Corporate Social Responsibility Assignment: Issues Encountered By CYE
Question
Task: Prepare a corporate social responsibility assignment outlining the issues encountered by Chug Yont Engineering Co., Ltd and also recommend a business strategy for the same?
Answer
Introduction
Chug Yont Engineering Co., Ltd was established in 1962 and is small-sized machinery and industrial construction company. Thecompany has two factories thathavefive and seventeenfrontline employees respectively. The business initially startedfrom fishing items and diversified into food machinery, and also packaging tools for seafood products. The companyalso has its diversification in packaging machinery and tools for dry fruits, sausages, coconut milk, and chilli pastes. The owner of the company is invested in corporatecitizenship to reducesocietyissues. This has led tocertainproblems due to the values and beliefs of the owner (Chug Yont Engineering Company, 2020).
Purpose
The report on corporate social responsibility assignmentserves the purpose to find out the main problems that the business is facing and the steps that can be taken to effectively solve the issues. The report on corporate social responsibility assignmentalso provides recommendations for improving the present business strategy keeping in mind the values of the owner and the profits of the business.
Problem statement consider in the corporate social responsibility assignment
The owner of the company explored in the corporate social responsibility assignment has Buddhist beliefs that lead him to be engaged in different corporate citizenship activities. He spends most of his time and resources in helping the external stakeholders such as the educational institutions, Buddhist temples, the community and many government agencies. Therefore he spends much less time in the business itself and the factories. The factory workers are allowed to make the decision on their own. Therefore a “laissez-faire leadership style” is followed. This makes the workers dissatisfied as due to lack of proper guidance and leadership, the company fails to keep its standard (Zinkin, 2007).The workers of the company are not paid any extra cost or incentives for the extra work that they do for corporate citizenship activities. The time that is spent to help the external stakeholders of the business creates a negativeworkenvironment in the internal stakeholders that lead many of the workers to leave the company. The corporate citizenship initiatives that are done by the owner do not increase the profitability of the company (Chug Yont Engineering Company, 2020).
What are theimplications of this problem identified in the context of corporate social responsibility assignment?
The leadership challenges and corporate citizenship initiatives createproblems for the business. As the owner spends much time in doing well for the community most of the business hours are spent for thebenefit of the external stakeholders. Therefore the demands of the employees are not noticed. The workers are given additional tasks apart from the business orders such as buildingwater tanks, classrooms, shelters and so on for the nonprofit organizationswithout any extra pay (Harrisonet al. 2015). This creates differences between the managers and the workers. The work attitudes of the employees have changed and there is no job satisfaction and increase rate ofabsenteeismand turnover. The rising problems as discovered in the corporate social responsibility assignment if are not solved then it can be predicted that the rates ofturnover will increase, which will, in turn, reducethe productivity and quality of work.
Analysis and Evaluation
Shareholder theory and stakeholder theory
Shareholder theory
The shareholder theory suggests that the businesses maintain a responsibility to create long term financial wealth for the shareholders. This is not fulfilledby the corporate initiatives done by the owner. The theory believes that a business only has the objective to improve and increase the wealth and maximize the profits (Harrisonet al. 2015).
Stakeholder theory
This theory outlined in the corporate social responsibility assignment believes that a company has the responsibility to stakeholders and not only the shareholders. A business must have the ethical duty to the business and as well as the community and the activities that are done by the company must not harm the community. This theory is effectively followed by the owner of CYE. He believes in doingwell for the community and thus spends most of his time in providing free services to them. The corporate citizenship initiatives done by the owner does not consider the shareholder theory. He does not believe in enhancing the financialwealth of the business (Strand, and Freeman, 2015). His beliefs are consistentwith the stakeholder theory as he operates the business with good deeds and kindness. Hedonates half of the profitsto the local communities and the rest is spent to take care of the business and sustaining his family. He believes thatperforming good deeds is more important than gathering wealth.
Impact of religion on corporate citizenship engagement
The actions anddecisions of the owner of a business can be influenced by the religiousprinciples and the beliefs of their personal lives. It is stated herein corporate social responsibility assignment that the concept and preaching of Buddhism have impacted the business as it gives enough emphasis on corporate engagement. The Buddhistteachingshave influenced the personal life and thebusiness perspectivesof the owner of CYE. As he follows the Buddhist values, hebelieves in doing good deeds (Tufailet al. 2017). He follows the Buddhist ideologiesand alsousesthese in real life. He spendsmost of his time guiding the communities. He helps the hospital, schools and churcheswith financial contributions. As his business is penalized in industrial constructions, he also helps different NGOs by building the physicalinfrastructure by only charging the minimum amount. As evident in the corporate social responsibility assignment one’s beliefs in religion can help in improvingthe responsibility towards the community (Jamali and Sdiani, 2013). There are severalarguments of scholars that suggestthat religiosityhas animpact on beliefs and values that affect the attitudes and behaviours at work. The personal values of the owner or a manager at work leadto a strongimpact on the decisionsthat they take. There is a positiverelationship between philanthropic giving and religion. Buddhism, the religion followed by the owner of the company challenges the westernmindset of profit maximization. The religious beliefs focuson the good deed. The value cultivated is good for physical and mental health;however, it can have adverse effects on the business (Read, 2015). As philanthropismis associated with the religiosity,the manager ortheowner ofa business gives away most of the profits for thebenefit of communities and does notconsider the demands and welfare of the internal stakeholders that are the employees. This creates conflicts in the workplace and gives rise to a negative mindset.
