Corporate Social Responsibility Legal Anthropology

Question: Discuss about the Corporate Social Responsibility for Legal Anthropology. Answer: Introduction Corporate Social Responsibility (CSR) is identified as an integral part of a companys operation. Haalboom (2012) mentioned that, most of the organizations all over the world have struggled to find out the practical implication of CSR. In this assignment, a CSR audit has been conducted for the company BHP Billiton. It is Anglo-Australian Multinational mining company founded in the year of 1885 (Fisher Grant, 2012). The company has revenue of A$ 61.2 billion in 2015. The company operates of processing, mining and oil and gas production operation in more than 25 countries. The company has donated 1% of the pre-tax profit in community programs for the last three year. The company has provided US$ 241.7 million for community donations. It includes US$ 100 million contribution by the BHP Billiton corporate entitles. Detail scope of engagement In order to conduct the CSR audit, the communication auditor has been provided some specific instructions. At first, it is required to analyze the current understanding of CSR. In order to do that, it is required to refer to academic literature and industry standards. Then it is required find out CSR commitment of the company BHP by carrying out some investigations. In order to do that, it is required to find out the CSR claims embedded in the vision and strategic documentation of BHP. Then it is required to analyze whether all the claims (actions arising from BHPS governance and performance documents) are measurable or not. Then it is required to analyze whether the company can demonstrate positive impact of its CSR policy or not. After that the communication auditor needs to find out the discrepancies between communicated intention and the corporate practices. Depending on the discrepancies it is required to provide some recommendation for the company BHP to improve its CSR policie s. Critical analysis of the current understanding about CSR As Mayes Pini and McDonald (2013) stated that Corporate Social Responsibility (CSR) has emerged as a global trend in various countries. There are various policies; CSR perspective and culture have been developed to manage responsibility of various organizations. It has been found that scope of various management theories are growing and theories of CSR are changing over time. As Hilson (2012) mentioned that, CSR can be defined as the bridge of connection between ecology, social community and the corporate world. According to Bice (2015), CSR is the concept whereby companies integrate social and environmental concern in their business operations in their interaction with their stakeholders on a voluntary basis. On the other hand, (Fisher Grant, 2012) argued that CSR is not only a mean to fulfill legal expectations and governmental policies. It also includes concerns related with society development, harmonious ecology, environment and human capital. It has been found that Corporate S ocial Responsibility has common ground with sustainable development, hence they are always associated. Theoretical Framework (perspective of CSR) The concept of CSR emerged in during 1970s. It started to gain high profile drastically during 1990s. According to Andrew et al. (2012), CSR is all about how a company allocates its value to manage the behaviour and expectations of suppliers, stakeholders, employees, government regulators and social communities. Major CSR issues are such as stakeholder engagement, community relations, human rights, governance, labor standards, environmental engagement and social equity (Bluszcz Kijewska, 2015). There are many scholars have developed research works related with CSR in the area of management. It has been found that managers are the initial driver and CSR is utilized as the management concept in the area of enterprise. According to Fisher and Grant (2012), working with CSR indicates the perspective of being responsible to the society. In the figure given below, the CSR map for an organization has been analyzed. Figure 1: CSR map for an organization (Source: Lanis Richardson, 2012) It has been found that the goal of the organization is to improve long term sustainability and profitability. The goal of economy is to increase sustainable economic development related activities (Lii Lee, 2012). It has been found that, a company has to meet some responsibilities to its stakeholders. The stakeholders include customers, society, employees, local community and investors. An organization can provide value to its customers by improving quality of products and services and reduce price of products. Bice (2014) mentioned that values for employees can be increased by improving health safety and labor standards. Engagement in community activities like donations can improve value for local community. Enhancing business ethic, protecting human rights and environments can improve value for the society (Kirschke, 2014). On the other hand transparency and accountability can improve CSR value for the investors of the organization. National Responsible Competitiveness Standing in the era of national economy development, CSR is referred as the concept to enhance national economic competitiveness. Guidance for the progression of the sustainable future can be provided by the National responsible competitiveness. It provides a cooperative