE was particularly important in the mining sector, as in order to obtain mining rights, businesses had to meet the requirements of a BEE ‘scorecard’. A number of principles have been introduced to target human rights, a major CSR concern in SA. These include Voluntary Principles on Human Rights and Security and the OECD Risk Awareness Tool for Multinational Enterprises in Weak Governance Zones (Hamann, 2009).

Another important milestone was the Kings Report, released in 2002, which outlined the CSR requirements for companies, including “recogniz[ing] that stakeholders such as the community in which the company operates, its customers, its employees and its suppliers amongst others need to be considered when developing the strategy of a company” (Visser, 2005). It also requires that businesses report annually on their social, transformation (including BEE), ethical, safety, health and environmental management policies.

A positive and innovative spinoff of the King’s Report was the introduction of a Kings Index on the Johannesburg Stock Exchange. Companies are required to meet the criteria of the King’s Report in order to list with the JSE, providing a fiscally competitive incentive to adopt CSR principles (Dale, 2005). This progressive legislation forms the beginnings of a seemingly sound CSR framework. But the SA government struggles to maintain the pressure needed to enforce all of its requirements. As in Ghana, SA’s dependence on the mining industry makes the government loathe to confront deviant companies for fear of disinvestment and job losses.

Firms often run philanthropic programmes merely as an attempt to maintain “business as usual”, satisfying the bare minimum for CSR. The lack of government capacity is most prominent in environmental requirements. Many mining companies have introduced more stringent environmental management regulations and have increased CSR spending, but Fig (2005) shows that due to lack of governmental pressure and effective sustainable reporting, many of the claims of these companies do not match their actions.

In recognition of its weaknesses, however, the SA government has adopted provision for voluntary conflict resolution within its environmental legislation (Fig, 2005). As an example of a developing country embracing CSR, SA has proven itself relatively forward-thinking and successful. SA is at the forefront of CSR legislation in Africa. It is in the inability to enforce these laws that the clearest CSR similarities, and failures, with Ghana, a less developed African nation, can be seen. CSR in Ghana

For the past 1000 years Ghana has enjoyed a thriving gold trade. However, due to political turmoil and changing mining and economic policy, by the beginning of the 1980s the gold-mining industry was virtually stagnant, and became the focal point in the country’s Economic Recovery Programme in 1983 (Campbell, 2005). Ghana also received assistance from the World Bank, the conditions of which resulted in the elimination of most barriers to entry for foreign investors, including reducing corporate taxes, royalty payments, foreign exchange taxes and import duties.

The company retention amounts negotiated by foreign investors were far above average and signify the extentto which the Ghanaian government was prepared to go to stimulate the industry (Campbell, 2005). This also indicates the extent to which the government was and is prepared to turn a blind eye to companies’ exploitation of the country. Liberalized legislation resulted in an approximate 800-fold growth of the predominantly foreign-controlled gold mining industry in the past 20 years.

But this growth has been accompanied by very little change in the quality of life of the Ghanaian people. In 2006 the International Council on Mining and Metals claimed that gold mining has not only ‘kick-started” Ghana’s economy, but that many of the large-scale mining companies are “committed to [CSR]”. In contrast, Hilson (2007) argues locals’ lives have been worsened by the increased use of land, relocations and environmental dilapidation. Because of the lax policies adopted by the government, the nation’s share of the mineral development profits has been minimal.

Despite the 40% contribution of total merchandise export earnings that gold-mining in Ghana represents, the contribution to GDP is only 2-3% (Hilson, 2002). Thus the government lacks fiscal control, and as such cannot redirect funds efficiently towards development projects. The most formal adoption of international policy in Ghana was that of the Global Mining Initiative (GMI) in 1998. Ghanaian mining companies claimed that “a series of dynamic and innovative community development projects… empowering rural communities and improving quality of life” were to be initiated (Garvin, 2009).

But others report that the mines are encroaching on indigenous land, resulting in cultural dislocation, poverty, displacement and environmental damage. Promises of jobs and adequate compensation have been broken. This is evident in the relatively small number of Ghanaians employed by mining companies, a mere 20 000, despite the immensesize of the industry (Garvin, 2009). An interesting response to growing unemployment is the intensification of small-scale, artisanal mining, nicknamed the galamsey.

