Introduction

       The role of corporations over the past forty years has gained particular significance as we reach a critical point of survival for generations into the future. Corporations have played the role of suppliers of goods and services that consumers demand, dating back to the eighteenth century. This predominant role continued to gain momentum at the height of the industrial revolution where technology provided automation to provide goods more rapidly to the consumers. This system of supply and demand is the basis by which economic growth depends, as a measure of prosperity of a nation. Growth can also mean increased depletion of natural resources that causes such phenomenon as deforestation. It could also mean an increase in pollution, sending more greenhouse gases into the atmosphere. On a planet with finite resources, infinite growth clearly cannot continue because it will jeopardize the survivability of humans and every other living organism.

           The need for sustaining growth and decreasing pollution necessitates the defining of some key terms to attain a greater understanding of the corporate role. The terms I will be defining include Corporate Social Responsibility, Corporate Governance, Corporate Citizenship, Corporate Social Performance, Social Entrepreneurship and Sustainability. Once these terms are defined, there will be a better understanding of their distinct role within an organization. Additionally, the similarities and differences of each term will become apparent as well as their interrelatedness and interdependence. This interrelatedness makes it apparent that one is dependent on the other and therefore it becomes difficult for corporations to choose one of these programs over another. The implementation of these terms as policy within a corporate organization may involve educating corporate leaders on the benefits they could attain as a result. Furthermore, I will assert an opinion of an appropriate hierarchal understanding of these terms with credible evidence to support my stated opinion. My opinion will determine if the hierarchy of these terms is a pyramid with one term sitting at the top. The fact that they are interrelated and interdependent does seem to draw a conclusion of the possible hierarchical structure but the evidence I present will substantiate this point. Upon providing my assessment of the researched terms, articulated above, I will provide some closing remarks and comments.

 Corporate Social Responsibility

Defining Corporate Social Responsibility (CSR) is not as straight forward as it may seem. CSR can mean something different from one person to the next. Some people interpret CSR as a legal responsibility or liability, while others see it as socially responsible behavior in an ethical sense (Zenisek, 1979). Regardless of these varying definitions, it is clear that corporations do have a role in the sustainability effort. Society has held, and continues to hold corporations accountable for what is in everyone's best interest. "At issue for CSR are the societal expectations of corporate behavior; a behavior that is alleged by a stakeholder to be expected by society or morally required and is therefore justifiably demanded of a business" (Lingreen and Swaen, 2010, p. 2). This does not translate into a form of coercion but contrarily, a means to use CSR as a vehicle to promote their corporate brand to consumers and stakeholders. To put it simply, corporations will enjoy the benefit of having a good reputation, held by the citizens within the community where they operate. By contrast, corporations can attain a bad reputation within a community by their production practices that pollute the water that people drink and poison waterways with metallic particulates. These particulates, such as mercury, can bio accumulate in the fish people eat, thus creating a health hazard. Additionally, practices such as polluting the air that we breathe with metallic particulate or carbon emissions can also negatively influence a corporation's reputation. Pollution of our air can result in new illnesses or can exacerbate existing medical conditions such as asthma. Environmental disasters such as the Exxon Valdez oil spill, brought attention to the need for a commitment to CSR. Disasters that are more recent further enhanced the need for corporations to commit to CSR. BP, the company at the center of the Gulf oil disaster, has long promoted itself as being socially responsible (Mattera, 2010). This claim seems to be contradictory but BP rests upon the fact that it invests modestly in renewable energy. The subsequent investigation dredged up evidence that BP cut corners on safety in deep sea drilling thus, bringing into question the company's sincerity about social responsibility.

            In the race by companies competing for leadership positions and increasing profits, they create entire strategies and systems of development. Sometimes situations occur when firms resort to unethical use of natural resources and wastewater dumping into lakes and streams. In these cases, their actions do not necessarily mean breaking the law. Consequently, these companies do not carry liabilities and responsibilities. It is more of a question of ethics and Corporate Social Responsibility. This type of responsibility is a voluntary activity of the private and public sectors aimed at maintaining high standards of operational and production activities. Companies and organizations need to focus on environmental conservation and social responsibility as the main objectives in their corporate responsibility. Although the government monitors corporate behavior relating to pollution, the development of solutions for this problem is impossible without direct assistance from companies and organizations. The implementation of CSR by corporate leaders requires them to thoroughly research and develop a strategy for putting such a plan into action. "The emerging need is to demonstrate that the organization is directed, managed and internally controlled with thorough consideration of stakeholders’ expectations and of the impact of the organization on stakeholders – economically, environmentally and socially" (Castka et al., 2004, p. 1). This point makes it apparent that CSR is more than just investments in clean, renewable energy. Additionally, CSR is more than just about avoiding risks. Instead, it is a matter of changes in management strategy by corporate leaders and policies to meet stakeholders' needs using the systems approach for the economy, environment and society. Additionally, it is an indicator that CSR is only a piece of the overall solution toward attaining sustainability. How CSR fits into the hierarchy of all the terms will be made apparent as I define all the remaining ones.