Behavioural tendencies of laissez-faire leadership style
As per the research on corporate social responsibility assignment, in “laissez-faire leadership” the leaders leave the decision of a business to the employees and trust then in making proper judgments. The manager is not directly involved in the operations of the organization andprovides the employees with a freedom of action and choice. The owner of CYF proposes a laissez-faire leadership style. He is not present in the factories or the offices due to his personal belief in doing well for the community, where he spends much of his time outside the factory. The factory managers have the total freedom to decide on behalf of the owner and also for the company (Wellmanet al. 2019). It is mentioned in the corporate social responsibility assignment that individuals following laissez-faire leadership delegate their authority, allow the workers to manage challenges by themselves and lead during any situation of crisis (Silva and Mendis, 2017).
Perceived organizational justice
This is the perceptions of the people working in an organizationtowards the fairness of principle or allocations. These are the conceptsthatshow whetherpractices followed in an organization are fair or not. If theemployeesfind that the practicesfollowed are not correct and unjust, theirwork attitudes change. The work attitudes and behaviours of the people tend to become negative if there is injustice in the organization. This is the casewith CYE, where due to the personal beliefs andvalues of the owner, the employees are unhappy and there is a negative work environment (Robert, and Vandenberghe, 2020). The company examined in the segments of corporate social responsibility assignment sees arise in rates ofturnover andreduced job satisfaction. The owner does not pay the workersenough for the additional tasks that they do. This makes the organizational practices unjust.
Leadership also impacts the perceived organizational justice. It can be observed from the study developed within the corporate social responsibility assignment thatif the leadership of an organization is proper and has better rules, then the practices followed in the organization will be just. An organization following democratic leadership will make sure that the demands of the workers are met and the organization has transparent policies (Erdogan et al. 2015). This makes sure that organizational practices are fair. On the other hand, a poor leadership style followed in an organization makes the practices unfair.
Social responsibility
(a) Impact
Social responsibility is the businessinitiatives that are taken for thebenefit of society. The initiatives taken by a business can be in terms of social, economic and environmental responsibilities. A business having a strong especially responsiblecore can attract more customers and can outperform the companies that are not sustainable. Socialresponsibility of business impacts the job satisfaction of employees and their rate of retention. The business that effectively uses a social responsibility has happier and satisfied workers (Naziret al. 2019). The workers working for a business that is sociallyconscious provides them with a sense of purpose. The business strategies of the companies are to retain talent and toincrease profitability. This strategy is impacted if the businesses do not have a socially conscious core, as employees do not want to work in a company that is not conscious of the society and to the environment. Social responsibility of a firm can impact the internal and externalstakeholders. In case of CYE focused in the corporate social responsibility assignment, having a socialresponsibility has impacted the external stakeholders such as the non-profit organizations, Buddhist temples, and local hospitalsand so on. Beingsociallyconscious has negatively impacted the organization (Ruppet al. 2015). The company has lost workers and there are challenges in managing the workers. This is because the owner is too involved in doinggood for the societythat he has forgotten the basicresponsiblytowardstheworkers. The demands of the workers are not fulfilled and therefore the business does not benefit from the social initiatives.
(b) successfully pairing
Social responsibility is nolonger considered an option for businesses. These are theactivities that are performed for improving the outcomes of a firm both in the long and short terms. This is because the perceptions and demandsof the consumers have changed and they do not want to involve with a company that is not socially conscious. As per the investigation on corporate social responsibility assignment, itis believed thatcompaniesmust go beyond improving financial andeconomicperformance and must have a crucial role in enhancingenvironmental and social welfare. The business initiatives are now integratedwith social responsibility. The strategy of the companies now has an integrated CSR to show the initiatives taken for the benefit of society. Most of the companies nowimplement initiatives for the improvements of public health, society and the environment (Lim and Loosemore, 2017). When organizations effectivelyengage in socialresponsibilitythe attitude of the customers is positively reinforced. The way a company usesCSR initiatives for positioning the company in the industry is important as it can help the customers in understanding how a point of differentiation is created by the company. The readings of the current corporate social responsibility assignment illustrates that the social responsibility and the core objectivesof the business can be successfully paired if the initiatives taken for society do not harm the employees and vice versa. This is different in case of CYE, as the social responsibilities that the owner does negativelyimpact the employees. Theowner does not take into account the demands of the workers and spends most of the time andresources for the benefit of society. Thus the employees are felt left out that creates conflicts. This can be minimized if the owner spends equal time in the company and the social work. Creatinga balance between the twocan successfully help the company in improving the work conditions and also on hisvalues and beliefs.
