[MUSIC] At first, a well defined framework to analyze firm social responsibility behavior was proposed by Carl in 1979. This framework to assess corporate social responsibility plan is known as the corporate social performance model. And it integrated the ideas and the works about such topic elaborated until that time. The scholar moved from the idea that business and society are interwoven rather than [INAUDIBLE] entities. Therefore, society has a certain expectation for appropriate business behaviors and outcome. Thus it first distinguished among the three distinct related phenomena. The source of the expectation plays in all business because of their rules as economic institutions. And thus place it on a particular firms because of what they have and what they do. And then lastly, the expectation placed on the manager as model actor within the firm. Once these three levels of analysis are distinguished, institutional, organizational, and individual level. Then several formerly competing concepts can mix together to explain the principles of corporate social responsibility that are the pivotal elements of the corporate social performance model. After analyzing principle of firm as this institution and at a single element of firm, competitive environment as well as individual that take decision on their behalf. We can now move to analyze the process and outcome of firm social responsible action. Let's first analyze the level of principles by describing the principle of legitimacy. Such principle is related to the expectation that society places on all business because of the rule of economic institution. According to the principle of legitimacy, society grants legitimacy and power to business as long as firms use the power in a manner that society considers responsible. Otherwise, not considering societies expectations firms are pushed out of the market because the society may withdraw the legitimacy for doing business. This aspect of the framework described that both represents a generic code conduct for firms to operating the market. Indeed, firms works should be socially responsible because they exist. And they operate in a shared environment with multi-impact on a broad variety of stakeholders, considering governments, competitors, consumer, media. Those groups may affect or are affected by the achievement of an organization's purpose. And in a different way, the grants and take away corporate legitimacy if the firm can compensate for the losses of stakeholders' benefits. Furthermore, model theories pointed out that Earth resource are finite, and the populations are dependent upon another. Therefore, firms decisions should have been taken on moral grounds as well as rational economic grounds. Not considering for social principle in doing business deeply affect firm performance. Please remember that the principle of legitimacy apply to all business rather than a single firm. The second principle we have to consider when we talk about CSR is the principle of public responsibility. According to it, business are responsible for outcomes related to their primary and secondary area of involvement with society. This principle apply at the firm level. Indeed, firms are not responsible for solving all social problems. Firms are responsible for problems that they have chosen. And they are responsible for helping to solve problems and social issues related to their business operation and interest. By illustrating the principle of public responsibility, we move from the generic expectation that society as all business to the specific expectations that it has over a subgroup of firms which operate in a sector. A classical example is that one of the outer producer company that is responsible for helping to solve problems related to vehicle safety and air pollution. Thus it may reasonably involved in driver education programs as well as on public transportation policy. Instead, it may be harder for an auto producer to justify their broad involvement with social issues about low income houses or adult literacy. However, businesses are so deeply interconnected with the society that companies may indeed be able to justify their social involvements that seems far away from the primary and secondary area of interest. However, this principle leaves substantial room for managerial discretion in that there are many tough socio problems and issues irrelevant and how they should be addressed. Contrary to the principle of legitimacy, the principle of public responsibility applies at the firm level. The last principle to consider in assessing firms social action is the managerial discretion. Such principal is related with the firm discretionary responsibility and the area of voluntary social involvement. The domain of discretionary responsibility typically is known as a corporate philanthropy. Or occasionally as corporate involvement in public private partnership or collaborative social problem solving venture. Company social responsibilities are not met by some abstract organizational actor. They are met by individual such as manager who could soundly make decision and choice on behalf of the firm. Thus the principle of managerial discretion is based upon the idea that managers can exist in an organization and the society environment that is full of choice. Thus managers actions have to jointly take into account corporate procedure or more job definitions and available resource in technology. Furthermore, managers are the moral actors on the job, and thus it is their own choice how to fulfill and balance many of these responsibility. Therefore, the principle of managerial discretion imply that because managers possess discretion, they are personally responsible for. And can avoid the responsibility to our society through reference of rule, policy or procedure. Then managers implement the corporate social principles through process to obtain a social outcome. In other words, corporation responds to the social pressure through actions and process taken by managers. Managers act according to the social and ethical principles and are aligned with those of firms they belong to. The process of corporate social responsiveness is the second step of the corporate social performance model. And should get attention from academic and managerial thinking on how firms implement the principles illustrated before. In order to implement effective process, social responsible firm has to monitor and assess environmental conditions, have to attend the many stakeholders demand placed on the firm. And to design plans and policy to responding to the changing conditions. First, responsive furtherance to societal pressure survived by adapting to the environmental condition or business condition as well as respond to them. Environmental conditions include competitors, political and legal boundaries as well as technological constraint. The level of knowledge which a firm has on its environment could be used to devise strategy for adapting to it. And to design corporate social responsible plan that best fit to the environmental situation. Second, social responsive firms typically connect with external stakeholder that may generate some advantages in translating corporate social principle into practice. Some example of strategic partnerships are those with the local communities, NGO or local activist. Such partnership are created by using instrument such as community based programs or relationship with public offices. The firms aim is to create social plans and share it with the largest number of entities involved in social issues. Third, issues management is the last facet of process of corporate responsiveness. Such facet of corporate social responsiveness model involve devising and monitoring internal and external processes. The main purpose is to minimize reprise connected with the development and handling the social issues. Then, the outcome of firms behaving in a socially responsible way are of direct and obvious interest for researchers in assessment of corporate social responsible plan. Firms outcome, social impact and policy are part of the corporate social performance model which is observable and open to assessment. Such visible outcome of corporate social responsibility plan embedded corporate principle and those individuals who implement them through process which may involve that awesome multiple stakeholders. Thus, by evaluating the outcomes, researchers are able to assess the entire social behavior of the firm. With this slide, we conclude the first lesson of module ten, definition of corporate social responsibility. And thanks for being with me in this lesson. See you in the lesson one, corporate social responsibility in the agrofood sectors of module ten. Thanks.
