Development of Social Responsibility Practices and Corporate Social Capital in Companies

 

Recognising the importance of social responsibility to their stakeholders, a vast majority of companies now focus on and practice corporate social responsibility (CSR). Companies employ different CSR-generated policies, practices, initiatives, programmes, and projects based on their business vision, mission and strategies. The development of CSR methods can be based on general social responsibility practices, international standards such as SA8000, ISO 50001, ISO 14001 and ISO 26000, and United Nations’ Sustainable Development Goals (2015), among others.

 

Companies can select their CSR methods in accordance with their business strength, financial budget, internal and external resources, stakeholders’ needs and expectations, respect for rule of law, service targets and social requirements. Incorporating the concept of Corporate Social Capital (CSC) while developing CSR practices has the advantage of fostering long-lasting impact through the self-sustaining activities of a relationship network bound by shared values.

 

Figure 2 illustrates the seven core subjects of CSR as defined in ISO26000 and Figure 3 lists their respective practices. The details are tabulated in Annex B. Of the seven subjects, Organisational Governance (OG) is the most important for integrating CSR and CSC throughout an organisation and its relationships since OG is the framework for decision making. Another key subject is Community Involvement and Development (CID) because it encompasses an organisation’s support for and engagement with the community, which directly contribute to Social Capital development

Figure 2. Social Responsibility: seven core subjects. Adapted from ISO 26000.

CSC can improve the quality of CSR implementation. By performing CSR, companies can build and enhance CSC. For instance, companies implementing good organisational governance and labour practices (two of the CSR subjects) can facilitate stable employment relationships and encourage organisational reciprocity norms, which are indications of strong CSC. In companies strong in CSC, relationships between employer and employee and among employees are characterised by trust and mutual commitment that make collaborative and collective action (such as engagement in community involvement and development) more efficient (Leana & van Buren, 1999). Figure 4 illustrates the reciprocal relationship between CSR and CSC. Companies may employ different strategies to build and enhance their CSC. These CSC strategies include CSR policies formulation, stakeholder engagement, stakeholders’ needs identification, regular contact with relevant value chains, cross-sectoral collaboration, development of collaborative relationships, shared value creation, two-way communication, provision of professional information, employee relationship management, development of cross-sectoral/cross-organisational networks, establishment of sustainable partnerships, participation in collective activities, exchange of resources, provision of caring messages, role transformation and long-term commitment.

 

Figure 3. Seven Social Responsibility core subjects and their practices (please refer to Annex B for details) (HKQAA, 2019)

 

 

 

Figure 4. Relationship between Corporate Social Responsibility and Corporate Social Capital

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