analysis of the national responsible competitiveness for a huge group of countries (Bisley Coyne, 2015). In accordance to the Sate of Responsible Competitive Index, Sweden is recognized as the most responsibly competitive country (Dashwood, 2014). This nation has strong urge for sustainable development. On the other hand, China utilizes international sustainability standards as a soft power to improve responsible competitiveness of all operating organizations in this country. It indicates that the Chinese Governments and Chinese organizations al already aware about the dynamics of responsible competitiveness. C-SR Model For various theories it has been found that CSR is a part of company management that has significant impact on the outcome of the corporate performance of an organization. As Wang Li and Gao (2014) stated that, measuring Corporate social performance (CSP) of an organization can help to analyze the CSR behavior of an organization. Meehan (2006) had provided a model to analyze the competitive strategy of an organization depending on social resources that provides triple bottom line benefits to an organization. It is known as3C-SR Model. Figure 2: 3C-SR Model (Source: Kirsch, 2014) Examining the CSR commitment of BHP Identification of the CSR claims embedded in the BHPs vision and strategic documents In terms of market capitalism, BHP Billiton is termed as the worlds third largest organization. It is a global mining, gas and oil organization that has headquarters in Melbourne. As Bisley and Coyne (2015) stated that the organization operates in more than 25 countries. It has more than 41,000 employees. BHP billion strives to develop long-term value with the help of discovery. The vision statement of the company is development and conversion of natural resources and the provisions of innovative. According to Lanis and Richardson (2012), the companies always try to develop market-focused and customer focused solutions in order to improve value for customers (CSR value). The major strategy of the organization to invest in world class, low cost and export related operations that reflect diversification across the market of different geographic regions. As Mayes (2015) stated that, it is the objective of the company to create sustainable value for their employees, contractors, shareholders, business partners and customers. The company aspires to cause zero harm to people, environment and its host communities and tries to achieve sustainable industry practices. The company is actively involved in CSR practices stating that Community programs are operating at four levels across the company- local, provincial or regional, national and global. The majority of the efforts occur locally at our operations where our businesses implement programs to develop and support the communities close to us and across the business, our business is to make positive contribution to the people to our host communities. Measuring the claims of BHP Figure 3: CSR rating for BHP (Source: Bluszcz Kijewska, 2015) It has been found that, allover CSR rating of the company is 62% in comparison to all global companies. This CSR rating for the company is constant for the last two years (2014-2016) (Lodhia Hess, 2014). The community rating is 58%, environment rating is 64%, employee rating 64% and the governance rating is 62% for the organization BHP Billiton (Bluszcz Kijewska, 2015). Coal mining involvement is a special issue that has affected the CSR rating for the company. Figure 3: History of CSR rating for BHP (Source: Dashwood, 2014) There is a table given below to mention the Corporate Social Responsibility requirements identified by the company BHP. Category Needs/ Requirements Child labor According to Bluszcz and Kijewska (2015), children cannot be hired at workplace before the completing their compulsory education. The minimum age to enter into the employment must not be lower than 15 years. Compulsory or forced labor The supplier of the company BHP makes sure that there is no bonded, forced or involuntary labor is associated with the company operation. Treatment towards employees The company has developed a working environment where all employees are treated with respect and dignity. It has been found that there is no sexual, verbal and physical abuse tolerated in the working environment of BHP. Wages Wages and benefits are provided to employees depending on the job standard. The minimum wage of the company is higher than the amount mentioned in the national legal standards or local industry benchmarks. In the states where no such standard exist, the company has to develop a wage standard that can meet the requirements living for the employees and their dependants. Health and Safety at workplace The company has taken appropriate precautionary measures in order to protect workers from work related hazards. All the workers are provided health and safety training in accordance to the requirements of the jobs. The company has provided clean, healthy, safe and specious work environment to the employees (Dashwood, 2014). All the safety policies of the organization comply with the HSEC Group Level documents. Freedom of Association The suppliers of the company have to adopt an open attitude to manage the legitimate activities of the trade unions. Protection World Heritage Sites The company has to make sure that none of the sources should be gathered from World Heritage listed