Ethics and corporate social responsibility

Question 1

Levels of CSR attainment

Answer 1

Awareness refers to the level of appreciation of the key CSR characteristics and the extent to which they inform and influence decision making in the organisation.

Understanding the knowledge and comprehension of the key issues affecting the formation of CSR as a concept.

Application of actions that support CSR.

Integration is a level of understanding that is more focused, detailed, and in-depth and that transforms comprehension and knowledge into specific expertise in embedding CSR into the decision making process and the organisation.

Leadership is achieved when those at the executive and strategic decision making level support managers for fully integrating CSR activities across the organisation.

Question 2

Key characteristics of a CSR framework

Answer 2

The framework consists of six core characteristics and is designed for application across the full spectrum of business functions including operations, planning, supply chain logistics and procurement, finance, human resources, customer service, marketing and sales.

Understanding society in which organisations operate and in particular how government, business, educational institutions, security and control organisations, and civil society support organisations operate.

Building capacity for delivering on strategic plans that incorporate CSR whereby networking skills are the catalyst for creating external partnerships, strategic alliances, or at least channels of communication.

Questioning the status quo or “business-as-usual” approach to addressing some of the most pressing global issues such as climate change, structure of economics, social welfare, political reform etc.

Strategic view of how their activities can be undertaken without harming the wider environment or the people that inhabit it.

Stakeholder relations that may include giving them a platform or channel of communication that informs change within organisations.

Harness diversity is a prerequisite for dispensing CSR in the modern global economy

Question 3

The role of CSR in mission and goals

Answer 3

Mission statement
It is incorporated into mission statements that are communicated to individuals inside and outside the company. Ordinarily descriptions of the company self-concept per se do not appear in mission statements. Yet such statements often provide strong impressions of the company’s self-concept.

The role of CSR in mission formulation
Three indispensable components of the mission statement are specification of the basic product or service, specification of the primary market, and specification of the principal technology for production or delivery

CSR as organisational goals
Goals incorporate a general statement of organisational purpose or “mission” and set of more detailed aims and objectives that guide strategic and operational decision making. 
Social goals
Output goals
System goals
Product goals
Derived goals

It is based on management’s perception of the way in which other (society) will respond to the company
It directs the behavior of people employed by the company
It is determined partly by the response of others to the company

Question 4

Advantages of ethical business practice and CSR

Answer 4

1. Image and reputation
   1.2 Political: increase credibility and lobbying power
   1.3 Social: consumer loyalty and improved reputation and image
   1.4 Economic: brand loyalty leading to competitive advantage and bigger profit
   margins
2. Accreditation and standards
   2.1 Operational: helps to acquire accreditation
   2.2 Health and safety: helps to produce safer products
   2.3 Sustainability: helps build a sustainable business with benefits for the
   environmental protection
3. Stakeholder communication
   3.1 Improved stakeholder relationships
   3.2 Corporate governance: a system of control over the actions and practices of
   managers in organisations through an agreed set of relationships between a
   company’s management, board, shareholder and other stakeholders.
   Key steps:
   3.2.1 Identification: in defining the organisation, managers must identify all of the
   stakeholder groups and weigh their relative rights and their relative
   influence in affecting the organisation’s activities.
   3.2.2 Understanding: decision makers need to understand the specific demands
   of each group.
   3.2.3 Reconciliation and priorities: claims must be reconciled in a mission
   statement that resolves the competing, conflict and contradictory claims of
   stakeholders.
   3.2.4 Coordination with other elements: the demands of stakeholder groups, the, managerial operating philosophy and the determinants of the product-market offering constitutes a reality test that the accepted claims must pass. The key question is: how can the firm satisfy the claims of stakeholders and at the same time achieve its stated strategic and economic aims?

Question 5

Philosophical approaches to ethics

Answer 5

Individualism: describes if a person functions primarily as an individual

Moral principles: fundamental principles that underpin understanding and knowledge of what is right and wrong

Utilitarianism: relies on the pursuit of maximising utility (or a favourable outcome) for the greatest number of people.

Human rights: based on widely held beliefs and consensus on how actions affect the human rights of individuals or groups

Question 6

Define ethical dimensions

Answer 6

The ethical dimension to corporate business activity is the extent to which enterprises improve the quality of life for stakeholders in the course of their economic development activities

Question 7

Define CSR

Answer 7

Corporate social responsibility (CSR) refers to the commitment shown by business to behave in an ethical manner.

Question 8

Define ethics

Answer 8

Ethics refers to moral principles that underpin modes of behaviour.