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Copy of Chapter 8: Ethics and Corporate Social Responsibility

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Jhon Dave Llanto

on 27 April 2014

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Transcript of Copy of Chapter 8: Ethics and Corporate Social Responsibility

Chapter 8: Ethics and Corporate Social Responsibility
Corporate Social Responsibility from a Historical Perspective
Historical Phases of Corporate Social Responsibility
Perspective on Corporate Social Responsibility
People's attitude, values and management culture differ. Consequently, each has a social responsibility in society since every individual, body or institution makes up a society.
Business have different viewpoints on social responsibility as well.
Current Activities Related to Corporate Social Responsibility
Stakeholder rights
Supplier relations
Human rights
Human resource management practices
consumer rights and protection
Labor protection and security
Environmental protection
Corporate governance
Community development
Health and safety
"corporate social responsibility means seriously considering the impact of the company's actions on society"
- Bauer
The Concept of Corporate
Social Responsibility
"the obligation of decision makers to take actions which protect and improve the welfare of the society as a whole along with their own interests"
- Davis and Bomstrom
"the idea of social responsibility supposes that the corporation has not only economic and legal obligations, but also certain responsibilities to society which extend beyond these obligations."
- McGuire

"the response of the corporation to issues beyond its narrow economic, technical and legal requirements. It is the obligation of the corporation to evaluate the effects of its decisions on the external environment.
- Prof. Keith Davis of Arizona State University
The Ancient and Medieval Period
People believed that businessmen and wealthy people should do business to the community as part of public or social service.
Criticisms against the evil of business came far and wide during the medieval period when the Catholic Church became the most powerful institution in Europe.
Period of Mercantalism
This period showed several violations of social responsibility.
No moral issue was raised in Europe.
The power of Catholic Church as the most influential body in Europe did not only diminish because European governments became active due to the influence brought about by the philisophy and doctrines.
The Industrial Revolution
The time when machines were introduced, thus contributing to improved production and business growth.
The emergence of big corporations also happened during this time.
CSR was totally absent as big corporations acted above law.
After the Period of Depression
Businesses have started to involve internal and external stakeholders to collaborate and participate in the improvement of the standards of their corporate social responsibility policies, procedures and practices.
Phase 1: Profit maximizing Management (1800s to 1900s)
Phase 2: Trusteeship
Management (Early 1900s)

Phase 3: Quality of Life Management (1930s)
Assessment on the Practice of Corporate Social Responsibility
Arguments in Support of CSR
Long-run self-interest
Business resources
Viability of Business
Public Image
Profit from Social Problems
Arguments Against the Practice of CSR
Profit maximization
Lack of Social Skills
Lack of Social Accountability
Higher Product Cost
The Four Corporate Responsibilities
Philanthropic Responsibilities - DESIRED of business by society
Ethical Responsibilities - EXPECTED of business by society
LEGAL Responsibilities - REQUIRED of business by society
Economic Responsibilities - REQUIRED of business by society
The Social Responsibility Towards Consumer
Consumers are considered to be the most important stakeholders of the business besides its own employees. Companies are duty-bound to fulfill and be conscientious of their social responsibility towards the customer of their business.
Social Responsibility Towards
the Community and the Environment
Businesses have the corporate social responsibility of preserving and maintaining the balance of nature because once natural resources are depleted, these can never be replaced no matter how magnificent the power of man's brain is.
Perspective on Corporate Social Responsibility
Full transcript