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E ISSN 2587 - 4691
∘ Khatuna Berishvili ∘
A NEW APPROACH TO MEASUREMENT OF CORPORATIVE SOCIAL RESPONSIBILITY

Abstract

Despite a great number of definitions and alternative theories of corporative social responsibility, the idea of functioning of socially oriented company was changing not so much radically. Essence of CSR within the entire period of development of this concept was being determined as some phylosophy of company behavior and the concept of formation of interactions with all, which are somehow connected with its activities.    Within last years on the pages of scientific literature the discussion was ongoing on crisis of the conception of a social state, the need for radical reform in the public sector, changes in direction of social protection, the need for radical institutional changes (reform, first of all, of social institutions). At the present stage of development of industrial society one of the most active problems is evaluation and changes of corporative social responsibility. On the basis of analysis of modern model of “social state” new economic methodological approaches are suggested to measurement of social responsibility of the society through life and permanent prosperity of man in an organization. Indexes over the evaluation of contentment are connected with working and complex evaluation of quality of working life.

Key words: corporative social responsibility, change, economic and social development, measurement, methodology, wellbeing of society, corporative social policy, quality of life. 

Introduction 

Within XX century corporative social responibility (CSR) was developing in two directions – as the idea of management [Donham, 1927; Porter, Kramer, 2006] and as independent theoretical conception [Clarke, 1916; Bowen, 1953]. The process of development of CSR ideas was not uniform, but it would be also right to mention that the status of corporative social responsibility in the second decade of XXI century is more evident than it was in previous hundred years. A greater part of accumulated knowledge refers to theory, but undoubtedly, a great amount of proofs also appeared for CSR as the practice of modern management of the companies.

In essence, short review of appearance of corporative social responsibility shows its permanently changing nature. CSR kept changing permanently as a concept and conception from the viewpoint of management, until it became scientific conception and continued experiencing change already in this field. It should also be added that transformations of CSR are ongoing not only at the level of idea or term to specify the concept of corporative social responsibility (for example, movement from CSR to corporative social susceptibility or corporative citizenship), but also at the level of internal structure   and content, when name of theoretical conception is not changed, but its internal structure is being transformed and redetermined. 

Evolution of views on corporative social responsibility 

Despite a great amount of determinations and alternative theories of corporative social responsibility, the idea of functioning of socially oriented company was changing not so crucially. Essence of CSR within entire period of development of this copncept was determined as some philosophy of the company behavior and conception of forming the interaction with all those, which were somehow related with its activity. Presence of additionally socially significant activity was also obligatory, apart from the main one.

Under the corporative social responsibility, in the broadest sense of the word, the conception is understood, which reflects voluntary decision of the company to participate in perfection of the processes of social development of society and protection of environement [1]; corporative social responsibility is also regarded as an ability of a company to benefit the society through use of profits from the private business. In Europe CSR was officially formed as sustainable     concept only in the beginning of XXI century at Lisbon European Summit in March 2000. European Commission determines it as “conception of integration of care on social and economic development in the business-operations of companies in cooperation with their shareholders and external environment” [4].

Recognizing the need and significance of the CSR conception, it should be considered to be outwardly imposed norm. For the majority of companies it has not become yet internal need and common value, its realization   is still connected with maximization of usefulness and those limitations (forced costs), which are imposed on the company activity by internal and external interest-holders (pressure of state, public organizations, pressure of consumers, competition for skilled workers), and external instruments of recognition (competitions, ratings, etc). To make corporative social responsibility      and social functions of business be regarded as internal components of modern company, internal norm, it is necessary, in our opinion, to pass definite stages of mature approaches on the part of both all the interested sides and also business itself (Pic.1).  

 

            Picture 1. Stages of approaches to social functions of business.

 Criteria of efficiency of social and organizational Development 

Within last five-six years on the pages of scientific literature discussion was ongoing on the crisis of conception of  the social state, the need for radical reform of public sector, change in the direction of social protection, the need for radical institutional changes (reform, first of all, of social institutions). German sociology far more frequently points to the need of radical changes in the model of social market economy and social state. For example, H. Norbert in the work “Has economy any future: end of growth and forthcoming crisis” talks about readiness of the society to social reforms, and mentions also about the interest in liberal ideas in connection with exacerbation of the problems of social dependency [4].In one of his last fundamentalworks R. Greenberg also poses the problem of crisis of a social state [14]. Search for a new model is ongoing “exclusively within this or that combination of market and social limitations”. The dispute is about correlation of liberalism and sociality: some demand the first more, others – the other. In other words, search is going on for change in qualitative proportions of redistribution of created wealth, but the principle proper – only agents of market can create wealth, while social policy can only redistribute it, to a greater or lesser degree undermining the market incentives – remains unchanged.

In 2012 was published the Strategy of World Bank in the field of social protection of work for 2012-2020, in which is presented principally new idea (conceptionally new) of social protection. In particular, is mentioned that “efficient systems of social protection are necessary components of sustainable economic growth” for the society on the whole [16]. The Strategy outlines new “functions of social institutions (social protection, first of all): 1) warning on reduction of wellbeing under the influence of abrupt changes in the level of income and expenses; 2) provision of possibilities, sources and work places of best quality; 3) protection from impoverishment and catastrophic loss of human capital” [16].

