Business Chapter 5

Question 1

What is CSR?

Answer 1

A tangible effort by many businesses to combat social imbalances and create equal access to goods and services

Question 2

Which 4 categories can the CSR be broken into?

Answer 2

Environmental responsibility
Ethical responsibility
Philanthropic responsibility
Economic responsibility

Question 3

How can corporations use their power and influence to contribute to the common good of markets?

Answer 3

1.Partnerships with the gov, businesses, communities or by themselves providing safe job opportunities.
2.Industy can develop new technologies for energy efficiency/products to provide the poor with access to markets.
3.Corporations can lessen their impact on societies and the environment ,or even contribute to social development

Question 4

Former and Latter

Answer 4

Former focuses solely on the responsibility aspect of business

Latter focuses on business being a social player by virtue of both its rights and responsibilities as a citizen

Question 5

Different practical orientations

Answer 5

1)Companies have a responsibility for their impact on society and natural environment
2)Companies have a responsibility for the behaviour of others with whom they do business(within supply chain)
3)Companies need to manage their relationship with wider society

Question 6

CSR is important because:

Answer 6

1)Contributes to sustainable development,including health and welfare society
2)It takes into account the legitimate interests and expectations of stakeholders
3)Is in compliance with applicable law and consistent with international norms of behaviour
4)Is integrated throughout the company and practiced in its relationships

Question 7

Elkington(three-pronged fork)

Answer 7

People, profit, planet

Question 8

CSR in contemporary business management

Answer 8

1)The continuation of virtual community engagement
2)Measuring CSR impact
3)Role model behavior
4)A focus on sustainability
5)The necessity of equity and diversity
6)Employee volunteer programmes

Question 9

List the different drivers

Answer 9

Social Drivers
Governmental Drivers
Market Drivers
Ethical Drivers

Question 10

Social Drivers

Answer 10

Consumers prefer socially responsible products and services, and employees increasingly choose to work for companies with a reputation for being socially responsible.

Question 11

Governmental Drivers

Answer 11

Companies must comply with the law in order to operate in the country
Legislation encourages corporate behaviour that is socially and environmentally responsible as well ethical reporting

Question 12

Market drivers(increase revenue through CSR)

Answer 12

1)Developing new products/services
2)Growing markets for services
3)General programmes such as job creations
4)Improving access to markets
5)Avoiding boycotts
6)Exploiting the CSR premium

Question 13

Market drivers(reduce costs through CSR)

Answer 13

1)Avoiding fines
2)Avoiding legal costs
3)Using resources efficiently
4)Using alternative raw material sources
5)Increasing staff retention
6)Reducing the cost of capital

Question 14

Ethical drivers

Answer 14

Does not only apply to external damage. It also applies to responsible business dealings

Question 15

Issues for which a business case cannot be made

Answer 15

Company’s visibility, location, size, ownership structure and the sector and market segments in which it operates

Question 16

Corporate Governance

Answer 16

Ethical and effective leadership.
Companies are managed and controlled; the relationship between those who govern and those who are governed. How can organization makes decisions about how to manage its affairs

Question 17

Board of directors

Answer 17

Group of people assembled to lead and control the company so that it functions in the best interests of its shareholders(fiduciary-trust)

Question 18

Director

Answer 18

Stands in the fiduciary relationship to the company and is bound by fiduciary responsibilities

Question 19

Boards

Answer 19

Executive directors and non-executive directors are not involved in day-to-day operation of the business of the company.

Question 20

Governing body’s primary governance roles and responsibilities

Answer 20

1)Steers and sets strategic direction with regards to:
i)the org’s strategy
ii)The way in which governance areas are to approached, addressed and conducted
2)Ensures accountability for organizational performance by means of, amongst others, reporting and disclosure
3)Approves policy and planning that give effect to strategy and sets the directions
4)Oversees and monitors implementation and execution by management

Question 21

Three ways to determine how to establish the corporate policy for CSR

Answer 21

1)A values-based system
Company’s own mission, vision, values and guiding principles
2)Stake-holder engagement process
Allows stakeholders to determine what they want from the company and what they consider to be the issues and culture of the company ,is a reactive approach
3)Combination of both

