Industries, which are eager to prevent interference in their process of production through regulations or taxations, need to adopt substantive voluntary methods. They have to make sure that they are able to persuade the wider public as well as the government into believing that they are very serious regarding issues such as health and safety, diversity, and even the environment. It is very important for these industries to present themselves as decent corporate citizens with respect to the effect on the environment and labor standards.
How to Maximize the License to Operate
It is essential for Corporate Social Responsibility or CSR to be recognized by multinational companies as being indispensable to the process of resolving concerns related to trust with the countries in which their base of operations is located. It should be the responsibility of the companies, to always try to maintain a cordial relation, with the countries in which they operate, instead of fostering an atmosphere rife with mutual hostility. CSR helps to identify and research the problems, which are faced by the industries during the process of implementation. It draws attention correctly, to the fact that the license to operate is mostly derived from performing in an approved contextual manner along the basis of five different probable dimensions. These happen to include global responsibility, generating sustainable means of employment, upholding the core values of the countries in which multinationals conduct their business, creating sustainable growth and managing externalities in a responsible way.
CSR as a Strategic Tool – License to Operate
Many developing countries around the world are plagued with difficulties like discrimination stemming from differences in caste, race and gender; corruption, human underdevelopment as well as widespread poverty. These factors usually lead to the obstruction of financial development in the country because of resource rents, which were supposed to enhance the economic situation in the first place. In case of such a scenario, it is necessary to stress on the issue of governance in order to remedy the situation. Various institutions present in the country also need to be drastically improved. However, when any sort of government commitment is noticeably lacking in the region, a moral argument is expected to be made that troubles related to administration should be dealt with by multinational firms. Nevertheless, it has been seen that governance is not one of the main concerns in the CSR plans of companies. CSR is instead used in a strategic way to acquire licenses from the government.
In the world of today, Corporate Social Responsibility has become somewhat of a requisite for any company to engage in a sustainable business and be able to get a hold of what is known as a license to operate. The presence of social media has become an accepted part of the communication strategy as it not only helps to promote the positive aspect of CSR but also maximizes its impact on the activities of a company. The enthusiasm to determine the extent of the effect of CSR in order to make a choice to employ it highlights the role of corporate philanthropy.
