Arguably, business in the 21st century has undergone tremendous changes. As a matter of fact, businesses have implemented various tactics that will make them achieve competitive advantage and develop a strong relationship with the society. The issues of sustainable development have been discussed since Earth Summit in 1992. The report ‘Beyond Rio’ led to a lot of challenges in the business world, to individuals, as well as the government. The main concerns of the meeting at Rio were to document the New Zealand’s Environmental record (Larry, 2003). The interface, linkages and relationship between society and business arise because of inception, nevertheless, for many decades this relationship has undergone tremendous changes. The effectiveness and survival of every business depends mostly on the quality of support it receives from the society, and its stakeholders. Every business must assert that the society plays various roles in their existence and progress, on the other hand, the society also benefits from the existence of businesses. Undeniably, this is an era of social responsibility awareness; business and society are related in every virtual aspect of life. Government officials, business executives, the public, and educators have become more concerned on corporate profits, social issues, and the environment, which is achieved by elaborating on the relationship between the society and business.
Businesses integrate economic, social, as well as environmental issues into their operations and values in an accountable and transparent manner. Hence, the CSR (Corporate Social Responsibility) creates and builds a relationship between the business and society. In the report on Earth Summit 1992 and ‘Beyond Rio’ businesses and community relationship was defined based on the sustainable development (Goll & Lafond, 2002). These included reduction of emissions, preservation of quality water, fisheries, biodiversity, as well as education for sustainability. It is fundamental to long term business success and growth, since it plays a tremendous role in promoting business values internationally, as well as contributing towards sustainable development of the society. The relationship between society and business arises due to the roles played by each other which include development and processing of economic values, the business in this has the ultimate role of providing services and goods to customers at a certain price. The business in most cases is engaged in making a profit, but its relationship with society is linked to the fact that it engages itself into non-commercial activities (Baker, 2006). Perhaps, they engage in charitable activities that help the society, it includes building of hospitals, missionary-run homes, orphanages, as well as the non-governmental organization. In fact, the business engages in activities that solely meant to improve the living standard and values of society.
Perhaps, the relationship between business and society developed as a result of market forces. Business in the global arena is carried in a social network. The society and business, mutually co-exist because each expects to benefit from each other. Business is related to society because it undertakes social activities, in fact, people in society, view business as a social institution and integral part of society (Baker, 2006). The influences of business in the contemporary society are far much reaching and influential. Moreover, society and business relationship is inherent in concepts such as material things, institutions, as well as ideas. The relationship in terms of ideas includes values, beliefs, attitudes and ideologies. The business and society are linked by ideas, whereby it helps in driving both the business and society to fulfilling its functions (Sengupata, 2003).
In addition, the relationship of business and society exist in tangible materials such as resources, stocks, and land. The existence of the business in society can be dictated by the society regardless of legal documentation. In executing its duties, business is responsible in ensuring that its actions are ethical and are within the context of society. In this scenario, being ethical is crucial because it protects business interest, prevent harm to society, develop trust, and protect itself from competitors (Sengupata, 2003). Certainly, the relationship between business and society has existed for many decades, but it undergoes changes. Perhaps, the change that takes place adjusts the relationship that exists between the society and business in ensuring that the Earth Summit of 1992 and ‘Beyond Rio’ are attained (Larry, 2003).
Incontrovertibly, there is a tremendous increase in firms that focus on social responsibilities since the original Earth Summit in 1992, and Beyond Rio policies. In order to dominate in the market place, firms must understand the business impact on the globe, as well as putting into consideration the strategies to create a positive impact. CSR (Corporate Social Responsibility) refers to the way firms and organizations integrate economic, environmental and social concerns into operations and values in a transparent manner. The Earth Summit of 1992, act as a roadmap to organizational focus on issues of social responsibility (Goll & Lafond, 2002). The concept of Corporate Social responsibility entail organizational interest in society by carrying out responsibilities that impact the activities of shareholders, employee, community and customers in various operational concepts aimed at ensuring that sustainable development is achieved. The obligation of an organization in this perspective goes beyond statutory and legal obligation of an organization, to improving the quality of employees, families and the entire community, which will lead o sustainable development as advocated in policies on Earth Summit of 1992 and ‘Beyond Rio’ (Trebeck, 2008).
