Business and Society Chapter 2
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Business for Social Responsibility (BSR)
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Formed to fill an urgent need for a national business alliance that fosters socially responsible corporate policies.
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Corporate Social Responsibility (CSR)
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Seriously considering the impact of a company's actions on society. Requires the individual to consider his or her acts in terms of a whole social system, and holds him or her responsible for the effects of his or her acts anywhere in that system.
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Corporate Citizenship Concepts
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1. Corporate social responsibility - emphasizes obligation, accountability 2. Corporate social responsiveness - emphasizes action, activity 3. Corporate social performance - emphasizes outcomes, results (Look in power point)
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Corporate Citizenship
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Embraces all the facets of corporate social responsibility, responsiveness, and performance. Serves a variety of stakeholders. Companies have certain responsibilities that they must fulfill in order to be perceived as good corporate citizens.
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Philanthropy
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Contributions to charity and other worthy causes... Even during periods dominated by the traditional economic view.
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Community Obligations
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To improve, beautify, and uplift were also evident.
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Paternalism
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Appeared in many forms.
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Evolving Meanings of CSR
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1. Corporate social responsibility is seriously considering the impact of the company's actions on society. 2. The obligation of decision makers to take actions that protect and improve the welfare of society as a whole, along with their own interests. 3. Supposes that the corporation has economic and legal obligations as well as responsibilities to society that extend beyond these obligations.
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A Four-Part Definition of CSR
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The social responsibility of business encompasses the economic, legal, ethical, and discretionary expectations that society has of organizations at a given point in time.
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Philanthropic Responsibilities
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Be a good corporate citizen
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Ethical Responsibilites
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Be ethical
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Legal Responsibilites
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Obey the law
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Economic Responsibilites
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Be profitable
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The CSR Equation
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Economic Responsibilities +Legal Responsibilities + Ethical Responsibilities + Philanthropic Responsibilities = Total Corporate CSR
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Ways Firms Respond to CSR Pressure
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Defensive Approach Cost-benefit Approach Strategic Approach Innovation and Learning Approach
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Corporate Social Responsiveness
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An action-oriented variant of CSR.
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Responsibility
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Implies a state or condition of having assumed an obligation.
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Responsiveness
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Connotes a dynamic, action-oriented condition.
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Broad View
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A reflection of shared moral and ethical principles. A vehicle for integrating individuals into the communities in which they work. A form of enlightened self-interest that balances stakeholders' claims and enhances a company's long-term value.
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Narrow View
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Corporate community relations
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Benefits of Corporate Citizenship
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Improved employee relations Improved customer relationships Improved business performance Enhanced marketing efforts
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Internal Motivators:
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Traditions and values Reputation and image Business Strategy Recruiting or retaining employees
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External Pressures:
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Customers and consumers Expectations in the community Laws and political pressures
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Stages of Corporate Citizenship
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Stage 1: Elementary Stage 2: Engaged Stage 3: innovative Stage 4: Integrated Stage 5: Transforming (Look at power point)
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Global Corporate Citizenship
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Are topics that are becoming more relevant with each passing year.
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Stakeholder Bottom-Line Perspective
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The view that a firm has multiple bottom lines that benefit for corporate social performance.
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"Triple Bottom-Line Perspective"
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Key Spheres of Sustainability 1. Economic 2. Social 3. Environmental Corporate sustainability is the goal.
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Social Screening
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A technique used to screen firms for socially-responsible investment purposes.
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Reasons for the Upsurge in Socially Responsible Investing
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1. More reliable research on CSP 2. Investment firms using social criteria have solid track record 3. The socially conscious 1960s generation is making investment decisions
