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ADM1301B society Notes for Midterm - including notes on videos

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University of Ottawa
David Delcorde

Business & Society ADM1301B Intro [terrible AC/DC video.] bands are businesses. revenues, expenses, marketing, promo, planning, org, etc bands have gov't connection : taxes, employ taxes, respect laws, need passports/visas to travel bands have affect on civil society: affects people, business,entertains ppl, offends people/stakeholders, which provokes pressure on gov't, indirect employ health professionals (at concerts) bands do not live and work in a vacuums. business do not exist on their own, they affect directly & indirectly other stakeholders. The banana (marketing video: feeding new york... about bananas) what happens when another competitor comes into the market and offers cheaper (lower quality) bananas? demand for the more expensive bananas falls. reaction? can drop their price? catch: requires money to wait it out. Company waits it out and then continues to prosper. then decides to give back. Do they need to give back? is the company property of the shareholders or is it the property of the society in which it exists? they decide to give back to society: charitable donations etc. reaction: perception of the company increases and they can charge even more! some companies will only invest in good, ethical companies. Then the gov't turns around and realizes they can tax them. So banana company needs a way to influence the gov't, they go to a lobby company. the lobbyiest is there to help you get ready to sit with the minister (they don't go to the minister themselves) gov't reaction: no change to tax laws. (The gov't is not interested in one company they are interested in sectors) suggestion: go global. so they become a publicly held corporation to oversee governance and went global. reaction: competition rises. not just an individual but the competition can now come from anywhere in the world. you need to be ready and have an action plan when this happens. Things go viral and spiral into something massive very quickly today. Nasty tactics: publicly accusing of child labor, illegal fertilizer, GMO bananas, stem cell research to increase crop yields etc - all fabricated stuff reaction: DBBI lobbies the gov't to raise these unethical tactics at WTO in the meantime the stakeholdres (any party or person with a perceived stake in the company - shareholders, suppliers, gov't in the area in which it works etc) want to know if they are true. DBBI wants to know who their key stakeholders are and how much power and interest they have? how powerful are they and how interested are they? do they truly understand their stakes? Which ones do we treat since we can't treat them all. How much do we have to do to create the perception of an ethical business, in the end, how can we be more effective. you need to be culturally aware/sensitive, you need to implent effect corporate governance. moral: business exists to satisfy the wants and needs of society. If society doesn't want a product, it wouldn't be made. when you move into globalization - many of the things we wouln't be able to afford if they weren't made offshore. the consequences of any business activity are good and bad. the objective is to minimize the bad but there are give and takes. there are always consequences. are the people who make our clothes better off because the stuff we wear is produced there? we don't know. Business needs to be profitable and you need to do so socially and ethically. Lecture 1 – Significance of business in its Social Context Issues - Society’s expectation of business driven by a more informed, affluent and litigious society - Technology advances facilitates misinformation and disinformation but also puts business in society’s spotlight- it is not about finidng info, it's about sifting through it and finding out what is real/relevant. - Who in “society” has the greatest influence? is it the gov't? business? civil society? the gov't can fix things but only using your money. will the gov't fix it? sure, if you want it, but if we let the gov't fix things there is less money for something else. that is the reality of the gov't - Who has the right to dictate how business should operate? is it the gov't? competiton? citizens? stakeholders? - What exactly is “ethical behavior”? an ethical dilemma can exist between two mutually acceptable actions, but you cannot do both. what is ethical behavior in this company may not be considered ethical in another. ie bribes: illegal in this company (and therefore not legal) but in other countires it isn't called bribes (convienience payments) and that cost can be deducted from your tax. Is it wrong? If one company does not do bribes, they will not be able to do business in countries where they do. - What exactly is “social responsibility”? we cannot all agree to this defn or how much is the right amount of social responsibility Significance of Business in its Social Context domestic macroenvironement - Business affects, and is affected by the society in which it operates - For managers to operate effectively, an understanding of business’ domestic microenvironment is essential What exactly is business’ Macroenvironment? - It is intuitive that business can affect, and be affected by other businesses - But business can affect, also be affected by o Government o Civil Society o o o The Modified Boulding Triangle: A way to depict the Canadian Macroenvironment The Business Segment - All forms of “for profit” business ownership – not crown corporations or anything that isn't in it for the momey - NGO etc o Corporations o Partnerships o Proprietorships The Government Segment - All levels of gov’t o Federal - focus o Provincial o Municipal The Civil Society Segment - Organized and unorganized social networks o Communities o Non-gov’t orgs o Charities o o Volunteers o Philanthropic efforts Canada’s Macroenvironment – the business-gov’t-Society Nexus 2 - The modified “boulding triangle” depects the three segments of the domestic macroenvironment – business (B), Gov’t (G) and Civil society (S) - At the apex appears B, G and S in its purest form - "purest" - only exist in theory as far as DD is concerned, because you would need perfect information. - o Pure reciprocity (civil society) o Pure exchange (business) o Pure coercion (gov’t) - All inner territory represents orgs embodying different mixes of the three – a variety of socioeconomic AND gov’t relationships o - Rules or “sorting” mechanisms of coordination for each segment are based on different principles - refers to how these sectors actually work. o Business – supply and demand forces at the end of the day S&D are the sorting mechanisms for business o Gov’t – redistribution and coercion - we coerce you to pay your taxes and then we redistribute the money o Civil society – cooperation, reciprocity and solidarity - has a very dif set of sorting methods. "I'll do something for you, you do something for me" simple trust and networks. ie social capital (more on that later) - Note that o The boundaries between B, S, and G are not well-defined because they are not rigid frontiers – but rather wavering and continually evolving zones of overlap, interaction and interdependency - be better to depict it as a dotted line - ie economic meltdown - immediately everyone tells the gov't to regulate, but before that everyone was telling the gov't to go away. Enron/worldcom. 