Chapter 28 Flashcards
Social responsibility
When a business decision benefits stakeholders other than share holders, e.g. a decision to reduce pollution by using the latest and ‘greenest’ production equipment.
Environment
The nature world including, e.g. pure air, clean water and undeveloped countryside.
Private costs
Costs paid for by the business from an activity
Private benefits
Gains to a business from an activity
External costs
Paid for by the rest of society, other than the business, as a result of a business activity.
External benefits
Gains to the rest of society, other than the business, resulting from a business activity.
Social costs
External costs + private costs
Social benefits
External benefits + private benefits
Sustainable development
Development that does not put at risk the living standards of future generations.
Sustainable production methods
Methods that cause minimum damage to the environment
Pressure group
A group made up of people who want to change business(or government) decisions; they take action such as organizing consumer boycotts.
Consumer boycott
Deciding not to buy from businesses that do not act in a socially responsible way.
Ethical decisions
Decisions based on a moral code. Sometimes referred to as ‘doing the right thing’.
