CSR Flashcards
Corporate Social Responsibility
The practice in which a business views itself within a broader context, as a member of society with certain implicit social obligations and responsibility for its own effects on environmental and social well-being.
4 categories of CSR
Environmental, Ethical, Philanthropic, Economic
sustainability development
meeting the needs of the present without compromising the ability of future generations to meet their own needs
replacement rate
the rate at which something can replenish, for example, cutting down trees will still have other trees growing or catching fish there will still be more fish to catch
systems thinking
a way of monitoring the entire system by viewing multiple inputs being processed or transformed to produce outputs while continuously gathering feedback on each part
Components of triple bottom line
people: Social variables related to equity, community, health, well-being, quality of life, education, etc.
planet: Environmental variables related to pollution, natural resources, waste, water, land use, energy, etc.
profit: Economic variables related to the bottom line, cash flows, returns on investments, etc.
stakeholders
Those with a legitimate interest in the success or failure of the business and the policies it adopts; include customers, clients, employees, shareholders, communities, the environment, the government, and the media, among others.
externalities
Occurs when an exchange between two parties (where a party can be an individual or organization) has an impact on a third party who is not part of the exchange. An externality, which is sometimes also called a spillover, can have a negative or a positive impact on the third party.
greenwashing
Carrying out superficial CSR efforts that merely cover up systemic ethics problems for the sake of public relations.
shareholders
Investors who purchase shares of stock in a corporation.
Stakeholder mapping
A systematic way to identify the expectations, needs, importance, and relative power of various stakeholders
P&G Case Study
Consumer goods companies say they are experimenting with various alternatives to plastic sachets, such as using biodegradable packaging or dispensing products in refill machines that allow customers to use the same container over and over. But these projects have not been rolled out widely. Environmentalists like Sian Sutherland, founder of A PlasticPlanet, say governments need to impose bans on sachets to stimulate real change. “Then we will create the vacuum that innovation will rush in and fill,” she said.
Why there is disagreement in shareholder vs stakeholder theory?
Politics, Scope/magnitude, Infrastructure, (Dis)incentives, Etc.
Traditional CSR vs. Creating Shared Value (CSV)
Traditional CSR: Reduce negative impact
Give back; do no/less harm
Cost focused
The more you do and the better you do it, the more it costs
Redistribute the value created by firms
CSV: Create positive impact
Address societal needs /challenges, Profit focused, the more you do and the better you do it, the more profit it generates Expand the total pool of economic and social value
Traditional CSR
Traditional CSR: Reduce negative impact
Give back; do no/less harm
Cost focused
The more you do and the better you do it, the more it costs
Redistribute the value created by firms