9/11 - gov't protect us! o An initial survey reveals that in Canada each of these three segments now occupies approximately one-third of the organizational/institutional territory denoted by the surface of the Boudling triangle About this Course - This course explores business in its social context - Business, and its affect on gov’t and civil society, and their affect on business - It’s more than simply making a profit - Business’s relation with “society” is increasingly complex About how you will be taught - Through o A highly interactive approach where in-class discussion is encouraged o Lectures and videos (where practicable) o Guest lecturers (when possible) - Jordan, lobbyist About the material - The course outline is available on doc-depot and you must review – indicates subjects, dates, regulations… - Most of the slides you will see in this class will be posted on BB - Required text book - You must be here to do well- hints, discussions, material that you will be responsible for. Your Responsibilities - Note carefully: you are responsible for all material covered on the course outline including o all text book references (chapters to be read) whether or not explicitly covered in the lecture 3 o all slides presented in the lecture  many slides contain material that is not explicitly covered in the text book o all content of class discussions including any case studies o all video material o all in-class group work o you must monitor your uOttawa email account About Expectations 1. you will real all text book, materials assigned and course lecture slides, in accordance with the outline before coming to class 2. you must attend lecture to do well in this class 3. you will participate fully in class discussions 4. you will not hesitate to ask the prof for clarification on any part of the course material that is not sufficiently clear for you Lecture 2 – The Canadian business Segment The Macroenvironment of Canadian Business - business drives the economy, it is not the gov't. the gov't fosters an environment in which business can drive the economy - business drives the economy of a nation - the economic system in Canada is a private enterprise system o rewards firms for effectively and efficiently meeting the wants and needs of customers o basic rights of a private enterprise system:  private property  freedom of choice  profits  competition - Six distinct time periods define north American business history o Colonial (before 1776)  Agricultural production o Industrial revolution (1760-1850)  The advent of the factory system and mass-production o Industrial entrepreneurs ( late 1800s)  Risk-takers and inventors; advances in technology o Production (late 1800s-1920s)  Assembly lines, producing greater quantity faster o Marketing (since 1950s)  Consumer orientation o Relationship (from 1990s)  Strategic alliances between customers, suppliers  the recognition that business cannot do it all by itself anymore. We work together so that everyone wins. I might sell widgets but I don't manufacture them b/c it wouldn't make sense. I work with suppliers who work with manufacturers etc. we work together and foster relationships - The workforce of today: you need to accept a variety of work life balance. the story goes that for baby boomers it was all about the job, which defined them and came first. they were born post-war. then you have the younger generation (X/Y) - is it fair that the younger generation are more interested in work-life balance. some articles suggest the younger generation don't want to marry into a company. they will go to the higest bidder and they want work-life balance. as future managers we will have to manager this. it is conceivable that we will be managing our own workforce, which will have differnet types of people who are motivated by different things. you need to get inside everyone's head. o Aging population o Shrinking labour pool o Increasing diversity - 2/3 of canadian population is from immigration you need to be culturally sensitive, not just in other countries but in canada. the diversity of the workforce we manage will have different cultures. 4 o Outsourcing & the changing nature of work - most manufacturing is outsourced. most Canadian business is in service o Flexibility and mobility - younger workers don't subscribe to work comes first lifestyle o Innovation through collaboration The Canadian private sector forms of business ownership be able to differentiate these different types of businesses. - Sole proprietorship o The simplest form of business organization available to any individual who is legally able ot enter into a binding contract o SPs fall under provincial and municipal jurisdiction o Filing a name declaration is not required provided the proprietorship operates under a person‟s name o Owned and operated by one person o owners & managers are one and the same o must be legally able to enter into a contract (not in jail/insane) Advantages: Disadvantages  Easy & cheap to start  Unlimited liability - if something goes wrong  Secrecy - ie an intellectual idea that you use and you go under, you are responsible for all for consulting. If it's a partnership you have to debts of the business share with partner  Limited financial resources  Flexibility and control  Limited skills pool - management team of 1.  