MBS 679 Emerging Challenges And Avenue Of CSR During COVID-19 Pandemic Assessment Answer
The business environment in the year 2019-20 has been embossed adversely in the pages of history due to the outbreak of COVID-19, a deadly virus that claimed millions of lives worldwide. The adversity aggravated without an effective vaccine to create fortification in the immunity system in resisting the virus. The business conditions across the globe are thereby poorly throttled impacting profitability and productivity of several renowned business organizations like Air New Zealand, British Airways, Debenhams, Wesfarmers, Qantas and others. The social distancing measures affected in retrenching their employees and reducing sales due to complete lockdown (He & Harris, 2020). However, the essay projects the importance and relevance of Corporate Social Responsibility (CSR) of the companies that argues the benefit of COVID 19 in shifting the business strategies towards more implementation of CSR in their practices.
The essay aspires to establish the avenues of CSR in the practices of the company while emphasizing on the emerging challenges of COVID-19 pandemic that contributed towards the CSR in urgency to address the environmental, social and economic difficulties emerged at every nook and corner of the world. The essay also indicates the organizational changes in their approach to global marketing efforts with financial and administrative governance of the companies while responding to this apocalypse.
Defining CSR and its role in an organization
Corporate Social Responsibility (CSR) is considered as a multi-dimensional and complex concept which can be emphasized with two general schools of thought, one arguing on maximizing profit within the minimal limitation of ethics and law prevailing in the business environment while the other portrays a more comprehensive range of obligation towards the society. As defined by Archie Carroll, the CSR encompasses the social, economic, ethical, legal and flexible expectation that a community bears on the organizations at a given period (Schwartz and Carroll, 2003). The four dimensions of the pyramid highlighted by Carroll comprises of Corporate, Ethical, Legal and Philanthropic spectrum of goals to be achieved while fulfilling the CSR in business perspectives.
Figure 1: The pyramid of Corporate Social Responsibility
(Source: Schwartz & Carroll, 2003)
The evidence-based research in management focuses on the drivers and barriers created by the Corporate Social Responsibility (CSR) of an organization. It is essential to understand the mechanism of CSR and the factors that drive towards the implementation of CSR by an organization. Corporate-based research on a Spanish firm has derived two perspectives of CSR, namely, subjective and objective depending on their values and utilization in the management context of an organization. The hypothesis emphasizes on the various factors that contribute towards the subjective and objective drivers of CSR are mentioned in the following segment:
The subjective perspective of CSR drivers in an organization
The management implication of CSR is integrating ethics into the practice in the corporate governance of the organization. The preference for senior management and ethical consideration of the work culture affects the growth of CSR in an organization. The performance-based on the social, environmental, and economic perspective of an organization is integrated in sustainable practice that helps in realizing the long-term association of CSR in earning profit and generating commitment of the employees towards their work culture (Forbes et al. 2018). The management of the company can be characterized based on their philanthropic thoughts and activities that contribute towards achieving the CSR goals.
A recent example of Woolworths can be referred in this context where the organization focused on the goals of attaining people, planet and prosperity in 2020 by ensuring diversity in work culture, promoting gender equity by 40%, supporting the Aboriginals and Torres Strait islanders in generating employment, achieving Gold Tier employment Status in Australian Workplace Equality Index (AWEI), moving towards a circular economy while incorporating zero food waste and recyclability of the Own Brand products (CSR Woolworths Group, 2020). The corporate is also aware of becoming ideal after passing through corruption or scandal where incorporating CSR becomes a strategy to start a new trend in the industry.
Figure 2: The sustainable goals developed by Woolworths Company to attain Corporate Social Responsibility in the year 2020
(Source: CSR Woolworths Group, 2020)
The objective perspective of CSR driver in an organization
The objective perspective of CSR implementation by identifying the drivers relates to the pressure created by the stakeholders of an organization. The generalized concept of stakeholders reflects the involvement of customers, employees, shareholders, government agencies, social and non-governmental agencies supporting the environmental causes, and the community creates a pressure on the corporate to fulfil their responsibilities and obligation through practices towards the society (Arif, 2017). The top-down pressure from society with the involvement of government decisions is also the expected drivers that build pressure on the organizations to implement CSR in their business strategies. The pandemic mandated a complete halt in manufacturing and production-related activities, which also aggravated the limitation of availing resources for the organizations (Thomassen et al. 2020). The lack of government willingness in offering grants or injecting cash help has been witnessed in the society that motivates the companies to look beyond their profit motives and involve philanthropic cause into productivity and profitability in the organizations.
