CSR | Corporate Social Responsibility | Key Terms

Key Terms - Corporate Social Responsibility

Altruistic CSR:  Organizations take a philanthropic approach by underwriting specific initiatives to give back to the company’s local community or to designated national or international programs.

Corporate Citizenship:  An alternative term for corporate social responsibility, implying that the organization is a responsible citizen in meeting all its obligations.

Corporate Conscience:  An alternative term for corporate social responsibility, implying that the organization is a responsible citizen in meeting all its obligations.

Corporate Social Responsibility:  The actions of an organization that are targeted toward achieving a social benefit over and above maximizing profits for its shareholders and meeting all its legal obligations.

Ethical CSR:  Organizations pursue a clearly defined sense of social conscience in managing their financial responsibilities to shareholders, their legal responsibilities to their local community and society as a whole, and their ethical responsibilities to “do the right thing” for all their stakeholders.

Instrumental Approach:  The perspective that the only obligations of a corporation is to maximize profits for its shareholders in providing goods and services that meet the needs of its customers.

Social Contract Approach:  The perspective that a corporation has an obligation to society over and above the expectations of its shareholders.

Strategic CSR:  Philanthropic activities are targeted toward programs that will generate the most positive publicity or goodwill for the organization.


Source: Ghillyer_Business Ethics A Real World Approach 2e

CSR | Corporate Social Responsibility – Instrumental approach

Instrumental approach






















































Instrumental approach is the perspective that the only obligation of a corporation is to maximize profits for its shareholders in providing goods and services that meet the needs of its customers.


Most famous advocate of this “classic” model is the Nobel Prize-winning economist Milton Friedman. 


Friedman argues it would be unethical for a corporation to do anything other than deliver the profits for which its investors have entrusted it with their funds in the purchase of shares in the corporation.


Friedman also argues that, as an employee of the corporation, the manager has an ethical obligation to fulfill his role in delivering on the expectations of his employers.


Source: Ghillyer_Business Ethics A Real World Approach 2e