The secret behind successful SOP(essay)

1. Edit your essaysRead through for logic, and be sure to use your computer’s spelling and grammar check. This won’t catch everything, but it will help.

2. Have someone who knows you well read your essaysAsk them if that describes you. Is it an accurate picture? What do they NOT say? Friends and colleagues are often a good source for singling out your accomplishments, strengths, and weaknesses.

3. Have someone who does NOT know you read your essaysAsk a friend of a friend. Find someone who only knows you professionally. The admissions committee does not know you personally, so this can give you a better feeling for the tone your essays are setting for a stranger.There are an increasing number of admissions consulting services available to candidates that can help to focus your work and strengthen your key messages. It is important that such services stop short of actually writing for you, but they can provide very valuable impartial input.

4. Think before you writeThe writing can be the easy part; deciding what you want to say can be harder. You have limited space to convey a lot of information about yourself and you should use it most effectively and efficiently.

5. Be interestingIf you are naturally funny and light hearted, let some of that show in your essays. While you should certainly take the essays seriously, make sure you allow some personality to show through.

6. Be true to yourself
Do not write what you think the Admissions Office wants to read if it does not accurately reflect the “real” you.

7. Be a contributorWharton does not want to admit someone who is smart but unlikely to add to the greater community. Through your application, show what you can add to the experience of your classmates – whether that be through extracurricular activities, a unique professional background, or your quirky sense of humor.

What B-schools are looking for in your essays

The essays are where you can provide the “how” and the “why” behind the “what” and “when” of the data forms. Before reading your essays, a reader will have looked at the data forms and your resume. Use the essays to explain the path you have taken, what you have learned along the way, and what you can offer to the school community.The essay questions give candidates the chance to express what they think is important to the admissions committee, in addition to answering more typical questions regarding the candidate’s reasons for obtaining an MBA, path, goals, and interest in the a particular school’s MBA. What we would therefore remind you is that there is no one response to each essay, but to give you tools to ensure that you are addressing the question, and thinking about it in terms that better enable the admissions committee to evaluate you for their school.This is your chance to convey a sense of self – a level of self understanding that validates your previous experience whilst conveying your potential for future achievement. You might be talking about your values – what is important to you, what are your priorities in life? Equally you can communicate your goals – what do you intend to achieve, what are your ambitions? To be truly convincing, make sure that you provide concrete examples. When the school asks you about your strengths and weaknesses, convey each strength with a specific illustration. Telling the school, “People say that I am very creative”, will not get you very far. It is only when you back up your claim that you can impress the school. “A good example of my creativity would be the investment proposal that I put together for Company X, which provided an innovative solution to …”It is also important at this stage to avoid lists – nobody remembers them, least of all a school handling thousands of applications a year. It is far more effective to limit yourself to two or three strengths, or to focus on a singular achievement, and provide a valuable insight as to what this says about you as a person.To fully grasp this idea, and use is to your advantage in your essays, compare your résumé with your answers to the school questions. A résumé will provide dates, locations, either job titles or qualifications, and a brief description of your responsibilities. For example:2004-2006 Financial Analyst, Mumbai- Advised on US investment for key Asian accounts- Averaged 12,7% return on portfolio investmentIn comparison, the essay is the chance to convey the characteristics that made such an experience a success, or tells the admissions team about your personality. What attracted you to this position? Maybe it is because you love to face new challenges, and are open-minded to business with an international context. Over the two-year period you had to demonstrate be determined and even single-minded when completing your research. These are the stories and illustrations that bring your admissions file to life, and help you to stand out from the other applicants.The other golden rule is to always answer the question, whether in an essay or during an interview. If the interviewer asks you about a weakness, a shrug and the answer “I don’t have any weaknesses” has just had the opposite effect, and highlighted a major weakness of self awareness! Most candidates struggle with the dilemma of either providing an honest answer that ruins one’s chances, or the rehearsed answer which leaves one looking evasive, phony, or guilty of giving yet another tired cliché. How many times have the admissions team heard “My greatest weakness is that I'm a perfectionist, and work too hard”?Such a candidate has obviously tried to rely on the idea of naming a fault that's not really a fault. Impatience with incompetence might be another example. If you do try this technique, again be sure to use a real example to give the story some interest and substance. An alternative is to provide a weakness that is actually related to others.

“I get frustrated when committees or institutions fail to respond decisively or in a timely fashion. Worse though is when they avoid taking a decision, pass it on to another department or group, and then criticize how it’s done.” Your answer should be in keeping with the school to which you are applying. Telling a school that emphasizes leadership and finance that you are a shy person, or that you don’t like mathematics, would make a school renowned for its leadership training and quantitative program quite concerned. It is often better to avoid interpersonal issues, because explaining that you don’t get along with people challenges the importance of the shared student experience on campus.