Pride of ownership  Overwhelming time commitment -  Distribution and use of profit  Few fringe benefits  No special taxes  Limited growth - limited to your own resources  No gov‟t regulation  Limited life span - Partnership o An arrangement whereby two or more persons combine some or all of their resources in a business undertaking with a view to sharing profits among partners o Provincial laws require that a partnership must legally register its name and give info about the partners o partnership agreement drives the whole thing. could be any number of details within the agreement o owners & managers are one and the same o types - be able to differentiate between these  General  Partners are not only liable in equal share for the debts of the partnership (jointly liable) but in addition, each partner is liable for the full amount (jointly & severally liable)  Each member can bind the partnership without consent of the other partners  Limited - every partner needs to have at least 1 general able to differentiate between types of partners  Composed of one or more general partners who conduct the business, and one or more persons who contribute an amount in actual cash (special or limited partners)  The special partner‟s liability is normally limited only to the amount of the cash s/he contributed to the partnership  Limited partners: - known or unknown to public, active or not mgmt role o Silent partners  Known to the public, no active management role o Secret partners  Unknown to the public, but take an active role in management o Nominal partners  Lend their name for public relations, but are actually not involved o Dormant partners  Neither known to the public nor active in management Advantages: Disadvantages  Ease of organization  Unlimited liability  More financial resources (capital and credit)  Partners are responsible for the business 5  Shared management activities of all others  Combine knowledge and skills - not everyone  Division of profits will have every skillset  Disagreements among partners  Faster decision making  Life of a partnership  Few regulatory controls - Corporation o A corporation is recognized as a separate legal entity under the law o A corp. can be incorporated federally or provincially  Federal  provincial o A corp. incorporated under the laws of Canada (federally) can carry on business in all parts of Canada  Federally incorporated business include 150 of the 200 largest corporations in Canada  A federal company cannot be prevented by a provincial gov‟t from exercising the powers that have been validly conferred on the company by federal authority (eg doing business in a province) o A private corporation:  The right to transfer shares is restricted  Number of shareholders limited to 50  May not sell shares or debentures (bonds or debt instruments) to the public (ie not on a public stock exchange) o A public corporation:  Sells shares to the public on a stock exchange  Is subject to stricter regulations for filing financial reports, must follow certain audit procedures  Must file a prospectus if shares are being sold to the investing public Advantages: Disadvantages  More money for investment  Initial cost  Limited liability  Paperwork  Separation of ownership from management -  Two tax returns - pay corporate tax and then owners of shares are not necessarily the when you get paid dividends you pay tax on owners those dividends  Ease of ownership change  Termination difficult - more difficult the larger  Perpetual life they get  Size  Double taxation  Perceived legitimacy - you need a loan for  Greater expectations for social responsibility your cleaning company, if it has "inc" at the and ethical conduct from stakeholders end it sounds more credible, people assume it is larger Question: under what circumstances would certain forms of business ownership be preferred? - Cooperative o An organization that emphasizes working together as a way of building community involvement by supplying needed goods and services at a lower cost (eg producer co-op, consumer co-op, financial co-op, service co-op, housing co-op) - Franchises – a specialized form of business ownership o A business established or operated under an authorization to sell or distribute a company‟s goods or services in a particular area o Top 10 US francises in 2007  Subway  Dunkin donuts  Jackson Hewitt tax services  7 eleven  UPS store, the mail boxes etc  Dominos pizza LLC  Jiffy lube int‟s inc 6  Sonic drivethrough restaurants  Mcdonalds  Pap john‟s int‟s inc o Top 10 US francises in 2012  Hampton Hotel  Subway  7 eleven  Mcdonalds  Denny‟s  H&R block  Pizza hut  Dunkin donuts Case: Biway optical Video: Caribbean Beer  unexperienced staff & management  contingency plan for brew master  large startup costs  chances of success? not that great  would you invest? most people would say no. it seem to lack experience and organization. But if you wanted to get someone to invest in a company they wouldn't show you that video showing you the overwhelming time commitment and everything in the video (disorganization) etc. what is the risk-return tradeoff? Corporate Governance: Definition The process, structures, and relationships through which the shareholders, as represented by a board of directors, oversee the activities of the business enterprise Governance Themes: how an organization steers itself all these things are in the domain of governance: - Values - Rules - Processes - Impact - Accountability - Responsibility Owner stakeholders and corporate governance Governance: how an organization steers itself OECD: Governance… the full set of relationships between a company’s management, its board, its shareholders and its other stakeholders such as its employees and the community in which it is located Corporate governance - According to the OECD, governance: o Concerns the rights and responsibilities of a company‟s management, its board, shareholders and various stakeholders Corporate governance Key players 1. Shareholders - The de-facto owners of the corporation - Interested in return on investment 2. Board of directors - 7 - Responsible for governance - Elected by shareholders to represent shareholder interests - Fiduciary duty - Duty of care - Responsibilities: - Accountability - Management control systems - Disclosure - Financial reporting - Shareholder & stakeholder rights - Risk - Performance - Directors‟ Fiduciary Duties: - Duties given in trust to an individual as a director - To act in good faith - To exercise powers properly for the purpose for which they are conferred - To avoid conflict of interest - To prevent improper payments - Obligations of directors to shareholders that are prescribed by laws or regulations - To make decisions in the best interest of the company (which are not always in the best interest of the shareholder - Consider other stakeholders - Equal consideration to all shareholdres - No personal profits at company expense - Declare conflicts of interest 3. Officers/senior employees - Officers - accountbility for governance still rests with the BOD - Senior employees who oversee daily operations 1. President 2. Chief operating officer 3. Members of the sr