Sample Management Paper on Corporate Social Responsibility

Corporate Social Responsibility

Corporate social responsibility has been defined as the means of assurance to budding policies that incorporate answerable practices into day-by-day enterprise practice intended at reporting on advancements made in the daily direction of employing these practices. (Zutshi, 2015). Porter and Kramer (2006) stated that the social responsibility of a business encompasses the economic, legal, moral, and discretionary expectations that the society has of organizations at a given point in time(Porter & Kramer, 2006). The economic responsibility is considered the core enterprise responsibility and relates to profit maximization. Legal responsibilities are geared towards adhering to rules and regulations set by the government and are crucial to any business. The ethical responsibilities go beyond the basic economic and legal requirements for any entity. The discretionary duties are primarily philanthropic, and may include donating to various causes or contributing to society.

While criticism regarding the hierarchy has been posited by numerous authors, I do agree with the hierarchy. The emphasis on the economic responsibility being core stems from the fact that any entity has a duty to maximize shareholders’ wealth. Corporations need to maximize profits for them to remain afloat. Any entity that neglects this responsibility will become history in a matter of time. The economic responsibility is mainly self-regulatory and requires management to evaluate continually and focus their efforts on. The fact that businesses need to generate revenues to remain afloat makes the economic responsibility the essential component in the CSR hierarchy.

The second most significant responsibility in the hierarchy is legal. This obligation includes meeting the legal requirements of the nation the entity is conducting business in. Requirements and regulations guide companies, and the failure to adhere to these requirements occasion dire consequences for enterprises. The case of Enron shows how critical this responsibility is for enterprises. Businesses thus strive to adhere to legal obligations formulated by the government to avoid the adverse consequences.

The third most important responsibility in the hierarchy encompasses the ethical requirements for business enterprises. These duties are usually expected by organizational stakeholders since there are rarely any government laws to enact this responsibility. Governments may, however, interfere in some instances if an entity’s practices are detrimental to the welfare of the majority. This responsibility is not as significant as the former two, and thus its position in the CSR hierarchy.

The last responsibility is discretionary. This responsibility is not required for businesses, and thus is philanthropic in nature. It is initiated for public relations purposes and advertisement, which is why it is placed at the highest level in the hierarchy (Tuzzolino & Armandi, 2008). These philanthropic efforts include contributing to society and donating to various community causes.

In conclusion, the CSR hierarchy has received criticism from numerous sources that argue that there is no need to represent CSR as a hierarchy (Hockerts, et al., 2008). Others argue that there are weak or no relationships between the activities in each level of the hierarchy. The hierarchy is divided into four responsibilities; economic, legal, ethical, and discretionary, with the economic responsibility being the most significant for business entities. The economic responsibility is the most important since it is consonant with the primary responsibility of every firm; maximizing shareholders’ wealth. The legal obligation is second in the hierarchy and geared at adhering to government rules and regulations. The ethical and discretionary responsibilities come in third and fourth in the hierarchy. I thus agree with the CSR hierarchy of responsibilities.


Hockerts, K. et al., 2008. An Overview of CSR Practices Response Benchmarking Report, Fontainebleau: INSEAD.

Porter, M. E. & Kramer, M. R., 2006. The link between competitive advantage and corporate social responsibility. Academy of Management Review, 84(12), pp. 78-92.

Tuzzolino, F. & Armandi, B. R., 2008. A Need-Hierarchy Framework for Assessing Corporate Social Responsibility. The Academy of Management Review, 6(1), pp. 21-28.

Zutshi, A., 2015. What is CSR, lecture notes distributed in MMM313 Corporate Social Responsibility at the Deakin University. [Online] [Accessed 21 May 2015].