MGT Flashcards
It means seriously considering the impact of the company’s actions on society
Corporate Social Responsibility
It is the obligation of decision makers to take actions which protect and improve the welfare of the society as a whole along with their own interests
Corporate Social Responsibility
It supposes that the corporation has not only economic and legal obligations, but also certain responsibility to society which extend beyond these obligations
Corporate Social Responsibility
Related primarily to achieving outcomes from organizational decisions concerning specific issues or problems which have beneficial rather than adverse effects upon pertinent corporate stakeholders, the normative correctness of the results of corporate actions has been the focus of
Corporate Social Responsibility
The response of the corporation to issues beyond its narrow economic, technical and legal requirements. It is the obligation of the corporation to evaluate the effects of its decisions on the external social system
Corporate Social Responsibility
One of the responsibilities of business to society is to operate at a profit. Business is the wealth-creating organ of society, but what is important is the management realized that it must consider the impact of every business policy and business action on society; it has to consider whether the action is likely to promote the public good, to advance the basic belief of society to contribute to its stability, strength, and harmony. The ultimate responsibility of management to itself, to our heritage, society, and to our way of life.
Corporate Social Responsibility
5 Corporate Social Responsibility from a historical Perspective
The Ancient Period (5th to 15th Century)
The Medieval Period (5th to 15 Century)
The Mercantilism Period (15th to 18th Century)
Industrial Revolution
Period of Depression
the Greek Philosopher and follower of Socrates– wrote and presented his ideas in the form of dramatic dialogues, recommending that such activities be prohibited.
Plato
People believed that businessmen and wealthy people should do business to the community as part of public or social service
The Ancient Period (5th to 15th Century)
The Greeks and Romans treated the businessmen next to slaves. The Elite of the society condemned businessmen, criticizing them for utilizing their money for profit and not for service to the community
The Ancient Period (5th to 15th Century)
Businessmen were pressured by the society
The Ancient Period (5th to 15th Century)
introduced the concept of compensatory justice which maintains that prices and wages should be fair.
St. Thomas Aquinas
Criticisms against the evil of business came far and wide during the medieval period when the Catholic Church became the most powerful institution in Europe
The Medieval Period (5th to 15 Century)
Catholic church did not trust the business system
The Medieval Period (5th to 15 Century)
Profit– motived = anti– Christian
The Medieval Period (5th to 15 Century)
claimed that Protestant values encouraged thrift, industry, and materialism, making Protestant countries more progressive than Catholic countries.
Max Weber
one of the proponents of Protestant Work Ethics, likewise glorified the thrifty and industrious businessmen.
John Calvin
The power of the Catholic Church as the most influential institution in Europe diminished at the onset of mercantilism, a politico– economic philosophy
The Mercantilism Period (15th to 18th Century)
This period shows several violations of social responsibilities;
The Mercantilism Period (15th to 18th Century)
To European governments, the main source of power and prestige among nations is the acquisition of gold and silver through trade. (Bullionism)
The Mercantilism Period (15th to 18th Century)
The Harmony of Interest Theory of England
The Mercantilism Period (15th to 18th Century)
Time when machines were introduced
INDUSTRIAL REVOLUTION
To improved productions and business growth
Industrial Revolution
Along with these improvements was the change in businessman’s attitude and values towards business.
Industrial Revolution
Businessmen regarded wealth as a symbol of moral excellence
INDUSTRIAL REVOLUTION
Absolute free enterprise became an argument
INDUSTRIAL REVOLUTION
Capitalist in ___ were the ones who thoroughly enjoyed this prerogative
England
___ ___ and ____ ____ , fighting against the capitalist, were both responsible in exposing these abuses, thereby earning for them the titles “social reformist”
Karl Marx , Robert Owen
The government, especially in progressive countries, protected the welfare of the public against abuses of businesses.
PERIOD OF DEPRESSION
Businesses viewed social responsibility as an adherence to rules and regulations and compliance with administrative and legal standards.
PERIOD OF DEPRESSION
As the growing demands for higher CSR emerge, approaches to this moral obligation has now become a business pursuit.
PERIOD OF DEPRESSION
How many phase of historical corporate social responsibility are there?
three
What are the historical phases of corporate social responsibility?
Phase 1: Profit Maximization
Phase 2: Trusteeship Management
Phase 3: Quality of life Management
Individual drive for profit maximization would ultimately create wealth for the nation
Phase 1: Profit Maximization
Business systems as profit maximizers are used as tools for the elimination of economic scarcity
Phase 1: Profit Maximization
Businesses ignored unsafe working conditions, paid starvation wages and used child labor in order to maximize profit.
Phase 1: Profit Maximization
Problems of cultural minorities, unsafe products, unfair advertising and urban poor problems were given little if no attention at all
Phase 1: Profit Maximization
Abuses of capitalism were extremely rampant and the government tolerated these deplorable business practices
Phase 1: Profit Maximization
Management was considered both as an instrument of stockholders and as trustee for all groups who contribute to the business enterprise
Phase 2: Trusteeship Management
Aside from profit maximization, management’s concern was also to maintain a fair balance in the interests of employee, customers, creditors, stockholders and the community
Phase 2: Trusteeship Management
Security of basic goods and services was no longer a principal problem
Phase 3: Quality of life Management
Social and economic problems brought about by economic growth expanded the concept of social responsibility of management
Phase 3: Quality of life Management
Society demanded management’s active participation in helping solve social and environmental problems in view of the vast resources (funds, manpower, materials, management skills and technology) of businesses.
Phase 3: Quality of life Management
Business is expected to contribute to the improvement of the quality of life, which involves cultural, social, educational, political factors and economic security
Phase 3: Quality of life Management
Society is unstable if the quality of life of the people is poor.
Phase 3: Quality of life Management
