Chapter 3: Corporate Social Responsibility & Citizenship

Transparency

Clear public reporting of an organization's performance to various stakeholders

Enlightened Self-interest

Concept that reflects the notion that providing value to stakeholders is in a business's long term self-interest

Integrated Report

Integration of legally required financial information with social/environmental information into a single report

Arguments FOR CSR

-Balances corporate power with responsibility -Discourages government regulation -Promotes long-term profits for business -Improves stakeholder relationships -Enhances business reputation

Principles of Corporate Citizenship

-Ethical Business Behavior -Stakeholder Commitment -Community -Consumers -Employees -Investors -Suppliers -Environmental Commitment *Exhibit 3.A on pg. 50

Arguments AGAINST CSR

-Lowers economic efficiency and profits -Imposes unequal costs among competitors -Imposes hidden costs passed on to stakeholders -Requires skills businesses may lack -Places responsibility on business rather than individuals

B Corporations

Explicitly seek to balance the interests of multiple stakeholders; focus on social responsibility and citizenship by blending their social objectives with financial goals and use the power of business to solve social and environmental problems

Corporate Social Responsibility

Means that a corporation should act in a way that enhances society and its inhabitants and be held accountable for any of its actions that affect people, their communities, and their environment

Corporate Citizenship

Refers to the actions they take to put their commitments to corporate social responsibility into practice

Corporate Power

Refers to the capability of corporations to influence government, the economy, and society based on their organizational resources

Reputation

Refers to the desirable or undesirable qualities associated with an organization or its actors that may influence the organization's relationships with its stakeholders

The Stages of Global Corporate Citizenship

Stage 1 - Elementary Stage 2 - Engaged Stage 3 - Innovative Stage 4 - Integrated Stage 5 - Transforming *see Figure 3.5 on pg. 61-62

Social Audit

Systematic evaluation of an organization's social, ethical, and environmental performance

Corporate Social Reporting

When a company decides to publicize information collected in a social audit