Ethical Corporate Social Responsibility in Decision Making

Ethical Corporate Social Responsibility in Decision Making
(Student’s Name)
(Instructor’s Name)
(Due date)
(Course)
Ethical Corporate Social Responsibility in Decision Making
Introduction
Globalization has made the world to be more interconnected through trade and the exchange of culture. Technological development in transportation, communication, freedom of trade, and availability of up-to-date skills and labor have enabled firms to cope up with the changing world. According to the book written by Lawrence & Weber (2019) Several parts of a business work together to ensure its success. They include; Consumer, Competitor(s), Channels of Distribution, Media, Strategy, Marketing, Operations, and Finance. Each of these parts has people put in place to ensure the smooth running of the business. Managers in organizations have several roles like; tackling performance problems, backing up problem-solving, decision-making, and evaluating the production at the right time. They also engage in translating corporate objectives to practical individual goals, monitoring the output, and starting an act to build up the outcome that are socially responsible. This paper will discuss how important it is to include ethical corporate social responsibility in decision-making in Saudi Aramco.
Saudi Aramco is a multinational company that is involved in producing chemicals and energy and chemicals that are part of people’s daily lives all over the world. Saudi Aramco is one of the famous companies that incorporate ethical social responsibility in their daily activities. The company embraces Corporate social responsibility to impart a difference in the vision of the society of altruism, advocate, or charitable. It does this by participating in practices and decisions that are ethically oriented. Cooperate social responsibility, in general, is acknowledged as a planned enterprise associated with developing a brand's reputation. Their Corporate Social Responsibility enterprises are aligned and joined reasonably to the model of their business design to be effective.
According to Lin and Liu (2017), CSR implementation also includes actions that promote benefits beyond the law's interests and requirements. Just like other firms Saudi Aramco undergone tremendous rewards as result of CSR. It has enabled Saudi Aramco to build its reputation in the market thereby gaining more competitive advantage. Customers view Saudi Aramco as a firm that have responsible policies and strategies. That can apply to any business, regardless of its size or sector.
In addition to that, the firm may use CSR in ethical or strategic developments. Increasing firm’s sales and output as a development strategy is highly influenced by CSR. The products then willingly display their constructive results by the response given by the customers. Benefits brought by CSR increase when there is positive growth in public relations and high ethical values, legal risk is reduced (Agudelo et al., 2019).
When company managers pay keen attention to their stakeholders, they make excellent and effective decisions that will positively influence their effects. CSR policies motivate companies in making positive aftermath on the environment and stakeholders like customers, workers, investors, and societies. Some firms implement CSR strategies from an ethical view due to influence from senior management (De Roeck and Farooq 2018). For instance, a manager might be believing causing harm to the environment is ethically intolerable; hence the members of the firm will implement the same. Business companies have compound relations with several people and institutions in society.
Relevant stakeholders in Saudi Aramco
Stakeholders combine all those that affect, are affected by, and the activities of the business (decisions, policies, and operations). They include; market stakeholders involved in direct economic dealings with the firm; nonmarket stakeholders are indirectly connected with the company but are affected by all means by the firm's actions. In Saudi Aramco relevant stakeholders help in understanding the nature of their interests, power, and relationship with each other (Nikolova and Arsić, 2017). Every stakeholder (employees, customers, creditors, nongovernmental organizations, shareholders, competitors, governments, and suppliers) share, to some extent, the risks and profits of the business. They also have some right to claim the firm's assets and consideration, depending on what is morally right and the law or both.
Saudi Aramco embraces CSR in attracting quality talent and retaining stakeholder like the investors. This is built by ensuring a constructive and common relationships that is beneficial to all parts of the organization. This has helped the firm in solving more critical and ethical social challenges. For example, being a responsible and a sustainable firm has made it easier for Saudi Aramco to bring in new employees or keep prevailing ones. Employees get motivated to stay longer into the firm, which reduces cost ad disruption of the recruitment process.
World globalization has led to change in society’s expectation, government guidelines, increase in environmental issues, and technological advancement. These changes make it difficult for senior managers to achieve financial results and create value for all their stakeholders. Due to this there is need for CSR in decision making that will cut governing weight. For example, a firm’s relationship with the government makes doing business easier and with less risk of fighting with the authority.
Business, society and the environment.
Business, the environment, and society are profoundly interconnected. Businesses and society greatly depend on the environment. The domain not only sources out all the materials that people use to survive but also undergo limitations. These resources that make life feasible are finite; hence humans must learn on how to use them sustainably. Humans need to ensure that these resources are not depleted for generations to come (Nikolova and Arsić, 2017). It is where the concept of sustainable development comes. Sustainable development occurs when there is state of equilibrium amongst economic development and protection of the environment. It is the act of meeting the wants of the people of today and not causing problems to the needs of the future generation.
Sustainable development Goals and Saudi Aramco firm.
Saudi Aramco firm embraces 2030 UN sustainable development goals. The company applies these Sustainable Development Goals (SDGs) in order to protect the environment (Yakovleva et al., 2017). Several of these Sustainable Development Goals (SDGs) relate more to the vision of the company (Pedersen, 2018). They include; decent work and economic growth goal promoting sustainable economic growth, Affordable and Clean Energy- that is modern, reliable, and sustainable. It also indicates, Industry, Innovation, and Infrastructure that is flexible, all-encompassing, and bearable, responsible Consumption and Production patterns (Yakovleva et al., 2017). Life on Land should be protected, restored, and increase sustainable use of terrestrial ecosystems to reduce desertification and stop biodiversity loss. Incorporating these SDGs has made Saudi Aramco to be part of building global low carbon economy.
According to a survey of WBCSD (World Business Council for Sustainable Development) members and Global Network partners about firms and SDGs in July 2018, most countries worldwide have embraced considerations towards the SDGs (Pedersen, 2018). Saudi Arabia is not an exception. They acknowledge the SDGs in business operation, innovation, and general development (Yakovleva et al., 2017). These companies have prioritized SDGs into their organizations and contribute towards achieving them. They give more attention to the value chain and addressing the negative impacts that can result from their operations. For instance, the most considered SDGs by Saudi Aramco is SDG 13 which focuses on climate Action. SDG 12 is also another area of priority that is Responsible for Consumption and Production. It is highly prioritized by the European and Asia countries (Pedersen, 2018). In addition to that it also puts into high consideration SDG 8 that is all about Decent Work and Economic Growth and SDG 14 that is concerned with Life Below Water. These SDGs ensures that Saudi Aramco make decisions that not only promote their growth but also promote the sustainability of the environment (Adnan et al., 2018). For example, Saudi Aramco environmental CSR ensures that it optimizes its production life cycle, uses recycled materials and works suppliers that are environmentally-conscious. Using local suppliers helps in supporting the local society, reducing the ecological effect of obtaining the ma...