MGMT 3080- Chapter 6 - Midterm

All of the following are examples of environmental performance indicators in the triple bottom line EXCEPT: A. energy use B. taxes paid C. changes in natural habitats caused by the company's operations D. materials used by weight or volume

B. taxes paid

Which of the following is a traditional, passive form of corporate philanthropy characterized by donations to multiple worthy causes without any relationship to business strategy? A. Altruism B. Cause-related marketing C. Checkbook philanthropy D. Venture philanthropy

C. Checkbook philanthropy

The international effort to develop uniform standards for company reports is called the:

GRI

_____ is the documentation and disclosure of how closely corporate operations conform to the goal of sustainable development.

Sustainability reporting

This is the economic growth that meets the needs of the present without consuming social and environmental resources in a way that harms future generations.

Sustainable development

A strategy is a basic approach, method, or plan for achieving an objective.

TRUE

In terms of a company's social report, the opposite of transparency is opacity.

TRUE

Job descriptions that include sustainability duties encourage accountability.

TRUE

Most mission statements center on profits and products.

TRUE

Social responsibility is still frequently seen as a superfluous activity only indirectly related to the bottom line, one that costs money, takes time, and reduces efficiency.

TRUE

The most effective assurance that information in a corporate sustainability report is correct is provided by independent, external auditors.

TRUE

The top management of a company sets the tone for the company's social goals.

TRUE

The triple bottom line has become the most accepted approach to CSR reporting because it can satisfy a range of demanding stakeholders.

TRUE

There is no single formula for social responsibility that fits all companies.

TRUE

When a company changes its philosophy of giving money to charitable organizations from pure generosity to commercial objectives, it is called strategic philanthropy.

TRUE

In terms of GRI indicators, which of the following is an economic performance indicator? A. Materials used by weight or volume. B. Total number of substantiated complaints. C. Number of jobs supported in the supply chain. D. Total value of financial and in-kind contributions to political parties.

C. Number of jobs supported in the supply chain.

Which of the following is an emerging form of philanthropy that uses market forces to achieve results? A. Checkbook philanthropy B. High impact philanthropy C. Philanthrocapitalism D. Microphilanthropy

C. Philanthrocapitalism

Which of the following sketches stakeholders in categories and depicts their relationship to the firm? A. Analysis map B. Stakeholder model C. Stakeholder map D. Concept map

C. Stakeholder map

All of the following are examples of economic performance indicators in the triple bottom line EXCEPT: A. net revenues B. taxes paid C. ratio of basic salary of men to women by employee category D. charitable monetary contributions to local organizations

C. ratio of basic salary of men to women by employee category

Which of the following is a relevant categorization of stakeholders according to their power to affect a firm's business? A. Neutral, supportive, or confrontational B. High, medium, or low influence C. Neutral, investors, or environmentalists D. Feminists, investors, or environmentalists

B. High, medium, or low influence

Which of the following is a rare variant of the progressive model wherein a founder with noble impulses left a culture inclined to corporate responsibility? A. The local business B. The large corporation C. The traditional business D. The small company

B. The large corporation

Define a business model and explain its purpose.

A business model is the underlying idea or theory that explains how a business will create value by making and selling products in the market. The theory is validated if the business makes a profit.

Explain what is meant by corporate social responsibility.

A corporation should assess its current situation and activities based on the society. This is known as its corporate social responsibility. Companies manage their responses to social pressures by moving through a process of CSR implementation.

Explain the basic components of a company's mission statement. What should be included in this statement?

A mission statement is a brief statement of the basic purpose of an organization. The best ones define the business, differentiate it from competitors, explain relationships with stakeholders, and focus energy on critical activities and goals.

What is a strategy? Discuss the implementation of a CSR strategy.

A strategy is a basic approach, method, or plan for achieving an objective. To establish its CSR objective, a company can consider options suggested by the profile of its situation constructed in the prior CSR review stage. This profile can be analyzed to find the strengths and weaknesses in the company's social response and the threats and opportunities in its environment. To be carried out, the strategy must be translated into specific goals and performance objectives, embedded in policies and procedures, reinforced with processes, and supported by both the formal structure and the informal elements of corporate culture.

Which of the following is a relevant categorization of stakeholders according to their orientation to the firm? A. Confrontational, neutral, or supportive B. High, medium, or low influence C. Neutral, low, or medium influence D. Feminists, investors, or environmentalists

A. Confrontational, neutral, or supportive

Which of the following statements about a CSR review is false? A. It explores regulatory requirements, but cannot examine competitors' initiatives. B. It involves an engagement of stakeholders to reveal expectations in society. C. It can begin with a definition of CSR to provide a focus. D. It involves a discovery of core values.

A. It explores regulatory requirements, but cannot examine competitors' initiatives.

Which of the following defines a business, differentiates it from competitors, explains relationships with stakeholders, and focuses energy on critical activities and goals? A. Mission statement B. Annual report C. Social contract D. Code of conduct

A. Mission statement

When American Express Co. advertised that it would donate 3 cents per transaction to nonprofit anti-hunger groups over a two-month period for all charges against its credit card, it was an example of:

A. cause-related marketing

All of the following are examples of social performance indicators in the triple bottom line EXCEPT: A. total amount of employee wages and benefits. B. total hours of employee training. C. total number of incidents of discrimination and actions taken. D. total number of substantiated complaints regarding breaches of customer privacy.

