Lecture 1: Background: Historical Perspectives On CSR And Sustainability Flashcards
There are 2 type of moral theories. what are their names and explain them
Non-consequentialist (categorical) and consequentialist moral theories. Non-consequentialists say that moral goodness is about whether an action follows certain rules or duties; consequentialists say that more goodness is about what effects an action brings about.
→if one person steals from another, a consequantalist would judge the action based on whether it caused good or bad consequences, a non-consequentialists would judge based on whether it broke a moral rule against stealing.
What is corporate social responsibility(CSR)?
Multiple definitions for corporate social responsibility (csr) exis t:
→ Actions that appear to further some social good, beyond the interests of the firm and that which is required by law.
→The responsibility of enterprises for their impacts on society.(European Commission)
→ A concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis and in a context specific way.
What is corporate sustainability (CS)?
→ CS means managing a firm in such a way that its activities meet the needs of the present, without compromising the ability of future generations to meet their needs.
→CSR and CS refer to company activities - voluntary by definition- demonstrating the inclusion of social and environmental concerns in business operations and in interactions with stakeholders.
Why companies go green? (Bansal & Roth, 2000)
There are 3 motivations why companies go green:
→ competitiveness: some companies adopt environmentally friendly practices to gain a competitive advantage by reducing environmental impacts and improving efficiency, firms can lower costs, enhance theirreputation and attract environmentally consigns customers.
→legitimation: companies may engage on green initiatives to enhance their legitimacy and comply with societal expectations.this can help them build trust with stakeholders.
→ social responsibility:ethically motivated firms view environmental stewardship as the right thing to do. top management and company values pIay a crucial role in encore going firms to evaluate their societal impact and take responsibility for their environmental footprint.
What is the idea of Friedman towards social responsibility (1970)?
The social responsibility of business is to increase its profits. That means:
→ use resources capabilities to increase profits for shareholders
→ stay within the rules of the game c
→ fiduciary responsibility of managers to owners (shareholders)
Hence CSR activities are equal to theft or imposing tax unless there is a business case
Contrast the ideas of Bansal & Roth (2000) and Friedman(1970).
Bansal and Roth ‘s study explores a more nuanced view of corporate motivations for going green including competitiveness, legitimacy and social responsibility. They acknowledge that companies may adopt environmentally friendly practices for reasons beyond pure profit maximization, such as enhancing
Reputation, attracting customers and fulfilling ethical obligations.
How do Porter & Kramer (2006) view conception CSR of firm?
Corporate social responsibility became a priority.
The conception of within firms is shifting towards a more strategic integrated and proactive approach that aligns social initiatives with core business strategies to create shared value for both company and society.
→traditionally,csr was seen asa separate activity from core business operations1 often focused on reputation management. However the current trend is towards viewing it as a strategic business imperative that is integrated into the core operations of the company.
→ it can be more than just a cost or constraint; it can be a source of opportunity, innovation and competitive advantage through making organizational adjustments.
How does Porter & Kramer’s (2006) conception of car firm compare to Friedman’s (1970) view?
Friedman’s critique of CSR revolves around the belief that the pursuit of profits within the framework of a free market system is the most effective way for businesses to contribute to society rather then diverting resources towards social causes that may be better addressed through individual actions or government intentions.
While Friedman’s view on CSR is routed in the belief that businesses should prioritize profits and avoid social responsibilities that may lead to unintended consequences, Porter and Kramer’s concept of creating shared value promotes the idea that businesses can benefit from actively engaging in social issues and integrating social impact into their business strategies for mutual benefits.
What similarities or differences do you see in Porter & Kramer’s (2006) and Friedman’s (1970) views?
Similarities
→ acknowledge the importance of business in society
→ consider the impact of business actions on society
Differences
→ purpose of business
→approach to social responsibility
→ relationship between business and society
Explain the normative stakeholder theory ( Freeman & Elms, 2018).
Old story is shareholder value maximization. The new story is stakeholder value maximization.
The stakeholder approach aims to create a new narrative about businesses - a new story- that enables great companies tu have our communities and our lives better through the creation of stakeholder value rather then simply profit to shareholder. The story includes a recognition that of we want the outcome of businesses to be a more responsible capitalism, it requires stakeholders to value business responsibility.
What should be the purpose of business according to Freeman & Elms (2018), what is the new story?
Business is designed to meet the demand. Business people need to be inspired to create competitive products and services that create value. This can be done — business is certainly capable of motivations the interests of consumers, employees, investors and other stakeholders toward one option over another. Business can thrive demand for responsible capitalism by offering responsibility;e option for stakeholders (e.g. smartphones example)
Businesses can be a part of solutions to societal problems rather than a cause.
