What is Corporate Responsibility Reporting?

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  • Written By: D. Nelson
  • Edited By: M. C. Hughes
  • Last Modified Date: 27 November 2019
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Corporate responsibility refers to the actions taken by a corporation to reduce the amount of harm done by factors such as selling and production. In many cases, corporate responsibility aims to make the actions of a corporation beneficial to communities by increasing living standards, profits, and overall economic health. Corporate responsibility reporting, then, is the act of performing studies and creating documents that illustrate a corporation's responsibility. This practice normally covers three different components: effects a corporation has on people, the environment, and on its shareholders.

It is common for corporate responsibility reporting to focus on the effects that a corporation's actions have on people. This can regard issues such as public health, as well as issues regarding the economic health of communities. For example, a company that provides water services for various communities might issue reports that illustrate the safety of the water. A large manufacturing corporation might issue reports regarding employment of members of a community and how this affects lifestyle through salaries and other benefits offered.


Another important factor covered by much corporate responsibility reporting regards the effects a corporation has on the environment. In many cases, these reports might analyze pollution and damage done to the land. Corporations that participate in the gathering of natural resources, such as oil, may issues reports regarding the amount of resources available and steps taken to preserve land from which resources are extracted. Reduction of pollution is often a large part of this component of corporate responsibility, so public health is also normally taken into consideration.

Many corporations have shareholders who purchase stocks of a company and are therefore invested in the profitability of a corporation. Corporate responsibility reporting often includes analysis of the effects that a corporations action's might have on those who are invested in stocks. Some proponents of corporate responsibility believe that this notion should be extended to include whole communities that are to some degree invested in a corporation, improving the public image of the company and therefore contributing to its chances for long term growth and sustainability.

Champions of corporate responsibility reporting believe that this practice can improve a corporation's performance and also make it a valuable component of a society. Detractors argue that this practice is a way for corporations to avoid regulation performed by government agencies and global institutions that are designed to serve the benefits of the public. Corporate responsibility reporting does not require inspections by outside organizations, so many critics also believe that certain results can be exaggerated and even fabricated, though representatives from corporations who engage this practice often deny those claims.



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