Question 22

6 basic steps in the stakeholder-engagement process

Answer 22

1)Prepare
Identify and understand the territory to be explored through the engagement process with stakeholders
2)Plan
Set objectives and parameters for the engagement process and identify and prioritize stakeholders with whom to engage
3)Design
Co-develop the engagement plan, including the agenda and logistics, to meet the engagement objectives
4)Engage
Successfully meet the objectives through execution of engagement plan with stakeholders
5)Evaluate
Assess the outcomes of engagement for both the company and stakeholders against specific objectives
6)Apply
Share information and integrate the outcomes of the engagement process appropriately into business practices

Question 23

Material issues

Answer 23

Issues that are relevant and significant to an org and its stakeholders

Question 24

The materiality determination process requires

Answer 24

1.The identification of the issues ,needs and concerns of stakeholders
2.Issues are evaluated against suitable and explicit criteria
3.That findings from evaluation should be used to determine the significance of each issue
4.The orgs take into consideration the changing sustainability context and maturity of issues and concerns

Question 25

Sustainable Development

Answer 25

Is the development that meets the needs of the present without compromising the ability of future generations to meet their own needs.

Question 26

Sustainable development encapsulates two key concepts:

Answer 26

The concept of needs of the worlds poor to which overriding priority should be given

The idea of limitations imposed by the state of technology and social organization on the environment’s ability to meet present and future needs

Question 27

Why companies engage with stakeholders

Answer 27

Companies want to understand and respond to society’s expectations
To help build better relationships with all parties resulting in improved business planning and performance
Provides opportunities to align business practices with societal needs and expectations helping drive long-term sustainability.

Question 28

Stakeholders

Answer 28

These are persons/groups who are potentially affected by, or affect, a company’s business activity.

Question 29

Primary Stakeholders

Answer 29

These are persons/groups who commonly have some contractual/financial relationship with the company(shareholders, employees)

Question 30

Secondary Stakeholders

Answer 30

They have less direct impact on the company, includes environmental NGOs or the media

Question 31

Stakeholder engagement

Answer 31

To an ongoing and multifaceted process between the corporation and stakeholders

Question 32

Stakeholder engagement includes:

Answer 32

Providing information
Capacity building
Listening and responding to community and stakeholder concerns
Establishing a realistic understanding of potential outcomes

Question 33

Stakeholder process:

Answer 33

1)The necessary competencies and resources to enable stakeholder participation
2)The identification and understanding of stakeholders in terms of their capacity to engage, and their views and expectations
3)The planning, development and implementation of appropriate engagement strategies, plans and models of engagement for stakeholders
4)Established ways for stakeholders to be involved in relevant decisions

Question 34

Principles for stakeholders engagement:

Answer 34

1)Involvement
Building existing relationships and find new participants to enrich dialogue
2)Candour
Be comprehensive, consider every issue. Disclose your agenda, assumptions, goals and boundaries
3)Relevance
Focusing on the issues of greatest importance
4)Learning
Uncover new perspectives. Emphasize what can be done to resolve issues
5)Act on results by applying what has been learnt to improve business planning and decision-making

Question 35

Primary principles of good governance

Answer 35

1)Lead ethically and effectively
2)Ensure that the organization is and is seen to be a responsible corporate citizen.
3)Serve as the focal point and custodian of corporate governance in the
organization
4)Govern risk in a way that supports the organization in setting and achieving its
strategic objectives
5)Govern technology and information in a way that supports the organization
setting and achieving its strategic objectives
6)Ensure that responsible investment is practiced by the organization to promote
the good governance and the creation of value by the companies in which it invests
7)Ensure that assurance services and functions enable an effective control
environment, and that these support the integrity of information for internal
decision-making and of the organization’s external reports
8)Govern compliance with applicable laws and adopt non-binding rules, codes and
standards in a way that supports the organization being ethical and a good
corporate citizen
9)Govern the ethics of the organization in a way that supports the establishment of
an ethical culture
10)Appreciate that the organisation’s core purpose, its risks and opportunities,
strategy, business model, performance and sustainable development are all
inseparable elements of the value creation process