A. total amount of employee wages and benefits.

Companies can manage their responses to social pressures by moving through a process of:

CSR implementation.

Which of the following is a variant of strategic philanthropy in which charitable contributions are based on purchases of a product?

Cause-related marketing

_____ are those social issues/impacts related to factors that influence success in the marketplace.

Competitive social issues

_____ values are the central beliefs that guide decisions and reside deep in a company's culture.

Core

Explain what is meant by corporate philanthropy and how it is expressed.

Corporate philanthropy is the concern for the welfare of society expressed by gifts of money or property to the needy or to activities for social progress.

In terms of GRI indicators, which of the following is an environmental performance indicator? A. Percentage of employees trained in the organization's anticorruption policies B. Voluntary donations to communities C. Net revenues D. Materials used by weight or volume

D. Materials used by weight or volume

Which of the following refers to a basic approach, method, or plan for achieving an objective? A. Vision B. Initiative C. Mission D. Strategy

D. Strategy

A company's charitable contributions are not tax-deductible.

FALSE

A progressive business model is one in which the central strategy for creating value is based on meeting market demands.

FALSE

At most companies CSR is still incidental, and rarely supplemental, to core business strategies.

FALSE

Cause-related marketing is a variant of strategic philanthropy in which charitable contributions are based on purchases of a service.

FALSE

Checkbook philanthropy is an active approach to philanthropy.

FALSE

Corporate philanthropy is a large part of overall private philanthropy in the U.S. every year.

FALSE

In traditional philanthropy, foundations and corporations give grants to profitable organizations that then spend the money to meet stated goals.

FALSE

Most companies begin with an early founding impulse for truth, justice, and the stakeholder way.

FALSE

Skeptics call cause-related marketing "conservation philanthropy".

FALSE

To be effective, performance goals must be general and progress toward them should be measurable.

FALSE

Distinguish between the progressive business model and the traditional model as they relate to corporate responsibility.

In the universe of business models, there are two distinct types as they relate to corporate responsibility, the progressive model and the traditional model. A traditional business model is one in which the central strategy for creating value is based on meeting market demands while complying with the law. A progressive business model creates value by meeting market demands and, in the process, mitigating social problems or improving society in some way. The value proposition is based on actions that would be considered voluntary responsibilities in more traditional companies. Progressive business models are rare, the basis of only a few companies.

What is philanthrocapitalism?

Now, a model of philanthropy is emerging based largely, but not entirely, on the philosophies and examples of new billionaires from technology industries. In distinctive ways, new philanthropists, either themselves or through their companies, apply the business methods that made them rich to the field of philanthropy, blurring the line between charity and business, seeking to harness market forces. This new philanthropy, or philanthrocapitalism as it is often called, covers a range of actors and approaches but it is bold, entrepreneurial, results-oriented, closely engaged, and impatient.

This is the state in which company social policies, processes, and actions are visible to external observers.

Transparency

The purpose of this concept is to appraise the overall impact of a firm's operations by adding nonfinancial measures to traditional financial results.

Triple bottom line

Explain what is meant by the "triple bottom line" in GRI reporting.

Triple bottom line is an accounting of a firm's financial, social and economic performance.

The statement of how a business will create value by selling something in the marketplace is called:

a business model

Tasks like revising or creating policies, budgeting resources, and assigning work are a part of the:

action plan

As a first step in implementing corporate social responsibility, a corporation should:

assess its current situation and activities.

Verification by audit that information in a corporate sustainability report is correct is known as:

assurance

With regard to CSR, the growing number of board committees and vice presidents of corporate responsibility implies more _____ than usually exists in practice.

centralization

Most companies, including nearly all of the largest multinationals, vary in their reaction to pressures in the operating environment across a spectrum from reluctance to enthusiasm. At the right of this spectrum:

companies seek to be proactive by anticipating demands and resolving problems before they arise.

A progressive business model:

defines a strategy that meets market needs by mitigating social problems.

In 2009, U.S. charitable giving was about $304 billion. The largest proportion of this was given by:

individuals

A traditional business model:

is one in which the central strategy for creating value is based on meeting market demands while complying with the law.

The two elements that determine the CSR orientation of a firm are its business model and its:

leadership.

The basic purpose of a company that defines the type of business in which the company is engaged in and explains how it differs from its competitors is called a:

mission statement.

When Hershey Foods states that its purpose is "to consistently create shareholder value by achieving excellence in every aspect of our business," this is called its:

mission statement.

When a company gives monetary gifts to society in order to advance social welfare, it is called:

philanthropy

According to Michael Porter and Mark Kramer, an "essential test" for the worthiness of any additional social initiative is to determine whether it presents an opportunity to create _____ that is, a meaningful benefit for society that is also valuable to the business.

shared value

When a company assesses its social impact on society, it has performed a(n):

social audit.

Formulas for CEO compensation are almost universally focused on attaining:

specific financial goals.

When a corporation aligns its charitable strategy with its business strategy, it is known as:

strategic philanthropy

At most companies CSR is still ___, and largely ___, to core business strategies.

supplemental; incidental

In terms of a company's social reports, the opposite of _____ is:

transparency; opacity

The standard that uses economic, environmental, and social performance indicators that are based on GRI standards is called the:

triple bottom line