(c) Factors
The current social activities done by the company mentioned in the corporate social responsibility assignment must be taken into account before aligning those with the business core values. The factors of employee opinions must be considered before integrating social responsibilities. The workers must be trained on how to accept the responsibilitytowards the environment and the society (Lim and Loosemore, 2017). It is crucial that the reasons for integrating are explained to the workers. The business must also understand the impact that social responsibility may have on the attitudes of the workers. Businesses with a socially responsible core must make sure that the work conditions of the employees are satisfied and their demands are met.
Conclusion
The overall discussion on corporate social responsibility assignment concludes that CYE faces challenges as it is too dedicated to completing social responsibility. The owner of the company followsBuddhistvalues and beliefs in both personal and business life. His philanthropic nature creates problems in the business as the workers are not satisfiedwith the pay and the extra work that they have to do without any benefits. The business faces a high turnover rate and low motivation. The company needs to integrate their CSR in the business principles and maintain a balance so that both the areas are equally treated.
Recommendations
It is recommended to the present case scenario of corporate social responsibility assignmentthat CYEconsider the demands of the internalstakeholders to remove the challenges. The owner gives much importance to the social responsibilities and spends much less time in the company that makes the workers think that the owner is not interested in the work. Spending much time in the company will remove this concept. The business currently gives enoughfreedomto the workersandpractices “laissez-faire leadership style”. This givesenough authority to the workers to make their own decisions (Naziret al. 2019). The owner needs to change the leadership style and get a hold of the reins of the company. He needs to practice democratic or transformationalleadership, where the decisions will be made by him. This will improve the workconditions and remove the problems of high turnover rate and lowproductivity. The change of leadership style and spending much more time in the business will help a positivework environment and make the workers feel motivated to work. The readings developed in the corporate social responsibility assignmentalso signify that a rise in the salary and incentives for the extra workthat the workers do will also change the behaviours and attitudes of the workers.
Reference list
Chug Yont Engineering Company, (2020), 2014 Annual Financial Report.Corporate social responsibility assignment Available at: http://www.segroup.cn/en/MediaCenter/Announcements/20150330/download/2, accessed on: 27.7.2020
Erdogan, B., Bauer, T.N. and Taylor, S., 2015. Management commitment to the ecological environment and employees: Implications for employee attitudes and citizenship behaviors. human relations, 68(11), pp.1669-1691.
Harrison, J.S., Freeman, R.E. and Abreu, M.C.S.D., 2015. Stakeholder theory as an ethical approach to effective management: Applying the theory to multiple contexts. Revistabrasileira de gestão de negócios, 17(55), pp.858-869.
Jamali, D. , and Sdiani, Y. (2013). Does religiosity determine affinities to CSR? Journal of Management, Spirituality & Religion, 10(4), pp. 309–323.
Lim, B.T. and Loosemore, M., 2017.The effect of inter-organizational justice perceptions on organizational citizenship behaviors in construction projects. International Journal of Project Management, 35(2), pp.95-106.
Nazir, S., Shafi, A., Atif, M.M., Qun, W. and Abdullah, S.M., 2019.How organization justice and perceived organizational support facilitate employees’ innovative behavior at work. Employee Relations: The International Journal.
Read, J.N.G., 2015. Gender, religious identity, and civic engagement among Arab Muslims in the United States. Sociology of Religion, 76(1), pp.30-48.
Robert, V. and Vandenberghe, C., 2020. Laissez-Faire Leadership and Affective Commitment: the Roles of Leader-Member Exchange and Subordinate Relational Self-concept.Corporate social responsibility assignment Journal of Business and Psychology, pp.1-19.
Rupp, D.E., Wright, P.M., Aryee, S. and Luo, Y., 2015. Organizational justice, behavioral ethics, and corporate social responsibility: Finally the three shall merge. Management and Organization Review, 11(1), pp.15-24.
Silva, D.A.C.S. and Mendis, B.A.K.M., 2017. Male vs female leaders: Analysis of transformational, transactional & laissez-faire women leadership styles. European Journal of Business and Management, 9(9), pp.19-26.
Strand, R. and Freeman, R.E., 2015. Scandinavian cooperative advantage: The theory and practice of stakeholder engagement in Scandinavia. Journal of business ethics, 127(1), pp.65-85.
Tufail, U., Ahmad, M.S., Ramayah, T., Jan, F.A. and Shah, I.A., 2017. Impact of Islamic work ethics on organisational citizenship behaviours among female academic staff: the mediating role of employee engagement. Applied Research in Quality of Life, 12(3), pp.693-717.
Wellman, N., Newton, D.W., Wang, D., Wei, W., Waldman, D.A. and LePine, J.A., 2019. Meeting the need or falling in line? The effect of laissez?faire formal leaders on informal leadership. Personnel Psychology, 72(3), pp.337-359.
Zinkin, J. (2007). Islam and CSR: a study of the compatibility between the tenets of Islam, the UN global compact and the development of social, human and natural capital. Corporate social responsibility assignmentCorporate Social Responsibility and Environmental Management, 14(4), pp. 206–218.
