In a groundbreaking exploration conducted by the Penn State School of Hospitality Management, researchers have established a comprehensive framework for understanding how strategic corporate social responsibility (CSR) can significantly enhance the social and business value of hospitality companies. This framework emerges from the realization that the alignment of CSR activities with a company’s core business operations not only benefits society but also provides tangible business advantages.
Led by Seoki Lee, a distinguished professor of Hospitality Management at Penn State, the research team stresses the importance of integrating CSR initiatives with the core competencies of hospitality organizations. The findings advocate for hospitality businesses to engage in CSR activities that resonate with their primary operations. An illustrative example provided by Lee is a restaurant that participates in food donation programs. This initiative exemplifies how businesses can create value that intertwines social responsibility with their operational strategy.
The distinctiveness of the research lies in its strategic CSR framework, which comprises four foundational components: shared value, enlightened stakeholder theory, resource-based theory, and CSR-fit perspective. Each of these elements plays a critical role in the effective implementation of CSR within hospitality businesses.
At the core of the framework is the concept of shared value, which emphasizes the necessity for CSR activities to generate both social and business value. For instance, when a coffee shop collaborates with local farmers to cultivate coffee beans sustainably, it not only champions environmental stewardship but also secures a reliable supply of quality products. This symbiotic relationship showcases how CSR efforts can enhance both societal welfare and corporate profitability.
The second component, enlightened stakeholder theory, highlights the long-term benefits of strategic CSR. This theory suggests that investments in CSR are often realized over an extended period. Companies may face challenges in communicating the value of their CSR initiatives to stakeholders, which requires time for the broader economic impact to become evident. Lee points out that it is crucial for businesses to understand this dynamic as they navigate the landscape of strategic CSR.
The framework’s third component, CSR fit, emphasizes the need for alignment between a company’s CSR initiatives and its operational capabilities. Effective strategic CSR must complement the business’s competencies, making it an integral part of the company’s identity rather than an isolated effort. In this way, businesses can create a coherent narrative that strengthens their brand image and resonates with consumers.
Resource-based theory forms the fourth pillar of the framework, illustrating how embracing strategic CSR can bolster relationships with key stakeholders. Engaging in socially responsible practices, such as environmental care or community support, enhances a company’s brand image. A positive image, in turn, nurtures consumer relationships and loyalty, solidifying the business’s competitive advantage in the market.
The findings from this research highlight the necessity for companies to embrace social and environmental responsibilities actively. Lee advises businesses to critically assess the best methods for maximizing both social and business value from their CSR ventures. Through a focused approach that prioritizes specific CSR initiatives aligned with core competencies, companies can yield significant returns on their investments in social responsibility.
To validate the application of the strategic CSR framework, the research team conducted a survey involving 310 participants sourced through a Qualtrics panel. The survey aimed to gauge public perception regarding the integration of business value within CSR initiatives. Respondents evaluated the effectiveness of CSR practices employed by specific hospitality companies, including restaurants and hotels.
The results gleaned from the survey suggest a strong correlation between the effectiveness of CSR activities and their alignment with a company’s core business functions. Participants expressed a preference for CSR initiatives that closely relate to the operational context of the company, thereby reinforcing the validity of Lee’s four-component framework.
One of the critical insights from the survey indicates that large corporations often attempt to diversify their CSR efforts to cater to the interests of various stakeholders. However, Lee argues that a more concentrated focus on a limited selection of CSR activities directly tied to a company’s core competencies can yield superior results. By honing in on specific initiatives that resonate with their business identity, these corporations can amplify their impact while enjoying enhanced business value.
The implications of this research extend beyond the hospitality sector. They serve as a blueprint for businesses in diverse industries aiming to refine their CSR strategies. By integrating social responsibility with core operations, organizations can foster a culture of responsibility that resonates with consumers, creating a ripple effect of positive change throughout society.
Lee’s extensive research, alongside contributions from Penn State doctoral student Samantha Hwang, Minjung Shin from the University of Houston, and Kyung Ho Kang from Kyung Hee University, represents a significant advancement in the discussion surrounding strategic CSR. Their work calls for a paradigm shift in how corporations conceive and implement CSR initiatives.
As the hospitality industry confronts ongoing challenges, including environmental sustainability and community impacts, the research underscores the vital role of strategic CSR in shaping the future of business practices. Companies that effectively navigate this landscape, prioritizing the alignment of their CSR initiatives with core competencies, may very well lead the charge in revolutionizing how businesses approach social responsibility and stakeholder engagement.
The research and its implications now shine a light on the potential for business and society to coexist harmoniously through thoughtful and strategically aligned CSR practices, providing a promising path forward for the hospitality industry and beyond.
Subject of Research: People
Article Title: Strategic corporate social responsibility in the tourism and hospitality industry: Conceptual proposal
News Publication Date: 8-Nov-2024
Web References: https://hhd.psu.edu/shm
References: http://dx.doi.org/10.1177/135481662412991
Image Credits: None
Keywords: Corporations, Microeconomics, Economics research, Business, Food industry, Tourism
