Module 10

Question 1

What are issues?

Answer 1

Issues are concerns related to a firm’s decisions and operations often with regards to environmental and social problems. Issues emerge in interaction between organizations and stakeholders.

Question 2

What are the most important factors in identifying and analysing issues?

Answer 2

1. Likelihood of existence and continance
2. Ability to resolve
3. Which key stakeholders are involved?

Question 3

What are the strategic options in response to issues?

Answer 3

Reactive:
- Defensive: stonewalling or denying the issue
- Accommodative: Accommodating stakeholder concerns, often after pressure. Engagement in dialogue with stakeholders.

Proactive:
- Though leadership: taking positive leadership position in issue to benefit of stakeholders

Question 4

What does the firm’s reaction to issues depend on?

Answer 4

1. Intensity of issue
2. Importance of issue to stakeholders
3. Values and beliefs of managers about the organizations responsibility

Question 5

Name the three types of stakeholders

Answer 5

1. Equity stakeholders
2. Economic stakeholders
3. Influencer stakeholders

Question 6

What are equity stakeholders?

Answer 6

Stakeholders with a form of ownership in the business. These are primary stakeholders

Question 7

What are economic stakeholders?

Answer 7

These are stakeholders with economic but not equity stakes (employees, lenders, suppliers customers etc.)
Primary stakeholders

Question 8

What are influencer stakeholder?

Answer 8

Stakeholders that do not have equity or economic stake but still have an interest. Secondary stakeholders

Question 9

What is the difference between economic and stakeholder theory?

Answer 9

Economic theory suggests firms should maximize proftifts, whereas stakeholder theory assumes mutual relationships with all stakeholders in which there is societal and financial accountability

Question 10

Explain the mapping out of stakeholders and their meaning?

Answer 10

1. Low power or stake: minimal effort
2. Low power high stake: keep informed
3. High power low stake: keep satisfied
4. High power and stake: key players

Question 11

What is sustainability?

Answer 11

The ability to fulfill the present needs without damaging the ability of future generations to fulfill in future needs

Question 12

What are human rights?

Answer 12

Rights that are attained because one is a human being.

Question 13

What is triple bottom line?

Answer 13

Economic, societal and environmental performance fulfilling demands of all stakeholders

Question 14

What is the instrumental view on CSR?

Answer 14

Treating stakeholders well may indirectly positively affect performance

Question 15

What is a normative view on CSR?

Answer 15

Firms should be motivated because they have societal obligations?

Question 16

What is shared value creation?

Answer 16

CSR approach trying to do good for both the firm and its stakeholders. Arises from long-term commitment

Question 17

Name the two topics in which companies have to figure out social responsibility themselves?

Answer 17

1. Environment
2. Labour

Question 18

What are pollution havens?

Answer 18

These are countries with lower environmental standards, put in place to attract businesses

Question 19

What is the race to the bottom?

Answer 19

Competition among countries for FDI by reducing environmental standards (and becoming pollution havens)

Question 20

What are labour standards?

Answer 20

Employment rules including hours, minimum wage etc.

Question 21

What are footloose plants?

Answer 21

Factories that can relatively easy be relocated. This is often the case with labout intensive factories. This increases the bargaining power of companies.

Question 22

What is Health, safety and environment?

Answer 22

This is a general term for areas for which common standards are established

Question 23

What is compliance?

Answer 23

Compliance is the monitoring and enforcement of standards

Question 24

What is compliance training?

Answer 24

Mandatory training to test the knowledge of relevant codes of conduct.

Question 25

What is explicit CSR?

Answer 25

Voluntary taking on responsibilities benefitting society

Question 26

What is philantropy?

Answer 26

Donations benefitting wider society

Question 27

What are hypernorms?

Answer 27

Norms that are valid everywhere around the world

Question 28

What is implicit CSR?

Answer 28

Participating in wider (in)formal institutions benefitting society