THE SOCIAL CONTEXT OF DOING BUSINESS IN THE 21ST CENTURY: REFLECTION AFTER DISCUSSION AT THE III KHARKIV INTERNATIONAL LEGAL FORUM, 2019, SEPTEMBER 24–28

Author
, professor, Kharkiv, Pushinska, 77

In heading

 Economic theory of law;

Signed print

 20.09.2019

Issues number

 2019 - № 3 (38)

Page

 79-94

Type of articles

 Scientific article

Code UDK

 330.34:316.66“20”

ISSN print

 2411-5584

Abstract

 Problem setting. The III Kharkiv International Law Forum has completed its work. The author participated in the Panel Discussion on Business and Human Rights: Key Challenges for New Democracies (2019, September 25). In my opinion, building a system of interaction between business and employees should begin with the understanding of the essence of modern corporate strategy, the place of the person in the present corporate world.
Resent research and publication analysis. The influence of corporations on labour relations, forms of business responsibility to employees have been of interest to society for a long time. The theoretical principles of corporate social responsibility (CSR) have been formulated in the works of representatives of various schools of economic theory. I will note the pioneering studies of Howard Bowen and his book “The Social Responsibility of the Businessman”. And also the concept of shared value developed by M. Porter and M. Kramer.
Paper objective. The purpose of the article is to analyse the social context of doing business and the reasons for rethinking corporate strategy in the 21st century.
Paper main body. The article contains the author’s reflections on many issues, including:
1. What is a traditional corporate strategy and how does it affect employment? For decades, most companies have focused their corporate strategies on maximizing “total shareholder return” (TSR). At the same time, the dilemma was “corporate profit – human rights”.
2. What is meant by the “new social context of doing business”? What should be the new corporate strategy? New social environment for doing business in the 2020s linked to the development of corporate social responsibility and the development of policies that focus on “total societal impact” (TSI). The idea is that corporate success and social wellbeing are interconnected. Businesses need healthy, educated workers to succeed, and
prosperity requires profitable and highly competitive businesses that generate profits, taxes, and well-being. If this benefit arises, it also increases TSR in the long run, reducing the risk of adverse effects and opening up new business opportunities.
3. What is the place of a person of work in the modern corporate world? A study by consulting firm PwC, Personnel of the Future (2019) identified four possible “worlds of work” in the 2030 perspective: Red World, Blue World, Green World and Yellow World.
In today’s corporate world, changes take place along the trajectory: corporate control – corporate social responsibility – social entrepreneurship. This generates an understanding of possible scenarios for the development of employment relationships and the choice by corporations of a particular workforce model.
4. How can a new corporate strategy develop in the future? What are the forms of corporate social responsibility? The article analyses in detail corporate social responsibility, its current models and types. Particular attention is paid to the essence and practice of social entrepreneurship. One form of CSR is also pro bono intellectual volunteering.
5. What is the practice of CSR and social entrepreneurship in Ukraine? The author believes that in Ukraine corporate social responsibility belongs to those institutions that have only recently been transplanted into the system of domestic social and labour relations from the western countries. Most entrepreneurs are limited to charity (sponsorship), doing it without any strategy, without special social budgets. The main motive is often to create
a positive image of the company or its management.
Conclusion of the research. Changing the logic of corporate strategy formation is connected with the maximum consideration of the interests of the person of work. We need to continue exploring corporate social responsibility, social entrepreneurship and intellectual volunteerism in the form of pro bono while developing economic and legal mechanisms for their implementation.
Short Abstract for an article
Abstract. The III Kharkiv International Law Forum (2019, September 24–28) has completed its work. The article explores some of the theoretical issues raised during the panel discussion “Business and Human Rights: Key Challenges for New Democracies”. They need further research and justification. These include: traditional corporate strategy and its impact on employment; a new social context for doing business and a new corporate strategy; the place of the person in the modern corporate world; modern vector of corporate strategy development – from corporate social responsibility to social entrepreneurship and intellectual volunteering.

Keywords

 corporate strategy, corporate social responsibility, social entrepreneurship, intellectual volunteering.

Reviewer

External reviewer

Article in PDF

 79-94

Bibliography

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Code DOI

 10.31359/2411-5584-2019-38-3-79

28.09.2019