CSR (Corporate Social Responsibility) has continually been made part of organizational commitment to operate ethically and be part of economic and sustainable development. Apart from making profits, organizations operate in an ethical manner with an intention of establishing a string base with the society. In fact, CSR is all about managing business operation within the organization in order to produce a positive impact in the community and to focus on sustainable developmet (Schwartz, 2011). Corporate Social responsibility is practiced with the intent to manage risks, win customers loyalty, and increase employees’ pride, and sustain the environment. Organizations are socially responsible through the initiatives of going green, developing community connections through fulfillment of needs (Trebeck, 2008).
The CSR is centered on equal, and fair treatment of employees, operate with integrity and ethics, respect the rights of the people, sustaining environment, as well as being a caring organization to society. ‘Beyond Rio’ agreements need to be followed so as to achieve sustainable development (Trebeck, 2008). There are crucial challenges in the corporate society today, which impose limitations to organizational main objective of sustaining the environment, and making profit. Government restrictions, globalization, exploitation, environment sensitivity, and tariffs prevent organizations from becoming socially responsibly and making maximum profits (Schwartz, 2011). Organization need to focus on CSR (Corporate Social Responsibility) because it leads to success, and presents safer and better global opportunities.
Perhaps, stakeholders in a business organization refer to all individual who have an interest in business. In fact, their main role is to contribute to the success and growth of the organizations. Stakeholders take the responsibility of making decisions and voting on crucial changes to be implemented in the business organization that will lead to sustainable development. For example, stakeholders may employ management team and entrust them with various activities in the business that are meant to lead to sustainable development. Stakeholders’ role is also to ensure that environmental and social responsibilities are carried out by the organization, as per the sustainable development issues agreed at Rio de Janeiro in 1992 (Wadham, 2009). In fact, stakeholders may decide to utilize a new resource if the current resource is scarce. Generally, stakeholders monitor the entire activities of the business and ensure that business policies are followed, profits are made, and public interest is adhered to, according to sustainable development issues raised in I992 Earth Summit and Beyond Rio (Trebeck, 2008). The stakeholders’ roles affect the business activities, and the community within the line of operation. Therefore, their decisions affect the employees, shareholders, customers, community, investors and the government (Crane & Matten, 2010).
Undeniably, every organization employ managers as an investment tool, this is because they play a crucial role of making decisions. Based on the Rio Earth Summit, managers are propelled to make decision that will reduce climate change (WWF Earth Summit, 2012). The business activities in an organization need to focus on sustainable development and reduction of environmental pollution. Their decision and action affect the viability and values of the organization. Thus, managers need to make decisions by adhering to the code of values because their decisions determine the organizational success, failure, and performance that are influential in the societal environment and development. The essence of management in every organization is to make decisions; hence managers need to base their decisions on the code of values because they are constantly needed to make decisions, as well as evaluating alternatives on issues pertaining business. Decision making by managers entails risk, and uncertainty of various degree; therefore, the code of values is there to guide the managers in the process of decision making (Freeman, 2010).
In the 21st business world, individuals and organizations are supposed to act and make decisions responsibly in order to achieve competitive advantage and sustainable development. In fact, they have to adopt policies progressed in New Zealand. In fact, the corresponding measures of the mangers must correspond to mitigation of climate change. The rationale of code of value in decision making is that it acts as the bottom line in evaluation of organizational activities, which must be focused towards environmental protection, ethical treatment, as well as community contribution (Crane & Matten, 2010). CSR (Corporate Social Responsibility) is crucial to organizations activities, managers need to make decisions based on code of values so as to deal with organizational undertakings in attaining environmental, revenue, as well as community support (Gardeiner & Pohlman, 2000).
In the report on Earth Summit 1992 and ‘Beyond Rio’ businesses and community relationship was defined based on the sustainable development. The relationship between business and society should be linked to environmental, social and political issues. Every stakeholder has the responsibility of ensuring that the community and business focuses on sustainable development. The resources in society are scarce, and it should be utilized in a manner that the coming generation will enjoy them too. The rationale of code of values in decision making is fundamental to managers since it regulates external and internal behaviors, and guides them in implementing the global agreements on issues pertaining sustainable development. Managers’ decisions should maintain business objectives and prevent conflicts between all organizational stakeholders and Beyond Rio policies (WWF Earth Summit, 2012). The decisions made based on code of values have the prospect of taking the organizational business and sustainable development to the highest level in various ways (Greasley, 1999). Generally, competition has tremendously increased, and consumer demands and global sustainability development policies keep on changing; hence, managers decisions must be based on code of values so as to achieve organizational, sustainable development and business objectives.
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