management team Governance failures Examples - Enron - Worldcom - Tyco - Peregrine systems Adversely affect many parties, both direct & indirect - Shareholders - Employees - Suppliers - Pension funds - Communities - Government - Civil society What exactly is corporate social responsibility? - The degree of moral obligation that may be ascribed to corporations beyond simple obedience to the laws of state (Kilcullen & Kooistra 1999) - An organization‟s obligation to maximize its positive impact and minimize its negative effects in being a contributing member to society, with concerns for society‟s long-run needs and wants. CSR means being a good steward of society‟s economic and human resources 8 - The intelligent and objective concern for the welfare of society that restrains individual and corporate behavior from ultimately destructive activities, no matter how immediately profitable, and leads in the direction of positive contributions to human betterment, variously as the latter may be defined - Definitions: - The way a corporation achieves a balance among its economic, social & environmental responsibilities in its operations so as to address shareholder & other stakeholder expectations - “…the capacity of a corporation to respond to social pressures” Corporate Social Responsibilities? - Can corporations have social responsibilities? - Can a corporation be morally responsible for it‟s actions? Corporations do have some level of moral responsibility - Corp have an org‟d framework of decision-making that transcends an individual‟s framework of responsibility - Corps manifest a set of beliefs and values – an organizational culture tha, among other things prescribes what is right or wrong - Therefore: the level of a corporation‟s moral resp is more than the respond of the individuals who constitute the corp Reality lies somewhere in between these two views: Case for Social Responsibility Case against social responsibility  Business must satisfy society;s needs  Profit maximization is the primary purpose of  CSR prevents public criticism and gov‟t regulation business – business should do what they are there  Business & society are interdependent for – to make money  CSR is good for the bottom line  Business is responsible to shareholders, ie not to every stakeholder.  Investors & consumers support CSR  Addressing social problems can become financial  Social policy is role of gov‟t – business doesn’t opportunities (eg pollution abatement - recycling) have the training to deal with social issues  Business should take long-term CSR approach  Business lacks training in social issues  Social actions improve public image and goodwill  CSR would give too much power to business if we did have all the power in business to deal with  Business can solve problems as well as government social issues, all of a sudden not only do we not  Proactive approach is better than reactive  Businesspeople are also concerned citizens have control of the economy, you give business the authority to solve social issues and all of a sudden they have too much power  Business involvement in social matters increases costs if business is going to solve the social problems then who pays for that? Shareholders and the consumer  No reliable guidance for business in CSR matters  Business cannot be held accountable unlike social institutions  There is divided support in business community for social involvement Social Responsibility Theories 1. Amoral View  Traditional view of business as merely profit-making entity  Neither moral nor immoral, this is just what it is. Not about being social responsible or not, the whole idea is that making money and being profitable lacks a moral quality 2. Personal view  Corporations are like people and can therefore not be held accountable for their actions  Are corporations moral persons or moral agents?  Can they be morally blamed? Yes if they are moral persons 9  Moral agents – then they can be punished 3. Social view  Corporations are social institutions with social responsibilities  Corp is a social institution because the only reason that it exists is because society sanctioned it to exist, otherwise it couldn’t exist legally. If society gives you life you have an obligation to give back to society How do we figure out an amount of CSR? The expectation is that you will be profitable because you have to be. Otherwise you are a drain on society. You have to be legal You are expected to be ethical In order to be a good citizen you will be philanthropic Economic Responsibilities + Legal resp + Ethical + Philanthropic resp = your CSR Starbucks Video Building relationships with coffee growers Implemented strategies - Buy coffee from small farms, pay 1.20 per lb even in depressed market - Help farmers show them how to grow coffee - Work in partnership with farmers - Goes directly to the farmer whenever possible - Demands price transparency if they cannot deal directly with the farmer - Negotiates longer-term contracts with producers - Helps farmers know they have guaranteed contract (2-5 years), allowing famers to plan and put back into their money making sources - Important to starbucks that their growers stay in business - Helping small farmers get credit because many farmers do not have access to credit. The farmers need to pay their pickers up front in order to harvest the crop. Starbucks contributes money to ppl who are ecologically friendly, put money up front through a third party to make sure the farmers will be around and that they can get their supply of coffee - Fair trade coffee : 17 certifications. Give pre-harvest loans, certifies fair trade products, encourages organic growing, co-op, sets minimum price for green coffee. Fair trade coffee is for sale in their stores and available in press pot and is coffee of the day at least once a week. They consider all their coffee fairly traded even if it isn’t certified. - Working to preserve the environment - Works with conservation companies (Conservation International) to conserve environmentally diverse areas such as in Mexico, which in return created a new product: shade-grown Mexico - Investing in regions where they have suppliers - Conduct social projects in their origin countries, specific to where they buy their products. Ie building schools and clinics - Being successful and responsible are not mutually exclusive. Themes - Giving back - Doing more good than bad - Achieving something good Is Starbucks a socially responsible company? All companies are in the business of making a profit, and they are doing that (otherwise they would not be a company), they are building goodwill. They do this for perception – so people perceive