Emerging challenges and avenues of CSR during the pandemic crisis
The emerging challenge that was faced by the company is the practical implementation of the policies in multinational companies. The changing climate in both the environmental and economic situations of the countries motivates the implementation of the CSR which is also challenging due to the lack of governance of the policies and regulations from the top management (Saarinen, 2020). The geographical distance between the establishments of internationally expanded companies creates a gap in monitoring the functions as expected from the companies. Hence, this detachment serves as a disconnection between the practical implementation of the CSR strategies in an organization.
The reduced use of plastic has been one of the strategy and commitment towards the society as mentioned in CSR policies of all the organizations since environment protection is one of the significant criteria of the CSR implementation. Plastic usage degrades the soil quality and one of the adverse causes of soil pollution, which has been addressed in the UN Climate Change Conference 2019. The single-use of PPE kits during the pandemic crisis shot up manifold in the healthcare and other sectors. The single-use and its disposal of plastic PPE kits have witnessed the increase of plastic, which is detrimental to environmental health choking the soil to extensively (Silva et al. 2020). This behaviour of hazardous use of plastic is thereby considered controversial in managing waste and poor maintenance of sustainability factors in the environment.
Figure 3: The increased usage of plastics prove to be detrimental to environment sustainability
(Source: Silva et al. 2020)
The managers of a firm are entrusted with the task of running the firm through production, sales, management and accounting. The stakeholders at a firm might be interested in taking credit of CSR endeavours and may very well strive to channelize the CSR endeavours of a firm for funding their personal agenda (Albitar et al. 2020). This particular aspect of human nature deters the firm from voraciously campaigning about the expenditure incurred and the accounting thereof of CSR projects undertaken (Liu, 2018). For instance, if Heinz Company advertises it the appearance of benevolence through disclosure of accounts, then the shareholders will change in leadership of the company. The same aspect is evident during the COVID 19, where disclosure of CSR funds allocation for the society and employees through accounting and governance is embedded in the functions of the organization. The disclosure of the allocation of funds in CSR activities will lead to scrutiny of the firm by the activist groups which can be bothering in running the management by the organizations.
The small companies during the pandemic have incurred severe losses in comparison to the bigger ones since they had more savings to incur in the CSR activities. The actualization of capital by the small companies create constraints in the implementation of the CSR activities. The employee retrenchment from several companies throughout the world has contributed to the unemployment of the youth. As estimated by the International Labor Organisation, the informal economy impact has been severe on the employees where 3.3 billion people have lost their jobs due to policy changes of the organizations and complete lockdown affecting the productivity and earning of revenue (Press Release, 2020). The employees will be depending on the CSR techniques being utilized by the companies, hence, will protest when the companies will not engage enough fund to meet the social and economic obligations of the employees and the communities as a whole.
The avenues recognized during the pandemic crisis for the CSR to be implemented addressing the needs of the healthcare sector by producing sufficient masks, sanitizers and PPE kits for the frontline warriors. The companies needed to support the society, especially contributing food to the remote corners of the world, which is already affected by poverty and unemployment, aggravated due to the complete lockdown of the economy. The emergency response fund was also another avenue addressed by the companies during the pandemic crisis.
Figure 4: The Holistic Framework of CSR addressing the pandemic crisis.
(Source: Ebrahim & Buheji, 2020)
The other avenues that are addressed during the pandemic crisis mostly focus on the integrated approach of the organizations in offering employee safety at work, engaging the employees with health benefits and funding their treatment, and responsible activities like strict maintaining of social distancing during the pandemic crisis. There have been both beneficial and challenging approaches taken by the companies. For instance, Levi's Brand has been vocal about their employees' safety which is an embedded part of CSR activity, Starbucks actively addressing the food crisis through their food banks and helping the Arkansas Delta in Mississippi, and Wesfarmers are providing paid leaves to the employees (Knight, 2020). On the contrary, the Qantas has axed 6,000 jobs that aggravates the condition of the employees of the company while affecting the economic and social security of the employees (Atkinson, 2020). The furloughed staff has been estimated at 80% in 2020.