You could consider naming a real weakness, but one you're taking steps to improve. This shows that you are aware of a situation, and are taking the initiative to do something about it.Examples could include learning another language, or improving your comfort level with technology. As business schools emphasize, there is no one right answer – just the freedom to express what you feel is important, and says something about the real you.


Matt Symonds is co-founder of the QS World MBA Tour , and author of the bestselling book on applying to b-school, “Getting the MBA Admissions Edge”. An experienced public speaker in more than 40 countries on TV, radio and at conferences and seminars public presentations, Matt is an authority on Graduate Executive Management Education. Source: TopMBA.com

Triple bottom line

Triple bottom line
The triple bottom line, a.k.a. "3BL" or "People, Planet, Profit", captures an expanded spectrum of values and criteria for measuring organizational (and societal) success—economic, environmental and social. For some a commitment to Corporate Social Responsibility brings with it a need to institute triple bottom line reporting.

Definition

In practical terms, triple bottom line accounting means expanding the traditional company reporting framework to take into account environmental and social performance in addition to financial performance. The phrase was coined by John Ellington, co-founder of the business consultancy Sustainability in 1994. It was later expanded and articulated in his 1998 book Cannibals with Forks: the Triple Bottom Line of 21st Century Business. (Ref Business and Sustainable Development: A Global Guide)

Arguments in favor of the concept

Fiscal policy of governments usually claims to be concerned with identifying social and natural deficits on a less formal basis. However, in a democracy at least, such choices are usually guided more by ideology than by economics. The primary benefit of embedding one approach to measurement of these deficits would be first to direct monetary policy to reduce them, and eventually achieve a global monetary reform by which they could be systematically and globally reduced in some uniform way.
The argument is that the Earth's carrying capacity is itself at risk, and that in order to avoid catastrophic breakdown of climate or nature's services, there is a need for a comprehensive reform in global financial institutions similar in scale to that undertaken at Bretton Woods in 1944, and not since. This argument has been made most coherently by Marilyn Waring, perhaps the only individual to have actually read all the documents that arose from that meeting.
Mainstream acceptance of her view has steadily grown. With the emergence of an externally-consistent green economics and agreement on definitions of potentially contentious terms such as full-cost accounting, natural capital and social capital, the prospect of formal metrics for ecological and social loss or risk has grown less remote through the 1990s.
In the United Kingdom in particular, the London Health Observatory has undertaken a formal program to address social deficits via a fuller understanding of what "social capital" is, how it functions in a real community (that being the City of London), and how losses of it tend to require both financial capital and significant political and social attention from volunteers and professionals to help resolve. The data they rely on is extensive, building on decades of statistics of the Greater London Council since World War II. There are some similar studies in North America, although with less rigorous methods, less uniform data, and which tend to be more regionally based.
Studies of nature's services and assessments of the value of Earth have tried to determine what might constitute an ecological or natural life deficit. The Kyoto Protocol relies on some measures of this sort, and actually relies on some value of life calculations that, among other things, are explicit about the ratio of the price of a human life between developed and developing nations (about 15 to 1). While the motive of this number was to simply assign responsibility for a cleanup, such stark honesty opens not just an economic but political door to some kind of negotiation - presumably to reduce that ratio in time to something seen as more equitable. As it is, people in developed nations can be said to benefit 15 times more from ecological devastation than in developing nations, in pure financial terms. According to the IPCC, they are thus obliged to pay 15 times more per life to avoid a loss of each such life to climate change—Kyoto seeks to implement exactly this formula, and is therefore sometimes cited as a first step towards getting nations to accept formal liability for damage inflicted on ecosystems shared globally.
Advocacy for triple bottom line reforms is common in Green Parties. However, the principle is increasingly popular among those of other stripes, e.g. in Islamic economics and in creditor economics. It is increasingly common also in United Nations circles as well. Some of the measures undertaken in the European Union towards the Euro currency integration standardize the reporting of ecological and social losses in such a way as to seem to endorse in principle the notion of unified accounts, or unit of account, for these deficits.

