International Csrr |

International csrr

Q1 (a)
Corporate Social Responsibility Reporting is a vital environmental and social
accountability aspect. This business approach through delivering environmental, social and
economic benefits to the stakeholders contributes to sustainable development. Companies and
corporates meet their social responsibility by creating a process that integrates the impacts of
their operations on the society into their mission and core values (Heidhues, 2012).
Some of the key theories that seek to explain the CSRR practices of firms include the
stakeholder theory and legitimacy theory. Other theories include instrumental, political,
integrative and ethical theories. Stakeholder theory states that an enterprise or a company has
responsibilities to all stakeholders and not just to the management (Hopkins, (2012).
Stakeholder theory is an important concept and an element of CSR that seeks to recognise the
economic, ethical and legal responsibilities of corporations towards the environment.
Legitimacy theory forms a significant criterion in the political economy of an environment.
The political and social framework cannot be separated from the economic sphere where the
operation is positioned. Legitimacy theory seeks to enhance the way progressive societies are
coordinated (Heidhues, 2012). The theory aims at ensuring that an organization maintains its
relevance by responding to the social and political requirements and meet the society's
demands. Based on Integrative theories, the organization focuses on social demands
satisfaction. The key provision of triple bottom line reporting is to incorporate social,
environmental and financial dimensions of performance. People, planet and profit should be
balanced to conform to the CSR standards. The three aspects form the basis of TBLR
(Elisabet Garriga, 2004).
Both GSK and Takeda produced their CSSR reports voluntarily and accurately thus raising
the bar for other companies around the globe. They considered the triple bottom line, i.e. the
planet, profit and the people as stipulated in the CSRR reporting standard. For instance, in the
Takeda report, it is stated that "we continue to work on aspects of sustainability such as
environmental protection, employee health and safety, and supplier management and
compliance." It is clear that the Takeda report conforms with the stakeholder's theory where
all the stakeholder's demands were met (Heidhues, 2012). The stakeholders comprise the
customers, shareholders, suppliers and distributors, employees, and the local communities
surrounding the enterprise. The legitimacy theory also formed the basis of the Takeda report
by shielding the company against political, social and economic pressures. GlaxoSmithKline
(GSK) just like the Takeda also complied with the CSRR standards. GSK considered the
immediate environment, social life and financial abilities of employees and communities,
investors, patients and consumers. The GSK extract states that" GSK's mission is to create a
responsible business to serve the purpose of improving people's lives and protecting the
environment. GSK conforms to stakeholder's theory by investing in people and the
environment to support global health goals and develop value for shareholders (Hopkins,
The various CSR reports ranging from carbon footprint reports to financial and non-
financial have become increasingly mandatory. Political lobbying has resulted to overturning
of set standards thus compromising the independence and reputation of organisations that
govern the standards. These have led to the violation of the standards. This new CSR agenda
termed as radical hinders the existence of the free market and the business community
(Hopkins, 2012). Governments that appreciate the importance of free market have pushed to
set bureaucracy that oversees the enactment of the CSR agenda. To sum up, it is quite evident
that the quality of CSRR directly reflects the economic status of a country. Gray's accounting
values model exemplifies that a country's overall CSR is directly proportional to a country's
development status (Heidhues, 2012).
Elisabet Garriga, D. M. (2004). Corporate Social Responsibility Theories: Mapping the
Territory. Journal of Business Ethics, 51-71.
Heidhues, (2012). Globalisation and contextual factors in accounting. The case of Germany.
Bingley: Emerald Group Publishing.
Hopkins, M. (2012). Corporate Social Responsibility and International Development: Is
Business the Solution? Hoboken: Taylor and Francis.

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