Corporate Governance

Changing the management strategy, which places greater emphasis on the systems approach, involves analyzing the term corporate governance. Understanding the role of corporate governance requires defining what it is. "The standard definition of corporate governance among economists and legal scholars refers to the defense of shareholders' interests" (Tirole, 2001, p. 1). This definition provides a vague explanation to the meaning of corporate governance because the undercurrent is that it should address both risk and a moral hazard problem. This brings to the forefront the need for corporate governance that provides managers who are held accountable to shareholders and investors. Therefore, a more concise definition for corporate governance is needed to understand its role in the sustainability effort. Schleifer and Vishner "define corporate governance as the way in which suppliers of finance to corporations assure themselves of getting a return on their investment" (Tirole, 2001, p. 2). This definition makes it clear that the emphasis is on how to implement shareholder value. However, this definition only seems to address the economic part of the systems approach and leaves out the environmental and societal systems. Managerial decisions do affect investors but they also have an impact on the environment and society. Managerial decisions produce externalities that have an effect upon natural stakeholders such as employees, customers, suppliers and communities where they operate. For example, managerial decisions to cut corners on safety places employees at risk because it creates greater chances for injuries to occur as well as health risk that result in employees calling in sick due to working around toxins. Corporate governance sets standards for decision-making that considers the impact on natural stakeholders. Fewer employee illness cases results in reduced sick leave, employee turnover and a healthy profit margin for the company. The bottom line is that any company that implements CSR policies must also implement corporate governance standards. This clearly establishes a precedence of interdependence between these two terms.

            The claim of interdependence between CSR and CG is made evident by the fact that the process approach is well advocated in developing, implementing and improving organizational performance (Castka et al., 2004). An example of a process-based approach is the development of CSR/CG management systems. This management system transforms stakeholder expectations into CSR/CG objectives that are embedded into the organization's processes and continuously monitored. A crucial consideration for implementing a CSR/CG management system is whether it is compatible with other management systems. Because CSR/CG management system is generic, it is indeed a compatible system with all organizational types. The CSR/CG management systems specify that organizations demonstrate management considerations for its stakeholders. The implementation of CSR/CG management system by organizations requires thorough documentation, evaluation of its effectiveness and has a complete understanding of the policy by which this program operates. Additionally, the establishment of good Corporate Governance is required for this management system to ensure there are no conflicts in CSR/CG policy with employee performance standards.

Corporate Citizenship

            Corporate citizenship is about a corporation's ability to establish relationships with all of its stakeholders. It is not enough for corporations to base their decision-making on internal self-interest and shareholder interest without considering the external environmental concerns. "Society is put in jeopardy if powerful self-interest has no constraints beyond its own interest" (Reilly and Kyj, 1994, p. 37). This point sets a condition of interdependence of corporate citizenship with CSR and corporate governance based on the necessity for establishing relationships with its natural stakeholders. Where corporate governance sets the standard to consider natural stakeholders in managerial decision-making, corporate citizenship establishes relationships with them. The path to social responsibility is complex because it involves setting standards for health, safety and employee rights. In terms of corporate citizenship, where do businesses fit in society? "In order to speak of corporate citizenship it is necessary to define business not as an isolated sub-system of society but as a critical integrated part of the total society" (Reilly and Kyj, 1994, p. 37). This is similar to humans having an integrated role within nature and not a separate entity with dominion over nature. The difference is that humans are considered the caretakers of the planet where businesses are not necessarily caretakers of society. Corporate citizenship also serves to promote its corporate brand and reputation in the community it operates in through meaningful relationships. There is a fine line between social responsibility and the economics of businesses maximizing their profits. Decision-makers must determine if the choices they make contribute to a good and successful society. There is a matter of ethics to consider in decisions made by corporate leaders. Especially when corporations have made choices that were unethical because it resulted in pollution of vital natural resources. This brings up one very important question, "is it possible for the corporation to be a 'good citizen' (Reilly and Kyj, 1994, p. 38). It is my belief that it is possible for corporations to be good stewards for social responsibility while considering the needs of their shareholders. Putting all the intricate pieces together toward implementing corporate social responsibility is crucial to attaining sustainability. We have defined and established the role of several terms and a possible hierarchy. However, we must determine how all the pieces to this sustainability puzzle fit by analyzing the remaining terms.  