them as a good company. Call: DVD 02006 Morisette library 10 You need to think critically, you need to accept everything at face value so you can make an informed decision. Consider the source. Contemporary Corporate Social Responsibility Concepts 1. Corporate Sustainability  Corporate activities demonstrating the inclusion of social and environmental as well as economic responsibilities in business operations as they impact all stakeholders  Five levels i. Compliance-driven: following gov‟t regulations & responding to charity & stewardship considered appropriate by society  A minimalist approach ii. Profit-driven: consider social, ethical and environment aspects of business operations insofar as they contribute to the bottom line – you won’t invest in anything that doesn’t contribute to bottom line  A “tactical” approach iii. Caring: initiatives go beyond legal compliance and profit considerations – economic, social & environmental concerns are balanced  An “accommodating approach” – trying to accommodate a number of stakeholder interests iv. Synergistic: well-balanced and functional solutions are sought that create value in the economic, social & environmental areas that result in gains for all stakeholders  A “collaborative” approach – “all stakeholder” – you cannot appease all your stakeholders all the time. The best you can do is probably please your most important. This is more of a theoretical argument because this might not be very practical. v. Holistic: full integration of corporate sustainability embedded in every aspect of the corporation‟s activity as this is important to the quality and the continuation of life of this planet  A “utopian” approach – this is almost like a vision statement – what we want to become. The idea is you may never get there, it’s what you’re striving toward. Admirable goal but not practical?  Corporate sustainability is recognized by the financial markets because it creates long-term shareholder value by embracing opportunities and managing risks relating to economic, social & environmental develops 2. Reputational Management -  Any effort to enhance the corporation‟s image and good name i. Focus has moved away from the media, public relations & crisis mgmt. to developing relations with all stakeholders  Reputational management involves several stages in its development i. Identify the desired perception of the corporation ii. Recognize the significance of image with all stakeholders iii. Be aware of the influence of interactions with all stakeholders on the corporation‟s reputation – iv. Manage relationships with stakeholders continuously 3. Social impact management  Defined by the Aspen Institute as “the field of inquiry at the intersection of business needs and wider social concerns that reflects and respects the complex interdependency of the two” – both need to exist. i. Stresses the need for business to recognize and understand this interdependency if business & society with to thrive  Two aspects: society‟s influence on the corporation & the corporation‟s influence on the social & environmental concerns of society  Social impact management evaluates three aspects of business: i. It‟s purpose (in both societal & business terms) ii. Social context (are stakeholder‟s considered?) iii. Metrics (how is performance & profitability measured?) – can we do this consistently? Can we compare two different companies? 11 Triple-E bottom Line (TBL) - Evaluates a corporation‟s performance according to a summary of the economic, social (ethical) and environmental value the corporation adds or destroys - Now forms the basis for corporate reporting of economic, ethical & environmental responsibilities Corporate Citizenship - The demonstration by a corporation that it takes into account its complete impact on society and the environment as well as its economic influence - A term recently becoming commonly used to describe the role of business in society - Good corporate citizenship can provide benefits in eight areas o Reputation management o Risk profile and management o Employee recruitment, motivation and retention o Investor relations & access to capital o Learning & innovation o Competitiveness and market positioning o Operational efficiency o License to operate (greater leeway when problems occur) The Natural Environment & Business - The natural environment - Debate: Pollution vs. Productivity o Everything leaves an environmental footprint? Are you aware of the environmental costs? We buy things that come from countries that do not have the same environmental regulations. Are you willing to go for less pollution to feed this lifestyle? o Every sector of business in every country leaves an environmental footprint o There is an environmental footprint left on everything Natural environment issues - Ozone depletion - Global warming – you need a balanced view - Social & hazardous wastes - Freshwater quantity & quality - Degradation of the marine environment - Deforestation - Land degradation - Endangerment of biological diversity Responses of gov’t of Canada - Canadian environment protection act (federal gov‟t) - Air quality legislation (provincial gov‟t) o Canada water act o Fisheries act o Navigable waters protection act o Arctic waters pollution prevention act o Canada shipping act o Dominion water power act - Land-related legislation CERES After the Exxon Valdez oil spill the CERES organization was formed. CERES developed ten principles that have been advanced as models for businesses to express and practice environmental sensitivity Many major companies have endorced these principles: EG Coca-cola, American airlines, GM, sunco. CERES Principles - Protection of the biosphere - Sustainable use of natural resources 12 - Reduction and disposal of waste - Energy conservation - Risk reduction - Safe products & services - Environmental restoration - Informing the public - Management commitment - Audits & report Two view of environmentalism – be able to differentiate between these two and be able to say which one you think is best - Standard environmentalism: Occurs when gov‟t regulation/intervention is required to remedy the market‟s failure to provide sufficient environmental protection - If you didn’t have the gov’t there would be no protection at all - Market environmentalism: occurs when economic incentives created by the market are more effective at protecting the environment than gov‟t intervention - People will not buy your product unless it is environmentally friendly, so we don’t need the gov’t. Lecture 3: Stakeholders: The Canadian Gov’t Segment September 16, 2013 When you hear the word “government” what is the first word that come to mind? - Bureaucrats, politicians, bungling, inefficient, ineffective, waste, taxes, smoke & mirrors, cover-ups, publicity, can’t get a job anywhere else, no accountability - “ let the gov’t fix the problem…it’s the politicians…it’s the bureaucrats…there’s no leadership…it doesn’t matter b/c the gov’t won’t listen and will do whatever it wants anyways” - Where is the balance? - Why are criticisms easier? o Lack of understanding of the gov‟t sector o Influenced by the press that suggests no accountability or responsibility Video: Insurance: Credit-based rates - What does an MPP do about this? - Insurance rates tied to credit rating o Are you ok with this - What do you feel the provincial gov‟t role should be? o Informed consent o Reinforced privacy laws that already exist o Put a limit on the amount they can increase rates o Are they respecting privacy laws? o It’s a civic responsibility o The MPP that is elected by the people – who should he or she side with?  