Arguments against the concept

While many people agree with the importance of good social conditions and preservation of the environment, there are also many who disagree with the 'Triple Bottom Line' as the way to enhance these conditions. The main arguments against it may be summarized as;
Division of Labor, which is characteristic of rich societies and a major contributor to their wealth, leading to the view that organizations contribute most to the welfare of society in all respects when they focus on what they do best... the baker exchanges his loaves with the shoemaker rather than making his own shoes to the benefit of both and by extension the whole of society. In the case of business the expertise is in satisfying the needs of society and generating a Value added surplus. Thus the 'triple bottom line' is thought to be harmful by diverting business attention away from its core competency. Just as charitable organizations like the Salvation Army would not be expected to attend to environmental issues or pay a cash dividend, and Greenpeace would not be expected to make a profit or succor the homeless, business should not be expected to take on concerns outside its core expertise.

Effectiveness: It is observed that concern for social and environmental matters is rare in poor societies (a hungry person would rather eat the whale than photograph it). As a society becomes richer its citizens develop an increasing desire for a clean environment and protected wildlife, and both the willingness and financial ability to contribute to this and to a compassionate society. Indeed support for the concept of the 'Triple Bottom Line' itself is said to be an example of the choices available to the citizens of a society made wealthy by businesses attending to business.
Thus by unencumbered attention to business alone, Adam Smith's Invisible Hand will ensure that business contributes most effectively to the improvement of all areas of society, social and environmental as well as economic.

Nationalism: Some countries adopt a nationalistic approach with the view that they must look after their own citizens first. This view is not confined to one sector of society, having support from elements of business, labor unions, and politicians.

Libertarian: As it is possible for a socially responsible person to sincerely believe that the 'Triple Bottom Line' is harmful to society, the libertarian view is that it would be arrogant to force them to support a mechanism for the improvement of society that may, or may not, be the best available. That is, those who would not force Greenpeace and the Salvation Army to generate a profit should not force businesses to take responsibilities outside their area of expertise.

Inertia: The difficulty of achieving global agreement on simultaneous policy may render such measures at best advisory - and thus not enforceable. For example, people may be unwilling to undergo a depression or even sustained recession to replenish lost ecosystems

PREPARATION FOR INTERVIEWS

Because communication skills are such an integral part of effective management, some schools include personal interviews as part of the admissions process.

Some tips to help you prepare for an interview: o Review your application; the interviewer is likely to ask specific questions about it.

o Be ready to provide examples and specifics and to elaborate on info on your resume and application.

o Be open and honest.

o Ask questions, since the interview is as much an opportunity for you to learn about the school as for the school to learn about you.

o Follow proper business decorum.

o Watch your nonverbal clues, such as eye contact, posture, and fidgeting.

o Be courteous to the administrative staff, since how you treat them can have an impact (positive or negative).

Some Frequently Asked Questions on Interviews :

