Corporate Social Responsibility: A Methodology for Performance Evaluation

Abstract

According to Strategic Management Theory, managers can add value to an enterprise by taking into account the social and economic effects of an enterprises operation when making decisions. This has led to the concept of Corporate Social Responsibility. The Stakeholders such as investors and financial institutions, business partners, consumers, employees, surrounding community, civil society organizations and governments and their institutions, must be provided the information about how and to what extent they fulfill their responsibilities. The Selection of the indicators for judging the performance of enterprise in fulfilling its social responsibilities, may be based on the following criteria (1) Comparability (2) Relevance and materiality (3) Understandability and (4) Reliability and verifiability. The guiding principles for selection of indicators may be (1) Universality to maximize comparability (2) Incremental approach (3) Capability of consistent measurement (4) Performance orientation rotes than process orientation and (5) National reporting and positive corporate contributions to development. The constraints are costs and benefits, confidentiality and trendiness. Various indicators such as values of imports Vs. exports, total new investments, local purchasing, employment creation and labour practices, expenditure on research and development, average hours of training per year now employee, payments to government voluntary contributions to civil society etc. and some eco-efficiency indicators are suggested and distasted in the tears of their background compilations, and presentations and disclosure.

Keywords: Corporate Social Responsibility, Methodology, Eco-efficiency Indicators

View PDF