They also need to take into consideration the party that they belong to and what direction the party is headed  You cannot please the people all the time  Ie a big company in the MPPs constituency may say they will go out of business if the MPP goes one way vs the way the constituents want that MPP to go. Video: Counterfeiting - Health & safety concerns, no quality, the actual company loses money, reflects poorly on companies who have done a lot of R&D, false accusations towards big companies, - IT enables this because you can make virtually identical copies very quickly - What should the federal gov‟t do about this? o Gov’t mostly concentrates on terrorists & drug control, this is a low priority o Legislation with higher fines, but international laws and cases could go on and on and cost a lot of money for the gov’t 13 o More about what the gov’t can do with the limited resources, and it is also based on what the people want (which is cheaper things usually) o Counterfeiting may also be funding drugs and terrorism o Citizens have the responsibility to voice there options to the gov’t and to elect those who say they will do what the citizens want o If no one buys it they won’t sell it. If there is demand they will find another way to sell to ppl. o Gov’t should crack down more on retailers o If the people are not willing to pay the real price of the real thing, why would the gov’t be motived to do anything about it? o All about Available resources:  We are all taxpayers  What is more important to the constituents  We cannot solve all the problems o Fake parts  Fake parts on airplanes…. Is that a real problem? Yes… we don‟t even know that it is there  Fake parts in military machinersy  In break pads  These fake items are in the marketplace. These can be the difference between living and dying  Fake medicine… filled with filler that could kill you o There are only so many resources. What are we NOT Going to do? What is the appropriate role of gov’t Insurance rate? - Endless issues Counterfeiting - Countless stakeholders Unemployment - Some favour more gov‟t intervention Economy - etc How Canadians Govern Themselves – Covered only briefly - Canada is a democracy, a constitutional monarchy and a federal state, with 10 largely self-governing provinces and three territories - Nova Scotia was the first part of Canada to secure a representative gov't (in 1758) A federal State - a federal state is one that bring together a number of different political communities with a common gov't for common purposes, and separate "states" or "provincial" gov'ts for the particular purposes of each community - federalism combines unity with diversity - the British North America Act, 1867, was the instrument that brought the Canadian federation into existence The Constitution Covered only briefly - the Constitution Act, 1982 did not give Canada a new Constitution - what we have now is the old constitution with a very few small deletions and four immensely important additions: 1. the establishment of 4 legal formulas for amending the constitution 2. the first three amending formulas place certain parts of the written constitution beyond the power of parliament or any provincial legislature to touch 3. the setting out of the Canadian Charter of Rights & Freedoms 4. The giving to provinces, wide powers over their own resources Canadian charter of Rights & Freedoms - Covered only briefly Specific Rights & Freedoms: - democratic rights - fundamental freedoms - mobility rights - legal rights - equality rights - official language rights - minority language education rights Canadian Federalism- Covered only briefly Canada- 14 - governed by a system of parliamentary democracy with powers divided among the various levels of gov't that constitute our federalist state - two sources of laws: provincial & federal Federalism - is a system of political organization in which the activites of state are divided between at least two levels of gov't in such a way that each level has certain areas in which it is empowered to make final decisions the canadian federation - the federal gov't - 10 provincial and three territorial gov't - a number of regional and local municipalities Some examples of Federal gov't exclusive national powers: (only the federal gov’t controls – know a few of these and provide a reason why they are federal - Covered only briefly - direct & indirect taxation - regulation of trade and commerce - "the public debt and property" : grants to individuals or provinces (family allowance, hospital insurance/medicare, higher education etc) - the post office - census and statistics - defence - navigation & shippping - the fisheries - money and banking - interest - bankruptcy - weights & measures - patents - copyrights - criminal law and procedure in criminal cases - general law of marriage and divorce some examples of provincial legislation powers - Covered only briefly - direct taxation in the province for provincial purposes - natural resources - prisons (except for federal penitentiaries) - charitable institutions - hospitals (except marine hospitals) - municipal institutions - licenses for provincial and municipal revenue purposes - incorporation of provincial companies - solemnization of marriage, property and civil rights in the province - the creation of courts and the administration of justice, fines & penalties for breaking the law - matters of a merely local or private nature in the province - education – wouldn’t it be easier if everyone in the country did the same curriculum? Yes but then there would be no diversity. Different provinces have different needs for different education. The focus is not global or international it is perrocial. some