"Tell us about yourself"? In an interview how does one handle the question "Tell us about yourself?". An often asked opening question. Perhaps the most frequently asked question across interviews. Your opening statement needs to be a summary of your goals, overall professional capabilities, achievements, background (educational and family), strengths, professional objectives and anything about your personality that is relevant and interesting. This question represents an opportunity to lead the interviewer in the direction you want him to go e.g., your speciality or whatever else you may wish to highlight. Your intention should be to try subtly convincing the interviewers that you are a good candidate, you have proved that in the past and have a personality that fits the requirement. Remember that the first impression you create will go a long way in the ultimate selection. Keep in mind, most candidates who are asked this question just blurt out their schooling, college, marks and qualifications. All this is already there in the CV. Why tell the interviewer something he already knows? A final word on approaching this question. Once you have said what you have to say - shut up. Don't drone on for the sake of speaking for you just might say something foolish. Sometimes interviewers don't interrupt in order to give the candidate the impression that he has not spoken enough. This is just a stress/error-inducing tactic. Don't fall for it, especially if you feel you have spoken enough. In case the pause gets too awkward for your liking, just add something like, "Is there something specific that you wish to know about me?" Is it better to have a longer selection interview or a shorter one? The length of an interview in no way is an indicator of how well an interview went. This is especially so when there are a number of candidates to be interviewed, like in the Civil Services interview or the MBA entrance interview. In the past, a number of candidates have reported varying lengths of interviews. Nothing positive or negative should be read into this. An interview is only a device whereby the panel seeks information about the candidate. Information that will help the panel decide whether or not the candidate should be selected. If the panel feels that it has gathered enough information about the candidate in 15 minutes of the interview commencing and that it has no further questions to ask the interview will be terminated in 15 minutes. If on the other hand the panel takes an hour to gather the information required to take a decision the interview will last for an hour. In either case the decision could be positive or negative. It is a fallacy to believe that interview panels take longer interviews of candidates whom they are more interested in. No panel likes to waste its time. If an interview is lasting longer than usual then it only means that the panel is seeking more information about the candidate in order to take a decision. In the MBA entrance interview how do I justify my decision to pursue the MBA programme? When you are asked this for God's sake don't tell the panel that you are looking for a"challenging job in a good firm with lots of money, status and glamour". That is the first answer that most candidates think of. Unfortunately, it is the last answer that will get you admission. In the answer to a direct question on this subject you must convey to the interview panel that you have made a rational and informed decision about your career choice and your intended course of higher study. There are broadly four areas which your answer could touch upon: Career Objectives : You could talk about your career objectives and how the two year MBA programme will help you achieve them. This implies that you have a clear idea of what your career objectives are and how you wish to achieve them. For example, you may want to be an entrepreneur and wish to set up your independent enterprise after doing your MBA and then working for a few years in a professionally managed company. You could explain to the panel that the MBA programme will provide you with the necessary inputs to help you run your business enterprise better. But then you must be clear about what the inputs you will receive in the MBA programme are. Value Addition : That brings us to the second area that your answer should touch upon. What is the value you will add to yourself during your two year study of management. Value addition will essentially be in two forms knowledge and skills. Knowledge of the various areas of management e.g. marketing, finance, systems, HRD etc. and skills of analysis and communication. You will find it useful to talk to a few people who are either doing their MBA or have already done it. They will be able to give you a more detailed idea of what they gained from their MBA. Background : Remember, there must be no inconsistency between your proposed study of management and your past subject of study or your past work experience. If you have studied commerce in college then management is a natural course of higher studies. If you are an engineer this is a tricky area. You must never say that by pursuing a career in management you will be wasting your engineering degree. Try and say that the MBA course and your engineering degree will help you do your job better in the company that you will join. But then you should be able to justify how your engineering qualification will help. Opportunities and Rewards : You could also at this stage mention the opportunities that are opening up in organizations for management graduates. Highlight with examples. At the end you may mention that while monetary rewards are not everything they are also important and MBAs do get paid well. You must not mention these reasons as your primary motivators even if that may be the case. What to Expect ? In general, B-school interviews are not formulaic. The focus can range from specific questions about your job responsibilities to broad discussions of life. Approach the interview as a conversation to be enjoyed, not as a question-and-answer ordeal to get through. You may talk more about your hobbies or recent cross-country trip. This doesn't mean that it won't feel like a job interview. It just means you're being sized up as a person and future professional in all your dimensions. Try to be your witty, charming, natural self. Interviews are conducted by students, faculty, admissions personnel and alumni. Don't dismiss students as the lightweights; they follow a tight script and report back to the committee. However, because they're inexperienced beyond the script, their interviews are most likely to be duds. You may have to work harder to get your points across. How to Prepare ? Prepare for the interview in several ways: Expect to discuss many things about yourself. Be ready to go into greater depth than you did in your essays (but don't assume the interviewer has read them). Put together two or three points about yourself that you want the interviewer to remember you by. Go in with examples, or even a portfolio of your work, to showcase your achievements. Practice speaking about your accomplishments without a lot of "I did this, I did that." Finally, be prepared to give a strong and convincing answer to the interviewer's inevitable question: "Why here?" Self Awareness 1. How would you describe yourself ? 2. Tell me about yourself ? 