Discussion on the involvement of more CSR during the COVID19
The coronavirus pandemic has created more avenues to be addressed by the companies that could not fulfil their CSR activities before this disaster. This crisis has involved more commitment from the companies as this has a long-term impact on the minds of the millennial since they witnessed a heavy toll on the lives of millions across the globe. The tragic part of this crisis is the delay of assured vaccine for the people affected, which calls for the more practical implementation of CSR activities by the companies (Kramer, 2020). The companies like Wal-Mart and Apple are paying their employees half-salary instead of complete job cut. Starbucks has more reliant on the suppliers and engaged them in supporting programs during the pandemic crisis.
The company is instrumental in addressing the small suppliers of coffee production in Rwanda by empowering the women and youth through a coffee plantation. The company in Australia recognized as Softmed has expanded its manufacturing unit to help the citizen in making masks and PPE kits, which initiates the CSR activity of taking care of the healthcare workers, and supporting the social cause of fighting pandemic (Redrup, 2020). The Australian Companies, in addition to supporting the world population and the different affected parts of the globe, they are also engaged in philanthropic activities to revive the economy and social life. The achievement of the same seems to be not very far considering the effort and the team spirit exhibited by the companies and the NGOs' in congruence with each other.
The COVID 19 pandemic has already had its toll on the world. A huge calamity has also befallen Australia due to the same. The singularity position of each of the citizens' organizations and members of the government of Australia has somewhat been a deterrent towards the community survival during calamities. However, at such times the importance of long-distance helping hand through the avid usage of internet has also been duly proclaimed, followed and thereby saved many lives. This particular aspect also has a huge say in Corporations, companies and big businesses (Filimonau et al. 2020). These corporations have since their birth always been accruing profit for the extensive proliferation of the Brand name and to get into the hearts of people. In a bid to do so, these huge brands have also developed their own way of charity for poor, rehabilitation of homeless and many other philanthropic tasks. These aspects are known as CSR, where the corporation is not gaining money but gaining the love, trust and sympathy of the people who have a heart towards the betterment of society as a whole. However, this COVID-19 pandemic has wreaked havoc amongst these philanthropic endeavours too (Rahdari et al. 2020). The main reason being, the seclusion and self-quarantine that each member, citizen and a non-profit volunteer had to undergo.
All this has left the country in a topsy-turvy mess, which will take time to recuperate. In this act of treading back to normalcy, duly maintaining social distancing and COVID-19 safety protocols, the administration is striving hard. A helping hand from business magnets through CSR programs will not only enable the country to regain its prior to pandemic normalcy faster but also with much more vigour. Many educated people have duly deliberated upon this aspect, and even a census on the same was carried out wherein it has been found that 66% of the people have sworn to avoid those corporations, business houses which are not assisting the comeback from pandemic procedures (Park, 2019). That is a harsh statement but definitely true as per the peoples’ decision. Even 78% of the population believes that their affinity towards the brands supporting the cause through CSR programs will be higher, and they will forever be etched in their hearts. In addition, 78% of the population believes that the companies should try to change their ways and means thereby supporting the COVID-19 relief even through their day-to-day functioning. This justly amplifies the scenario going on the in the hearts of citizens about the thought they have about CSR and how much appeal and hope they have from the corporations in bringing back normalcy.
Even before the COVID-19 pandemic breakout, the companies were involved in CSR, which were mainly three-dimensional philanthropic, environmental, and ethical. As discussed by Saiz Alvarez et al. (2020), these approaches included things like charitable distribution of food and medicines, investing in the environment to curb pollution levels, imposing labour laws to enrich the living standards of lower strata of employees and even medical and health camps at certain places where the medical facilities are not so developed etc.
Nevertheless, as of now the modus operandi of the CSR needs a revamp as the fight is no longer confines to any locality or area but is vast and worldwide against the Coronavirus, which is fatal to all, and sundry irrespective of colour, creed, economic strata or place. In Australia, the extreme hardship was the communities bearing the brunt at the hospitals and food banks. These places needed the most assistance (Wong et al. 2020). In a bid to ease the huge pressure the Nestle` corporation has donated $ 2 million worth of items including coffee, food items, pet food and meal bases which are being distributed through these food banks throughout Australia. This has heavy repercussions, and a lot of pressure on the food banks has been ameliorated (Progress Report, 2020). Although, much more needs to be done to bring the economy of the country back on track, but this noble gesture by Nestle Corp will definitely hold ground amongst the customers for years to come.
