Corporate social responsibility
CSR and competitiveness are very much related. Growing evidence suggests strong links between competitiveness drivers; the quality of human and social capital and the contribution of corporations to the development of this quality through CSR (see sketch on the right). At the firm level, there are two feedback loops to this process. One is the role of corporations. Corporation needs to be smart about how their CSR activities are directed and positioned at addressing the strategic areas that on the medium to long term enhance the human and social capital of the country and preserves the natural capital.
The other side is that society through markets and policy drivers recognize and internalize responsible practices of companies into market mechanism. Through these feedback loops CSR issues become source of competitive advantages (e.g. cost advantages or enhanced productivity) further increasing the intensity of competition and innovation potential at regional and national levels.