3. How do you think a friend or professor who knows you would describe you? 4. What motivates you to put forth your best effort ? 5. How do you determine or evaluate success ? 6. What academic subjects did you like best ? Least ? 7. What led you to choose the career for which you are preparing ? 8. What personal characteristics are necessary for succeeding in the career that you are interested in ? 9. What is your philosophy of life ? 10. Why have you switched career fields ? Weaknesses / Negatives 1. What major problems have you encountered and how have you dealt with them ? 2. What have you learnt form your mistakes ? 3. What do you consider to be your greatest weakness ? 4. Did you ever have problems with your supervisor ? Skills / Abilities / Qualifications 1. What do you consider to be your greatest strength ? 2. Are you creative ? Give an example. 3. What qualifications do you have that makes you think you will be successful ? 4. In what way do you think you can make a contribution to society? 5. Why should we take you ? 6. What are your own special abilities ? 7. Why should we take you over another candidate ?8. What is your managing style ? 9. Why do you want to join this institute ? 10. What do you know about our institute ? Values 1. What is your attitude towards working hard ? 2. What part does your family play in your life ? 3. What are the most important rewards you expect in your career ? 4. What is more important to you : money offered, or the type of job ? 5. Do you enjoy independent research ? 6. In what kind of a work environment are you most comfortable ? 7. How would you describe the ideal job for you ? 8. What two or three things are most important to you in your job ? 9. Do you prefer working with others or all by yourself ? 10. How do you like to work ? 11. Under what conditions do you work best ? 12. What is the highest form of praise ? Experience 1. In what part-time or summer job have you been most interested ? 2. Tell me about your experience. 3. What jobs have you held ? 4. How did your previous employer treat you ? 5. What have you learnt from some of the jobs that you have held ? 6. What jobs have you enjoyed most ? Least ? Why ? 7. What have you done that shows initiative and willingness to work ? 8. Describe your current job. 9. What did you like least about your last job ? 10. What did you like most about your last job ? Goals / Objectives 1. What are your short-term and long-term goals and objectives ? 2. What specific goals other than those related to your occupation have you chosen for yourself for the next 10 years ? 3. What do you see yourself doing 5 years from now ? 4. What do you really want to do in life ? 5. How do you plan to achieve your career goals ? Education 1. How has your education prepared you for a career ? 2. Describe your most rewarding college experience. 3. Why did you select your college or university ? 4. If you could, would you plan your academic study differently ? 5. Do you think grades are a good indication of your academic achievement ? 6. What have you learnt from participation in extracurricular activities ? 7. Do you have plans for continuing your studies ? 8. Why did you pick your programme ? 9. What courses did you like best and why ? 10. What courses did you like least and why ? 11. How has your college experience prepared you for this job ? 12. How did you pick your dissertation ? 13. Describe your dissertation process. Salary 1. What do you expect to earn in 5 years ? 2. What did you earn in your last job ? Interests 1. What are your outside interests ? 2. What do you do with your free time ? 3. What are your hobbies ? 4. What types of books do you read ? 5. How interested are you in sports ? 6. How did you spend your vacations in school ? General 1. What qualities should a successful manager possess ? 2. Describe the relationship that should exist between a supervisor and a subordinate. 3. What 3 accomplishments have given you the greatest satisfaction ? 4. If you were taking a graduate for this institute, what qualities would you look for ? 5. What can I do for you ? 6. Tell me a story.7. Define cooperation. Stress Questions 1. What causes you to lose your temper ? 2. How often have you been absent from school, work or training ? 3. Have you ever had trouble with other people on the job ? 4. Can you take instructions without getting upset ? 5. Don't you feel you are a little to old/young for this job ? 6. How does your family like you being away on business trips ? 7. With your background, we believe that you are overqualified to join this institute. 8. You haven't had sufficient experience in this field. 9. Our experience with women on this job has not been good. 10. What would irritate you most if I as a manager did it ? Influencing Others 1. Tell me about the time you were most persuasive in overcoming resistance to your ideas or point of view. 2. Tell me about the last time someone made an unreasonable request of you. 3. Describe the most disappointing and frustrating experience in gaining the support of others for an idea or proposal. Interpersonal Skills 1. Describe a situation where it was most important for you to display tact and diplomacy. 2. Tell me about the last time you had a clash or disagreement with someone at school/college/workplace. 3. Tell me about a time when you felt most frustrated and disappointed at a person with whom you had worked. Personal Adaptability 1. Tell me about the last time you were criticized by a supervisor or a professor. 2. Tell me about the time when you felt most pressured or stressed at work/ school/internship. 3. Tell me about the time when you felt most frustrated at your school/workplace. 4. In what aspects of your work/internship do you have the most confidence in your abilities. Communication Skills 1. Tell me about the time when you felt best about your ability to draw out or solicit information from another person. 2. Tell me about the time when you had to work your hardest in order to fully understand what another person was saying to you. 3. Describe the last time when someone at school/work misunderstood what you were trying to communicate. Motivation 1. Tell me about the most long term, sustained extra hours of effort that you put into your work/college/internship. 2. Describe a time when you felt most frustrated or discouraged in reaching your goals or objectives. 3. What do you feel has been your most significant work/school/internship related achievement within the past year or so ? 4. Describe the last time you did something well which went beyond the expectations in your work/internship. Administrative Skills 1. Tell me how you go about organizing your work and scheduling your own time. 2. What do you do to ensure that your goals and objectives are met in a timely way ? 3. Describe the most extensive planning that you have ever done. Problem Solving and Decision Making 1.Tell me about the most difficult problem that you faced in your work/school/internship ?2.Tell me about the last time you made a decision that backfired. 3.Tell me about the time when you regretted most not getting advice before you went ahead ? Conflict Management Skills 1. Tell me about the last significant crisis situation that you faced in your work. 2. Tell me about a time when you were most persuasive in overcoming resistance to your ideas. 3. Tell me about the time when you had a disagreement with someone at work.

