GCSR
Select appropriate causes
"There should be agreement on what you stand for" and what the organization wants to support, said Christen Graham, president of Giving Strong Inc., a social impact consulting firm based in Portland, Maine
Sustainability
- is a business approach to creating long-term value by taking into consideration how a given organization operates in the ecological, social and economic environment. - is built on the assumption that developing such strategies foster company longevity
Business already has enough power
Considering that business exercises powerful influence over where and how we work and live, what we buy, and what we value, additional concentration of social power in the hands of business is undesirable.
Healthy sustainable food
Food grown locally by farmers using organic methods (without the use of chemicals, GMO's, or synthetic fertilizers) is the right choice for food production. It is safer for the environment, ecology, and people's health. Growing your own food is even better because you are able to control the amount of chemicals you use for pest control measures, as well as regulate the use of antibiotics, and fertilizers
Green initiatives and sustainable investment, healthy sustainable food, sustainable communities, clean water, environment and health
Global Environmental Issues
Determining power and influence over decisions
Identify the individuals or groups that exercise power and influence over the decisions the firm makes. Once it is determined who has a stake in the outcome of the firm's decisions as well as who has power over these decisions.
Sustainability, accountability, transparency
Key principles of CSR
clarity, consistency, achievability, supportability, visibility, discussability, sanctionability
Seven virtues of Corporate Ethical Virtues that represent dimensions of the ethical culture that a corporation should strive for and aim to achieve the greater the level of embeddedness of these dimensions, the higher the ethical quality of the organizational culture and the less likely it is that unethical behavior would occur
Sanctionability
concerns the extent to which employees are likely to be punished for irresponsible conduct and rewarded for responsible behavior, either in a formal or informal way.
Clarity
concerns the extent to which the corporation's moral expectations from its employees are expressed accurate, concrete, comprehensive, and understandable.
Clean Water
availability is going to be a major health issue around the globe, as the world population increases. The need for safe clean drinking water is likely to double in the next decade, where the world population is expected to exceed nine billion.
Board of Directors
corporate strategies that are intended to build sustainable long-term value; selects a chief executive officer (CEO); oversees the CEO and senior management in operating the company's business, including allocating capital for longterm growth and assessing and managing risks; and sets the "tone at the top" for ethical conduct
Ethical Responsibilities
embody those standards, norms, or expectations that reflect a concern for what consumers, employees, shareholders, and the community regard as fair, just, or in keeping with the respect or protection of stakeholders' moral rights.
Environment and health
has a profound effect on our health and well-being. No matter how advanced we get technologically, if we fail to keep the environment clean, our progress and development will not be positive development. All things that surround us can affect our health; our drinking water, the air we breathe in, the soil we walk on, and the food that we eat, all have a profound effect on our health, and how we will progress into the future
Reactive Responses
involve responding to government policy after it happens
Interactive Response
involves engaging with government policymakers and actors (including the media) to try to influence public policy to serve the interests of the business
Strategic Philanthropy
is a business concept whereby companies perform charitable deeds and receive indirect financial benefits from these actions. The process usually entails a corporation's engaging in some sort of partnership, either for one project or on a long-term basis, with a non-profit organization.
Bayanihang Pampaaralan
is focused on capability building of public schools as well as influencing systems of change to contribute to the attainment of desired education outcomes and impact. This program shall enable HS graduates to be ready for work or entrepreneurship, fit for jobs or ready for college
Audit Committee of the Board of Directors
retains and manages the relationship with the outside auditor, oversees the company's annual financial statement audit and internal controls over financial reporting, and oversees the company's risk management and compliance programs.
Board of Directors and Management
should engage with long-term shareholders on issues and concerns that are of widespread interest to them and that affect the company's long-term value creation
Horizontal Visibility
when it relates to awareness of unethical behavior among colleagues of the same hierarchical position
Vertical Visibility
when it relates to top-down or bottom-up awareness of unethical behavior
Nominating/Corporate Governance of the Board of Directors
plays a leadership role in shaping the corporate governance of the company
Business Lobbying
This can include influencing decisions of Congress and state legislatures and executive branch agencies directly through its own government relations specialists, through an industry trade association, through consultants, or through a combination of all those avenues. Businesses may also engage in indirect or grassroots influencing of decisions by appealing to its own employees, stakeholders, or the general public to make their views known to policymakers.
