Social responsibility Test 1

The "social" bottom line

is about the quality of people's lives and about equity between people, communities, and nations. It emphasizes on people.

Principles of stakeholder management

is also known as the Clarkson Principles. The principles are intended to provide managers with guiding precepts regarding how stakeholders should be treated.

Unintentional Amoral

managers do not think about business activity in ethical terms, but for different reasons. These managers are simply casual about, careless about, or inattentive to the fact that their decisions and actions may have negative or deleterious effects on others. They lack ethical perception and moral awareness.

Managerial Approach

managers are practical, and they have begun to deal with social and ethical concerns in ways similar to those they have used to manage traditional business functions- marketing, finance, operations. The measure of success of the managerial approach will be the extent to which leaders can improve an orgs social, ethical, and sustainability performance by taking a managerial approach rather than dealing with issues on an ad hoc basis

Intentional Amoral

managers of this type do not factor ethical consideration into their decisions, actions, and behaviors because they believe business activity resides outside the sphere to which moral judgments apply.

Models of management ethics: Amoral

middle position

Factors leading up to business criticism: Awareness through TV, Movies, and the Internet; and 24/7 News and Investigative Programs

- Awareness through TV, Movies, and the Internet: the prevalence and power of TV touches all socioeconomic classes. There is a broad and growing level of public awareness in society. 24/7 News and Investigative Programs - 3 ways that information leads to criticism of business on TV: 1) Straight News Show such as the 24 hr cable news channels, evening news on major networks and investigative news programs. 2) Prime-Time TV Programs like CSI, The Apprentice, and Criminal Minds. 3) Commercials. Movies are also a significant.

Describe and explain actions, strategies, or "best practices" to improve an organization's ethical climate

- Behavior of superiors was ranked as the number one influence on unethical behavior in all three studies. In other words, the influence of bosses is powerful. Behavior of one's peers, industry or professional ethical practices, and personal financial needs are ranked. - Most actions and strategies for improving the orgs ethical culture must originate from top management and other management level.

how a pluralistic society becomes a special interest society

- As the concept of pluralism is pursued to an extreme, a society is created that is characterized by thousands of special interest groups, each pursuing its own focused agenda. These groups are strongly committed to their causes and strive to put pressure on businesses to meet their needs and on governments to accommodate their agendas.

Major criticisms of business

- Business is too big, it is too powerful, it pollutes the environment and exploits people for its own gain, it takes advantage of workers and consumers, and it does not tell the truth. Major one is that business's use and perceived abuse of power.

stakeholders view of the firm

- Finally as major internal and external changes occurred in business managers were required to undergo a radical conceptual shift in how they perceived the firms. The result was the stakeholder's view of the firm. In the stakeholder view of the firm, management must perceive as stakeholders not only those groups that management thinks have some stake in the firms but also those who themselves think or perceive they have a stake in the firm.

managerial view of the firm

- Later with the growth of corporations and the resulting separation of ownership from control, business firms began to see their responsibilities towards other major constituent groups to be essential if they were to be successful, thus the managerial view of the firm engaged.

factors affecting an organization's ethical culture and provide examples

- Society's Moral Climate - Business's Moral Climate - Industry's Moral Climate - Organization's Moral Climate

The socially responsible investing movement's charactersitics

- The socially responsible, sustainable or ethical investing movement arrived in 1970s. By 2013 socially responsible and sustainable investing had matured into a comprehensive investing approach complete with social and environmental screens, shareholder activism, and community investment. - The concept of social screening is the backbone of the socially conscious investing movement.

Behavior Ethics

- helps us to understand at a deeper level many of the behavioral processes that research has shown actually are taking place in people and orgs.

One way of thinking about the business-society relationship is through the concept of social contract-

- it is the set of reciprocal understandings that characterize the relationship between major institutions. The social contract has been changing to reflect society expanded expectations of business, especially in the social, ethical, and environment realms.

Using Normative Approach

1) What is the true nature of the practice, behavior, or decision that occurred? 2) What are society's (or business's) prevailing norms of acceptability? 3) What value judgements are being made by someone about the practice or behavior, and what are that person's perceptions of applicable norms?