areas of cross-over (read for yourself, not covered in class) - both parliament and provincial legislatures have power over agriculture and immigration, and over certain aspects of natural resources - if their laws conflict the national law prevails - although parliament cannot transfer any of its powers to a provincial legislature, nore a provincial legislature any of its powers to parliament, parliament can delegate the administration of a federal act to provincial agencies, and a provincial legislature can delegate the admin of a provincial Act to a federal agency The Canadian Political Landscape 15 Video: Question Period re: Wright/Duffey - PM avoided all questions (most people in question period do that in tought situations - Someone appears to be not telling the truth - “to my knowledge” etc no one wants to “know” anything. - Frustrating exchange – same question and answer back and forth no answers - It’s all a sort of game - Huge scandal that took several senators down. - When you look at this, the difference is that all the questions were right to the point, they were not presented with a flowery explanation beforehand. It was a yes or no questions. But if you say no that will provoke more questions and if you say yes, that it worse - During question period you notice that someone will have a great oration before they get to the question. – not here - Normally people ask questions and the whole party supports it even if the comment was absurd - Press What about the press? The press is the conduit of the interpretation of what is going on. You rely on the press’ interpretations of things to make the judgements - What is your reaction to the press o They indicated that everyone was trying to avoid any knowledge of anything o No one caught up in a scandal would admit to knowing about it o The press is losing faith in the gov’t b/c of the way the whole scandal is being hidden and they are clearly not being upfront about things o Consensus between press members that it was too late for him to apologize for it five days later o Biased view against conservatives. o Every political party through history has had their own parties and their own scandals throughout history. This is just where they got caught o Affects several senators, including liberal senators o The whole scandal revolves around senators spending tax dollars inappropriately o There is a difference between an administrative oversight and a blatant misuse of funds o This is why we have control functions throughout the gov’t these things should not happen which is why we have an auditor general etc o - Canada is a constitutional monarchy, a federation and a parliamentary democracy - her majesty Queen Elizabeth II is the Queen of Canada, and our constitutional head of state - She delegates her duties, which are mainly ceremonial, to her representatives in Canada: the GG & the provincial lieutenant-governors - Formally the PM and cabinet advise the queen, but practically cabinet holds the power and determines the policy for proposed legislation - This is a complicated business: Canada governs through the "westminister model" of gov't 16 Three branches of gov't - legislative - House of Commons & the senate - executive - PM, Cabinet & the Public Services - Judicial - independent of Cabinet, Parliament or of any other state institution - Judiciary – not linked to anything because judges need to be objective, they do not report to the sovereign or the PM Etc. - Know who is included in each part: legislative, executive & judicial and a bit about them Legislative Branch - House of Commons - 308 seats - elections at least every 5years - the speech from the Throne (intended work plan for the gov't) - Question Period (Opposition's chance to challenge gov't actions) – all the opposition members ask questions of the gov’t in power) - legislation and debates (draft bills are tabled and debated before becoming law) – bills ultimately become law - all proceedings of the HoC are recorded in a parliamentary publication called Hansard breakdown of seats: Hansard – every word that was said in parliament, in both official languages Province Seats Province Seats Ontario 106 NS 11 Quebec 75 NB 10 BC 36 NL 7 Alberta 28 PEI 4 Manitoba 14 NWT 1 Saskatechewan 14 N 1 Y 1 Majority gov’t – has more than half the seats. Breakdown is determined by the sensus, because it is based on populations and populations change over the years. Legislative Branch - the Senate - 105 seats - senators are appointed by the PM of the day and must retire at aged 75. (the PM chooses the senators) - the senate is a revising and investigatory body for legislation - bills tabled in the HoC pass through the senate and its committees for discussion, amendment and recommendation, then back to the HoC for "Royal Assent" - most senators are affiliated w a political party and must retire at aged 75 (note they are appointed not elected) they retire at age 75 not when the gov’t changes. - Senators elected by people not selected by PM? - breakdown of seats: Province(s) Seats Province(s) Seats Maritime 24 NL 6 Quebec 24 NWT 1 Ontario 24 Y 1 Western 24 N 1 The idea is to give each major region a voice in the senate. If there is a majority in both the senate and the HOC they can pass bills just from their own party. Amounts to effective control. There is an advantage to a minority gov’t because the parties have to work together, and it gives a more reflective view of the different views of Canadians. If there is a majority, they can pretty much do whatever they want. Know the legislative process: 17 Stages of a bill (before becoming law) 1. Introduction 2. first reading – just the title is read, nothing happens 3. second reading (most important - principle and object of the bill are debated and either accepted, rejected or amended) a. six months hoist b. reasoned amendment c. referral to a committee 4. third reading 5. senate 6. royal assent The Legislative Process - a closer perspective part 1 : the Cabinet Policy Requiring Legislation Starts off in the cabinet: - Consideration of policy proposal on a subject matter Cabinet committee and recommendation - Cabinet approval of Committee recommendation - Official of the responsible Ministry issue drafting instruction for the dept of justice - Draft bill prepared in both official languages and approved by the responsible Minister - Consideration of the draft bill by the Cabinet Committee on Legislation and House planning - Cabinet approval of Committee recommendation and House Leader's signature - To House of Commons The Legislative Process - A closer perspective part 2: parliament 18 From the Cabinet - First reading in either the