Corporate Governance and Corporate Social Responsibility , Relationship…
Corporate Governance and Corporate Social Responsibility
(CG) is concerned with balancing economic and social goals and between individual and
Corporate Social Responsibility
is concerned with treating the firm's stakeholders ethically or in a socially
CSR disclosure can be defined as the information that a company discloses about its environmental impact and its relationship with its stakeholders through relevant communication channels (Gray et al. 2001).
Reasons for CSR Disclosure:
By disclosing information on their social and environmental performance, firms want to minimize the(potential) costs arising from the firm's interaction and its natural and societal environment—referred to as political or societal costs (Fields et al. 2001).
Voluntary corporate social disclosure gives the public information regarding a company's activities that
relate to the community.
The company would have a better reputation, which would increase its chances to secure contracts
from the Government as it is seen as socially responsible.
Corporate social responsibility may be able to strengthen stakeholder relations as reporting promotes
corporate transparency and instills greater confidence and trust
Relationship and Contradiction between Corporate Governance and CSR
related to profit maximization
protection for the provided capital to the firm
the broadest control mechanism within which a company
contrast profit maximization
suggest a set of actions beneficial for external stakeholder
based on self governance (external legal and regulatory mechanisms
Fused into companies Corporate Governance practices
Focus in ethical
Directly affect an organization's performance
Results in better image of an organization