Developing the discussion on crisis of a social state, the scientists point to two groups of factors that caused the present crisis: economic globalization and technological innovarions [11. pp 111-112]

Methodological breakthrough in change in the evaluation paradigm of social progress efficiencr happened also after publishing the report of International Commission headed by Nobel Prize holder J. Stiglitz “The Measurement of Economic Perfromance and Social Progress” in 2009 (Report of the Commission on measurement of economy efficience and social progress, J. Stiglitz, A. Sen, J.-P. Fitoussi). Thus, the report focuses the accent on the need in evaluation of economic development to attach more attention to the quality of life in general and separate man in particular. In change of quality of life should be taken into consideration both the objective indicators, having quantity evaluation and the subjective, having both qualitative and quantitative measurement [16].

To reflect the above-listed tendencies in the social sciences, the term “wellbeing” was used (literally, good being), by the content meaning “continuous wellbeing” of man and society (from this the concept “good society”, “just society”). The present conception involves a wide array of objective and subjective evaluations of people of their own “continuous” wellbeing at different stages of life, including intensive work activity and wellbeing in the “elderly age” (Age Watch). It should be mentioned that earlier the economic science used conception “wellfare”, which reflected the level of wellbeing from the viewpoint of mesurable qualitative indicators and level of social protection of citizens. To measure wellbeing of people is used the system of inter-complementary indicators: income, work, society, education, ecology, civil rights, health, contentment, security, balance between work and rest [16].

Thus, in the present period, as never, production, economic activity of companies (for measurement of which are used the standard market criteria of correlation of expenses and benefits) requiring non-market criteria of efficiency. In such a case   we suppose that CSR is not only management technology, pursuing purely market goals and results, but also an indicator of social activity, social functions (social activities) of the companies, and should be directed to continuous wellbeing of man (worker) in an organization, should promote formation of social environment inside and outside the organization, development and support of social relations and social communication. This, approaches to measurement of social responsibility of business should reflect wellbeing of man (worker) within an organization, it is also necessary to measure contribution of business into continuous wellbeing of the local community and society on the whole.

Approaches to measurement of corporative social responsibility 

As thepronlems in measurement of corporative social responsibility have comprehensive charcater, we’ll consider its evaluation from the viewpoint of wellbeing of man in the period of active work activities, i.e. of a worker.

One of the possible approaches to measurement of corporative social responsibility can become evaluation of social programs, being realized at the level of a company from the viewpoint of their influence on the quality of life (probably in a narrower sense, on the quality of work life).

Complex evaluation of the quality of life in an organization, in its turn can involve the following blocks of indicators (through the subjective perception):

- Contentment with work – contement with salary, applied systems of payment for work, feeling of justice in payment for work, positive motivations of employees, possibility for professional and personal growth, assureness in the future, guarantee of employement, stability;

- Level in organization of work – targeted planning in organisanization, presence of service transport, parking, level and condition of rationing, good ergonomic and physical conditions of work, level of organization of work place, technique of personal work, presence of work clothes;

- Level of development in social infrastructure in organization – presence of dining-rooms and hot meals, presence of medical points for examination and prevention, additional pension services, additional medical insurance, feeling of social security;

- Autonomy of worker and security of work – degree of delegation, responsibility, amount of operations at the present work place, possibility of vision of final results of work, interchangeability of works;

- Style of governance – social direction of style of governance, contentment with style of governance, wish to work in the future with a supervisor, possibility to choose a supervisor;

- Culture of organization – ptesence of values, traditions, “heroes”; policy of governance in relation with recognition of merits of workers, degree of trust in governance, social environment inside organization, presence of feedback;

- Relations between people in the process of activities – presence of favorable atmosphere for work activities, presence/absence of conflicts, stress situations; possibility of informal relations at work with colleagues, level of interaction with employes, level of development of social relations;

- Level of production/work democracy – level of development of work democracy, direction to group work and aspiration to achievement of joint results, ability to agree personal interests with the interests of group, other work groups and an organization on the whole.

- It should be mentioned once more in conclusion that the function of goal in development of corporative social responsibility should be the function of quality of life and worthy work (F ql max, in which F is function of goal and ql – quality of life). On the basis of relevant system of indicators (objectively evaluated and subjective) at the level of a company should be elaborated the methods of calculation of index of social development, which can be presented with the help of formula of linear addition I= (Fi)/n, where Fi – achieved level of I indicator, n – quantity of indicators. The present methods can be specified, if weight coefficients are attached to the present indicators (Pi). “Weights” carry in them the share of subjective and can be determined by expert way, which, in our opinion, can be a source of very valuable information. Then the formula will take on the form of medium-arithmetical weighed I = (Fi   Pi) / Pi. Systematic calculation of such indicator and its comparison by years will give a picture of forming tendencies [20]. Integration of 15-20 most important social indicators enables to receive indicator new by its nature and analytical potentials, characterizing the tendencies of social activity, social activities of companies, reflecting continuous wellbeing of man in an organization.

Summary

The present article reviews dynamic in development of the conception of corpoerative social responsibility, problems of its evaluation and change. After analyzing the evolution of corporative social responsibility and modern model of “social state new methodological approaches are suggested for evaluation of economic and social development through continuous wellbeing of man and society. The article also reviews main approaches to change of corporative social responsibility at the microlevel through the quality of life and continuous wellbeing of man in an organization and the indicators of evaluation of contentment by work and complex evaluation of quality of working life.

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