Content area
Full Text
Abstract:
The concept of Corporate Social Responsibility (CSR) is gaining support in the global business environment. Some companies are adopting a model, the Social License to Operate (SLO), as part of their CSR strategy. This paper provides background on the concepts of Corporate Social Responsibility and Social License to Operate with examples supporting the business case for them. It proposes a process based on stakeholder theory for identifying and classifying stakeholders that divides stakeholders into two groups: vested and non-vested. Vested stakeholder groups have a vote in the awarding of a social license to operate, while non-vested stakeholder groups have only a voice. By using a process based on alignment of the norms and values of the company, and the stakeholder groups, social licenses to operate can be negotiated that can allow a company to succeed in different countries and cultures.
Keywords: social license to operate; corporate social responsibility; ethical global business; stakeholder theory
The concept of Corporate Social Responsibility (CSR) is gaining support with companies, especially those that operate in the global arena. At present, corporate social responsibility is "a voluntary approach that a business enterprise takes to meet or exceed stakeholder expectations by integrating social, ethical, and environmental concerns together with the usual measures of revenue, profit, and legal obligation" (BNET Business Dictionary, 2009).
However, global companies may find that Corporate Social Responsibility becomes less and less voluntary. CSR is currently finding support at the political level. It the recent World Economic Forums, politicians have told corporate leaders that they must have collective as well as company goals that must focus on sustainability. A subset of CSR, sustainability, when "based on the idea of sustainable development, refers to how well a company ensures its long-term viability based on its environmental, social, and economic performance" (The Ethical Funds Company, 2009). Organizations like the Global Reporting Initiative, and Mary Robinson's (former President of Ireland) Realizing Rights, The Ethical Globalization Initiative, focus their efforts on helping companies recognize that ethical globalization "acknowledges shared responsibilities for addressing global challenges and affirms that our common humanity doesn't stop at national borders" (What is Ethical Globalization?, 2009).
The recent McKinsey reports of business executives show this is having an effect on the responses of business to the...