Lecture 6 Flashcards
What are the three types of social assets
Status, reputation and license to operate
How can a firm gain legitmacy
Through reframing its business (danish porn, life insurance)
What does status emerge from
Patterns of market relations (buyers/suppliers); association
What does status grant you
Higher willingness to pay and lower cost
Why does status grant higher WTP
Desire to be associated with high status firms, lower risk that quality is worse than advertised
Why does status grant lower cost
less need for advertising, due dilligence costs for other parties are lower, lower borrowing costs, lower hiring and retention costs
What is the matthew effect
Richer get richer because they get more opportunities
What is the middle status conformity effect
Middle status conformity (proposed by philip and zuckerman) is about how conformity to categories’ codes is largest in the middle of said category. This is because large companies have enough resources to bounce back, small ones have nothing to lose and the middle ones are most anxious about their position.
How is reputation different to status
It is not about affiliations but performance and is easier to change
How can CSR benefit the company
It can improve reputation, generate stakeholder support and create a more attractive workplace
What types od CSR issues are there for a company?
generic social issues, value chain social impacts and social dimensions of competitive context
Which issues do you want to engage in as a firm?
Value chain social impacts (animal testing), social dimensions of competitive context (creating skilled labour)
When is CSR most effective
When it is aligned with the firm’s resources and capabilities
What are the characteristics of successful CSR
value creation
alignement with core mission
capturing value
proactive
voluntary
visible
What makes a CSR scandal?
When a negative action reaches a relavant audience and gains notoriety within it
