Traditionally, the businesses kept profit maximization as the key motivational factor to pursue their business. There was no accountability to the stakeholders, society, and employees who were an integral part of the business.
Later, Archie Carroll, a professor at the University of Georgia, wrote a paper on how businesses can add four layers of objectives to their businesses and adopt a holistic view of yielding profits. In this framework of thinking, the businesses consider the four elements: economic, legal, ethical, and discretionary expectations for strategizing the crucial activities. However, it becomes challenging for businesses to adhere to the four elements as it demands sheer commitment. Currently, many companies have incorporated ethical practices as the foundation of their operations by adding sustainable changes to suit the environment. Further, the explanation below will elucidate the aspects, benefits, and challenges of corporate social responsibility.
ECONOMIC: The economical layer is at the core of the CSR pyramid. It connotes that the salient feature of the business to fulfill its economic goals: minimizing cost, employee benefits, and stakeholders. Besides, a nation’s economy is dependent on the way businesses generate revenue and increase opportunities overall.
LEGAL: To regulate the lawful operations in a business, it must comply with the legal practices. In the 1970s, many businesses indulged in unlawful global trade activities, which caused strict laws against fraudulent practices. Similarly, it is the responsibility of the business to provide the right product/service in the right way through the right channel to the consumers.
ETHICAL: In the ethical layer of the CSR pyramid, the businesses strive to bring discipline and justice to their constitution. Ethics bring clarity and morality to the otherwise unmonitored business practices. Furthermore, the ethical accountability of businesses enables them to stick to the codes they set for themselves.
PHILANTHROPIC: The uppermost element in the CSR pyramid focuses on how a business is expected to give back to society. In the contemporary landscape, m
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