Making Ethical Judgements: 3 Key Elements to Compose a Decision Using Conventional Approach

1) observe the decision, action, or practice that has taken place in the workplace setting. 2) compare the practice with prevailing norms of acceptability - that is society's or some other standard of what is acceptable or unacceptable. 3) recognize that value judgments are being made by someone as to what really occurred and what the prevailing norms of acceptability really are.

Univeralizability

A criterion by which the proposer of a rule (right, principle, or test) would be willing to apply the rule equally to everyone. The first formulation of the Categorical Imperative.

Reversibility

A criterion by which the proposer of a rule (right, principle, or test) would be willing to have the rule applied to himself or herself.

The Categorical Imperative

A duty based ethical principle that determines obligatory actions. It is best known in first of three forms: "Act only according to that maxim by which you can at the same time will that it should become a universal law".

Pluralism Strengths:

A pluralistic society prevents power from being concentrated in the hands of a few, it also maximizes freedom of expression and action. It provides for a built-in set of checks and balances so that no single group dominates.

Factors leading up to business criticism: Affluence and Education

Affluence: refers to the level of wealth, disposable income, and standard of living of the society. Alongside a relatively high standard of living has been a growth in the average formal Education: as citizens continue to gain more education, their expectations of life generally increase. - The combination of relative affluence and growing education has formed the underpinning for a society in which criticism of major institutions, such as business, naturally arises.

Legal Rights

An entitlement claim that has received recognition from political entities in the form of legal protection.

Utilitarianism

An ethical principle that focuses on socially beneficial outcomes. It calculates all benefits and harms that accrue for each action and argues that actions with the greatest net benefit are ethical. In business it takes the form of cost-benefit analysis.

Proportionally ethic

An ethical principle used to guide actions that are subject to double effect and include three components: the intention, the means, and the end. This principle provides guidance as to when actions involving double effect are permissible. Embodied in the Just-War Theory. To act, decision makers must weigh the following Criteria. 1. the type and magnitude of benefit and harm involve. 2. The urgency of the situation .E.g. will waiting result in more harm? 3. The probability of both benefit and harm, and likelihood of success 4. The intensity of influence over effects 5. The existence of alternatives that might result in different types and magnitudes of harms and benefits.

Ethics of care

An ethical principle, posited by Carol Gilligan, that focuses on relationships and emphasizes the value of and responsibility for relationships. It sees that the individual cannot be evaluated apart from his or her relationships.

Servant leadership

An ethical principle, posited by Robert Greenleaf, that states that leadership embodies the moral responsibility to put others first. Leaders must care for the needs of employees, customers, and other stakeholders before their own.

Virtue Ethics

An ethical system that stresses the importance of developing enduring character traits such as: honesty, trustworthiness, benevolence, respect, fairness. These traits are the heart of the ethical manager.

Factors leading up to business criticism: Revolution of rising expectations; and entitlement mentality.

Another trend has been Revolution of rising expectations: this is a belief or an attitude that each succeeding generation ought to have a standard of living higher than that of its predecessor. One notable outgrowth of the revolution is rising expectations has been the emergence of an entitlement mentality- this is the general belief that someone is owed something just because he/she is a member of society.

The Golden Mean

Aristotle's principle that virtue exist between extremes. Little used as a moral principle today, it embodies the concepts of moderations and restrain in pursuing self gratification.

Philanthropic Responsibilities:

Business voluntary, discretionary. Though not responsibilities in the literal sense of the word, these are perceived as responsibilities because they reflect current expectations of business by the public. Its businesses desire to engage in social activities that are not mandated, not required by law, and not generally expected of business in an ethical sense.

simple definition of Corporate Social Responsibility (CSR)

CSR is seriously considering the impact of the company's actions on society.

8. _______ are all general issues involving social or ethical ramifications within the relationship between business and society.

Downsizing pension programs, toxic waste disposal, and insider trading

Test if common sense

Does this decision/action make good sense? Sometimes called the smell test.

Rawlsian Justice

Each person has an equal right to the most extensive basic liberties compatible with similar liberties for everyone. Social and economic inequalities are arranged so that they are both reasonably expected to be to everyone's advantage, and attached to positions and offices open to all.

Moral Rights

Entitlements intended to protect the intrinsic dignity and self-worth of moral actors. Contains two parts: 1) the entitlement, and 2) the moral responsibility to provide the entitlement. For someone to be an acceptable recipient of the entitlement, they must also be able to accept responsibility to provide the entitlement.