Senate or the House of Commons (reading of title of the bill) - Second reading in the same House of Parliament (debate & vote on the principle of the bill) - Consideration by the appropriate parliamentary committee (clause by clause study - Report stage and vote on any further amendments proposed in the house - third reading (debate and vote on bill as amended - introduction of the bill into the other House of Parliament and repetition of the process - Royal Assent by the GG or a GGD all bills entailing the expenditure of public moneys must be introduced in the House of Commons - Anytime you are spending the people’s money, it has to go through the House of commons – the ppl in the House are elected, the people in the senate are appointed Know the dif btn bills: gov’t and private members public bills Private bills: matter of particular interest or benefit to a person or persons, including corporations Purpose: to confer special powers or benefits upon one or more person or body of persons; or to exclude one or more persons or body of persons from the general applications of the law ( two types - Governemt bills introduced & sponsored by a minister - private members' public bills sponsored by a private member o public bills dealing with a matter of public policy introduced by members who are not ministers o only a minister can introduce a bill for the appropriation of public monies or for taxation, and only in the House of Commons example of a private members’ bill: An act respecting a day to increase public awareness about epilepsy” intention: designate march 26 in each and every year as [pirpe day” assented 1012.06.28 sponsor: Geoff regan Parliamentary Committees (composed of members from all parties) Don’t worry about statistics in first chapter, but responsible in general for textbook Standing committees: Focus on a substantive sphere of gov't policy (eg public accounts committee) special committees: examines specific issues (eg pensions, child care) Legislative committees: examine specific gov't bills after they have passed second reading – committees that are created to debate the subject of the bill. committee of the whole: all members from either the commons or the senate 19 The Canadian Federal Gov't Executive Branch the PM, cabinet & the Public service comprise the Executive Branch of gov't - PM selects the cabinet ministers from amongst elected members of his/her party - ministers then formally appointed by the GG - PM and Cabinet ministers make all majority policy decisions - PM establishes committees of cabinet to handle streams of policy issues - PM also recommends various appointments to the GG - ministers, lieutenant-governors, speakers of the senate, chief justices, senators, deputy ministers – deputy ministers are chosen and recommended by the PM but the GG appoints them officially. - PM also recommends a GG for the Queen's appointment! - In a cabinet you need representation that broadly respresents the Canadian landscape. You need balanced gender, you need ppl who know the legislative process, you need knowledge (ie for minister of health – a dr), you have to choose from those who got elected – you gotta dance with the one who brung ya - if the person you wanted did not get elected you have to pick someone else – if only 2 people got elected in BC you have to pick one. the public service is the third and largest component of the executive branch of gov't - public servants work to "translate the declarations and definitions of public policy into action" devising options for actions from which ministers decide on a course of action - do you include the armed forces? Crown corporation? Who is on the public payroll here? - The ministers decide the policy, Public servants make it happen. Public servants are non-partisan, they work for the elected gov’t, regardless of who it is. You are allowed to vote. You work to support the minister, doesn’t matter if you agree with him or her or not. You work to support the minister of the day. - When the gov’t changes, the very next day, you give the new minister 100% support regardless of who that minister is. That is the essence of non-partisan. It does not meet you cannot vote. - As a public servant you are there to support whatever gov’t is in charge. Departments & Agencies - the PM decides on number and substance of federal gov't depts (but changes do require consent of parliament) - depts are responsible for designing policies, delivery programs to the public and managing the regulatory aspects of gov't note the Central Agencies - Privy council office (including the intergov't affaires office) - treasury board and its secretariat - dept of finance Canada The Judiciary the third branch of gov't - the canadian system is inhertied from the common law tradition of England - the basis of the constitutional, crominal and civil law of the entire country except quebec which has its own civil code - the judgements of the supreme court of canada are binding on all other courts - judges of the supreme court (nine, three of whom must come from the Quebec bar) are appointed by the GG on the advice of the federal cabinet and hold office until they reack age 75 - The constitution provides that almost all our courts shall be provincial, but it also provides that the judges of all these courts from the county courts up shall be appointed by the federal gov't - judges of the provincial "superior courts" (all provincial supreme courts and the provincial courts of appeal) can only be removed on address to the GG by both Houses of Parliament (the same applies to judges of the Supreme court of Canada & the Federal court - Judges of the county courts can only be removed if one or more judges of the Supreme Court of Canada, or the Federal court, or any provincial superior court, report after inquiry that demonstrates guilt of misbehavior or inability or incapacity to perform their duties 20 Sources of Legislation Where does legislation come from? - the public - the gov't - the public service - parliament - the judiciary Public Policy - whatever gov't choose to do or not do (Dye: 1972) a bit cheeky, and it helps if you have a majority - a course of action or inaction chosen by public authorities to address a problem, expressed in the body of laws, regulations, decisions and actions of gov't - process 1. Problem identifcation/definiton 2. setting the agenda 3. formulating the policy 4. implementing the policy 5. evaluating the policy - Consultation - coordination - decision - implementation - evaluation - identity issues - policy analysis - policy instruments public policy is unending, it does
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