BUS3001-Social Responsibility Of Business-Level 6


Social Responsibility is an important concept for every organisation to consider and work upon to contribute something to society and community in which it is established and is making use of their resources as well. Corporate Social Responsibility is an essential part which makes an organisation liable towards the society, people and environment and makes them to fulfil their responsibilities towards them (Definitions of corporate social responsibility - What is CSR?, 2019). The assignment will focus on presenting, comparing and contrasting of different theories and models and their applications along with specific examples which provides companies with different benefits such as sustainability, good brand image and many more from the application of these tools in working of

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Friedman vs. Freeman Theory

Friedman Theory

Freeman Theory

The following theory was proposed by Milton Friedman, an American Economist during the period of Great Depression in between 1867-1960s. This theory is also stated as Shareholders Theory.

This theory was proposed by Edward Freeman which was named as Stakeholders Theory. This theory was founded in the year 1984.

This theory was related to money not to other factors such as output, incomes or prices. Friedman was totally focused on money as from his perspective nothing was more important than money (Moratis and Cochius, 2017).

On the other hand, the consideration of Freeman was related to considering every factor which was affected by the working of an organisation. The focus was not only on the money but there were also other factors which were important more than and equals to money depending upon the situation.

The following economist sees money in two forms only of which one is medium for exchange and the second is an asset.

This economist considers money in many forms such for making profit, for survival and growth, satisfaction of shareholders, contribution to society, environment and people as well.

It includes only money. No other factor is considered here.

On the other hand, the following theory considers about customers, suppliers, political action groups, local communities, governments and many more.

On the basis of above discussion, the recommendation is provided about Freeman's Theory which has made its focus on not only on one concept but on different aspects considering the future as well. Looking on today's world, the best will be this theory because in today's world, not only money is important but there are many other factors which provides an organisation with sustainable competitive advantage. For example, BMW deals in luxurious cars so in case, it consider only money aspect and ignores the legal factors such as government than in this case, there will be negative impact on its working due to government intervention. This will also destroy brand image of business in the marketplace and minds of customers as well.

Triple Bottom Line Approach

The following framework or theory recommends an organisation about making their focus on social, environmental likewise they do on economical concepts. In other words, it can also be said that Social Approach shows people and community, Environmental Approach shows consideration related to planet and Economical Approach considers about Profit of an organisation (Leipziger, 2017). The explanation has been provided as under:

Social Approach: This approach focuses on betterment and consideration by an organisation to their employees, community and people at their first preference.  For example, Google should firstly focus on people, community and employees such as by providing services according to the need of people, contribution towards community in which it is established and salary and incentives along with good working environment to their employees. This will help in making business sustainable.

Environmental Approach: This approach focuses on protection of environment also at an important preference. As there are increasing issues with environment so the importance of consideration of this factor also increases because of issues such as global warming, pollution, emission of harmful gases and many more impacting negatively on the environment. For example, the pollution caused due to use of BMW Cars pollutes the environment, so the solution to this problem could be related to improvements in the technology that could cause low emission of gases or the use of electric cars so that environmental protection could be done.

Economical Approach: The following approach is considered as the bottom approach which should be fulfilled at the last stage or on the fulfilment of above stated approaches only. It is related to earning of profit by the companies for their survival and growth and for their incomes as well (Grayson and Hodges, 2017). But along with this, the consideration about the preservation of environment and tastes and preferences of customers should also needed to be taken into consideration. For example, Logo company can make their utmost preference to society and environment and after that it should consider to their profit. With the help of this policy and working, it will be possible for the company to gain faith of people, contribution towards environment and society and will be able to build a good brand image of the company in the market.

CSR Pyramid

The development of following Pyramid was done by Archie Caroll and provided the pyramid with its focus on four main responsibilities of the business which are Economical, Legal, Ethical and Discretionary. The development of this pyramid has been done on the basis of looking over the situations of current business environment. It is because in today's world, people, society, government all are concerned and have proper knowledge about the market, companies, environment and all other factors. Customer is the kind of the market in today's world. So only by considering these aspects by the organisation, their survival could be possible in the business environment. In the current times, companies are required to come forward and work for the growth and the betterment of society as well by contributing a part of their earnings and profits (McWilliams, 2015). The explanation of different concepts covered under this Pyramid is provided as under:

The first component of the framework is regarding the economic responsibility of the company which is related to earning sufficient profits for the growth and survival of their relative organisations.

