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MODULE%205%20SOCIAL%20RESPONSIBILITY%20AND%20GOVERNANCE

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The Case 'Against' Corporate Social Responsibility ... Enron. CORPORATE GOVERNANCE. Corporate Governance. CORPORATE GOVERNANCE. Government Regulations ... – PowerPoint PPT presentation

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Title: MODULE%205%20SOCIAL%20RESPONSIBILITY%20AND%20GOVERNANCE


1
MODULE 5SOCIAL RESPONSIBILITY AND GOVERNANCE
Organizations have ethics, too
  • What should we know about organizational
    environments and social responsibility?
  • What are current issues in corporate governance?

2
SOCIAL RESPONSIBILITY AND GOVERNANCEOrganizationa
l Environments And Social ResponsibilityMODULE
GUIDE 5.1
  • Organizations operate within conditions set by
    the general environment.
  • The specific environment includes an
    organizations stakeholders.
  • Social responsibility is an organizations
    obligation to best serve society.
  • Social performance by organizations can be
    evaluated in different ways.
  • Scholars argue cases for and against corporate
    social responsibility.
  • Organizations follow different social
    responsibility strategies.
  • Failures of ethics and social responsibility
    prompt calls for stronger governance.

3
ORGANIZATIONAL ENVIORNMENTS AND SOCIAL
RESPONSIBILITY Organizational Environments
  • General Environment
  • Consists of cultural, economic, legal, political
    and educational conditions
  • Specific Environment
  • Consists of the people and groups with which an
    organization interacts
  • Stakeholders
  • People and Institutions most directly affected by
    an organizations performance

4
ORGANIZATIONAL ENVIRONMENTS General Environment
  • Economic
  • Health of the economy in terms of inflation,
    income levels, gross domestic product,
    unemployment, and job outlook
  • Sociocultural
  • Norms, customs, and social values on such matters
    as human rights, trends in education and related
    social institutions, as well as demographic
    patterns in society
  • Legal-political
  • Prevailing philosophy and objectives of the
    political party or parties running the
    government, as well as laws and government
    regulations
  • Technological
  • Development and availability of technology,
    including scientific advancements
  • Natural
  • Nature and conditions of the natural environment,
    including levels of public concern expressed
    through environmentalism

5
ORGANIZATIONAL ENVIRONMENTS Specific Environment
Specific Environment The people and groups with
whom an organization interacts.
6
ORGANIZATIONAL ENVIRONMENTS Social Responsibility
  • Corporate Social Responsibility
  • The obligation of an organization to serve its
    own interest and those of its stakeholders
  • Social Responsibility Audit
  • Assesses an organizations performance in the
    area of social responsibility

7
ORGANIZATIONAL ENVIRONMENTS Social Responsibility
8
ORGANIZATIONAL ENVIRONMENTS Social Responsibility
  • The Case In Favor Of Corporate Social
    Responsibility
  • Responsibility Increases long-run profits
  • Improves public image
  • Helps avoid government regulation
  • Businesses have resources and ethical obligations
    to act responsibly
  • The Case Against Corporate Social
    Responsibility
  • Reduces business profits Creates higher business
    costs
  • Dilutes business purpose Gives too much social
    power to business

9
ORGANIZATIONAL ENVIRONMENTS Social Responsibility
  • Strategies

10
SOCIAL RESPONSIBILITY AND GOVERNANCECorporate
GovernanceMODULE GUIDE 5.2
  • Failures of ethics and social responsibility
    prompt calls for stronger governance.
  • Weak corporate governance can result in more
    government regulation.
  • Moral management builds capacities for
    self-governance in organizations.

11
CORPORATE GOVERNANCE Corporate Governance
  • Corporate Governance
  • The oversight of top management by a board of
    directors
  • Weak corporate governance leads to government
    regulation
  • Boeing
  • WorldCom
  • Enron

12
CORPORATE GOVERNANCE Corporate Governance
13
CORPORATE GOVERNANCE Government Regulations
  • Government Regulations
  • Sarbanes-Oxley Act 2002
  • Goal is to see that top CEOs oversee the
    financial conduct of their organizations
  • Occupational and Safety Act (OSHA) 1970
  • Goal is to protect employees from workplace
    injuries
  • Equal Opportunity Act (EEO) 1972
  • Goal is to protect minorities against
    discrimination
  • Consumer Product Safety Act 1972
  • Goal is to protect consumers from harmful products

14
CORPORATE GOVERNANCE Moral management
  • Moral Management
  • Moral Manager
  • Considers ethical behavior as a personal goal
  • Amoral Manager
  • Is unethical but unintentionally
  • Immoral Manager
  • Chooses to behave unethically

15
CORPORATE GOVERNANCE Moral Management
16
CORPORATE GOVERNANCE Ethics Mindfulness
  • Ethics Mindfulness
  • Enriched awareness that leads to consistent
    ethical behavior

17
MANAGEMENT TIPS
  • A social responsibility audit assesses an
    organizations accomplishments in areas of social
    responsibility.
  • Discretionary Responsibility
  • Contribute to Community
  • Ethical Responsibility
  • Do What Is Right
  • Legal Responsibility
  • Obey the Law
  • Economic Responsibility
  • Be Profitable
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