Negative Rights

Entitlements that impose a duty of non-interference.

Positive Rights

Entitlements that impose a duty to provide costly benefits.

Deontological Principles

Ethical principles based on duty.

Teleological Principles

Ethical principles based solely on outcomes.

Aretaic Principles

Ethical principles that result from virtue.

______ refers to issues of right, wrong, fairness, and justice.

Ethics

Industry or Professional levels at which business ethics may be addressed

Ex of questions that might pose ethical dilemmas at the level include the following: is this safety standard we electrical engineers have passed really adequate for protecting the consumer in this age of do-it-yourselfers?

Social Environment

Focuses on demographics, lifestyles, culture, and social values.

Secondary social stakeholders

Gov and regulators, civil institutions, social pressure, media. They may be extremely influential as well especially in affecting reputation and public standing, but their stake in the org is more indirect.

Business

The collection of private, commercially oriented organizations, ranging in size from one person proprietorships to corporate giants.

Test of one's best self

Is the decision/action I am going to make/take compatible with myself at my best? Would others be proud of me if they could see me make this decision or action?

Drivers of corporate Citizenship:

Internal: traditions & values, reputation & image, business strategy, and recruiting or retaining employees. External: customers & consumers, expectations in the community, and laws & political pressures.

Gag test

Is the decision so ill-considered and decrepit as to induce a violent visceral reaction?

how corporate citizenship develops in stages in companies

The development of the corporate citizenship model reflects a stage by stage process in which seven dimensions (Citizenship, concept, strategic intent, leadership, structure, issues management, stakeholder's relationship, and transparency). Evolve as companies move through five stages and become more sophisticated in their approaches to corporate citizenship. Stage 1 Elementary (Challenges: Credibility), stage 2 Engage (Challenges: Capacity), stage 3 Innovative (Challenges: Coherence) , stage 4 integrated (Challenges: Commitment), and stage 5 transforming.

Principle 1 of stakeholder management

Managers should acknowledfe and actively monitor the concerns of all legitimate stakeholders, and should take their interests appropriately into account in decision making and operations.

Principle 7 of stakeholder management

Managers should acknowledge the potential conflicts between (a) their own role as corporate stakeholders, and (b) their legal and moral responsibilities for the interests of stakeholders, and should address such conflicts through open communication, appropriate reporting, incentive systems and, where necessary, third-party review.

Principle 3 of Stakeholder management

Managers should adopt processes and modes of behavior that are sensitive to the concerns and capabilities of each stakeholder constituency.

Principle 6 of stakeholder management

Managers should avoid altogether activities that might jeopardize inalienable human rights (e.g., the right to life) or give rise to risks that, if clearly understood, would be patently unacceptable to relevant stakeholders.

Principle 2 of Stakeholder Management

Managers should listen to and openly communicate with stakeholders about their respective concerns and contributions, and about the risks that they assume because of their involvement with the corporation.

Principle 4 of Stakeholder management

Managers should recognize the interdependence of efforts and rewards among stakeholders, and should attempt to achieve a fair distribution of the benefits and burdens of corporate activity among them, taking into account their respective risks and vulnerabilities.

Principle 5 of stakeholder management

Managers should work cooperatively with other entities, both public and private, to ensure that risks and harms arising from corporate activities are minimized and, where they cannot be avoided, appropriately compensated.

SMC Level 3:

Transactional Level. This is the highest goal for stakeholder's management- the extent to which managers actually engage in relationships with stakeholders. Management must take the initiative in meeting stakeholders face to face and attempting to be responsive to their needs. This is the communication level.

What are our stakeholder's stakes?

Nature or legitimacy of a groups stakes- stakeholders may possess varying types of stakes. All these groups have legitimate claims, they are all owners. Power of a group's stakes- the powerful stakeholders in this care are (1) the institutional owners and mutual fund orgs, because of the sheer magnitude of their investments and (2) the board and management shareholders because of their dual roles of ownership and management (Control). Sub-groups within a generic group- it would require some degree of time and care for the firm to identify the nature, legitimacy, power, and urgency of each specific group. However, the firm can and should do this if ii wants to better engage and manage its environmental stakeholders. Companies have an ethical responsibility to be sensitive to legitimate stakeholder's claims even if the stakeholders have no power or leverage with the management.

