Session 5: Corporate Social Responsibility Flashcards
an idea that suggests that organizations behave ethically and with consideration to social, cultural, economic, and environmental issues
Social Responsibility
Social Responsibility applies to all types of businesses that implement social responsibility initiatives. Small businesses may have a greater impact in local communities. Social responsibility, as it applies to business, is known as
Corporate Social Responsibility
adopts a strategic focus that involves action, measurement, and result
Social Responsibility
the duty of business to do no harm to society; should be concerned about the welfare of society and mindful of how its actions could affect society as a whole
Social Responsibility
fulfills societal expectations
Social Responsibility
Archie Carroll’s Pyramid of Social Responsibility (4)
From bottom to top:
- Economic
- Legal
- Ethical
- Philantropic
the responsibility of business to be profitable
Economic
only way to survive and benefit society in long-term
Economic
responsibility to obey laws and other regulations
Legal
E.g. Employment, Competition, Health & Safety
Legal
responsibility to act morally and ethically
Ethical
businesses should go beyond narrow requirements of the law
Ethical
E.g. Treatment of suppliers & employees
Ethical
responsibility to give back to society
Philantropic
responsibility is discretionary, but still important
Philantropic
E.g. charitable donations, staff time on projects
Philantropic
blueprint to achieve a better and more sustainable future for all
Sustainable Development Goals
address the global challenges we face, including those related to poverty, inequality, climate, environmental degradation, prosperity, and peace and justice
Sustainable Development Goals
important that we achieve each Goal and target by 2030
Sustainable Development Goals
“development that meets the needs of the present without sacrificing the right of future generation to fulfill their needs.”
Sustainability
seriously considering the impact of the company’s actions on society
Corporate Social Responsibility
take actions which protect and improve the welfare of the society as a whole along with their own interests
Corporate Social Responsibility
impact of every business policy and business action on society
Corporate Social Responsibility
extending beyond the business compliance with laws and other legal requirements
Corporate Social Responsibility
Pros of Corporate Social Responsibility
- Enhances reputation among stakeholders.
- Better customer relations
- Attract and retain employees
- It’s the right thing to do.
Cons of Corporate Social Responsibility
- Costs money to implement.
- Conflicts with the Profit Motive
- Customers are careful about Greenwashing / PR Ploys
- Many businesses put the cost on consumers.
he practice of making an unsubstantiated or misleading claim about the environmental benefits of a product, service, technology or company practice
Greenwashing
can make a company appear to be more environmentally friendly than it really is.
Greenwashing
Historical Phases of Corporate Social Responsibility
Phase 1: (1800s to 1900s) Profit Maximizing Management
Phase 2: (Early 1900s) Trustee Management
Phase 3: (1930s) Quality of Life Management
- Management must maximize profit.
- Individual drive for profit maximization would ultimately create wealth for the nation.
- Business systems as a profit maximizer are used as a tool for the elimination of economic scarcity.
- Business ignored unsafe working conditions, paid starvation wages and used child labor in order to maximize profit.
- Problems of cultural minorities, unsafe products, unfair advertising and urban poor problems were given little if no attention at all.
- Abuses of capitalism are extremely rampant and the government tolerates these deplorable business practices.
Phase 1: (1800s to 1900s) Profit Maximizing Management
- Management was considered both as an instrument of stockholders and as a trustee for all groups who contribute to the business enterprise.
- Aside from the profit maximization, the management’s concern is also to maintain a fair balance in the interests of employees, customers, creditors, stockholders and the community.
Phase 2: (Early 1900s) Trustee Management
- Security of basic goods and services was no longer a principal problem.
- Social and economic problems brought about by economic growth expanded the concept of social responsibility management.
- Society demanded management’s active participation in helping solve social and environmental problems in view of the cast resources (funds, manpower, materials, management, skills and technology) of businesses
- Business is expected to contribute to the improvement of the quality of life which involves cultural, social, education, political factors and economic security.
- Society is unstable if the quality of life of the people is poor. Businesses contribute to a good quality of life and society.
- A prosperous society is the best environment for a business to thrive in. Businesses will benefit from its self-investment in society.
Phase 3: (1930s) Quality of Life Management 1
