Handout 4 Flashcards
is an ethical framework that asserts that an individual is obligated to work and cooperate with other individuals and organizations to benefit society and their environment as a whole.
social responsibility
This self-regulating business model helps a company act responsibly in many ways, such as engaging in ethical labor practices, producing goods and services in a way that is not harmful to society or the environment, preserving natural resources, and changing manufacturing processes to reduce carbon emissions.
Corporate Social Responsibility (CSR).
According to this, the primary social responsibility of a business is to use its resources and engage only in activities designed to increase profit so long as it stays within the rules of open and free competition without deception or fraud.
Friedman’s traditional view of business responsibility.
proposed that maximization of profits cannot be the primary obligation of a business.
Carroll’s four (4) responsibilities of business.
A business organization is responsible for producing goods and services of value to society so that the firm may repay its creditors and increase the wealth of its shareholders.
Economic.
A business organization has responsibilities that are defined by governments in laws that management is expected to obey.
Legal.
A business organization is responsible for following the generally held beliefs about behavior in a society.
Ethical.
A business organization has responsibilities that are purely voluntary on the part of the corporation.
Discretionary
suggests that companies should ensure that their social responsibilities also become business opportunities.
Peter Drucker’s view of social responsibility
This suggests that companies may tailor their program to help eradicate existing social problems while maintaining business stability and profitability.
Government cannot solve many social problems.
The first social responsibility of the business is to make a profit sufficient to cover operational costs in the future.
The corporate mission comes first.
means that the organization assumes full legal responsibility for the future outcome of their initiatives, their company’s debts, and all other financial commitments.
The unlimited liability clause.
Carr argues that business is a game and that business ethics differs from private life ethics.
Albert Carr’s view of social responsibility.
holds a very favorable view of social responsibility. Wheelen (2018) cited that he believes in a “Stockholder Theory,”
Edward Freeman’s view of social responsibility.
that any person or organization that has an underlying interest in the business should also play a role of participation in the business’ actions and decisions – responsibility to customers, responsibility employees, responsibility to financers, responsibility to suppliers, and responsibility to communities.
“Stockholder Theory,”
those who directly connect with the corporation and have sufficient bargaining power to affect corporate activities directly.
Identify primary stakeholders.
are those who have only an indirect stake in the corporation and are also affected by corporate activities.
Identify secondary stakeholders.
The primary decision criteria used by management are generally economic, which is why secondary stakeholders may be ignored or discounted as unimportant.
Analyze stakeholder influence over strategic decisions.
is the consensually accepted standard of behavior for an occupation, a trade, or a profession.
Ethics
in contrast, constitutes one’s rules of personal behavior based on religious or philosophical grounds.
Morality,
refers to formal codes that permit or forbid certain behaviors and may or may not enforce ethics or morality.
Law
This approach proposes that actions and plans should be judged by their consequences.
Utilitarian approach
This approach proposes that human beings have certain fundamental rights that should be respected in all decisions.
Individual rights approach.
This approach proposes that decision-makers can be equitable, fair, and impartial in distributing costs and benefits to individuals and groups.
Justice approach.