What strategies or actions should the firm take to best address stakeholder challenges and opportunities?

Once responsibilities have been assessed, an org must contemplate strategies and actions for addressing its stakeholders. Important questions or decisions choices for mgmt. in dealing with stakeholders include, do we deal directly or indirectly, do we take the offense or the defense in dealing with stakeholders, do we accommodate, negotiate, or resist.

1. The business environment in current times can best be described as ________.

Turbulent

Marxist Justice

People should be treated differently based on needs and ability.

Meritocratic Justice

People should be treated differently based on their productivity.

Ethical Due Process

Procedural or process justice requires impartial rules be used for all organizational decision affecting stakeholders. The outcomes of decisions will be fair if the processes used to make those decisions are fair.

SMC Level 2:

Process Level. Develop and implement processes-approaches, procedures, polices, and practices by which the firm may scan the environment and gather pertinent info about stakeholders. This level is described as planning integrativeness, because the management does focus on planning processes for stakeholders and integrating a consideration for stakeholders into org decision making.

Descriptive value

Provides language and concepts to describe effectively the corporation or org in inclusive terms. The corporation is a constellation of cooperative and competitive interests possessing both instrumental and intrinsic value.

SMC Level 1:

Rational level. Simply entails the company identifying who their stakeholders are and what their stakes happen to be. This level is descriptive and somewhat analytical, because the legitimacy of stakes, the stakeholder's power, and urgency are identified. This is an entry level of SMC. They have just identified who their stakeholders are.

Test of making something public

Would it bother me if I read about this decision/action test in the newspaper tomorrow? Would my grandmother approve?

What responsibilities does the firm have to its stakeholders?

Responsibilities may be thought of in terms of the corporate social responsibility discussion presented in ch.2. Managers use the stakeholder responsibility matrix to systematically think through its various responsibilities to each stakeholder group.

Social Responsibility

Seriously considering the impact of the company's actions on society. The obligation of decision makers to take actions that protects and improves the welfare of society as a whole, along with their own interests. Supposes that the corporation has economic and legal obligations as well as responsibilities to society that extend beyond these obligations

Justice

Similar people should be given similar benefits and burdens; dissimilar people should be given different benefits and burdens in proportion to their dissimilarity

Society

a community, a nation, or a broad grouping of people with common traditions, values, institutions, and collective activities and interest. Society is though of as being composed of numerous interest groups, more or less formalized organizations and a variety of institutions.

Carroll's CSP model brings together 3 points

Social responsibility, Philosophy of social Responsiveness, and social issues involved.

who are our orgs stakeholders?

Stakeholder's identification stage. Management must identify not only generic stakeholder groups but also specific subgroups. Generic stakeholder groups is a general or broad grouping such as employees, shareholders, env groups.

Sustainability

Sustainability was derived from the idea of sustainable development- which is a pattern of resource use that aims to meet human needs while preserving the environment so that these needs can be met not only in the present but also for future generations. Sustainability has been expressed in the well-known concept of the triple bottom line.

Distributive Justice

The benefits and burdens of social life should be allocated using impartial criteria

Expound upon the concept of stakeholder management

The challenge of stakeholder management is to see to it that while the firm's primary stakeholders achieve their objectives, the other stakeholders are dealt with ethically and are also relatively satisfied. At the same time the firm's profitability must be ensured. Without economic sustainability, all other stakeholders interests become unresolved. The quest for stakeholder management embraces social, legal, ethical, and economic considerations.

End-means ethic (the end justifies the means)

The ethical principle that focuses on desirable or beneficial outcomes but ignores the means by which he ends are attained. This principle states that any and all methods are acceptable in the pursuit of beneficial outcomes, including the violation of human rights and principles of justice.

What opportunities and challenges do our stakeholders present to the firm?

The opportunities are for business to build decent, productive working relationships with the stakeholders. Challenges, on the other hand, usually present themselves in such a way that the firm must handle the stakeholders acceptably or be hurt in some way-financially or in terms of its public image or reputation in the community. Stakeholder's challenges typically take the form of varying degrees of expectations, demands, or threats. Opportunities and challenges might also be viewed in terms of potential for cooperation and potential for threat. In terms of threat- managers need to consider stakeholders relative power and its relevance to a particular issue facing the org. In terms of cooperation- the firm needs to be sensitive to the possibility of joining forces with stakeholders for the advantage of all parties involved

The performance focus of CSP

The performance focus suggest that what really matters is what companies are able to achieve- the results of their acceptance of social responsibility

Might equals right justice

The principle, advocated by some, that the strong should dominate the weak. Widely condemned as being indistinguishable from self-interest.

