Chapter 4 Flashcards
Three dimensions of institutionalization
- Voluntary practices
- Core practices
- Mandated boundaries
Beliefs, values, and voluntary contractual obligations of a business
Voluntary practices
Giving back to communities and
causes
Philanthropy
Documented best practices,
often encouraged by legal and regulatory forces and trade associations
Core practices
Externally imposed
boundaries of conduct (e.g. laws, rules,
regulations and other requirements)
Mandated boundaries
Government established laws/regulations
Legal compliance
Elements of an Ethical
Culture
A. Culture
B. Values
Norms
Artifacts
Behavior
C. Voluntary actions
Governance
Core practices
Legal compliance
2 types of law
Civil
Criminal
defines the rights and duties of
individuals and organizations
Civil
prohibits specific actions and
imposes punishments for breaking the law
Criminal
Laws Promoting
Equity and Safety
Magna Carta for Women
Magna Carta for Persons with Disabilities
Labor code of the Philippines
Food Safety Act of 2013
establish the basic ground rules for
responsible business activities
Laws
Five categories of laws
- Regulating competition
- Protecting consumers
- Promoting equity and safety
- Protecting the environment
- Incentives to encourage organizational compliance programs to deter misconduct
because they encourage competition and prevent activities that restrain trade
procompetitive legislation
require businesses provide
accurate information about products and services and follow safety standards
Consumer protection laws
become a buzzword in
recent years
Sustainability
meeting the present needs without compromising future generations to meet their needs” – UN’s World Commission on the Environment and Dev’t
Sustainable
the glue that holds businesses and
their stakeholders together
Trust
Overseers of business actions
Gatekeepers
Measure and disclose financial information to the public
Accountant
Assess financial risk and express that risk through letter ratings from “AAA” to “C”
Risk Assessors
Four major benefits to society
- Improves communities quality of life
- Reduces government involvement
- Develops employee leadership skills
- Helps create an ethical culture
Ties an organization’s product(s) to a social concern through a marketing program
Cause-related marketing
The synergistic and mutually beneficial use of core competencies and resources to deal with stakeholders, benefit the company and society
Strategic philanthropy