Stakeholder communication plan
This helps maintain strong relationships with stakeholders
Accountability
This is concerned with an organization recognizing that its actions affect the external environment, and therefore assuming responsibility for the effects of its actions. This concept therefore implies in quantification of the effects of action taken
Brainstorming
This is done by including all the people already involved and aware of the company and its objectives, and encouraging them to come out with their ideas. Through this stakeholders can be thought of based on categories such as internal or external.
Interest Group Participation
This plays a key role in all democratic systems of government. As a group of individuals organized to seek public policy influence, there is tremendous diversity within interest groups. Business is just one of many interest group sectors trying to influence public policy.
Board of Directors
A corporation's business is managed under the their oversight. The board also has direct responsibility for certain key matters, including the relationship with the outside auditor and executive compensation.
Attracting and retaining talent, investor loyalty, customer satisfaction, regulators
Advantages of Business Ethics
Brainstorming, determining power and influence over decisions, determining influences on mission, vision, and strategy formulation, checklist, involve the already identified stakeholders
Affective techniques to identify key stakeholders
Determining influences on mission, vision, and strategy formulation
Analyze the importance and roles of the individuals or groups who should be consulted as strategy is developed or who will play some parts in its eventual implementation.
Economic Responsibilities, Legal Responsibilities, Ethical Responsibilities, Economic Responsibilities
Archi Carroll's CSR Pyramid
Economic Responsibilities, Legal Responsibilities, Ethical Responsibilities, Philanthropic Reponsibilities
Archie Carroll's Pyramid of Corporate Social Responsibility is consist of:
Political Contributions
Businesses also use campaign contributions to support their position and to try to influence public policies that can help them increase profits. Seven of the ten largest corporations in the world are oil companies, based on revenues. Their access to funds for lobbying and this gives them a significant voice in the political system and on policies that can impact sustainable businesses.
Fact
Fact or Bluff. Any individual or groups of individuals who believe and have an interest in an organization's ability to deliver intended results and affect or are affected by its outcomes are called stakeholders. Stakeholders play an integral part in the development and ultimate success of an organization.
Government Taxation and Spending
Governments get money to spend from taxation. Increased spending requires increases in taxes or borrowing. Any tax increase will discourage investment, especially among entrepreneurs, who take the risks of starting and managing businesses. This also eats into the limited pool of savings, leaving less money for private investment. Reduction in private investments shrinks production of goods and services. That, in turn, may lead to the elimination of jobs.
As an economic institution, business lacks the ability to pursue social goals
Gross inefficiencies can be expected if managers are forced to divert their attention from their pursuit of economic goals.
Board of Directors
Has the vital role of overseeing the company's management and business strategies to achieve long-term value creation. Selecting a well-qualified chief executive officer (CEO) to lead the company, monitoring and evaluating the CEO's performance, and overseeing the CEO succession planning process are some of the most important functions of the board.
Economic Responsibilities
Historically, business organizations were created as economic entities designed to provide goods and services to societal members. The profit motive was established as the primary incentive for entrepreneurship. Before it was anything else, business organization was the basic economic unit in our society.
Business Lobbying, Political Contributions, Interest Group Participation
Tactics that Businesses Use to Influence Government
NutriSapat, Batang Angat
The Supplemental Feeding Program which caters to Filipino children who are below the ideal weight for their ages. These identified undernourished children will be registered to be part of the group who will be given supplementary dietary support for 120 days (or four months).
The Role of Human Resource Management
Volunteer and philanthropy programs often, but not always, develop through the efforts of HR staff. Senior leadership and the marketing department can also be key drivers of the program. No matter who is involved, it is important for employers to consider a few things when developing a program
BRIDGe Project
through a project, Brokering Business Investments in the Bangsamoro to Achieve Inclusive Development and Growth, implemented by PBSP in partnership with Hineleban Foundation, Inc. and Regional Board of Investments ARMM (RBOI-ARMM), developed the Business Sustainability Framework in the Bangsamoro, serves as a guide for future investors on how to do business in the region and an Investor's Guide called CLICK, a toolkit for investors interested in the Bangsamoro.