Political Environment

The processes by which laws get passed and officials get elected.

How the public regards business ethics

The public view of ethics has never been high. Many citizens see business ethics as essentially a contradiction in terms, an oxymoron, and think that there is only a fine line between executive and a crook. Only 21% of the public thought business executives had high or very high ethics. We found out what was going on within companies ex: Misconduct observed, reporting bad behavior, retaliation against workers, pressure to compromise, and weak ethical cultures.

Double effect

The recognition that some actions have results (consequences) that are both beneficial and detrimental.

Egalitarian Justice

There is no basis for treating people differently therefore everyone deserves equal treatment, equal benefits, and equal outcomes.

Libertarian Justice

This ethical principle stresses the importance of personal liberty and argues that everyone should be afforded the greatest personal liberty that is consistent with equal liberty for everyone else.

The Golden Rule

This highly popular rule might be stated as "Do unto others as you would have them do unto you" or "Treat others as you wish to be treated". Also known as the ethic of reciprocity.

Test of the big four

To ask yourself if you are making the decision in haste, out of greed, out of laziness, or with inadequate understanding.

Test of ventilation

To discuss the decision or action with others to solicit their inputs and approval

Test of purified idea

To get the approval of organizational authorities with expert knowledge: e.g. supervisors, lawyers, accountants

Technological Environment

Total set of technology based advancements taking place in society and the world.

Social Performance

What really matters is what companies are able to achieve - the results or outcomes.

_____ refers to the level of wealth, disposable income, and standard of living of a society.

affluence

Social responsiveness

an action oriented variant of CSR. Actually responding to the obligation.

Rights claims

an entitlement claim that has not yet received widespread acceptance

types of stakes

an interest, a right, and ownership.

Models of management ethics: Immoral

approach that is devoid of ethical principles or precepts and at the same time implies a positive and active opposition to what is ethical. Decisions, behaviors, actions, and practices are discordant with ethical principles. Ex: Enron

Ethical Responsibilities

are needed to embrace those activities, standards, and practices that are expected or prohibited by society even though they are not codified into law. Ethical responsibilities embody the full scope of norms, standards, values, and expectations that reflect what consumers, EE, and the community regard as fair, just, and consistent with respect for or protection of stakeholders moral rights.

Conceived goals

are poorly set goals that encourage negative behaviors

Economic Responsibilities:

as in institution it should be the objective to produce goods and services that society wants and to tell them at fair prices. Also financial effectiveness to rev, cost, and investments.

Societal and Global levels at which business ethics may be addressed

at this level it becomes very difficult for the individual manager to have a direct effect on business ethics

conventional approach to business ethics

based on how common, everyday society (the average person) views business ethics today. This approach is based on ordinary, common sense, and prevailing practice.

Ethical Tests

based on the use of ethics principles or guidelines to justify and direct behavior, actions, policies, and practices.

principles approach

based on the use of ethics principles or guidelines to justify and direct behavior, actions, policies, and practices.

Instrumental Value

because it is instrumental in portraying the relationship between the practice of stakeholder's management and the resulting achievement of corporate performance goals. The fundamental premise here is that practicing effective stakeholder management should lead to the achievement of traditional business goals, such as profitability, stability, and growth

Normative value

because stakeholders are seen as possessing value irrespective of their instrumental use to management. This is considered the moral or ethical view because it emphasizes how stakeholders should be treated.

Retributive Justice

blame and punishment should be evenhanded and proportionate to the transgression

4. Social contract is a relationship between society and ______. The social contract is expressed through: 1) Laws and regulations that society has established as the framework within which business must operate and 2) Shared understandings that evolve over time as to each group's expectations of the other.

businesses

Business Power

capacity or ability to produce an effector to bring influence to bear on a situation or people.

Models of management ethics: Moral

conforms to the highest standards of ethical behavior or professional standards of conduct. It is not always crystal clear what level of ethical standards prevail, moral management strives to be highly ethical in terms of its focus on elevated ethical norms and professional standards of conduct, motives, goals, orientation toward the law, and general operating strategy.

