Business and Society- Chapter 3

4 advantages of corporate social responsibility *

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

Why are corporations socially responsible?

CSR allows them to act in a way that enhances society

Corporate Power

Capability of corporations to influence government, economy, and society based on their organizational resources

Phases of CSR

Corporate social stewardship Corporate social responsiveness Corporate/business ethics Corporate/global citizenship

Corporate Social Responsibility

Corporations should act in a way that enhances society and its inhabitants be held accountable for any of its actions that affect people, community, and environment

Stages of Corporate Citzenship

Elementary, engaged, innovative, integrated, transforming

4 disadvantages of corporate social responsibility *

Lowers economic efficiency and profit Imposes unequal costs among competitors imposes hidden costs passed on to stakeholders requires skill business may lack

Enlightened self-interest

Providing value to stakeholders is in a business' long run self interest

The world's largest corporations are capable of wielding tremendous influence, at times even more than national governments, due to economic power

True

Transforming Corporate Citizenship stage

change the game, market creation/social change, visionary ahead of the pack

Reputation

desirable/undesirable qualities associated with an organization

5 stages companies progress through

elementary, engaged, innovative, integrative, transforming

reporting legally required financial information with social and environmental info into __________________________.

integrated report

transparency

quality of complete clarity

Corporate Citizenship

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

B corporations

seek to balance the interests of multiple stakeholders

Social audit

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

Iron Law of Responsibility

those who do not use power in ways that society considers responsible tend to lose it

corporate social reporting

when a company publicizes information collected in a social audit