Corporate Social Performance

            Throughout this research, ethics has proven to be a critical aspect in corporate social responsibility and all the other terms analyzed thus far. Because ethics is so important, it seems logical there should be a means of measuring ethical performance of individuals and corporations. We as humans are unique in how we process information, personality traits and how we respond to ethical concerns. "Just as individuals differ in how they respond to ethical dilemmas, organizations also differ in their responses to ethical issues" (Logsdon and Yuthas, 1997, p. 3). One stark difference between individuals and corporations is that moral development is more complex for organizations because they consist of multiple individuals with differing beliefs. Addressing this difference with corporations is difficult but certainly not impossible. Yet another point of consideration is the fact that corporations are entrenched in societal expectations and standards of behavior, which are determinants for codes of ethics. Furthermore, organizations are judged on how well they build upon stakeholder relationships. "Integrating concepts about individual and organizational moral development with concepts about corporate social performance and stakeholder orientation strengthens understanding of complex decisions and outcomes" (Logsdon and Yuthas, 1997, p. 3). Despite the similarities between individuals and organizations, their differences pose significant challenges in developing a plan that includes all of these concepts. It is best to approach complex problems by breaking them down to the basic level and building a plan from the ground up. In this case, we would first look at individual moral development then build up to organizational moral development. The proposal for accomplishing this feat is to utilize Kohlberg's theory on individual moral development. Kohlberg's theory creates a parallel, which can be integrated "with concepts in the literature on corporate social performance and stakeholder theories" (Logsdon and Yuthas, 1997, p. 3). Integrating these concepts by building up from the individual moral development enables the creation of a model for organizational moral development. Corporate social performance contributes to an organization's success for developing corporate citizenship, which is needed for corporate governance and corporate social responsibility. Furthermore, as more of the terms included in this research are defined, we can start to see how these terms fit into a hierarchal schematic.

Social Entrepreneurship

            The ability for corporate leaders to meet societal expectations and attempt to resolve social problems is the concept known as social entrepreneurship. Because society holds corporations accountable for what is in everyone's best interest, social entrepreneurship is the vehicle that enables them to meet this requirement. J. Gregory Dees is "convinced that social entrepreneurs, operating outside of the constraints of government, significantly enhance our ability to find and implement effective solutions to social problems" (Dees, 2007, p. 24-25). To put it simply, social entrepreneurship bridges the gap at the point where government fails to resolve many of society's problems. This is also an indicator that this is a team effort between social entrepreneurship and government toward attaining a good and successful society. While society looks to the government as the problem solver, it is clear that they cannot accomplish this alone and that is where corporations can provide immeasurable assistance. Addressing society's issues calls for the need to look at society as a social organization. "To put the current interest in social entrepreneurship in perspective, it is useful to think about human history

as a series of experiments in social organization—from family, clan, and tribal structures to the elaborate governmental, corporate, and social structures of today" (Dees, 2007, p. 25). Essentially, there is a need to organize ourselves publicly and privately as we move toward a good society. Moreover, social entrepreneurship collaborated with the government needs to have an understanding of social structures to resolve the problems within a social organization.

            Another aspect of social entrepreneurship is opportunity identification. Recognizing opportunities could simply come in the form of a corporation's social mission or by institutional barriers, they face when attempting to enter a particular social market. Recognition of opportunities could also come by way of the social entrepreneur's background. However, "this idea has not been clarified in SE" (Corner and Ho, 2010, p. 636). Opportunity recognition in the context of social entrepreneurship is a new concept with little known information about identification processes. Because corporations are held accountable by society for what is in everyone's best interest, corporate social responsibility is dependent upon social entrepreneurship in its effort to attain a good society.

