Globalization and the Emergence Of Social Risk: Corporate Social Responsibility as an Effective Strategy (original) (raw)

In recent years, globalization and the increased rate of social and technological change has brought about various changes to the way companies handle their businesses. Despite the many opportunities that globalization offers to companies, it also poses new sources of risk and uncertainty that these traditional risk management techniques are ill equipped to handle. The subtle increase in importance of various stakeholders such as the community, regulators, suppliers, NGOs, civil society groups and even employees posits that social risk is increasingly becoming an area of concern for most global corporations. As the effects of corporation’s business processes and dealings are beginning to be felt worldwide much more than ever before, there is more focus on responsibility, accountability and sustainability which they have to adhere to. Managing these risks require new and innovative courses of action. The aim of this paper is to explore the emergence of social risk and the factors that have made it impossible to ignore, its fundamental principles and the opportunities inherent in it. It will also discuss based on current literature how the use of corporate social responsibility policies might be an effective tool in mitigating social risk. Keywords: Social Risk, Corporate Social Responsibility (CSR), Strategy, Globalization, Change.