Corporate social responsibility (CSR) is the idea that a business has a responsibility to the society that exists around it.
Firms that embrace corporate social responsibility are typically organized in a manner that empowers them to be and act in a socially responsible way to have a positive impact on the world. It’s a form of self-regulation that can be expressed in initiatives or strategies, depending on an organization’s goals. Many organizations communicate these efforts to external and internal stakeholders through corporate social responsibility reports.
For example, the case of HSBC gave insights into how responsible they are ato their society by answering some salient questions.
What did HSBC do and why?
HSBC partnered with Green-Works, a not-for-profit social enterprise providing office furniture to schools, charities, community groups, and start-up businesses. Nigel Pate, Senior Manager of the ‘HSBC in the Community program. Their partnership led to the opening of Green-Works’ Silvertown warehouse, which in turn created local jobs and training development.
The final destination of the office equipment discarded by HSBC was Gambia where the equipment was distributed to schools, hospitals, and a wide range of non-government organization projects under the President’s Award Scheme
Why because,
HSBC had begun planning the logistics for the movement of 8500 staff from around 20 different sites in central London to its new 45-storey headquarters at Canary Wharf in London’s Docklands district. And one of their key challenges was the disposal of more than 3000 metric tons of office furniture. HSBC was faced with the options of either disposing of the furniture through a landfill or recycling and reusing it.
What challenges did they encounter?
- HSBC group faced considerable criticism in October 2003 due to its decision to shift 4000 jobs to less developed nations as part of its global resource restructuring drive.
- HSBC faced an attack from different quarters. Friends of the Earth (FOE), an environmental organization, claimed that the HSBC group had funded companies that were responsible for the destruction of rainforests in Indonesia, and oil companies linked to human rights violations in Sudan.
- FOE also charged HSBC for helping arrange US$ 1.6 billion in loans and credit guarantees to various companies in the palm oil sector in Indonesia.
- The multinational bank was also in the news for its links with the controversial Three Gorges Dam in China.
- A few major investment banking entities like Goldman Sachs, UBS, and HSBC had been hired by the China Development Bank to raise Euro 500 million 7 from Europe and by the Chinese Export-Import Bank to place another US$ 1 billion of bonds worldwide
How did they live the three Ps of CSR?
HSBC believed that multinational enterprises had a greater responsibility toward social, ethical, and environmental causes as they were in direct interface with people, businesses, and communities across the globe. In a report, HSBC Group Chairman, Sir John Bond, spelled out the current priorities of the group in clear terms. He said that the group’s first responsibility in the dynamic environment was to be a successful company that satisfied all the stakeholders’ interests in the short term and, more importantly, in the long-term future.