Milton Friedman- A LIVING LEGEND

Milton Friedman
Born
July 31, 1912Brooklyn, New York City
Died
November 16, 2006San Francisco, California
Nationality
American
Field
Economics
Institution
Hoover Institution (1977-2006)Univ. of Chicago (1946-1976)
Alma Mater
Rutgers University
Academic Advisor
Simon Kuznets
Notable Students
Gary BeckerTom CampbellThomas Sowell
Known for
MonetarismPermanent income hypothesisCritique of Phillips curve
Notable Prizes
Nobel Memorial Prize (1976)
Milton Friedman (July 31, 1912 – November 16, 2006) was an American economist and public intellectual who made major contributions to the fields of macroeconomics, microeconomics, economic history and statistics while fiercly advocating laissez-faire capitalism. In 1976, he was awarded the Nobel Memorial Prize for his achievements in the fields of consumption analysis, monetary history and theory and for his demonstration of the complexity of stabilization policy.[1]
Friedman, along with John Maynard Keynes, is considered to be one of the two most influential economists of the 20th century.[2] In his 1962 book Capitalism and Freedom, he advocated minimizing the role of government in a free market as a means of creating political and social freedom. In his television series Free to Choose, which aired on the Public Broadcasting Service (PBS) in 1980, Friedman explained how the free market works, emphasizing that its principles have shown to solve social and political problems that other systems have failed to adequately address. It was later released as a book, co-authored with his wife, Rose Friedman. The book was widely read, as were his columns for Newsweek magazine. His writings were circulated underground behind the Iron Curtain before it fell in 1989, [3]
In statistics, he devised the Friedman test. His political philosophy, which Friedman himself considered more classically liberal, stressing the advantages of the marketplace and the disadvantages of government intervention shaped the outlook of American conservatives and libertarians and had a major impact on the economic policy of the Richard Nixon and Ronald Reagan administrations in the United States and in many other countries after 1980.
The 1980s were a watershed decade for the acceptance of Friedman's ideas. His views of monetary policy, taxation, privatization and deregulation informed the policy of governments around the globe, especially the administrations of Ronald Reagan in the United States and Margaret Thatcher in the United Kingdom. His ideas were studied throughout the world, and played a major role in the transformation of China's economy.

Corporate social responsibility (CSR)

Corporate social responsibility (CSR) is a concept that suggests that commercial corporations have a duty of care to all of their stakeholders in all aspects of their business operations. A company’s stakeholders are all those who are influenced by, or can influence, a business’s decisions and actions. These can include (but are not limited to): employees, customers, suppliers, community organizations, subsidiaries and affiliates, joint venture partners, local neighborhoods, investors, and shareholders.

CSR requires that businesses account for and measure the actual or potential economic, social and environmental impacts of their decisions. In some cases the application of a strong CSR policy by a business can involve actions being taken which exceed the mere compliance with minimum legal requirements. This can sometimes give a company a competitive/reputational advantage by demonstrating that they have the interests of society at large as an integral part of their policy making. CSR goes beyond simple philanthropy and is more about corporate behaviour than it is about a company's charitable donation budget.

CSR is closely linked with the principles of Sustainable Development which argue that enterprises should be obliged to make decisions based not only on financial/economic factors (e.g. Profits, Return on Investment, dividend payments etc.) but also on the social, environmental and other consequences of their activities.

Development and analysis
Today’s heightened interest in the role of businesses in society has been promoted by increased sensitivity to, and awareness of environmental and ethical issues. Issues like environmental damage, improper treatment of workers, and faulty production leading to customers inconvenience or danger, are highlighted in the media. In some countries government regulation regarding environmental and social issues has increased, and standards and laws are also often set at a supranational level (e.g., by the European Union). Some investors and investment fund managers have begun to take account of a corporation’s CSR policy in making investment decisions (so called "ethical investing"). Some consumers have become increasingly sensitive to the CSR performance of the companies from which they buy their goods and services. These trends have contributed to the pressure on companies to operate in an economically, socially and environmentally sustainable way.

It is important to distinguish CSR from charitable donations and "good works" (i.e., philanthropy, e.g., Habitat for Humanity or Ronald McDonald House). Corporations have often, in the past, spent money on community projects, the endowment of scholarships, and the establishment of foundations. They have also often encouraged their employees to volunteer to take part in community work and thereby create goodwill in the community which will directly enhance the reputation of the company and strengthen its brand. CSR goes beyond charity and requires that a responsible company take into full account their impact on all stakeholders and on the environment when making decisions. This requires them to balance the needs of all stakeholders with their need to make a profit and reward their shareholders adequately.