Sustainability

            Sustainability is the goal that all the other terms presented in this research want to achieve. Sustainability is a multi-faceted issue where corporations play only a part, but a very large part of the effort to attain it. For the purposes of economics, we do not think of sustainability in terms of longevity, in the sense an ecosystem or the planet will endure, but whether the quality of the environment has not degraded by our activities (Cato, 2011). We want to leave a planet for future generations at least as good as we had. The need for sustainability rests with the fact that we live in a world with finite resources but have an economy that depends upon growth into infinity. This is where the economy and the environment experience tensions in their relationship. Decreasing this tension involves having the cooperation of corporate leaders to reduce unsustainable production practices. The source of this problem is that we have an economy based on the concept of supply and demand; suppliers are pressured to tap into natural resources at an increasing rate to meet consumer demand. In addition, as economic growth increases, pollution also seems to increase. Earlier, I referred to the systems approach for sustainable development. The three systems include the economic, ecological and social systems. By meeting the needs of all three systems, we attain sustainability. It is clear that by "attempting to maximize the goals for just one system does not achieve sustainability" (Barbier and Markandya, 2012, p. 37). While this concept seems straight forward, it is more complicated because there are tradeoffs that require one system to pay the price for meeting needs of another system. Furthermore, the systems approach does have some limitations. Namely, "there is no guidance as to how the tradeoffs among the goals of the various systems should be made" (Barbier and Markandya, 2012, p. 38). There are other concepts such as the capital approach, which frankly has become the dominant approach to attaining sustainability. Regardless of the approach used, corporations will be a major component toward attaining sustainability. While many companies are enthusiastically implementing policies of corporate social responsibility, many other companies require incentives to implement such policies. Additionally, implement all the other interdependent programs such as corporate governance, citizenship, social performance and social entrepreneurship. The government may be viewed as the problem solver but sustainability cannot be attained without the assistance of corporate leaders.

Hierarchy

            The terms discussed in this research are interdependent of each other and have a role in achieving a common goal. Because the common goal is to attain sustainability, the term sustainability would be placed at the top of the hierarchy. I alluded to the tense relationship between the economy and the environment. "Three concepts are useful in exploring the relationship between the economy and the environment: efficiency, optimality and sustainability" (Cato, 2011, p. 7). Because economics is a social science, the interpretation of these concepts is different depending on whether it is the point of view from conventional or environmental economists. Regardless of the views of economists, sustainability is what all other terms discussed are vying to achieve. Now that we know, the ultimate goal is achieving sustainability the next term in the hierarchy based upon the research conducted is primary and the remaining terms are elements. Therefore, it is my concerted opinion that corporate social responsibility is the second term in the hierarchy and all other terms are elements that contribute to an organization's CSR policy goals. Because CSR is a commitment by a corporation to develop socially responsible policies in the areas of work and family life, community welfare, ecology and human rights, the other terms are merely participatory in the CSR mission. The analysis of all these terms clearly shows a pattern of corporate governance, citizenship, social performance and social entrepreneurship all provide unique parts that contribute to an organization's CSR policy. It is important to note that there are internal and external components to CSR. Corporate governance is an internal component and the term I consider next in the hierarchy. "Corporate governance is the system of structural, procedural and cultural safeguards designed to ensure that a company is run in the best long-term interests of its shareholders" (Fombrun, 2006, p. 267). Corporate governance provides an organized means by which corporations carry out their CSR policies. While corporate governance is the mechanism for ensuring shareholder interests, corporate citizenship establishes relationships with stakeholders thus, is next in the hierarchy structure. "Business, without any moral obligation to its environment, must be inspected, watched over, policed, regulated and imposed upon, since following economic theory it has no interests but its own" (Reilly and Kyj, 1994, p. 37). However, businesses that build relationships and show legitimate interest for its external stakeholders and the environment are socially responsible members of their community. Because social responsibility is a common denominator for every term in this research, it makes sense that social entrepreneurship would be next in the hierarchy of terms. In the midst of a plethora of social problems, there is hope for a good society. "One potentially promising strategy for improvement is to encourage and support social entrepreneurs, individuals and organizations that bring to social problems the same kind of determination, creativity and resourcefulness that we find among business entrepreneurs" (Dees, 2007, p. 24). All of the intricate parts for implementing CSR are now in place except for corporate social performance. Although, I placed corporate social performance last, CSR would not be possible with the means to measure ethical performance. Corporate social performance also evaluates the behavior of individuals and organizations. The rationale for behavior is to seek pleasurable consequences and avoid negative consequences (Logsdon and Yuthas, 1997). The premise of this observation seems to indicate that corporate social performance seeks to reward, not punish corporations.

Critical Success Factors (CSFs)      

          This research has established corporate social responsibility as a strategic program important for organizations. CSR serves to develop a positive correlation between financial and business performance. "However, little research has been done to understand which factors lead to the positive correlation" between these entities (Sangle, 2009, p. 205). Shirish Sangle conducted an extensive research on critical success factors for corporate social responsibility, for public sector businesses in India. However, I believe many of the conclusions focused on the public sector will work in the private sector as well. Sangle utilized data through review of reports for sustainability, CSR and journals. Additionally, the data for this research was obtained by means of questionnaires and focus groups. Based upon my personal review of Sangle's research, it is my opinion that the five critical success factors for corporate social responsibility are:

• integrating CSR with functional strategies of the organization
• top management support
• organizational ability to manage stakeholder groups
• internal support
• external support

My reasoning for selecting these five critical success factors was determined from my analysis of the terms researched in this report.