Transparency
As a principle, means that the external impact of the actions of the organization can be ascertained from the organization's reporting and pertinent facts or not disguised within the reporting. Thus, all the effect of the actions of the organization, including external impacts, should be apparent to all from using the information provided by the organization's reporting mechanism.
Corporate social action will prevent government intervention
As evidenced by waves of antitrust, equal employment opportunity and pollution control legislation, the government will force business to do what it fails to do voluntarily.
Business is unavoidably involved in social issues
As social activists like to say, business is either part of the solution or part of the problem. There is no denying that private business shares responsibility for societal problems including unemployment, inflation, and pollution
Management
Led by the CEO, is responsible for setting, managing and executing the strategies of the company, including but not limited to running the operations of the company under the oversight of the board and keeping the board informed of the status of the company's operations. Their responsibilities include strategic planning, risk management and financial reporting.
Sustainable communities
Most Americans live in cities or the surrounding areas; people living in metropolitan areas account for over 80% of the US population. The choices we make while we are living in cities greatly impact the global economy, environment, and personal well-being. The bright side of living in a city is that it creates efficiency of energy uses, and reduces the per person energy and resource use, and reducing energy waste and pollution.
Involve the already identified stakeholders
Once the stakeholders are identified, it is important to manage their interests and keep them involved and supportive.
Primary or Internal Stakeholders
These are groups or individuals who are directly engaged in economic transactions within the business, such as employees, owners, investors, suppliers, creditors, etc.
Secondary or External Stakeholders
These are groups or individuals who need not be engaged in transactions within the business but are affected in some way from the decisions of the business, such as customers, community, trade unions, and the government.
Community, government, trade association
These are the additional stakeholders
investors, employees, customers, suppliers, other business partners
They are the primary investors
True
True or False. CSR is built on the foundation of profit - profit must come first
False
True or False. In making decisions, the board CANNOT consider the interests of all of the company's constituencies, including stakeholders such as employees, customers, suppliers and the community.
Reactive, Interactive, Proactive
Types of Business Responses
Business has the resources to tackle today's complex societal problems
With its rich stock of technical, financial, and managerial resources, the private business sector can tip the scale in favor of solving society's more troublesome problems. After all, it is argued, without the support of society, business could not have built it resource base in the first place.
Compensation Committee of the Board of Directors
develops an executive compensation philosophy, adopts and oversees the implementation of compensation policies that fit within its philosophy, designs compensation packages for the CEO and senior management
Ethics in Marketing
is the area of applied ethics which deals with the moral principles behind the operation and regulation of marketing.
Visibility
is the corporate virtue pertaining to the degree to which employee unethical behavior and its consequences are manifest to those who can take a stance.
Philippine Business for Social Progress
is the largest business-led NGO at the forefront of strategic corporate citizenship and business sector leadership, contributing to sustainable development and poverty reduction.
Checklist
make this or formulate some questions to help identify the more influential or important stakeholders.
The CEO and Management
under the CEO's direction, are responsible for the development of the company's long-term strategic plans and the effective execution of the company's business in accordance with those strategic plans.
Philippine Plan of Action for Nutrition
- PBSP takes active participation in the implementation of activities under this to contribute to the fight against malnutrition among children, through the supplemental feeding program. - This is anchored in the 2030 Sustainable Development Goals for promoting Maternal, Infant and Young Child Nutrition.
Shareholders
- They invest in a corporation by buying its stock and receive economic benefits in return. - are not involved in the day to-day management of business operations, but they have the right to elect representatives (directors) and to receive information material to investment and voting decisions. - They should expect corporate boards and managers to act as long-term stewards of their investment in the corporation.
Sustainability
- This is concerned with the effect which action taken in the present has upon the options available on the future. If resources are no longer available for use in the future, and this is of particular concern if the resources are finite in quantity and once used are not available for future use. - most prominent at the present time among the three principles of CSR
Management
- develops and implements corporate strategy and operates the company's business under the board's oversight, with the goal of producing sustainable long-term value creation - under the oversight of the board and its audit committee, produces financial statements that fairly present the company's financial condition
Ethics
- is a branch of social science. It deals with moral principles and social values. It helps us to classifying, what is good and what is bad. It tells us to do good things and avoid doing bad things. - Separates the good and bad, right and wrong, fair and unfair, moral and immoral and proper and improper human action. - means, a code of conduct
Corporate Social Responsibility
- is a self-regulating business model that helps a company be socially accountable to itself, its stakeholders, and the public - also called corporate citizenship - is also often referred to as business responsibility and an organization's action on environmental, ethical, social, and economic issues.