Social Issues Involved

consumers, environment, employees, and others

the three levels of stakeholder management capability (SMC)

describes the org integration of stakeholders thinking into its processes and it may reside at one of three levels of increasing sophistication: rational, process, transactional

"CSR encompasses the economic, legal, ethical, and philanthropic expectations that society has of orgs at a given point in time." This places...

economic and legal expectations of business in context by linking them to more socially oriented concerns.

Corporate Citizenship

embraces all that is implied in the concepts of social responsibility, responsiveness, and performance.

The concept of triple bottom line seeks to

encapsulate for business the three key spheres of sustainability that it must attend to - economic, social, and environmental.

Macro level

entire corporate system

Stakeholder management

external stakeholders (Gov, consumers, community members) Internal stakeholders (Employees)

Kohlberg's three levels of developing moral judgment: Level 3: Post-conventional, Autonomous, or Principled Level

few people reach - the focus moves beyond those "others" who are of immediate importance to the individual to humankind as a whole. The individual develops a concept of ethics that is more mature than the conventionally articulated situation. Moral principles become self-accepted, not because they are held by society, but because the individual now perceives and embraces them as "right". Stage 5: social-contract orientation - right action is thought of in terms of general individual rights and standards that have been critically examined and agreed upon by society as a whole. Clear awareness of the relativism of personal values and a corresponding emphasis on fair process for reaching consensus. Stage 6: universal-ethical-principle orientation - individual uses his or her thinking and conscience in accord with self-chosen ethical principles that are anticipated to be universal, comprehensive, and consistent. Principles might be focuses on such ideals as justice, human rights, reciprocity, and social welfare. Individual is motivated by a commitment to universal principles or guidelines.

Duty Based (Deontological)

focuses on duties. For ex it cold ne argued that managers have a duty to tell the truth when they are doing business. Categorical imperative- is a duty based principle of ethics. This is an action that is morally obligatory. This says that a since of duty arises from reason and rational nature.

Consequence based (Telelogical)

focuses on the consequences or results of the actions they produce. Utilitarianism is the major principle in this category. It recommends taking the actions that results in the greatest good for the greatest number.

At the narrowest, the term triple bottom line is used as a framework for

for measuring and reporting corporate performance in terms of economic, social, and environmental indicators.

A sense of Moral Obligation

foundation for all capacities.

Intermediate Level:

groups of corporations acting in concert in an effort to produce a desired effect (set prices control markets, etc.)

Sustainability

has become one of business's most pressing mandates. Sustainability is about business's ability to survive and thrive other the long term. Today it is understood to embrace environmental, economic, and social criteria.

Kohlberg's three levels of developing moral judgment: Level 1: Pre-conventional Level

how people behave as infants and children. The focus is mainly on the self. Main behavioral reactions are in response to rewards and punishments. Stage 1: reaction to punishment stage - avoidance of pain Stage 2: seeking of rewards stage.

Iron Law of Responsibility

in the long run those who do not use power in a manner which society considers responsible, will tend to lose it.

Organizational level at which business ethics may be addressed

in the roles as managers or employees. These carry consequences. Ex of issues managers and employees face at the org level include, should I set high production goals for my work team to benefit the org, even though I know it may cause them to cut corners to achieve them?

Primary Social stakeholder

includes shareholders and investors, EE and mangers, customers, local communities, and suppliers. They have a direct stake in the org and its success and are most influential.

Individual level:

individual corporate leader exerting power

Micro level:

individual firm

Kohlberg's three levels of developing moral judgment Level 2: Conventional Level

individual learns the importance of conforming to the conventional norms of society. This is the level at which social relationships form and become dominant. Stage 3: good boy/nice girl morality stage - young person leans that there are some rewards for living up to what is expected by family and peers. Stage 4: law-and-order morality stage - individual learns to respond to family, friends, the school, and the church.

