Creating Shared Value (CSV) and Corporate Social Responsibility (CSR) in the Australian Agricultural Industry
In the agricultural sector, Corporate Social Responsibility (CSR) can be applied as a development and sustainability tool. CSR is a broad concept that has spun debate worldwide. Notably, Australia is also embracing the idea of CSR in most industries at an alarming rate due to its ability to encapsulate issues and obligations that stretch beyond the shareholders. In other words, CSR involves all stakeholders, including the community, in analyzing how the business goes about with its business. The other stakeholders include investors, customers, creditors, suppliers, and employees. While CSR continues to grow, creating shared value (CSV) is a newly introduced concept that coordinates business concerns with social interest to create an opportunity for sustainable development.
Businesses find it hard to create and implement CSR programs because they mostly focus on a company’s reputation. As a result, it has limited connection to the organization’s current operations. That said, it is hard to justify such programs since they do not affect current business operations (Sternberg, 2000). Concerning the scenario described, all parties in discussion need to understand that CRS is meant to optimize an organization’s stakeholders’ benefits. It achieves this goal by neutralizing any potential adversity that may hinder the business operations. Therefore, it covers a broad spectrum of issues that require you to consider before engaging in unfamiliar business conduct. These CSR issues include corruption, gender equality, human rights, consumer interests & taxes, and working conditions.
In the scenario, Bill is trending towards violating children’s rights. Bob is cautious to discover that parents are lying about children’s ages by claiming that they are 15 while in reality, they look younger, according to Bob. Although they stand to benefit and help the families simultaneously, employing underage children is a criminal offense unless a permit had been issued. It is a company’s responsibility to ensure all human rights, as outlined by the UN, are respected and recognized even at the workplace (Kolk, 2016). Although Bill may not realize it now, respect for human rights is a value chain in good time because the due diligence attained from the respect enables an individual to identify with the consequences resulting from its activities. Practically, employing the children and subjecting them to harsh working conditions with high temperatures was a risk factor for the partners to consider.
In CSR, placement of funds or dollars requires justification. Since its emergence, CSR has now grown throughout, even to cover an organization’s practice. In the scenario, it means that despite Bill’s proposal to donate to a local children’s hospital in Wagga Wagga, he shows no intention to give (Sternberg, 2000). It is just a means to achieve personal goals. CSR comes to a greater demand for transparency and accountability from investors, beneficiaries, and stakeholders. The right approach to this issue would be to go by Bob’s idea. He proposes that some amount is set aside to help the Pacific Islanders in their home country. This can be achieved in several ways, such as funding renovations of schools. This is most definitely the right choice in CSR because it pays back to the community that has offered labor services.
Downsizing the wages of the Pacific Islanders who were devoted to working hard while increasing the wages of lazy Australians shows there was no consideration for what is morally right or wrong (Boatright, 2000). To conclude, I feel that pressure should be pressured on all partners in the scenario to understand the concept of CSR. In the long run, researchers have proved that effective SCR programs are associated with both financial and accounting benefits that complement the organization’s overall goal.
CSV in Practice
Creating Shared Value (CSV) is a concept that focuses on profitability and a competitive edge in the market. However, in the current business world, sustainability and social responsibility go hand in hand (Carroll, 2014). The two form the core reason why a business exists. Without showing appreciation and willingness to do something good for society or the environment, the organization’s image is tainted. To this end, there is no doubt that there isn’t any other issue that exemplifies the power and urgency of creating shared value that farmers in Australia. To Bill, the core idea of shared value is eradicating poverty and awareness to handle problems such as climate change and food insecurity without engaging other institutions and corporations. Despite the partners and other farmers’ efforts to acquire labor succeeding, Bill isn’t still satisfied and hopes this is a chance to rip more rewards. In this context, shared value seeks to alter how the business is operated. Changes must occur in processes, strategies, people, and sectors to achieve triple bottom returns.
The most convenient way to create shared value is by integrating social aspects into the business. By shifting from traditional ways to a new positioning, CSV is doing something separate from CSR by integrating environmental and social factors to address the economic value. In the scenario, Bill has no intentions to attend to the social needs of the workers. Instead of fighting inequality, he advocates a strategy that will see the payroll for wages slashed to 60-70% of the adult wages merely because they are young. With such a mind, the income gap between the rich and the poor will never get narrower. Going by Bill’s thinking and how he raises his issues, he is not yet able to manage such an enterprise by himself. Sometimes, his comments leave the others surprised. His actions confirm the reasons why the vicious cycle of income inequality and poverty has never come to an end.
In layman’s language, the framework for creating shared value is that it simultaneously benefits the environment and addresses societal needs. When businesses forego their philanthropic approaches, they are no longer charitable organizations. This means that they have adequate resources to improve profitability and environmental performance, which are key societal wellbeing measures (Baron, 2003). In another instance, Bill is observed to appreciate that most Pacific Islanders are traveling with their families. To him, this will save on expenses. Instead of this sadistic reaction, the best approach should have been to provide affordable housing and other relevant social amenities like public health and nutrition, and financial security. Such businesses are well poised to succeed while at the same time, meeting societal needs.
To summarize the information above, CSR involves taking a company’s resources and reinvesting the same resources as a corporate citizen. Fundamentally, it entails doing things that are separate from the business or things that do not directly interfere with a businesses’ internal operations. Conversely, CSV alters the functioning of key business operations such as structure, strategy, people, and processes. It incorporates the environment and social impact to drive economic value for the business.
Conclusion and Recommendations
There is no denying that futuristic companies have a great chance of succeeding and, ultimately, making substantial profits from their investments from the preceding discussion. This is attributable to the fact that forward-thinking businesses always want to be involved in the decision-making processes that solve complex business problems that stretch beyond communities, regions, and nations. Companies and employees alike familiarize themselves with the fact that charitable organizations are vital. Nonetheless, it is expected that CSV will play a critical role in ensuring that business models focus on the stakeholders’ needs and wellbeing and the planet at large. This move will help attain profits while eliminating negative externalities at the same time. I recommend that multinational corporations in Australia and around the world steadily ramp up their CSR and CSV efforts. This way, it is possible to effectively handle complex global issues such as inequality, hunger, poverty, climate change, and inequality. Finally, emerging businesses should start embracing CSV as a sustainable and profitable model to foster operations.