Strategic Philanthropy
- is a unique and powerful way to combine your company goals with your desire to increase the well-being of mankind. - caused-related marketing - community partnering - is a positioning that connects your company with a not-for-profit organization or cause. - In this way, while you are being helpful and working for the common good in your community, your business is receiving parallel benefits. These benefits include exposure, lead generation, employee retention and increases in performance and productivity. They can even include benefits to your bottom line.
Corporate Governance
- is the system of rules, practices, and processes by which a firm is directed and controlled. - essentially involves balancing the interests of a company's many stakeholders, such as shareholders, senior management executives, customers, suppliers, financiers, the government, and the community
Water Alliance
- led by their CEOs with strong commitment to create solutions to water problems in the Philippines. - has evolved into a multi sectoral consortium that includes private sector and business networks, academe and research institutions, and social development organizations
Business Ethics
- means to conduct business with a human touch in order to give welfare to the society - is the application of ethical behavior in a business context. This means more than simply obeying applicable laws and regulations: It also means being honest, doing no harm to others, competing fairly, and declining to put your own interests above those of your company, its owners, and its workers.
Ethics on Human Resources
- plays a decisive role in introducing and implementing ethics. - covers those ethical issues arising around the employer-employee relationship, such as the rights and duties owed between employer and employee.
Consistency
- refers to the way in which corporate moral expectations regarding employee behavior are coherent, univocal and compatible. - The value of this therefore suggests that managers need to constantly and continually follow the ethical norms and display the desired behavior that the organization sets out, or else employees receive inconsistent signals.
Argument against CSR
Based on the assumption that business should stick to what it does best, that is, pursuing profit by producing marketable goods and services. Social goals should be handled by other institutions such as family, school, church, and government.
A better society means a better environment for doing business
Business can enhance its long-run profitability by making an investment in society today. In other words, today's problems can turn into tomorrow's profits.
Profit maximization ensures the efficient use of society's resources
By buying goods and services, consumers collectively dictate where assets should be deployed.
Code of Conduct, Based on moral and social values, Gives protection to social groups, provide basic framework, voluntary, requires education and guidance, relative term, new concept
Characteristics of Business Ethics
Ethics in Compliance
Compliance is about obeying and adhering to rules and authority. The motivation for being compliant could be to do the right thing out of the fear of being caught rather than a desire to be abiding by the law. An ethical climate in an organization ensures that compliance with law is fuelled by a desire to abide by the laws.
Since managers are not elected, they are not directly accountable to the people
Corporate social programs can easily become misguided. The market system effectively controls business' economic performance, but it is a poor mechanism for controlling business' social performance.
Keep it voluntary
Employers should take care not to pressure employees to use service hours or to participate in volunteer or philanthropy programs. Timberland's McIlwraith recalled a competition among business units to get employees more engaged with volunteerism. "Some managers took that a little too far," she said. "They never threatened anyone's position, but some of them reached out to employees to find out why they hadn't signed up for the program."
Setting Interest Rates
Government policy can influence interest rates, a rise in which increases the cost of borrowing in the business community. Higher rates also lead to decreased consumer spending. Lower interest rates attract investment as businesses increase production. The government can influence interest rates in the short run by printing more money, which might eventually lead to inflation.
Political Stability and Political Culture
Government policy will always depend on the political culture of the moment. Policy crafted in a politically stable country will be different that formed in an unstable country. A stable political system can make business-friendly decisions that promote local businesses and attract foreign investors. Unstable systems present challenges that jeopardize the ability of government to maintain law and order. This has a negative effect on the business environment.
