Chapter 8 The Societal Context
Corporate Social Responsibility (CSR)
The Case Against CSR
Business is business
Profit maximization is the primary purpose of business.
Business’s primary responsibility is to its owners.
Business should be ethically neutral and focus on profit as the primary
measure of corporate success.
Business plays by its own rules
Business is like a game and should be played by its own rules.
Business should not dictate morality
Organizations cannot be held accountable
The Case for CSR
Conform to Societal Expectations
Business should conform to society’s expectations.
Faith in value-free, self-regulating markets is a dangerous illusion.
Adopt CSR as a Practical Business Strategy
Acknowledge membership in a Broader Network of Stakeholders
Organizationeed to acknowledgeresponsibiltoyalltheir
Responsibilities to owners or shareholders
Provide fair and honest reporting
Responsibilities to employees
Treat employees fairly with regard to hiring, firing, wages, etc.
Responsibilities to Consumer/Customers
Produce products of acceptable quality and price them fairly
Responsibilities to competitors
Avoid unethical corporate activity, such as corporate spying
and unfair competition practices
Responsibilities to creditors
Make proper use of financial resources and disclose
The concern of businesses for the welfare of society as a whole;
consists of obligations beyond those required by law or contracts.
A company’s commitment to ethical and responsible behaviour will affect
the success of the company.
Enhanced brand and image reputation
Increase sales and customer loyalty
Ability to attract and retain employees
Meeting its obligations to and behaving responsibly with its stakeholders
makes a company admired or perceived as socially responsible.
The Social Responsibility of Business
Economic Responsibilities – Make a Profit
A corporation must be profitableits economic responsibilities for the base of the pyramid.