Posted in MBA

CSR: To outsource or not to outsource

This is a weekly academic blog for my MBA class Lasallian Business Leadership, Ethics, and Corporate Social Responsibility.


One of my burning questions in CSR class is this: Should CSR be outsourced or performed externally?

CSR is not just an activity to be performed for society. Sometimes it could be as simple as paying employees well, providing benefits allowing work-life integration, and making sure they are heard and valued.

Additionally, some companies are in better position than most NGOs to conduct activities that benefit society. An example of this is my own company which has the technical expertise, network, resources, and manpower to create programs that will have a broader and deeper reach. A lot of NGOs may create social programs within our industry, but they may be significantly less knowledgeable, less connected, and less equipped to fulfill the mission.

Yet there are companies whose industries are by nature difficult to conduct CSR with. Example of these companies that produce industrial components that do not concern consumers. Examples of these indsutries are high-grade chemicals, indsutrial steel, tobacco, liquor, mining, and more. What if aside from existing good labor practices, they wanted to benefit society competitively?

In reality, sometimes the most ethical or socially beneficial things that companies may do is to simply stop existing. There are just some business that may be legal and profitable but are damaging society.

Another thing that most companies can do is to simply outsource their CSR. I know this sounds like dole outs and merely dumping money on charity. But there are times that I think it is far better than initiating CSR activities in which companies do not have expertise in.

The famous example of tree-plating activities have often wasted land use and seeds because these companies do not bother doing research on the kinds of trees that can adapt to the terrain and the seeds’ effect on the soil. Similarly there are CSR activities totally not related with company’s industry whose budgets and other resources such as time and money often go to waste.

Meanwhile, there are hundreds of NGOs out there who have excellent programs but zero funding. They have the competency to reach out to society but not the resources. It is my opinion that, to bridge the gap, some companies should merely provide financial support to these NGOs instead of undertaking their own.

Even though financing a charity is not good for publicity compared to well-publicized CSR activities that do not make lasting impact, society can benefit more by taking a cooler and more rational approach.



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