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