        When designing a CSR structure, it is imperative that it is aligned with the company's functional strategies. What is the company's mission, culture and business structure? Where is the business' geographic location? What are the potential risks and the level of commitment by decision-makers and stakeholders? These are just a few questions to consider and the answers should come through careful deliberation. "There is considerable variation in how companies internally structure and organize their CSR activities" (CSR Structure, 2002, p. 13). While designing the CSR structure with the company's functional strategies, the program must attain support from top management because their support or lack thereof will determine the longevity and overall success of the program. It would be impossible to implement CSR without a buy-in by company boards and senior management. In addition to attaining support by the top management, we also have to consider the company's stakeholders. Who are the company's stakeholders, their issues, relationship to the company and their willingness to engage in CSR? A key factor to the success of CSR is "understanding your stakeholders and their primary expectations is critical to creating an appropriate CSR structure" (CSR Structure, 2002, p. 9). As you can see, the common theme for critical success factors is gaining support by everyone involved with the organization. This includes attaining support internally as well as externally. By influencing and educating internal and external stakeholders with the intent of creating support within the organization as well as outside.

Key Performance Indicators (KPIs)

          Selecting the top five most important key performance indicators is a significant step toward determining an organization's success. "They represent a set of measures focusing on aspects of organizational performance that are the most critical for the success of an organization and help companies define and measure progress toward organizational goals" (Missing Ingredient, 2010, p. 6). Specifically, KPIs provide guidance on how to increase the organization's performance. There are specific characteristics that qualify an indicator to be a KPI. It must be nonfinancial, measured frequently, acted upon by senior management, action required by staff, ties responsibility to a team, has an impact on one or more CSFs and ensures appropriate action (Parmenter, 2007). With these criteria in mind and the CSFs I selected, it is my opinion that these are the five key performance indicators to measure the success of an organization for the success of their CSR program.

• Aligns/does not align with company mission, culture and structure.
• Enthusiastic/unenthusiastic support by company board and senior management on the implementation of CSR policies.
• Adversely/positively affected supplier relationships and servicing schedules, resulting in poor service quality.
• Increased/decreased employee dissatisfaction due to misalignment of the new CSR policies with existing policies for employee performance standards.
• Content/discontent by the community due to decreased/increased pollution.

These KPIs were chosen as a means to measure the success or lack of success for the CSFs I indicated earlier. The KPIs are a means of taking a temperature to determine if adjustments are required to ensure the organization's success.

Conclusion

          Attaining sustainability at the top of the hierarchy of terms in this research through corporate social responsibility is a very complex undertaking for any corporation, large or small. There is a plethora of moving parts throughout all the elements of CSR as well as a commitment to the program. Furthermore, management needs to set guidelines for measuring the success of the organization. The incentive for corporations to implement a CSR policy is promoting their brand and show they are environmental stewards as well as a positive influence in the community they operate in for attaining a good, successful society.

References  

Works Cited

Barbier, E., & Markandya, A. (2012). A new blueprint for a green economy. New York: Routledge.

Castka, P., Bamber, C., & Sharp, J. M. (2004). Implementing effective corporate social responsibility and corporate governance: A Framework. London: British Standards Institution. Hpo Online Library. Web. 16 Jun. 2014.

Cato, M. S. (2011). Environment and economy. London: Routledge.

Corner, P., & Ho, M. (2010). How Opportunities Develop in Social Entrepreneurship. Entrepreneurship Theory & Practice. 34(4), 635-659. Doi: 10.1111/j.1540-6520.2010.00382.x

Dees, J. G. (2007). Taking social entrepreneurship seriously. Society, 44(3), 24-31. doi:https://dx.doi.org/10.1007/BF02819936

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Fombrun, C. J. (2006). Corporate governance. Corporate Reputation Review, 8(4), 267-271,265.

Logsdon, J. M., & Yuthas, K. (1997). Corporate social performance, stakeholder orientation, and organizational moral development. Journal of Business Ethics, 16(12), 1213-1226. 

Parmenter, D. (2007). Key performance indicators developing, implementing, and using winning KPIs. Hoboken, N.J.: John Wiley & Sons.

Reilly, B. J., & Kyj, M. J. (1994). Corporate citizenship. Review of Business, 16(1), 37.

Sangle, S. (2009) Critical success factors for corporate social responsibility: a public sector perspective. Corporate Social Responsibility and Environmental Management, 17, 205-214.

Works Cited

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Zenisek, T. J. (1979). Corporate social responsibility: A conceptualization based on organizational literature. Academy of Management. the Academy of Management Review (Pre-1986), 4(000003), 359.