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Corporate Social Responsibility and Sustainable Development

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Saint Xavier University

The Importance of Corporate Social Responsibility in Sustainable Development

Sean Jones

MGMT 380-01

Professor Parker



        For decades now, big business has progressively increased the levels of pollution and waste being dumped on our planet. It was not until just recently that corporations have decided to take on a different approach that looks to advance business in ways that benefit the environment as well. This is known as sustainable development. Sustainable development is a great way for corporations to further their business while keeping in mind that the world’s resources are far from infinite. There are many ways to achieve sustainable development, however, it cannot be achieved without the right corporate guidance. In order to be successful in this area, the management team of any company must come up with strict guidelines on how to develop their product in a way that satisfies consumers’ needs while decreasing its pollution output. This is only attainable if management can continue to develop a culture that follows its guidelines strictly. That is often times where corporations are thrown off track. There is a lot of masking that takes place when it comes to what these businesses publish regarding their pollution output and it happens all over the world. Volks Wagon, the South Korean based car distributor has recently been involved in a scandal about their falsification on emissions of Nitrogen Oxides (NOx). According to, Volks Wagon set aside $7.5 billion to cover the financial hit that they will receive from this. Additionally, their former CEO, Martin Winterkorn, has since resigned. This is just one of many examples of how a lack of corporate social responsibility can impact a business. Had Volks Wagon’s management set up a stronger ethical culture, they would not have this current dilemma on their hands. There are many elements that are involved with sustainable development and the affects that it has on our communities as well as these businesses themselves. Now let’s take a look at some of these factors and how they relate to corporate social responsibility.

What Affects Ethical Behavior?

        Ethical decision-making can be a hard and strenuous task presented to many management teams. There are a multitude of factors that factor into every single ethical decision, mainly because it does not affect just one area of the business. Most of the time the decision is between two or three of the components of a company’s triple bottom line. One ethical decision can either make or break a company. That is why it is important to know what internal and external factors can affect an ethical decision.

One factor that affects an ethical behavior is the knowledge on the topic being debated. Sometimes management does not have the information necessary to make the decision on the spot. This is why it is important for them to expend every resource they have to find out the information on the decision they are making to ensure that they are not making decisions blindly.

Another factor that affects ethical behavior and the decision-making process is technology. Technology brings us many positive uses for business, however, there are still many negative uses of technology that can reflect poorly on a company from an ethical standpoint. The easiest way to make a poor ethical decision is through a computer. Inappropriate emails, social media posts, and even monitoring of employees can have a negative impact on a company’s culture. If a single employee makes a poor decision with the use of technology that reflects negatively on a company, the decision to discipline the employee is easy, but the severity depends on each situation. That is a simple solution, however, if a company were to be caught monitoring its employee’s technological use outside of work in an inappropriate manner, making the matter right can be very difficult.

Success and temptation is a major factor that sometimes enters the equation in an ethical dilemma. As a decision-maker for a company, it is always best for whoever is making the decision to try and maximize shareholders’ profits while still protecting the company’s reputation. This can sometimes be difficult if the decision has an effect on your position as well because it allows personal agendas to take over and influence the decision. Once an unethical decision is made by an individual, it becomes easier for that person to set aside the company’s needs to further their own success.

The last factor that I will discuss concerning ethical decision making involves fear of criticism or failure. There are times when someone in management may choose to not take action with a plan that may be associated with more risk in order to protect themselves or the business because they are scared that they will fail or receive some sort of criticism. One example would be somebody in a business electing to go along with the businesses action plan, even if they know that it is either illegal or unethical. This could be the result of a forced decision from management giving off the sense that the individual’s job depends on it.

Sustainability and its impact on Brand Image

        Sustainability is becoming a bigger part of many company’s philosophies and with good reason. Sustainable Development increases a company’s value in many forms from cutting costs through supply chain management to ensuring a longer life span for a company. When it comes to sustainable development decision making, it is important to cover how each decision will affect the company’s triple bottom line, or how it affects the company economically, as well as socially and environmentally. It is the Corporation’s social responsibility to take into account all three areas and decide on which one forms the best balance between increasing profits while ensuring that it benefits the economy while being seen as socially acceptable. This does not mean that a company must sacrifice profits to the point that it becomes a charity, but that it should consider all three areas of the business in order to create products and services that are ethical and sustainable at the same time. A company with an appropriate triple bottom line is sure to be successful as it promotes positive relationships and feedback from its customers. This consumer loyalty creates repeated purchasing from its customers. This shows that a company is generating a need for its customers That is one way to create value for a company. Another way to create value is to reduce risks involved with the business while securing future earnings. As audiences learn more and more about a company’s sustainability, this lowers the risk associated with the company as it proves the brand will have a longer life span than the competition.



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