CSR Flashcards
Business ethics definition is…
Distinguishing between right and wrong, making the right choice and ensuring that ethical actions are in accord with moral values
Can be described as a set of values and principles which influence how orgs behave and are closely related to social responsibility. The ethics of a company are likely to influence the extent to which it behaves in a socially responsible way
CSR means…
Organisations going above and beyond the law to do good things for stakeholders and the wider community.
Social Responsibility means…
an organisations obligations to all its external stakeholders
Effect of CSR on marketing x5
Used in advertising campaigns which improves the business image and strengthens brand
Target socially responsible/eco-friendly market segment to attract new customers and ethical customers
Add CSR branding to packaging to promote sales
Press release outlining businesses CSR policy could improve their reputation
Businesses who publicise their policies list ensure they’re met. Failure will result in negative publicity and greater scrutiny which damages reputation.
Effect of CSR on operations x5
Raw materials could be more expensive if using ethical/fairtrade to adhere to orgs CSR policy which reduces competitiveness.
Find local suppliers to reduce carbon emissions which could reduce transportation costs.
If org has already implemented environmentally friendly practises, they are ready to deal with changes to legislation giving them competitive edge.
Implementing a recycling policy reduces waste going to landfill reducing landfill
tax and increasing profits
Ensure machinery is switched off to reduce energy consumption and bills.
Effect of CSR on HR x4
Having environmental standards and safety requirements in line with current legislation means the business can avoid penalties and fines due to less accidents in the workplace
Increased training costs due to new production methods implemented
Employees more satisfied due to responsible org which reduces staff turnover. This reduces recruitment and selection costs
Effective CSR can attract high quality staff which increase efficiency and quality of output
Effect of CSR on finance x4
Boosts businesses ability to obtain finance from ethical investors which helps cash flow
May charge premium prices as some consumers more willing to pay higher prices for ethical goods and services
Increased business costs reduces dividends to shareholders who could sell their shares
Effective CSR boosts sales and lower staff absenteeism which boosts finance departments income statement
Business ethics means.. x3
Distinguishing between right and wrong
Conducting business and making decisions according to moral values and principles
This means that decisions involve more than financial incentives and interests of shareholders.
Ethical issues include… x3
Worker wages and conditions
Environmentally friendly production processes
Researching the operations of suppliers
Costs to UK organisations of business ethics are…x3
Increased costs due to ethically sourced supplies which reduces profit and makes the business less competitive
Businesses who publicise their ethical policies must ensure they are met. Failure will result in negative publicity which damages reputation and sales
Shareholders may sell shares which reduces the value of the company.
Benefits to UK organisations of business ethics are…x4
Ethical organisations can attract high quality applicants when recruiting which increases the quality of output produced
Employees currently employed will be satisfied that the organisation is being responsible which lowers staff turnover
Having environmental standards and safety in line with current legislation means the business can avoid penalties and fine as there will be less accidents
May charge premium prices as some consumers are willing to pay higher prices for ethical goods and services.
Impact of government influence in CSR has on a business is…x5
New production methods have to be investigated that use less fuels and produces less emissions which is time consuming and increases costs.
Further spending on research and development may be needed to create more environmentally friendly packaging e.g. altering packaging to become more biodegradable
Ways of reducing and recycling waste may have to be found in order to comply with legislation e.g. carbon footprint reduction by using less paper
Possible cost reductions in the long term
Possible increased demand for their goods and services from ethical consumers
How good CSR can satisfy stakeholders…x5
Using less water reduces water pollution which is vital as water shortages threaten farmers
Implementing a reducing policy reduces waste going to landfills which reduces landfill tax leading to bigger dividends to shareholders
Reducing packaging reduces the amount of packaging thrown away, satisfying customers and reducing the cost of supplies. Higher profits could result in pay rises
Reduction in transport due to using local suppliers helps the local community and reduces carbon footprint and emissions which improves air quality
Reduction of noise pollution by using quieter machinery will reduce disturbances to local community.
Why create environmental policies? x6
public awareness and consumer pressure- more info in the media of environmental issues so consumers are more aware and will seek socially responsible firms.
legislation- introduced by the gov to protect the planet. could face fines if isn’t followed
taxation- high landfill tax reduces firms profit, encourages them to reduce waste
subsidies offered by gov to ethical firms and ethical projects which could improve cash flow, encourage firms to think
compensation- may have to pay compensation for negative impacts of production on the planet
cost saving- solar panels reduce energy bills
Ways an org can be more environmentally friendly are… x7
using less water and reduce water pollution- if not, can cause droughts and effect health of wildlife and population
using less energy and greener energy- reduces energy bill e.g. solar panels
reduce the impact of transportation reduces carbon footprint. May mean not using JIT as that’s more frequent deliveries which increases footprint
reducing noise pollution- can be fined if above legislation allowances and complaints from local community
using recycled materials and making packaging recyclable- could increase costs but can attract ethical consumers
reducing packaging- reduces landfill tax needing paid
waste reduction in production process- better utilisation of resources