A widely quoted definition by the World Business Council for Sustainable Development states that "Corporate social responsibility is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large." (CSR: Meeting Changing Expectations, 1999). This holistic approach to business regards organizations as (for example) being full partners in their communities, rather than seeing them more narrowly as being primarily in business to make profits and serve the needs of their shareholders.


Auditing and reporting
To demonstrate good business citizenship, firms can report compliance with a number of CSR standards, including:

AccountAbility's AA1000 standard, based on John Elkington's triple bottom line (3BL) reporting
Global Reporting Initiative's Sustainability Reporting Guidelines
Social Accountability International's SA8000 standard
The ISO 14000 environmental management standard
Some nations require CSR reporting, though agreement on meaningful measurements of social and environmental performance is difficult. Many companies now produce externally audited annual reports that cover Sustainable Development and CSR issues, but the reports vary widely in format, style, and evaluation methodology (even within the same industry). Critics dismiss these reports as lip service, a charge that carries some weight given notable examples: Enron's yearly "Corporate Responsibility Annual Report" and tobacco corporations' social reports.

CSR reporting draws much inspiration from its much older cousin, environmental and sustainability reporting (e.g., in Germany).


The business case for CSR
The benefits of CSR to businesses vary depending on the nature of the enterprise, and are difficult to quantify, though there is a large body of literature exhorting business to adopt measures beyond financial ones (e.g., Deming's Fourteen Points, balanced scorecards). Orlizty, Schmidt, and Rynes found a correlation between social/environmental performance and financial performance. However, businesses may not be looking at short-run financial returns when developing their CSR strategy.

The definition of CSR used within business can vary from the strict "stakeholder impacts" definition used in this article and will often include charitable efforts and volunteering. CSR may be based within the human resources, business development or PR departments of a company, or may be given a separate unit reporting to the CEO or in some cases directly to the board. Progressive companies do not have a CSR department or function at all -- the concept is so ingrained in the company itself that employees implement the company's values directly.[citation needed]

The business case for CSR within a company will likely rest on one or more of these arguments:

Human Resources

Corporate Social Responsibility can be an important aid to recruitment and retention, particularly within the competitive graduate student market. Potential recruits are increasingly likely to ask about a firm's CSR policy during an interview and having a comprehensive policy can give an advantage. CSR can also help to build a "feel good" atmosphere among existing staff, particularly when they can become involved through payroll giving, fundraising activities or community volunteering.

Risk Management

Managing risk is a central part of many corporate strategies. Reputations that take decades to build up can be ruined in hours through incidents such as corruption scandals or environmental accidents. These events can also draw unwanted attention from regulators, courts, governments and media. Building a genuine culture of 'doing the right thing' within a corporation can offset these risks.

Brand Differentiation

In crowded marketplaces companies strive for 'X Factors' which can separate them from the competition in the minds of consumers. Several major brands, such as The Co-operative Group and The Body Shop are built on ethical values. Business service organisations can benefit too from building a reputation for integrity and best practice.

License to operate

Corporations are keen to avoid interference in their business through taxation or regulations. By taking substantive voluntary steps they can persuade governments and the wider public that they are taking current issues like health and safety, diversity or the environment seriously and so avoid intervention. This also applies to firms seeking to justify eye-catching profits and high levels of boardroom pay. Those operating away from their home country can make sure they stay welcome by being good corporate citizens with respect to labour standards and impacts on the environment.

Critics of CSR will attribute other business motives, which the companies would dispute. For example, some believe that CSR programmes are often undertaken in an effort to distract the public from the ethical questions posed by their core operations. Some that have been accused of this motivation include British American Tobacco (BAT) which produces major CSR reports and the petroleum giant BP which is well known for its high profile advertising campaigns on environmental aspects of their operations.


Criticism
Some critics of CSR, such as the economist Milton Friedman, argue that a corporation's principal purpose is to maximize returns to its shareholders, while obeying the laws of the countries within which it works. Others argue that the only reason corporations put in place social projects is utilitarian; that they see a commercial benefit in raising their reputation with the public or with government. Proponents of CSR, however, would suggest a number of reasons why self-interested corporations, solely seeking to maximise profits are unable to advance the interests of society as a whole.

