CH 7 PDF

• Corporate Social Responsibility (CSR) is a strong concept that involves achieving a balance among economic, social, and environmental responsibilities in business operations to address shareholder and stakeholder expectations
• Key elements of CSR include:

  • Corporations having responsibilities beyond the production of goods and services
  • Helping to solve social problems, especially those they have helped create
  • Having a broader constituency than just shareholders alone
  • Impacting beyond simple marketplace transactions
  • Serving a wider range of human values than just economic values
• The basic idea of CSR is that business and society are interwoven rather than distinct entities, with expectations placed on business due to its roles as an institution, corporation, and individual managers who are moral actors within the corporation
• The CSR debate includes arguments for involvement such as satisfying society's needs, preventing public criticism, and solving social problems, as well as arguments against involvement like profit maximization and the role of government in social policy
• Managers have different motivations when responding to sustainability, resulting in different sustainability management initiatives categorized as reactionary, reputational, responsible, and dialogue-based
• Three categories of social responsibility theories are:

  • Amoral view: traditional view of business as a profit-making entity
  • Personal view: corporations viewed as collectives that act as individuals
  • Social view: corporations seen as social institutions with responsibilities
• Carroll's pyramid of CSR includes economic, legal, ethical, and philanthropic responsibilities, with a hierarchy where economic and legal obligations are primary, but ethical and philanthropic responsibilities have gained more attention in recent years
• Contemporary CSR concepts include corporate sustainability, reputation management, social impact management, and the triple bottom line (TBL) which evaluates a corporation's performance based on economic, social, and environmental value added or destroyed
• Corporate citizenship demonstrates that corporations consider their complete impact on society, environment, and economic influence, providing benefits in areas like reputation management, risk profile, employee relations, and operational efficiency
• The VBA model integrates and unifies common frameworks based on value, balance, and accountability to define the proper role of business in society, avoiding confusion from various frameworks