Corporate Social Responsibility Essay

corporal loving righteousness and in incarnate Governance are the two important inevitable corporal practices all over the manhood today. Once voluntary acts, these practices have now been made mandatory in the wake of various unified scandals that shook the corpo aim world in the past decade. 1. 1 Aims and Objectives With the above background, it is proposed enquire into the corporate practices in the realms of incorporate Social function and incorporated Governance that are prevalent in the U. K. and to ascertain how effective the practices are in achieving the objectives behind the said concepts and finally conclude whether U. K has established standards of these practices or still lagging behind. This newspaper publisher shall be a proposal to determine feasibility of such an exercise.1. 2 Problem Statement As the term suggests corporal Social Responsibility is an obligation of the corporate entity in addition to the duties owed to its shareholders. Maximising prof it for the shareholders is not the only goal of a smart set. It owes responsibility to all the stake holders in the conjunction.The group of stake holders are share holders, employees, suppliers, customers, government agencies, and Environment. It implies that while exploit the value of the mansion for the sake of shareholders, interests of these stake holders should not be sacrificed in the process. Hence ensuring the genial responsibility of a corporate entity is objet dart of incorporated Governance. Corporate Governance is a wider term encompassing the corporate companionable responsibility also. Hence the managers of the companies must establish sound standards of corporate brass instrument based on the combined work out of corporate financial compositioning.A corporate entity must comply with code or explain wherefore it has not, in its annual reports as per the guideline set out by Cadbury report. Prior to the Cadbury report, there was no requirement as such on t he fragmentize of the U. K. Corporates. It was only after the surfacing of corporate scandals in U. K, that the Cadbury report was required to be made by the Government. This proposal therefore gains conditional relation to make a study on the practices of UK companies complying with their social responsibility and separate aspects of corporate brass section.That there is a Minister in the U. K. for corporate social responsibility would show the importance attached to it by the Government. The two aspects of CSR and Corporate Governance are part of business ethics. Chapter2 publications Review Literature round off is an exercise to justify this research proposal. This involves examining the literature available on the subject of this proposal which will form part of secondary info for the study. 2. 1 Corporate Governance It is a system by which the corporate entities are directed and controlled.Thus accountability is required on the part of the come along to make sure that te corporates are managed in the surmount interests of their shareholders. (Higgs 2003) There must be an effective board which while providing for entrepreneurial leadership should also at the equal time control the incumbents of the board. To hit this, the board must consist of a balanced structure of directorship with executive, non-executive, self-supporting non-executive in right residue to ensure against concentration of power and at the same time ensure balanced decision making.Where there are conflicts of interests likely, the board should appoint sub-committees for nomination and remuneration of directors and auditors to make proposal to the board for approval. The board is expected to deal with shareholders effectively ensuring transparency and accountability. The combined code issued by the Financial Reporting Council and revised from time to time prescribes command principles and procedures of Corporate Governance for listed companies. (CSR) However Corporate governa nce is not a new concept.Adam Smiths(1776) An Enquiry into the Nature and Causes of Wealth of Nations gave inception to Berle and Means(1932) agency theory which enunciated separation of corporate ownership from control. Corporate Governance is precisely that. Bruce (2006) states that it is a myth that concentration of power improves firm value. Rather dispersed ownership enhances firm performance. This warrants corporate governance. 2. 2 Corporate Social Responsibility (CSR) Rather than shareholder interests, CSR principle requires companies to have a wide range of stakeholder interests.In pursuit of its business activities, a caller should keep in mind the interests of the stake holders as well so that maximisation of firm value in the long run is consolidated. In the process, key relationships with consumers, employees, and other stakeholders are improved. Interaction with consumers results in better intelligence of their needs and improvement in the quality of the products be sides becoming to a greater extent competitive in the market. Efficiency increases through cost minimisation. Corporates such as BT and Cooperative Bank are in the practice of giving be given back on their competitiveness as a result of their CSR initiatives. withal showing the companys concern towards its employees in whatever slipway possible including facilitating their work-life balance and giving of additional benefits to physically challenged employees would result in increased productivity and over all improvement in the companys image. Companys environmental concern also is demonstrate through its practice of energy saving , participation in greening projects, compliance with pollution control requirements, minimising deoxycytidine monophosphate habit and taking part in atomic number 6 credit programs. Desisting from giving bribes to Government officials is also considered a part of CSR.2. 