Carroll's Pyramid Model

3.1. Corporate Social Responsibility

Study on CSR is element of the derivation of business-based peace building. At the Initial stage, CSR generally focused on environmental degradations, human rights and labor concerns, but the concept was expanded to incorporate society and the dynamics of conflicts in general. This transformation manifested by the hard work of several NGOs and at present the recognized vision on CSR is that MNCs should look beyond their economic and legal responsibilities and employ approaches that benefits society and especially host communities. The expansion of CSR was reinforced with a joint effort of UN and a number of MNCs, when they formed the Global Compact. The thought was to outline guidelines for MNCs behaviors

In his definition pyramid, Carroll demonstrates four dimensions of the corporate social responsibility (see Figure 1). Carroll’s attempt to demonstrate the concept established around the time when the anticipated corporate manners started to go further than the goal for financial turnover. In order for the initiative of CSR to be internationally acknowledged and considered as legitimate, it required to tackle the whole outlook of positive corporate behavior. Whichever attempts of tackling business responsibility had to go much further than the economic importance. Carroll’s pyramid model of CSR encompasses all of the important mechanism of positive MNC behavior: economic, legal, ethical and philanthropic responsibility (Carroll, 1991:42). All four levels will be discussed

A business’ ethical responsibility clarifies the principles, norms or expectations that have to deal with the employees, consumers or the host community affected by a business’ activity. Carroll expresses the importance for a corporation to adjust to their host community. The actual societal and ethical customs of the given host may in fact go beyond what is at present required by law – making it vital to know that the corporate integrity and ethical conduct may possibly go beyond law and regulations of the given host country (Ibid: 42). In the case of MNCs, this type of situation can happen when conducting business in a country where its legal systems are non-functioning and likely suffers from oppressed regimes and corrupted government officials