Figure 5: The CSR forecast of Nestle Corp.
(Source: Progress Report, 2020)
Other large-scale corporations in Australia have also initiated CSR initiatives in line with the COVID-19 pandemic resurrection process. There are innumerable PPE kit donations to hospitals and health workers, charitable institutions by many business enterprises. In addition to all this, the corporations are trying to follow a "give-back" policy, thereby helping the people to sustain by lowering costs of products (Aziz, 2020). Even Forbes has come up with a questionnaire for each organization to estimate the amount of “Give-back” that can be done by the organization. The questionnaire is as follows:
Identifying the core partners by the companies and estimating their condition during the pandemic while searching for avenues to support them if required.
Which COVID-19 pandemic aspect is solvable by the organizational channel, e.g. which product is most required to control COVID-19, which medicine is produced which can help patients or what goods and services does the organization provide which can assist COVID-19 fight? Is the organization doing its best to enable these resources to reach the right target group during this juncture?
Is the production at full capacity? Is the labour force sustaining well? Can they be rechanneled for better and more effective result in the COVID-19 fight?
Is the healthcare system getting the required support from the organization? Can the company improve the system to enhance the support provided to the healthcare system?
Is there any new collaboration probable, which will boost the fight against Corona Virus by the corporation?
All these aspects although being thought out by the organization and the necessary steps already put into effect, but there are many who are yet to put in their additional effort to bring the economy, country and its people back on track. Even though much effort has been put in, but a huge part is yet to be done (Popkova et al. 2020). A continuous assist and an unflinching attitude to come around are required in the form of CSR to end this pandemic quickly. Few aspects of the CSR can be analyzed and employed by the organizations to deal with the fight against COVID-19. The following are the aspects:
Support for local business and non-profit organizations
The local business and non-profit organizations are the main sources of local economic buoyancy. The turpitude in the economy has its own ill effects and also its own drawbacks. The improvised way to instil in the local economy some amount of cash in-flow will not only be beneficial for the local economy but also will enable the people to ensure a better standard of living among its residents (Obrenovic et al. 2020). This thing in-turn will also enhance the economic condition of the country as a whole if exercised in every locality and community.
Enhancing mental wellness
Mental wellness is an issue which has forever been a matter of concern. But during these pandemic times when a lot of people have lost their near and dear ones, most have been economically drained, and the hopefulness of people is a scarce thing, mental wellness is a very important aspect. Assistance to mental wellness does not require physical contact and can be implemented through the available means of communication. Most efficaciously can be done through the internet. This will enable that the cases of domestic violence, suicide, and homicide will reduce drastically, thereby empowering the community by itself to tide over the perilous of times (Chatterjee et al. 2020). Some individuals live alone, and thereby their loneliness sometimes becomes a bane, especially now when there is no social interaction. The same may cause depression, and that can be thwarted by the organizations doling out grants to charitable institutions who are already taking care of mental wellness.
Every person knows a few people who would need assistance in these trying times. Virtual volunteering helps motivate such people to come up and volunteer himself for the wellbeing of these people, and this can be done sitting a the desk at home. Many have the penchant for serving the needy but do not know-how. The virtual volunteering site can tell them how exactly they can support the cause of the fight against the Corona Virus, how they can assist the needy without getting infected him or her or making themselves vulnerable to the infection (Akbar & Kisilowski, 2020). The first way to win the hearts of so many people is to allow them to help in this endeavour voluntarily without even risking their own lives through virtual volunteering. The organizations can develop virtual volunteer portals by themselves and can link with other virtual volunteer portals to enhance the influence zone, thereby improving upon the volunteer base. The increase in the volunteer base with the support of company CSR will enable all the needy of the country to be helped out either directly or indirectly through some non-profit organizations who also need to be linked with the portal.
In conclusion, the final consideration can be assessed in implementation of the CSR activities by the management of the companies that projects in the assurance of achieving the goals embedded through social, economic, legal, and environmental obligations. The context of marketing and business has witnessed a thorough change where the companies have now been instrumental in addressing the needs of the society and not just working with the approach of incurring profit for the organization. The restrictions mandated during the COVID 19 is not only meant for contemplating the CSR strategies for short-time implementation but require motivation from the management and the employees to be performed and practised for the long-term sustainability of the companies.