sites or International Union for conservation of Nature Protected Areas. Corporate Social Responsibility requirements of BHP (Source: Bluszcz Kijewska, 2015) Examining whether BHP can demonstrate positive impact on the CSR policy It has been found from various research works and industrial analysis that the company BHP has demonstrated positive impact of the CSR policy by creating various foundations to help local communities: The company has developed BHP Billiton SEWA Society in India during the year of 2005 (Bluszcz Kijewska, 2015). It is also known as BHP Billiton India development Foundation. This foundation was developed to invest in the social and human resource capabilities in India. Special focus was given to various states of India like Orissa, Jhar Khand, Chhattisgarh and Andhra Pradesh. It provides attention in the sectors of health, education and rural development (Dashwood, 2014). BHP has developed The Minera Escondida Foundation to provide contribution to improve the quality of the life standard of low income people of Chile. The organization has developed The Tintaya Foundation in Peru. It is an independent non-profit company which was developed to support the Tintaya Copper operation (Bisley Coyne, 2015). The main objective of this foundation is to improve and promote participation and self-management process within the community of Tintayas areas of influence. It has high contribution in the sustainable development of this area. The organization has developed the Montelibano Educational Foundation in Colombia. As Bisley and Coyne (2015) stated that this foundation is mainly trying to focus on the educational provision for Cerro Matoso employees and their families. It also helps the needy students to find out shelter from the surrounding communities. Assessing the discrepancies between communicated intention and corporate practices of BHP Despite of several positive intentions taken by the company BHP, there are some discrepancies have been found between the communicated intention and the corporate practices of the company. As mentioned that, since the starting of the industrial age, the company BHP is listed as one of the 90 companies that extract and market fossil fuel that are responsible for 66% of the global Greenhouse gas emissions. It is ranked as the 19th largest corporate polluter all over the world (Lodhia Hess, 2014). Although the company has voluntarily reporting about direct GHG emissions since 1996, the company has been criticized for lobbying against carbon pricing in Australia (Bisley Coyne, 2015). On 5th November 2015, a flood occurred from a dam that holds waste water of an iron ore mine owned by BHP Billiton. A village was flooded and there were more than 17 people died during the flood. There were more than 50 peoples get injured and it caused enormous environmental damage. It had been termed as the biggest environmental disasters occur in the history of Brazil (Bisley Coyne, 2015). Recommendations to improve CSR policies of BHP In order to solve CSR related issues, there are some recommendations have been provided for the company BHP. They are mentioned below: 1. The company has to develop renewable energy sources in order to generate electricity. 2. BHP Billiton has to use economic instrument to control emissions of Green House Gas. The economic instrument includes emission fees that give permission to the company to achieve lower environmental costs. 3. It is required by the mining company to implement extra measures of energy efficiency. It also needs to take some initiatives to minimize non energy emission like methane emission from the site of landfills. 4. The company needs to invest more in the research works in order to estimate the environmental changes more correctly. 5. The company has to instruct its suppliers to eliminate child labor. The company also has to spread equal labor rights throughout the sub contracted operations. It has been found that many mining companies cut down labor expenses by employing workers with low wages. This problem can be sorted out by developing appropriate rules and regulations related with child rights. 6. The company has to take care of the working environment of the organization. It is required to develop such a working atmosphere where all employees are treated with respect and dignity. 7. BHP has to provide clear and safe working condition to the employees and need to provide safeguarding against any kind hazard and problem they face during their work. 8. The company BHP has to team up with other parts of the society like local governments and Trade unions to make sure that the incentives and wages are given to the employees are based on the minimum national and legal standards. Conclusion In this assignment a CSR audit has been developed for the company BHP. The theoretical approaches related with CSR have been discussed in this report in order to understand the concept of CSR properly. The CSR responsibility for the company has been measured and it has been demonstrated how the CSR policies of the company can spread positive impact on the community. The discrepancies of the CSR polices have also been analyzed in report. Depending on the discrepancies some recommendations have been provided to the company for future improvement of CSR policies. Reference list Andrew, N., Wickham, M., O'Donohue, W., Danzinger, F. (2012). 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