The ____________ states that those who abuse power will lose power. Or "in the long run, those who do not use power in a manner which society considers responsible will tend to lose it"

iron law of responsibility

The "Environmental" bottom line

is about protection and conservation of the natural environment. It emphasizes on the planet.

stakeholder

is an individual or a group that has one or more of the various kinds of stakes in the org. Just as stakeholders may be affected by the actions, decisions, policies, or practices for the business firm these stakeholders may also affect the orgs actions, decisions, policies, or practices. - An individual or groups may be business's stakeholders. Stakeholders can be other groups as well such as the community, suppliers, special interest groups, the media and society.

stake

is an interest in or a share in an undertaking. Ex: if a group plans to go out to dinner and a movie for the evening, each person in the group has a stake, or interest, in the group's decision. A stake can also be a claim, which is a demand for something due or believed to be due.

The CSP model

is intended to be useful to both academics and managers. For academics the models major academic use, therefore, is in helping to organize the important concepts that must be understood in an effort to clarify the CSP concept. Also be used as a planning and diagnostic problem solving tool.

In summary, stakeholder theory...

is managerial in the broad sense of the term in that it not only describes or predicts but also recommends attitudes, structures, and practices that constitute stakeholder management.

The Social Responsibility

is the economic, legal, ethical, and discretionary (philanthropic) components

Corporate sustainability

is the goal of the triple bottom line approach. The goal of sustainability is to create long term shareholder value by taking advantage of opportunities and managing risks related to eco, env, and social developments.

At the broadest, the concept triple bottom line

is used to capture the whole set of values, issues, and processes that companies must address to minimize harm.

Pluralism Weaknesses:

it creates an environment in which diverse institutions pursue their own self-interest with the result that there is no unified direction to bring together individual pursuits. Another weakness is that groups and institutions proliferate to the extent that their goals start to overlap, thus causing confusion as to which org best serve which function.

Legal Responsibilities

it establishes the ground rules- the laws- under which businesses are expected to operate. Law is inadequate for 3 reasons: the law cannot possible address all the topics or issues that business may face, the law often lags behind more recent interpretations of what is considered appropriate behavior, and third laws are made by elected lawmakers and may reflect the personal interests and political motivations of legislators rather than appropriate ethical justifications.

Sustainability

making it last

_____ depict corporate life as amoral and possibly deadly

movies

10. Decentralization and diversity of power concentrations leads to a ________ _____. Pluralism refers to diffusion of power among society's many groups and organizations. A long-standing definition of a pluralistic society is helpful.

pluralistic society

production view of the firm

owners thought of stakeholders as only those individuals or groups that supplied resources or bought products or services.

Basic concepts that are central to understanding the relationship between business and society

pluralism, our special-interest society, business criticism, corporate power, and corporate social response to stakeholders.

Pluralism

refers to diffusion of power among society's many groups and organizations. "wide decentralization and diversity of power concentration".

Ethics

refers to issues of fairness and justice, and business ethics focuses on ethical issues that arise in the commercial realm.

The "economic" bottom line

refers to the firm's creation of material wealth, including financial income and assets. It emphasizes on profits

Compensatory Justice

requires fair compensation for victims

Personal level at which business ethics may be addressed

situations we face in our personal lives that are generally outside the context of our employment. Ex: should I cheat on my income tax return by overinflating my charitable contributions?

9. The demographics, lifestyles, and social values of a society determine the firm's _________.

social environment.

2. Stakeholders are effected by the corporation and the _______ are the owners of shares in a corporation.

stakeholders

Philosophy of Social Responsiveness

strategies ranging from reaction, defense, accommodation, and pro-action.

Bounded Ethicality

tends to occur when managers and employees find that even when they aspire to behave ethically it is difficult due to a variety of orgs pressures and psychological tendencies that intervene.

stakeholders have a stake in

the "value" they expect to receive from firms with which they interact.

Moral Identification and Ordering

the ability to discern the relevance or non-relevance of moral factors that are introduced into a decision-making situation.

Moral imagination

the ability to perceive that a web of competing economic relationships is, at the same time, a web of moral or ethical relationships.

Business ethics

the concern of morality and fairness in behavior, actions, policies, and practices that take place within a business context.

Tolerance of Moral Disagreement and Ambiguity

these must be accepted, however, it is a natural part of ethics discussions.

Economic Environment

the nature and direction of the economy in which business operates.

Moral evaluation

the practical, decision phase of moral judgment and entails essential skills such as coherence and consistency that have proved to be effective principles in other contexts.

11. Movies are a significant source of business criticism because corporations are seen as powerful, profit-seeking enterprises that have no redeeming value.

true

Integration of Managerial and Moral Competence

underlies all that we have been discussing this far.