Health Program, Environmental Program, Education Program, Livelihood Program
Programs of the Philippine Business for Social Progress
Legal Responsibilities
Society has not only sanctioned business to operate according to the profit motive; at the same time, business is expected to comply with the laws and regulations promulgated by the state and local governments as the ground rules under which business must operate. Legal responsibilities reflect a view of "codified ethics" in the sense that they embody basic notions of fair operations as established by our law makers
Green initiatives and sustainable investment
The global warming and the environmental impacts that we are experiencing today are in part due to the rapid industrialization around the globe that increased the amount of carbon, and other greenhouse gases in the atmosphere. As a consequence, we have been experiencing extreme weather, record heat, droughts, devastating hurricanes, and tsunamis in the coastal areas.. People slowly started realizing the importance of sustainable investment and preservation of natural resources; economic development of human civilization would only go so far without harming the human health and many dangerous risks
Policy as a Market Catalyst
The government can implement a policy that changes the social behavior in the business environment. For example, the government can levy taxes on the use of carbon-based fuels and grant subsidies for businesses that use renewable energy. The government can underwrite the development of new technology that will bring the necessary change. Imposing on a particular sector more taxes or duties than are necessary will make the investors lose interest in that sector.
Set activity guidelines
The organization should establish clear parameters and rules for days of service. For example, employees will have to follow certain rules when planning their days or hours of service and work with their managers to avoid workplace disruptions. "It is just like a vacation that has to be set up in advance," said Tom Shaw, vice president of human resources for Triumph Bancorp in Dallas. "Employees have to coordinate their volunteerism with their supervisor."
Ethics of Production
This area of business ethics deals with the duties of a company to ensure that products and production processes do not cause harm.
Regulations and Permits
Trade regulations, the federal minimum wage, and the requirements for permits or licenses have effects on business. For example, periodic health inspections must be carried out in all restaurants. Businesses might spend a lot of money and time to comply with regulations that ultimately prove to be ineffective and unnecessary. Fair and effective regulations, however, promote business growth.
Supportability
concerns the extent to which employees are encouraged to recognize and realize the legitimate expectations and interests of stakeholders. It refers to the commitment of managers and employees to behave ethically, and the extent to which the corporation fosters or hinders such commitment.
Discussability
concerns the openness to discuss ethical dilemmas, as it is perceived by employees. When employees can openly talk about ethics, unethical behavior is less frequent. On the contrary, when the corporate culture allows for little discussion and debate, unethical behavior is more present.
Arguments in support to CSR
convinced that the corporation should be more than simply a profit machine, proponents of social responsibility have offered these.
Volunteer Activities
employers can develop a program to encourage volunteerism. Footwear Company Timberland, based in Stratham, N.H., offers its employees 40 paid hours per year to spend on volunteer activities. Although using those hours is not required, the company keeps volunteerism and philanthropy front and center by sponsoring global service days twice a year and smaller monthly service events to keep employees aware of and engaged in opportunities to serve the community.
Philanthropic Responsibilities
encompasses those corporate actions that are in response to society's expectation that business be good corporate citizens. This includes actively engaging in acts or programs to promote human welfare or goodwill. Examples of philanthropy include business contributions to financial resources or executive time, such as contributions to the arts, education, or the community. Communities desire firms to contribute their money, facilities, and employee time to humanitarian programs or purposes, but they do not regard the firms as unethical if they do not provide the desired level. Therefore, philanthropy is more discretionary or voluntary on the part of businesses even though there is always the societal expectations that businesses provide it.
Proactive Response
entails acting to influence policies, anticipating changes in public policy, and trying to enhance competitive positioning by correctly anticipating changes in policy.
Governments
establish many regulations and policies that guide businesses. Some rules, like minimum wage, are mandatory, while other policies may influence your business indirectly. Businesses need to be flexible enough to respond to changing rules and policies.
Ethics in Finance
includes issues that companies and employees are confronted with such as in accounting: window dressing, misleading financial analysis; related party transactions not at arm's length; Insider trading, securities fraud leading to manipulation of the financial markets; Executive compensation; Bribery, kickbacks, over billing of expenses, facilitation payments; Fake reimbursements
Stakeholders
is a person or group that has an interest in a company and can either affect or be affected by the business.
Archie Carroll's CSR Pyramid
is a simple framework that helps argue how and why organizations should meet their social responsibilities.
Achievability
is the corporate virtue which acknowledges that moral expectations set out by corporations must be in line with the capability of employees to live up to them. It concerns the degree to which corporations enable employees to meet such expectations by providing sufficient time, budgets, equipment, information, and authority to fulfill their ethical responsibilities.