CHALLENGES AND APPROACHES FOR THE CORPORATE SOCIAL RESPONSIBILITY AND HUMAN RESOURCE MANAGEMENT IN THE FINANCIAL SECTOR.

• Author: Andrei, Jean Vasile
• Position: Report

1. Introduction

   Issues generated by some companies with major implications on the environment, employees and business partners led to the need for the emergence of new concepts such as corporate social responsibility and corporate governance. Crystallization of these concepts has been achieved simultaneously with the development of principles that must guide the corporate activity given that their financial difficulties or even their bankruptcy has repercussions on many categories of stakeholders such as employees, customers, suppliers, the environment or public authorities. Financial scandals that rocked major transnational corporations like Enron, WorldCom, Parmalat and Goldman Sachs have shown the necessity to obey the principles of CSR and corporate governance (Asif et al., 2013; Volosevici, 2013).

   Despite conflicting views about social responsibility of corporations belonging to valued economists such as Milton Friedman, the concept of CSR has been consolidated, principles of CSR have been developed worldwide under the auspices of the United Nations--Principles of the Global Compact (Matthew, 2012) and the European Union is making considerable efforts to promote socially responsible behavior among European companies (Iamandi & Constantin, 2012; Matthew, 2013; Volosevici, 2013). Milton believes that the sole responsibility of managers is to maximize company profits so that shareholders' interests are met and social issues are the responsibility of public authorities that know best the needs of society, they are empowered to do so by law. This opinion is shared by other economists who have addressed this issue after 2000, when the interest of companies for social responsibility programs is increasing (Manne, 2006; Henderson, 2002).

   There are opinions, especially from NGOs, consumers or journalists, who believe that the actions of CSR undertaken are determined by economic, social, political and environmental pressures (the triggering of the financial crisis, global warming, promoting sustainable development) of vulnerabilities posed by undertaken activities (companies that pollute the environment, pharmaceutical companies have great prices on certain products and develops unethical marketing campaigns) or to enroll in the internationally manifested trend (Kim & Scullion, 2013; Crifo, Diaye, & Pekovic, 2016). Major companies in developed countries publish the Activity Report which shows the CSR activity or CSR reporting. As a result of legal regulations or stock exchange regulations, companies publish reports on exposure to environmental, social and governance risks and how to manage these risks. In this way, companies respond to the needs of portfolio investors which, in recent years have increased considerably the integration of non-financial information in investment decisions. Portfolio investors individual and institutional take into account not only profitability of financial products but also the so-called ESG factors (Matei and Andrei, 2011; Matei, 2013; Panait, Voica, & Radulescu, 2014)

   CSR is increasingly more a marketing strategy because CSR programs promoted by corporations lead to generating purchase intent, increased customer loyalty, improved attitude of the various parties involved in the company or reducing skepticism consumers (Sima & George, 2007; Purcarea & Purcarea, 2008). CSR has a communicating function, because undertaken these measures, the company becomes known by the business environment and consumers and potentially employees know better the values that the company promotes. Furthermore, studies demonstrate the positive impact of CSR on company's performance (Johan de Jong, 2011).

   Moreover, CSR is an integral part of corporations' operational and business strategy. Companies do not have to pursue short-term profit maximization, but sustainable development is based on compliance with ESG principles in their work and in relationships with stakeholders. "CSR is a modern, open and flexible form of management" being practiced both by transnational companies and the small and medium enterprises (Sima & George, 2011; Inyang, Awa, & Enuoh, 2011; Matei, 2013).

   The success enjoyed by the concept of CSR among companies, prompted the current expansion for other entities such as central and local public administration, universities and portfolio investors. Thus, the UN Global Compact adapted the CSR principles for other entities, elaborating specific principles for portfolio investors, universities and cities (Matei, 2013).

   European authorities' efforts in promoting the concept of CSR are notable (Gheorghe & Sima, 2011; Muller, 2013; CES Romania, 2014). At EU level it was initiated and developed a public policy to promote CSR and CSR Principles inserting into EU Policies which has resulted in numerous outcomes:

   * CSR Green Paper in 2001 (COM/2001/366);

   * setting up of an EU Multi-Stakeholder Forum on CSR and European Alliance for CSR;

   * Communication from the Commission concerning Corporate Social Responsibility: A business contribution to Sustainable Development (COM/2002/347);

   * Communication from the Commission Implementing the partnership for growth and jobs: Making Europe a pole of excellence on corporate social responsibility (COM/2006/136);

   * Communication from the Commission A renewed EU strategy 2011-14 for Corporate Social Responsibility (COM/2011/0681).

   Initially, CSR has been defined as a "concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis" (COM/2001/366). Given the new definition of CSR (the responsibility of enterprises for their impact on society) new EU strategy on CSR brings a paradigm shift line with the international instruments as the OECD Guidelines for Multinational Enterprises, ISO 26000 and the UN Guiding Principles on Business and Human Rights.

2. Interdependences between Human Resources Management and Corporate Social Responsibility

   Companies' Corporate Social Responsibility (CSR) policy rely on organizational culture since a company cannot manifest as a good citizen (citizen company) if its employees are not good citizens and in the company they do not have an appropriate behavior shaped by the ethics code (Crisan-Mitra and Borza, 2015). Organizational culture is the "personality" of each company which is based on "business ethics, consumer rights, economic and social equity, technology which do not affect the environment, fair treatment of workers, transparent relations with public authorities, moral integrity" (CSRforAll, 2013). So, CSR is not just about philanthropic acts (Sima & George, 2011; Sharma, Sharma, & Devi, 2011).

   Given the 10s Global Compact Principles which are particularly relevant at international level for RSC and the four focus areas--human rights, labor standards, environment and fight corruption, we subscribe to the idea expressed by other specialist (Lis, 2012; Crifo, Diaye, & Pekovic, 2016) on the multidimensional nature of CSR policy which includes social, environmental and governance.

   Employees are the most important resource of a company. The success of large corporations from developed countries is due to the special attention that they have given to the company's management of human resources (Popescu, Lazar, & Lazar, 2006; Lis, 2012; Muresan, 2015; Kim, & Scullion, 2013; Marasova & Vallusova, 2010). Moreover, Voegtlin and Greenwood (2016) consider that "HRM plays a significant role in how CSR is understood, developed and enacted." On the one hand CSR programs are initiated by the management, but their implementation is done with employees, enterprise volunteering being an important component of CSR strategy of each company. Furthermore, studies have shown at international level the importance of CSR employees' management since the phase in which potential employees are looking for a job. Thus, people who are looking for a job are more attracted to those companies which develops social responsibility programs, thus contributing to organizational CSR and companies attractiveness as employers.

   Furthermore, of all company's stakeholders, employees are the most imprtant strategic category. Employees as internal stakeholders "assume a leading role in Corporate Responsibility Programs in an organization" (Inyang, Awa, & Enuoh, 2011).

   For this reason, corporate responsibility towards employees is high, the human resource being the most important component of CSR. Responsibility towards employees translates not only by providing equitable salaries in relation to the work performed, and providing safe working conditions and respect for human rights. This is also revealed in a study conducted in Romania on promoting the concept in our country (CSRforAll, 2013).

   In...