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ADMS 3660 - Business Ethics & CSR Textbook Notes.docx

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York University
Administrative Studies
ADMS 3660
Avraham Kleiman

ADMS 3660 Business Ethics Notes Ch 1 Business and Society Relationship aside from corporate wrongdoing many common issues includecorporate abuse of the environment toxic waste disposalsweatshop conditions sexual harassment in the workplacecorporate power minority rightsdrug testing insider trading whistle blowing product liability criseslack of concern for the welfare of consumers eg Fast food industriesBusiness and Society Business the collection of private commercially oriented orgs ranging in diff sizes big businesses are more widely known in the public eye people in our society often associate size with power when referring business in relation to society all different business sizes must be kept in mind Society a community nation or broad grouping of people that have common traditions and values is composed of numerous interest groups formalized orgs and a variety of institutions Society as the Macroenvironment Macroenvironment the total env outside a firm is the societal context in which the organization residescomposed of four segments Social environment focuses on demographics lifestyles social values of the society Economic env nature and direction of the economy in which business operatesEg GNP inflation unemployment rates global trade Political env processes by which laws get passed and officials get elected Technological env total set of techbased advancements taking place in society Our Pluralistic Society Pluralism the diffusion of power among societys many groups and organizations a pluralistic society is one in which there is wide decentralization and diversity of power concentration the power is dispersed among many individualsStrengths prevents power from being concentrated in the hands of a fewmaximizes freedom of expression and actionno single group will dominate Weaknesses diverse institutions pursue own selfinterests no central direction to unify these pursuitsthere is confusion as to which orgs best serve which functionsconflicts among groups when they each try to pursue their own objectives the system isnt very efficientBusiness and Multiple Publics Systems and Stakeholders when we speak of business and society relationships we usually refer either to particular segments or to business and some system in our societyOur SpecialInterest Society Defn the idea of pluralism to an extreme in which thousands of special interest groups each pursues itsown limited agenda specialization on the part of interest groups representing all sectors of societyincluding consumers communities natural environment the government these groups have increasingly become active committed intense and diverse each of these groups have been able to attract many members thus increasing revenuesat the same time they also increase the complexity for businesses to operate with them Business Criticism and Corporate Response Factors in the Social Environment Societal Beliefs Regarding Success in Business the belief that material success is derived from some kind of dishonesty tv has suggested that in order to succeed one has to engage in some kind of dishonesty manipulation essentially to get ahead one needs to step on other peopleAffluence and Education as a society becomes more affluent and better educated there are also higher expectations Affluence the level of wealth disposable income standard of living of society reflects both economic welfare and social elements Education how much one receives in their environment the combo of affluence and education forms the underpinning for a climate where societal criticism of businesses arisesAwareness through the Media newspapers magazines television through tv the audience gets a variety of info that contributes to a climate of business criticism Straight News and Investigative News Programs straight news shows that often portray businesses in a negative spotlightbias journalists see it differently though they say that when asked businesses ignore qtnsdownplay issues PrimeTime TV Programs business people are often cast as evil and greedy is also shown through movies as well Commercials are a double edged sword in SR they may sell more products but if products are promoted in a deceptive way then LR they will lose credibility the media therefore should be seen as only one major factor that contributes to the env in which the business now finds itself Revolution of Rising Expectations Defn belief that each succeeding generation has a standard of living higher than the one before Social problem the gap bn a societys expectations of social conditions and the actual social realities the nature of rising expectations is such that they outpace the responsiveness of businesses thus creating a predicament that is conducive to criticismEntitlement Mentality Defn the general belief that someone is owed something because theyre a member of society the current context of workplace has contributed to making the issue of entitlement more prominentRights Movement Defn comes from the revolution of rising expectations entitlement mentality and more activism for rights of other groups like blacks women ethnic minorities disabled Criticisms Use and Abuse of Power common issue that runs through all complaints is the use and abuse of power the reason that Canadians are less trusting of companies is they feel mistreated and ignored as both citizens and consumers some points of friction include CEO pay high gas and drug prices poor airline service Business power ability or capacity to produce an effect or to bring influence to people in the context of business criticism power is perceived as being abusedLevels of Power Macro level corporate system Intermediate level groups of corps that act in concert in an effort to produce a desired effectcould be to raise prices control markets Micro levellevel of the individual firm any one major corporation Individual levelindividual corporate leader that exerts power one person as one analyzes corporate power they should keep in mind the diff levels of power Spheres of Power economic power political power are most common social and cultural power over the individual technological environmental Balance of Power and Responsibility the powerresponsibility relationship is the foundation for CSR Iron law of Responsibility in the LR those who do not use power in a manger which society considers responsible will lose it when power is out of balance a variety of forces come to bear on business to be more responsible including governmental actions
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