4 CSR Management on an Organizational Level

Question 1

Name three instruments of CSR management on the level of the organization and describe how they help to enhance the company’s CSR performance

Answer 1

• CSR Managers and Committees:
  
  • specific individuals or groups appointed to coordinate and/or take responsibility for managing ethics in their organization
• Ethics Consultants:
  
  • a wide range of companies also use external consultants to manage certain areas of business ethics, e.g., envirnmental issues. the consultancy market has expanded to satisfy this growing demand
• Risk Analysis and Management:
  
  • Managing and reducing risk has become one of the most important components of ethics management. areas of risk are identified, the likelihood is assessed and risks are scaled.
• Mission or Value Statements:
  
  • general statements about corporate aims, beliefs and values
• Ethics Education and Training
  
  • ethics trainings are now conducted at approx. 70% of large companies in order to identify situations where ethical decision-making is involved and to understand the culture and values of the organization. Also the ethical impact of managerial decisions is evaluated
• Code of Ethics:
  
  • explicit outlines of what type of conduct is desired and expected of employees from an ethical point of view. Success factors are the maximization of participation, the detection of violations, sanctions for breaches of codes, consistency between policy and actions

Question 2

Why have codes of ethics been criticized?

Answer 2

Critical stream of research claims that codes of ethics „suppress“ individuals‘ moral instincts, emotions, and empathy in order to ensure bureaucratic conformity and consistency.

Question 3

What are the objectives of the UN Global Compact?

Answer 3

• initiated in 1999 by the United Nations
• consists of ten principles in the areas of human rights, labor, environment and anti-corruption
• brings companys, cities, UN agencies etc. together in a multiple-stakeholder network
• Objectives:
  
  • “mainstream the ten principles in business activities around the world”
  • “catalyze actions in support of broader UN goals, such as the MDG”

Question 4

Why do consumers appreciate to be informed about company-internal CSR activities?

Answer 4

• Because customers increasingly care about how companies treat their employees
• Looking at the internal CSR reveals if the external might only be greenwashing

Question 5

What is CSR reporting?

Answer 5

CSR reporting includes the measuring, evaluating and communicating of the organization’s impact and performance on a range of social, ethical, and environmental aspects of interest to their stakeholders.

Question 6

How does Wood (1991) define Corporate Social Performance? And which outcomes of corporate behavior does he highlight?

Answer 6

Wood (1991) defines CSP as principles of CSR, processes of social responsiveness, and outcomes of corporate behavior.

Outcomes:

1. Social policies: explicit and pronounced social policies stating the company‘s values, beliefs, and goals with regard to its social environment.
2. Social programs: activitites, measures, and instruments implemented to achieve social policies.
3. Social impacts: concrete changes a corporation has achieved through the programs implemented

Question 7

What are differences between company-internal and external CSR activities?

Answer 7

• Firm-external CSR activities are:
  
  • often quick and easy to implement without changing the core of the organization
  • frequently featured in CSR advertisements
  • highly visible to firm-external stakeholders such as customers, investors, and the wider public
• Firm-internal CSR activities are:
  
  • in many cases targeting employees
  • leading to real organizational change
    
    • often incurring high costs for the company

Question 8

What happens if companies focus on company-external CSR while neglecting the same ethical stance on the inside?

Answer 8

• examples for this behaviour: Walmart, Amazon
• companies might be tempted to overinvest into external CSR while not maintaining the same ethical stance on the inside (clear priorization of external stakeholders)
• this leads to significant increase in emotional exhaustion, intention-to-quit, real employee turnover

Question 9

Which three different levels of stakeholder involvement are distinguished in the framework of Morsing and Schultz (2006)?

Answer 9

1. Stakeholder Information Strategy: the company merely informs stakeholders about their CSR activities -> One-way communication
2. Stakeholder Response Strategy: the company informs stakeholders about their CSR activities and encourages them to give feedback -> two-way asymmetric communication
3. Stakeholder Involvement Strategy: there is an ongoing dialogue between company and stakeholders - the company takes stakeholders opinions into account, adapts their CSR strategy accordingly, and informs stakeholders about the changes -> two-way symmetric communication

Question 10

What is meant by an inside-out approach to the design of CSR strategies and an outside-in approach to the involvement of external stakeholders?

Answer 10

• Three spheres:
  
  • Sphere 1: the core company
  • Sphere 2: the company in interactions with external stakeholders
  • Sphere 3: the company in society
• “inside-out” approach: Design of the CSR-Engagement: Sphere 1 -> 2 -> 3
• “outside-in” approach: Design of the CSR-Engagement: Sphere 3 -> 2 -> 1

Question 11

Which roles play reporting/ advice channels in companys?

Answer 11

They are a way to gather information on ethical matters and provide employees with appropriate tools for reporting or receiving advice regarding ethical dilemmas. Therefore they help to tackle problems before they become public!