What defines corporate social responsibility (CSR)?

Corporate social responsibility (CSR) is defined as a business model that emphasizes the importance of being socially accountable not just to shareholders, but to all stakeholders involved, including employees, customers, suppliers, and the community at large. This concept encourages companies to operate in an ethical manner, taking into consideration their impact on society and the environment.

By engaging in CSR, businesses demonstrate a commitment to positive social and environmental practices, which can enhance their reputation, build consumer trust, and foster loyalty. The focus on accountability to a broad range of stakeholders differentiates CSR from models that prioritize shareholder profits alone. Integrating CSR into business strategies means that companies not only aim for financial success but also strive to create a positive societal impact, contributing to sustainable development.

In contrast, models that only benefit shareholders would neglect the broader responsibilities companies have to their stakeholders. Similarly, a strategy focused solely on maximizing profits would not consider the ethical implications of business practices, while a regulatory requirement would imply a legal compulsion rather than a voluntary commitment to ethical conduct. Such distinctions highlight the comprehensive nature of CSR as a guiding principle that encourages a holistic approach to business practices.