Chapter 4- Corporate Social Responsibility

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Corporate Social Responsibility
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The actions of an organization that are targeted toward achieving a social benefit over and above maximizing profits for its shareholders and meeting all its legal obligations.
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Instrumental Approach
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the perspective that the only obligation of Organizations is to maximize profits for its shareholders in providing goods and services that meet the needs of its customers.
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Milton Friedman
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Nobel Prize Winner who was the most famous advocate of the instrumental approach
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Social Contract Approach
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the perspective that the organization has an obligation to society over and above the expectations of its shareholders.
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Five Major Trends behind the CSR Phenomenon
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1. Transparency 2. Knowledge 3. Sustainability 4. Globalization 5. The failure of the public sector
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Bottom Line
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Profitability- the money left over after all the bills have been paid
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Triple Bottom Line Approach
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Social and environmental support alongside financial performance.
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Ethical CSR
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the purest or most legitimate form of CSR in which organizations pursue a clearly defined sense of social conscience in managing their financial responsibilities to their shareholders, legal responsibilities to their society and ethical responsibility to do the right thing for all their stakeholders.
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Altruistic CSR
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Philanthropic approach to CSR in which organizations underwrite specific initiatives to give back to the community.
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Strategic CSR
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Philanthropic approach to CSR in which organizations target programs that will generate the most positive publicity for the organization but which runs the greatest risk of being perceived as self-serving behavior on the part of the organization.
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Kyoto Protocol
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an agreement between 160 countries that requires developed nations to reduce their greenhouse gas emissions not only by modifying their domestic industries but funding projects in developing countries in exchange for carbon credits.

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