Corporate Social Responsibility in Strategic Management

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The internal impact includes organizational commitment, which should be given through an enterprise. Every employee must identify him- or herself with the new objectives and ethics conferring to social responsibility. This is a challenge all business has to face, and make it possible that the new aims can be identified by the employees. To conduct daily operation with stakeholders belongs also to the internal impact of economical issues of CSR. Stakeholders include employees, customers, supplier, banks, NGOs and other groups can either help or damage the implementation of CSR in an enterprise (Frynas & Mellahi, 2015, p.384). Furthermore, employees, which are the most valuable source of an enterprise, should not only identify with the objectives. Firms must create a transparency and create ethical behaviour through all stages of a business including the functional, business and the corporate level. A lot companies pursuing external CSR ignoring internal CSR, do not score well in public sensor by emphasizing for a company to be considered truly social responsible, internal CSR is essential. Next to the internal impact there are also external impacts which affect the efficiency and effectiveness of CSR.

External factors “[…] include customer requirements and attraction and retention of employees, NGO pressures, and public concern” (Brunn, 2013, p.6). External impacts can be classified in the following: political, economic, social, environmental and technological. Political impacts include, regulation which refers to specific regulations and political changes. For example, special greenhouse emissions regulations, EU guidelines, minimum wages or new political instable situation in some regions, where the company operates. Next to the political impacts are the economic impacts, which are major for profit-orientated companies. Instable economies, riots, low-growing profits and much more can influence the CSR of a company. Economic growth, interest rates and inflation rates have a major impact on how enterprises operate and make decisions on CSR. If the economy is not stable, it is hard for enterprise to invest additionally in sustainability and renewable projects, because their pervious goal is to make profit and enhance their margins and sales. Additionally, the social impact of external effects, could be the pressure from NGOs and other groups and the value change which is going on right now. More people are interested in renewable energy, sustainable products, ethical behaviour and prevent child labour. Therefore, the social impact has a very high ponderosity. “The environmental component refers to the incorporation into the design, manufacturing and distribution of products of environmental considerations such as pollution prevention and control; protection of water resources; biodiversity conservation; waste management: management of local pollution; or management of environmental impacts from transportation” (Crifo &Forget, 2012, p.2). Environmental impacts also include weather, atmosphere and climate changes, for example, Daimler tries to reduce their water pollution in dry area countries more than in humid areas. This show how the environmental factor can have an impact on the accomplishment of CSR goals. The last impact which company have to face is the technological one, such as R&D activities, automation, technology incentives and the rate of technological changes. This is the most hazardous and also most profitable impact. New technologies can not be shown completely in advance. This makes it possible, that the upcoming technologies can damage the CSR within an enterprise or support it with simplifications and improvements.

The internal and external impacts of the economical elements show how large the CSR is scattered and how much aspects can influence the efficiency as well as the performance of an effective CSR. “[…] CSR can influence social identity as well as the exchange process within firms” (Chon & Yoo, 2013, p.516).

1.2.2 Societal Impact

Beside the economical impact, the societal impacts are considerable referring to CSR. The society around the globe is situated in a changing world. Governments, societies and companies faces huge challenges in reducing inequality and social exclusion. For example, in Europe “80 million people are at risk of poverty and 14 million young people are not in education, employment or training” (European Commission, 2015). The societal impact is related to the society and shows how the people are involved. One focus on societal challenges is the health care, demographic changes and wellbeing of the society. The demographic change, especially in Europe face an important challenge, which the companies have to adjust. In addition, the health care in third world countries and less developed countries plays also an important role. For example, P&G cooperate together with the child aid agency Unicef. Composed they launched the ‘Pampers Unicef “1pack = 1 Vaccine” campaign’ “[…] to help eliminate maternal and newborn tetanus in some world’s poorest countries” (Unicef, 2015). This partnership has provided an incredible 300 million vaccines, eliminating the disease in 15 countries, since 2006. This instance from P&G show, how companies could deal with the healthcare problems and increase the wellbeing in the poorest countries with combating the societal impacts. Besides this challenges, the impacts of food security, sustainable agriculture and forestry and the marine and maritime and inland water research plays an important factor in the CSR of companies. To be sustainable and anticipatory for the next generations becomes more an impact which the companies should focus on. Trends like local food, sustainable fishing and correct labelling of food, influence the strategies and procedures of companies. For example, the US-company The Coca-Cola Company set the goal for 2020, to obtain their key ingredients exclusively from sustainable agriculture. By now The Coca-Cola Company made steady progress in the sustainable sourcing of several commodities and implemented the new supplier engagement program, to provide sustainable products from them. (The Coca-Cola Company, 2014). Furthermore, the food security which is one of the most pressing issues, because “[…] about 800 million people go without sufficient food” (Cargill, 2015). The company Cargill wants to fight against this, they supporting smallholder famers, advancing African agriculture, improving nutrition and encouraging investments. (Cargill, 2015). These two illustrations show how companies can handle this societal impact and deal with excellent CSR. Furthermore, secure, clean and efficient energy can be seen as societal impacts. A lot of people and also governments did an about-face towards the