3 Corporate Governance Practices in UK The Corporate governance gained more sign ificance in the U. K. ever since the collapse of BCCI bank and the Robert maxwell pension funds during 1991. In order to put its own dramaturgy in order, Government set up a committee downstairs the chairmanship Sir Adrian Cadbury which gave a report known as Cadbury Report with comply or explain directives. It was later followed by Greenburg Report in 1995 concerning remuneration to directors. And both(prenominal) the reports together were integrated to make a combined code in the year 1998.And this has been twice updated once in 2003 after Enron and World com scandals of the U. S. and again in 2006. The Financial Reporting Council enlists the following as key aspects of corporate governance in the U. K. There is a single board of directors with embodied responsibility to the companys success. A balancing act is achieved by a separate chief executive and chairman. A right proportion of executive and non-executive directors to ensure balanced decision making in the affairs of the company. Presence of independent audit and remuneration committee.Evaluation annually by the board of its own performance. Maintaining transparency in the matters of appointments and fixation of remuneration. Comply or explain are the basic guidelines when making annual reports for compliance or failure to comply any of the codes recommended by the financial reporting council as regards corporate governance. As a result, the U. K. is the leading country with best standards of corporate governance as per the report by FISE ISS in 2005. National experience of pension funds as also certified in the same year that 94% of the U. K.pension funds complied with corporate governance measures in more efficient manner. Compliance cost for companies is also reported to be lower than in other countries. This positive corporate governance makes investors to favor the U. K. for listing their companies in preference to the U. S stock exchange as per the Oxera report of 2006 (FRC 2006) As a part of its corporate social responsibility, the company Procter & Gamble has introduced a product turn to 30 as a substitute to its own Ariel in order to reduce carbon consumption while tidy sum washed clothes.This is as part of their commitment towards removing carbon foot print in their product. The company was awarded with Ethical Marketing valuate by the U. K. marketing society. The company found that rather than the presence of carbon foot print in their product, the carbon emission took place when people washed clothes in hot piddle. So the company veritable turn to 30 which could be used for washing in refrigerant water without giving rise to emission of carbon while washing. As a result the percentage of population using cold water for washing rose from 2 percent to 17 percent.This could amount to a great deal in terms of carbon emissions that were saved. (Baker 2008) Chapter 3 methodology The methodology for the research chosen will be qualitative. The literature review w ill be the major contributor for arriving at conclusions though nigh 25 companies will also be randomly selected for the sake of primeval data to gain first hand knowledge of the subject of research.And to nourish the findings in the secondary data gathered through literature review. Chapter 4 Conclusion The Brief literature review above proves to be of long value as an indicator of practices in the U. K. as regards Corporate Social Responsibility and Corporate Governance. Commitment of the companies and the Government in the U. K. towards the CSR and Corporate Government encourages further detailed research in the discipline so as to understand the implications fully and suggest measures to increase the present compliance rate in the U. K. by identifying bottle necks still faced by the corporates in that connection. With this in view, the researcher hopes to make a substantial contribution to the field of honor through this proposed research.ReferencesBaker, Mallen. 2008 How t o make friend and influence customers Buisness Respect issue 129 June 10 Berle, A. A, & Means, G. C. (1932) The Modern Corporation and Private Property, Larcourt, Brace & World Inc. , New York, N. Y. Bruce N Douglas. , 2006 Corporate Governance, Capacity Utilisation and Growth CSR Corporate Social Responsibility A government update. Accessed 17 June 2008 FRC 2006 Financial Reporting Council The UK Approach to Corporate Governance Higgs, Derek. 2003 Review of the role and effectiveness of non-executive directors. Accessed 17 June 2008