The galamseyhave become an important means for support for many subsistence farmers who have been displaced, but their illegal status has led to them being labelled “hazardous and environmentally damaging” by the Chamber of Mines (Bush, 2008). There is potential for both large and small scale miners to collaborate, as they have different methods and it is uneconomical for one to do what the other does. This has been proven by Goldfields, who have leased small portions of land to groups of galamsey. Most large-scale gold ines refuse to license their unused land for work, so the galamseyare forced to mine illegally in order to eke out a living. Hilson (2007) accuses the large mining companies of supporting a massive military sweep aimed at eradicating the galamsey, which resulted in human rights violations and many forced removals. Instead of taking advantage of collaborative opportunities major mine operators in Ghana have resorted to the most common CSR endeavours amongst extractive mine companies: the building of schools, clinics and libraries. These CSR projects are still predominantly philanthropic and unsustainable.

Garvin (2009) determined, through a series of surveys, that although many locals perceived an increase in social welfare, they reported a decline in security, increased crime, cyanide-poisoned water, and other environmental hazards resulting in a lack of useful agricultural land. Notwithstanding the urgings from the World Bank Industries Review, Departments for International Development, the UN, and limited pressure from the Chamber of Mines, most CSR programmes that go beyond philanthropy emphasize the expansion of existing practices such as pig-rearing, livestock and activities.

These give little opportunity for advancement, provide little more than subsistence wages and definitely do not contribute to sustainable economic growth (Hilson, 2007). One of the largest problems with CSR in Ghana, and similarly in SA, is the lack of communication between government, companies and public. Mining companies enter into agreements with the national government, paying royalties of 9%, of which 3% go towards community development (Hilson, 2007). These monies pass through many layers of government and administration, and often very little reach the locals they are meant to compensate.

Inhabited land is often designated for mining with little or no consent from the inhabitants. Under the Minerals and Mining Act (2006) mining companies are required to compensate displaced people for their crops and use of land, but these payments are still woefully undervalued (Hilson, 2007). Locals value their land quite differently from the value placed on it by mine employees and the lack of communication only worsens these discrepancies. The regulatory and reporting systems in Ghana are very poor, effectively making the situation for many locals worse than that seen in SA.

There have been few legal efforts made to legislate mining activities, thus the improvement of CSR practices is dependent on international legislation, NGOs and pressure groups. Changing the CSR Pyramid There are certain drivers of CSR that are significantly different in developing countries than in developed countries like Europe and the US. Existing models must be adapted to fit the individual needs of developing countries. One such model is Carroll’s pyramid, consisting of 4 tiers; economic, legal, ethical and philanthropic responsibilities. draw:frame} {draw:frame} {draw:frame} Figure 1: Pyramid models for CSR drivers (adapted from Visser, 2006) Visser advocates thatto adapt Carroll’s pyramid to developing countries, economic responsibilities are given the highest priority, followed by philanthropic, legal and ethical. The economic tier represents the need for businesses to not only ensure that direct foreign investment increases, alleviating poverty and unemployment, but that further investment is generated, goods and services produced and stable infrastructure built.

Visser argues that the emphasis on philanthropy is necessary because of the dire situation and poor quality of life in many developing countries thathave become reliant on donor assistance. Philanthropy has become ingrained in developing country CSR. The legal responsibilities are of lower priority because the pressure to adhere to legislation in developing countries is less than in developed countries. In order to elicit response, both nationally and internationally, sustainable indicators must be developed allowing more accurate reporting of CSR successes and failures.

Efficient and diverse indicators allow for better sustainable reporting and transparency. These indicators serve two main functions: providing guidelines for company policy and government policy (Danegard, 2005). Increasing the number of indicators increases the scope for surveys or investigations. Data collected from these is usually validated by companies and government, and is, as yet, not mandatory. Although these inquiries may provide useful data, Danegard (2005) suggests that the use of third party verification may be necessary where governments lack the capacity for collection and evaluation.

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