Ethical Flashcards
Corporate responsibility
CR - ‘companies integrating social and environmental concerns in their daily business operations and in their interactions with their stakeholders on a daily basis’ (wetherly and otter, p188)
In the environment, corporate governance and business standards (e.g. fair pay) and human rights.
Involves philanthropy, enlightened self-interest (positive publicity through sponsoring), and straightforward self interest (investments benefitting the organisation)
Corporate citizenship
‘Understanding and managing a company’s wider influences on society for the benefit of the company and society as a whole.’ (W&O, p188).
The ‘footprint’ of a company on the social and physical environment. Refer to sustainable capitalism article HRZone. https://www.hrzone.com/perform/business/sustainable-capitalism-business-as-a-force-for-positive-change
Business Ethics
Underlying ethical values of a business, particularly professions
Codes, policies, theories of ethics.
Deontological (letter of the law), utilitarian (consequences of), virtue ethics (taking everything into account)/
Free market CR
Sole responsibility is to make money for shareholders, any activity outside of this is morally wrong as you are not serving your owners as per your duty (deontological)
You can do so if shareholders see fit however.
Pursuing community issues will result in costs incurred by shareholders , employees and consumers and therefore constitutes an unconscious tax.
Stakeholder theory
Who are the wider stakeholders such as customers, unions, government and how do the business decisions affect them. E.g. reputation.
Motivations for CR (W&O, p196)
Self interest - to not ‘look bad’ or to affect your own reputation.
Mutual interest - as above, in partnership.
Shared responsibility - everyone has to ‘do their bit’
Process and practice.
Robinson et al (2007) 4 stages
1) data gathering. Awareness and appreciation of all issues and stakeholders.
2) Value clarification and management. What are your own values and purposes?
3) responsibility, negotiation and planning. Identify stakeholders, power/responsibility, negotiation of responsibility.
4) Audit. Review and adjust in response.
Sustainable capitalism
Rejection of profit only capitalism by workforce, leaders, investors and customers.
‘B corporations’ balance purpose and profit with ethical business models. There is also evidence that this leads to better performance (hrzone, 2020)
Carroll, 1991
CSR pyramid
Economic - produce goods and services to consumers.
Legal - codified ethics of fair operations.
Ethical - uncodified societal expectations, often to a higher standard than law dictates.
Philanthropic - societal expectation that businesses at as good corporate citizens.
