Question

Corporate social responsibility (CSR), as practiced by business, means many different things. Consider the following: “At one end of the broad span of CSR lie corporate policies that any well-run company ought to have in place anyway, policies that are called for on any sensible view of business ethics or good management practice. These include not lying to your employees, for instance, not paying bribes, and looking farther ahead than the next few weeks. At the other end of the range are the more ambitious and distinctive policies that differentiate between leaders andlaggards in the CSR race—large expenditures of time and resources on charitable activities, for instance, or binding commitments to ‘ethical investment,’ or spending on environmental protection beyond what regulators demand.

Required:

a. Discuss the meaning of corporate social responsibility.

b. Do companies have an obligation to do more than the law requires? Why or why not?

c. Should companies report on their social responsibility activities? Why or why not?

d. What is the relevance of CSR disclosures for outside investors?

QUESTION 2

Select any two companies listed in TADAWUL from the same industry andidentify the CSR activities that these companies have implemented in 2018 (based on the annual report).

	Company A	Company B
CSR Activities
Community
Environment
Employees
Social
Sustainability

Answer 1

As per the policy, only four parts of a question are allowed to answer at a time, so answering Q1 & its parts here:

Answer 1)

Corporate Social Responsibilities (CRS):

a: The term can be defined as ethically caring about the rights of the employees and shareholders and the society at large, both environmentally and their wealth and health-wise. The workers are being paid appropriately for their hard work and shareholders are appropriately rewarded for their investment and risk-taking. The society is served with the good quality products at fair price and environment caring policies.

b: Yes , the companies are having obligations to do more than the law requires because company is an entity which works within the society, uses their resources to benefit the people of the society, whether directly connected to the company or not. The law binds a company with the obligation which are spelled in the law, but a company have to treat the society and its people on humanitarian ground.

c: Yes, every company have to put the Corporate Social Responsibility and the related activities performed during the year under a separate section of its “Annual Report”. This is essential as per the law and also to express their concerns to the employees, shareholders and the society at large. This will going to increase the goodwill of the company in the eyes of the people of the society and the government.

d: The relevance of CSR disclosures for outside investors is to:

1) create significant investors for the company’s future projects.

2) bring faithful and responsible employee and workers in the company.

3) to indicate the appropriate use of the social resources to create wealth for company and its shareholders.

4) to inform the authorities and the government that company is fulfilling responsibilities more than what is desired in the law.

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