Analysis and Solutions Market Failures Free Samples to Students

Question: Discuss about the Analysis and Solutions : Market Failures. Answer: Introduction: CSR policies play great roles in the smooth and effective running of any business. Its very beneficial to implement CSR policies in any company. This concept of corporate social responsibility has continuously grown over the past years. This concept has developed both in academics and communities of practitioners worldwide. Most of the discussions going on in newspapers regarding business are related to CSR either its contribution in business or a certain conference being carried out. An exploitation of some interest in CSR has been seen to dominate Europe and around the world as well (Vogel, p 16). Initially CSR was regarded as a business type that was domestic especially in its regions of origin however its a concept that has spread worldwide and its virtually in all developed countries and taking roots in developing countries as well. The debate on CSR has been in existence for a very long time and there have been supporters and detractors in almost equal measures. The discussion on these arguments has been done in an extensive manner. However from my view the CSR polices have to be implemented by any serious company that means business in whatever they venture into (Porter and Kramer, p 87). If a business is socially responsible for the activities its carrying out then the long term benefits are all theirs. For any healthy climate of doing business to exist and which has to be functional in the future then actions that ensure long term viability have to be taken at an early stage (Archie and Kareem, p 87). The government regulations are easily done away with if one adopts the CSR in their business. With CSR the government interventions for the future regarding the business can be forestalled. This is possible because with CSR the business is able to police itself with standards regarding self discipline and the expectations of the society are well fulfilled with CSR the said business has enough resources and also has its own say regarding how its running its business. The adoption of CSR implies that the business has the necessary resources and a good reservoir of talents related to management. The capital and functional expertise are also in sufficient supply (Valor, p 318). The business is therefore better placed to be given the chance of solving its own social problems. With the use of CSR polices comes the idea where pro-acting is deemed better than reacting. In this perspective, pro-acting which entails the act of anticipation followed by planning and then initiating is proved to be less costly and more practical compared to a situation where there is much reaction to issues of social matters the moment they occur (Chen, Patten and Roberts, p 143). Owing the strong support of CSR policies by the public its advised that businesses should engage in it more often. Its through this CSR that the public believes its the responsibility of the business to take care of their workers and also communities. It may require some sacrifices by the business to make things better for these stakeholders. The use of these policies has also led to high morals among employees as well as reputations that are good. However such ideas do not reflect on the balance sheet. For any firm that runs on profit basis the CSR makes a good representation of allocating discretionary resources in a civic-minded way (Pivato, Misani and Tencati, p 208). This idea of profitability has recently become the most influential however its not the only reason as to why corporate have to behave in a virtuous manner. In regards to the CSR business case firms are expected to behave in a more responsible manner with a belief that when one wants to be more competitive then they have to be a better corporate citizen. This has made managers more responsible and much public spirited. Fewer business risks are faced by a firm that is managed in a much more responsible way compared to its competitors who are less virtuous (De Schutter, p 219). This in the end result avoids boycotts by consumers, capitals are obtained at a lesser cost and one is better placed when it comes to attracting and retaining employees that are committed and loyal. The firms that do not recognize the importance of CSR are more disadvantaged in the market place. Any investor that sounds responsible and sophisticated may find such firms too risk working with. This may lead to the decline in the value of their brands and also they may lose morale of their employees. However all said and done there are a few objections to the CSR policies such as most businesses may not be well equipped to handle some social activities and most managers have their orientation towards operations and finance. Therefore may lack expertise in making decisions that are socially oriented. Some people are of the view that CSR also seems to dilute the main purposes of any business (Barnett, p 802). The business may venture into fields that are not in any way related to their main goals. Its also argued that the business already has enough powers and there is no need for extra powers of dealing with social problems. Some feel the CSR policies if adopted may make the company less competitive globally. Conclusion In view of the above arguments Im of the idea that businesses should implement the CSR policies because the positive impacts far much outweigh the objections and again most of the objections are only views or rather speculative ideas with no profound basis. Its seen that the CSR policies come with a lot of business strength in the sense that any company that operates under these polices wins a lot of customer trust. Not only that, but also attracts more investors because they feel a sense of protection in whatever they want to venture into. This is different from those businesses that operate without CSR policies. Its taken them time and resources to win the trust of both clients and prospective investors. In this global world most serious businesses with long lasting visions are operating with CSR policies. Its become the normal way of doing and surviving in the competitive fast growing business world. References Barnett, M.L. (2007). Stakeholder influence capacity and the variability of financial returns to corporate social responsibility. Academy of Management Review, 32, pp. 794 816. Chen, J.C., Patten, D.M. and Roberts, R. (2008). Corporate charitable contributions: a corporate social performance or legitimacy strategy? Journal of Business Ethics, 82, pp. 131144. De Schutter, O. (2008). Corporate social responsibility European style. European Law Journal, 14, pp. 203236. Vogel, D (2006). Market for Virtue, Brookings Institution Press, Washington. Available from: ProQuest Ebook Central. [27 March 2017]. Pg 16-27. Pivato, S., Misani, N. and Tencati, A. (2008). The impact of corporate social responsibility on consumer trust: the case of organic food. Business Ethics: A European Review, 17, pp. 312. Valor, C. (2008). Can consumers buy responsibly? Analysis and solutions for market failures. Journal of Consumer Policy, 31, pp. 315326. Porter, M.E. and Kramer, M.R. (2006). Strategy society: the link between competitive advantage and corporate social responsibility. Harvard Business Review, 84, pp. 7892. Archie B. C. and Kareem M. S. (2010). The Business Case for Corporate Social Responsibility: A Review of Concepts, Research and Practice. International Journal of Management Reviewspg 86-89.