Introduction to IB chapter 10

Question 1

Sustainability

Answer 1

The practice of fulfilling present needs without compromising the ability of future generations to meet their own needs globally

Question 2

Primary stakeholder groups

Answer 2

The essential parties upon which a firm depends for its ongoing survival and success

Question 2

Secondary stakeholder group

Answer 2

Individuals or entities that can influence or be influenced by a corporation but do not engage in direct transactions with it and are not critical to its survival

Question 3

Instrumental view

Answer 3

The perspective that effectively managing stakeholder relationships can indirectly enhance a firm’s financial performance

Question 4

Corporate social and environmental responsibility (CSER)

Answer 4

The commitment of firms to address social and environmental issues within their communities

Question 5

Normative view

Answer 5

The belief that firms should be intrinsically motivated to act ethically and fulfill their societal obligations

Question 6

Shared value creation

Answer 6

A CSER approach that emphasizes initiatives that benefit both the firm and its stakeholders.

Question 7

Greenwashing

Answer 7

The practice of promoting social or environmental initiatives superficially while failing to address underlying issues

Question 8

Institutional arbitrage

Answer 8

The strategy of positioning business activities in locations where compliance costs with regulations are minimized

Question 9

Pollution havens

Answer 9

Nations that have less stringent environmental regulations, attracting businesses seeking lower compliance costs

Question 10

Race to the bottom

Answer 10

The phenomenon where countries compete for foreign direct investment by continuously lowering their environmental standards.

Question 11

Health, Safety and Environment (HSE)

Answer 11

A term encompassing the mandatory standards and regulations related to health, safety, and environmental protection that companies must adhere to

Question 11

Footloose plants

Answer 11

Facilities that can be easily relocated to different locations without significant cost or disruption

Question 12

Compliance

Answer 12

The processes implemented to monitor and enforce adherence to standards for employees and suppliers

Question 13

Compliance training

Answer 13

Required training programs and assessments aimed at ensuring that all employees are familiar with the relevant codes of conduct and regulatory standards

Question 14

Explicit CSER

Answer 14

The voluntary acceptance of responsibilities related to societal concerns by a firm

Question 15

Implicit CSER

Answer 15

Engaging in both formal and informal institutions to support societal interests and address social concerns without explicitly stating those responsibilities

Question 16

Philanthropy

Answer 16

Charitable donations made to support causes that benefit the broader society

Question 17

Hypernorms

Answer 17

Norms considered valid anywhere in the world

Question 18

Defensive strategy

Answer 18

An approach that prioritizes regulatory compliance with minimal commitment from top management to corporate social and environmental responsibility (CSER) initiatives

Question 19

Proactive strategy

Answer 19

An approach that aims to exceed basic requirements in corporate social and environmental responsibility (CSER) efforts

Question 20

Accommodative strategy

Answer 20

A strategy marked by some level of support from top management, recognizing CSER as a valuable pursuit