Key challenges to the idea of CSR include:

The rule of corporate law that a corporation's directors are prohibited from any activity that would reduce profits
Other mechanisms established to manage the principal-agent problem, such as accounting oversight, stock options, performance evaluations, deferred compensation and other mechanisms to increase accountability to shareholders.
Because of this, it has been suggested that CSR activity is most effective in achieving social or environmental outcomes when there is a direct link to profits: hence the CSR slogan "Doing Well by Doing Good". Note that this requires that the resources applied to CSR activities must have at least as good a return as that that these resources could generate if applied anywhere else, e.g. capital or productivity investment, lobbying for tax relief, outsourcing, offshoring, fighting against unionization, taking regulatory risks, or taking market risks—all of which are frequently-pursued strategies. This means that the possible scope of CSR activities is drastically narrowed. And corporations, with their constant incentive to maximize profits, often have identified all areas where profits could be increased, including those that have positive external social and environmental outcomes. The scope for CSR is thus narrowed to situations in which:

Resources are available for investment
The CSR activity will yield higher profits than any other potential investment or activity
The corporation has been remiss in identifying this profit opportunity
A conflict can arise when a corporation espouses CSR and its commitment to Sustainable Development on the one hand, whilst damaging revelations about its business practices emerge on the other. For example the McDonald's Corporation has been criticised by CSR campaigners for unethical business practices, and was the subject of a decision by Justice Roger Bell in the McLibel case (which upheld some of these claims, regarding mistreatment of workers, misleading advertising, and unnecessary cruelty to animals). Similarly Shell has a much publicised CSR policy and was a pioneer in triple bottom line reporting, but was involved in 2004 in a scandal over the misreporting of its oil reserves which seriously damaged its reputation and led to charges of hypocrisy.

Universities and business schools, many of them with keen advocates of CSR amongst their teaching staffs, have themselves come in for criticism concerning their dealings with corporations (note the different stances taken by ESADE and Wheeling Jesuit University with regard to Aramark).

Critics of the role of business in society argue that:

Corporations care little for the welfare of workers, and given the opportunity will move production to sweatshops in less well regulated countries.
Unchecked, companies will squander scarce resources.
Companies do not pay the full costs of their impact. For example the costs of cleaning pollution often fall on society in general. As a result profits of corporations are enhanced at the expense of social or ecological welfare.
Regulation is the best way to ensure that companies remain socially responsible.
Supporters of a more market based approach argue that:

By and large, free markets and capitalism have been at the centre of economic and social development over the past two hundred years and that improvements in health, longevity or infant mortality (for example) have only been possible because economies - driven by free enterprise - have progressed.
In order to attract quality workers, it is necessary for companies to offer better pay and conditions which leads to an overall rise in standards and to wealth creation.
Investment in less developed countries contributes to the welfare of those societies, notwithstanding that these countries have fewer protections in place for workers. Failure to invest in these countries decreases the opportunity to increase social welfare.
Free markets contribute to the effective management of scarce resources. The prices of many commodities have fallen in recent years. This contradicts the notion of scarcity, and may be attributed to improvements in technology leading to the more efficient use of resources.
There are indeed occasions when externalities, such as the costs of pollution are not built into normal market prices in a free market. In these circumstances, regulatory intervention is important to redress the balance, to ensure that costs and benefits are correctly aligned.
Whilst regulation is necessary in certain circumstances, over regulation creates barriers to entry into a market. These barriers increase the opportunities for excess profits, to the delight of the market participants, but do little to serve the interests of society as a whole.

[edit] Other perspectives
Some would argue that it is self-evidently “good” that businesses should seek to minimize any negative social and environmental impact resulting from their economic activity. It can also be beneficial for a company’s reputation to publicise (for example) any environmentally beneficial business activities. A company which develops new engine technology to reduce fuel consumption will be able (if it chooses) to promote its CSR credentials as well as increase profits.

Some commentators are cynical about the true level of commitment of corporations to ideas like CSR and Sustainable Development, and their actual motivations for responsible behaviour. (Corporations that create the appearance of acting responsibly just for its public relations value are said to be "greenwashing.")

Such commentators also say, citing Friedman's dictum, that the idea of an “ethical company” is an oxymoron, since the corporation is by its nature compelled to maximize its own interest, whatever the external price. Corporate executives and employees in turn have strong incentives to internalize the corporation's statutory obligations to maximize profits, sometimes to the extent that they abdicate their individual moral and ethical obligations as human beings. This tendency is, of course, encouraged by the desire to keep one's job, and by a system that judges and rewards performance strictly by bottom-line returns. The results of this tendency were clearly seen in the many corporate scandals of the late twentieth and early twenty-first centuries.

So the CSR movement may perhaps be understood as an attempt not so much to regulate the activities of corporations per se, as to remind the people who constitute these corporations that they nonetheless have other responsibilities beyond the corporate ones.