Corporate Social Responsibility Reports Essay Example | Topics and Well Written Essays - 1500 words

Corporate Social Responsibility Reports - Essay Example The essay "Corporate Social Responsibility Reports" discusses the relationship the corporate social responsibility report has with all its stakeholders like employees, communities, customers, suppliers, governments, and environment and whether it provides the shareholders and all the stakeholders with useful information. The readers of a CSR report expect that the company should go beyond simple community affairs in their report. Companies which are new to this CSR reporting may confine the CSR reports to reporting only the charitable giving and the volunteer programs. Corporations are now increasingly expected to issue the CSR report to their stakeholders. A CSR report which focuses only on the community is too narrow to be considered as a comprehensive reporting on their commitments to the community through the CSR report. Such Community affairs reports may be useful for the local communities which want to understand how the firms support their causes. But they fail to provide the others with substantive information which is necessary to assess the strengths and the weakness of a corporation to all its stakeholders. There are many accounting theories in this respect. The Stakeholder theory implies that a business has to interact with a number of parties in the environment. These groups or actors are known as the stakeholders. They can be investors, customers, political groups, employees, communities, trade associations, governments, suppliers etc. The communication between them is bidirectional in nature. (Deegan and Rankin, 1996, pp. 50-69). It means that the business influences the stakeholders while the stakeholders also influence the business at the same time. Figure 1: Directions of influence between the business and the stakeholders Stake in a business is defined as the potential benefit which a company provides to the stakeholders. Business has to consider many people, groups or anyone who have interest in the business. This theory can be viewed as ins trumental, descriptive or normative. Presence of any relationship between the stakeholders and the profitability denotes the instrumental nature of the theory (Hooghiemstra, 2000, pp. 55-68). Explanation of the past, present and future of the business and the stakeholders denotes the descriptive nature of the theory. Presenting the function of the business through codes of conduct denotes the normative perspective. According to several studies, it is unethical to focus only on the intent of the shareowners and not on the interest of the customers and employers. The central idea of this theory is that it is not only the shareowners but also the interest of cast set of stakeholders which needs to be satisfied by the managers. According to this theory, there is more than just profit maximizing ability of the firm (Mahoney, Thorne, Cecil and LaGore, 2013, pp. 350-359). The firm needs