In the second component, the consideration is related to legal factors where an organisation is required to follow rules and regulations and follow legal compliances set by society so as to prevent themselves indulging in government and legal issues impacting negatively upon their performance, brand image and goodwill of the company. Sometimes, these issues may end to end of the organisation also.

The third component of this pyramid links to ethical responsibility of companies under which they are require to make their activities, business operations in an ethical manner, such as Microsoft could provide their high quality services to their customers at affordable prices, fulfilment of social responsibility, presenting their real financial statements and records in front of people are counted under Ethical responsibilities of an organisation.

The forth component is the discretionary responsibility of the business under which the involvement of an organisation in their contribution towards the development, betterment and growth of society is counted. For example, BMW could develop some new people awareness programs towards environment or could also make some new schools or colleges for children are all covered under Discretionary Responsibilities of an organisation.

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EFQM Excellence Model

EFQM stands for European Foundation for Quality Management. It was founded in the year 1988 and the main objective of the establishment is related to providing companies with the ways that could help them in improving their performance on continuous basis (Spence, 2016).

In accordance with this model, it explains about the quality management model that focuses on the improvement in the overall quality, efficiency and sustainability in the business so that better services could be provided to their customers along with fulfilling their obligations towards society, environment and government as well. The following model is based on Total Quality Management (TQM) Approach. Both of the concepts are focused on continuous improvement in the overall quality of their products and services. The following model has been divided into Five Enablers and Four Results which are also been discussed. The

Five Enablers are listed as under:

  • Leadership
  • People
  • Policy & Strategy
  • Partnerships & Resources
  • Processes

The Four Result Indicators are also listed as under:

  • People Result
  • Customer Result
  • Society Result
  • Key Performance Results

The following model is a continuous process with the help of which the focus is made on finding new ways of making improvement in the products and services of an organisation. With the help of above provided diagram, it has been shown about the areas of focus of organisation as what can be achieved and what cannot be? The following model provides the organisation with a chance to know about their own place that where they are standing currently in the quality management process (Quarshie, Salmi and Leuschner, 2016). The improvements in the quality processes starts with knowing about the results or performance of their employees. On the very basis, there have been specified five development stages and they are listed as under:

Activity Oriented:

In the first stage, the focus of the organisation is being made on the activities which are performed in the organisation, on the basis of the rules and regulations which are being made by the professionals.

Process Oriented:

Overlooking and controlling the processes are the key elements of process stage under which power, duties and responsibilities are clearly defined. After this, improvements in the processes are made only after the evaluation of the performance of organisation.

System Oriented:

Controls of the processes is related to controlling the processes of company internally as well as externally.

Chain Oriented:

In this stage, the focus is made on the overlooking on the processes of the company as well as on the relationship of the company with their customers, suppliers and other partners in the key chain of the company (Safwat, 2015).

With the help of focusing  and application this model in their working, it will be possible for companies such as BMW, Microsoft, Logo, Google and many more to make good improvements in their products and services for the betterment and growth of their organisation.


From the above assignment, it has been concluded that corporate social responsibility is an important concept with the help of which the growth and survival of organisation in the market is made possible. In addition to this, it has also been concluded that the application of different tools and models will also help in delivering good performances and improvements in the organisation's performance. Further, the conclusion has been drawn about the importance of environment and people above the profits of the company as without people and environment survival is not possible and profit could only be earned with the help of people so their satisfaction should be kept by companies at utmost preference.


  • Moratis, L. and Cochius, T., 2017. ISO 26000: The business guide to the new standard on social responsibility. Routledge.
  • Leipziger, D., 2017. The corporate responsibility code book. Routledge.
  • Grayson, D. and Hodges, A., 2017. Corporate social opportunity!: Seven steps to make corporate social responsibility work for your business. Routledge.
  • McWilliams, A., 2015. Corporate social responsibility. Wiley encyclopedia of management, pp.1-4.
  • Spence, L. J., 2016. Small business social responsibility: Expanding core CSR theory. Business & Society. 55(1). pp.23-55.
  • Quarshie, A. M., Salmi, A. and Leuschner, R., 2016. Sustainability and corporate social responsibility in supply chains: The state of research in supply chain management and business ethics journals. Journal of Purchasing and Supply Management. 22(2). pp.82-97.
  • Safwat, A. M., 2015. Corporate social responsibility: Rewriting the relationship between business and society.
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