STRAMA 4

Akhilesh Ganti

According to WHO (2022), social responsibility is an ethical framework that asserts that an individual is obligated to work and cooperate with other individuals and organizations to benefit society and their environment as a whole. 

2022

According to Akhilesh Ganti (WHEN), social responsibility is an ethical framework that asserts that an individual is obligated to work and cooperate with other individuals and organizations to benefit society and their environment as a whole. 

social responsibility

WHAT is an ethical framework that asserts that an individual is obligated to work and cooperate with other individuals and organizations to benefit society and their environment as a whole. 

social responsibility

As it applies to business, WHAT is referred to as Corporate Social Responsibility (CSR).

Corporate Social Responsibility (CSR).

As it applies to business, social responsibility is referred to as WHAT

Corporate Social Responsibility (CSR).

This self-regulating business model helps a company act responsibly in many ways, such as engaging in ethical labor practices, producing goods and services in a way that is not harmful to society or the environment, preserving natural resources, and changing manufacturing processes to reduce carbon emissions. 

Corporate Social Responsibility (CSR).

The realization that businesses must adopt policies and engage in WHAT emphasizes that a business's ability to maintain a balance between pursuing economic performance and adhering to societal and environmental issues is a critical factor in operating effectively and efficiently. 

Bamford

WHO, Hoffman, Hunger, and Wheelen (2018) cited Milton Friedman and Archie Carroll’s two (2) contrasting views of the responsibilities of business firms to society as follows: 

Hoffman

Bamford, WHO, Hunger, and Wheelen (2018) cited Milton Friedman and Archie Carroll’s two (2) contrasting views of the responsibilities of business firms to society as follows: 

Hunger

Bamford, Hoffman, WHO, and Wheelen (2018) cited Milton Friedman and Archie Carroll’s two (2) contrasting views of the responsibilities of business firms to society as follows: 

Wheelen

Bamford, Hoffman, Hunger, and WHO (2018) cited Milton Friedman and Archie Carroll’s two (2) contrasting views of the responsibilities of business firms to society as follows: 

2018

Bamford, Hoffman, Hunger, and Wheelen (WHEN) cited Milton Friedman and Archie Carroll’s two (2) contrasting views of the responsibilities of business firms to society as follows: 

Milton Friedman

Bamford, Hoffman, Hunger, and Wheelen (2018) cited WHO and Archie Carroll’s two (2) contrasting views of the responsibilities of business firms to society as follows: 

Archie Carroll

Bamford, Hoffman, Hunger, and Wheelen (2018) cited Milton Friedman and WHO’s two (2) contrasting views of the responsibilities of business firms to society as follows:

Friedman’s traditional view of business responsibility.

two (2) contrasting views of the responsibilities of business firms to society 1

Carroll’s four (4) responsibilities of business.

two (2) contrasting views of the responsibilities of business firms to society 2

Friedman’s traditional view of business responsibility.

Milton Friedman argued against the concept of social responsibility as a function of the business.

Friedman’s traditional view of business responsibility.

According to Friedman, the primary social responsibility of a business is to use its resources and engage only in activities designed to increase profit so long as it stays within the rules of open and free competition without deception or fraud. 

Friedman’s traditional view of business responsibility.

Example: A businessperson who acts “responsibly” by cutting the price of the firm’s product to aid the poor, or by making expenditures to reduce pollution, or hiring the hard-core unemployed, is spending the shareholder’s money for general social interest. 

Friedman’s traditional view of business responsibility.

 

Even if the businessperson has shareholder permission or even encouragement to do so, he or she is still acting from motives other than economic and may, in the long run, harm the very society the firm is trying to help. By taking on the burden of these social costs, the business becomes less efficient, resulting in price increases to pay for the increased costs or postpone investments in new activities and research. These results negatively affect the long-term efficiency of a business. 

Milton Friedman

WHO argued against the concept of social responsibility as a function of the business.

Milton Friedman

According to WHO, the primary social responsibility of a business is to use its resources and engage only in activities designed to increase profit so long as it stays within the rules of open and free competition without deception or fraud. 

Carroll’s four (4) responsibilities of business.

Archie Carroll proposed that maximization of profits cannot be the primary obligation of a business.

Carroll’s four (4) responsibilities of business.

He suggested that business organizations have four 

(4) responsibilities

Archie Carroll

He suggested that business organizations have four 

(4) responsibilities

Archie Carroll

proposed that maximization of profits cannot be the primary obligation of a business.

Economic.

four (4) responsibilities by Archie Carroll 1

Legal

four (4) responsibilities by Archie Carroll 2

Ethical

four (4) responsibilities by Archie Carroll 3

Discretionary

four (4) responsibilities by Archie Carroll 4

Economic.

four (4) responsibilities by Archie Carroll

A business organization is responsible for producing goods and services of value to society so that the firm may repay its creditors and increase the wealth of its shareholders. 

Economic.

four (4) responsibilities by Archie Carroll

Example: The launch of Apple’s Iphone devices has changed society in many ways. It allows users to call, text, email, facetime, and use social networking at an easier and faster rate. In return, Apple became the world’s first $3 trillion company. 

Legal.

four (4) responsibilities by Archie Carroll

A business organization has legal responsibilities that are defined by governments in laws that management is expected to obey. 

 

Legal.

four (4) responsibilities by Archie Carroll

Example: U.S. business firms are required to hire and promote people based on their credentials rather than to discriminate on non-job-related characteristics such as race, gender, or religion. 

Ethical.

four (4) responsibilities by Archie Carroll

A business organization is responsible for following the generally held beliefs about behavior in a society. 

Ethical.

four (4) responsibilities by Archie Carroll

Example: Society generally expects firms to work with the employees and the community in planning for layoffs, even though no law may require this. The affected people can get very upset if an organization’s management fails to act according to prevailing ethical values. 

Discretionary.

four (4) responsibilities by Archie Carroll

A business organization has responsibilities that are purely voluntary on the part of the corporation.

Discretionary.

four (4) responsibilities by Archie Carroll

The difference between ethical and discretionary responsibilities is that few people expect an organization to fulfill discretionary responsibilities, whereas many expect an organization to fulfill ethical ones. 

Discretionary.

four (4) responsibilities by Archie Carroll

Example: philanthropic contributions, training unemployed people, and providing day- care centers. 

priority.

Carroll listed these four (4) responsibilities in order of WHAT

profit

. A business firm must first make a WHAT to satisfy its economic responsibilities.

laws

To continue, the firm must follow the WHAT, thus fulfilling its legal obligations.

social responsibilities

Having met the two (2) basic responsibilities, according to Carroll, a firm should look to fulfilling its WHAT.

ethical and discretionary

Social responsibility, therefore, includes both WHAT, but not economic and legal responsibilities.

taking actions that society tends to value but has not yet put into law

A firm can fulfill its ethical responsibilities by WHAT.

discretionary responsibilities

When ethical responsibilities are satisfied, a firm can focus on WHAT—purely voluntary actions that society has not yet decided to expect from every company.

Carroll’s four (4) responsibilities of business

Example: When Cisco Systems decided to dismiss 6,000 full-time employees, it provided a novel severance package. Those employees who agreed to work for a local non-profit organization for a year would receive one-third of their salaries plus benefits and stock options and be the first to be rehired. Non-profit organizations were delighted to hire such highly qualified people, and Cisco could maintain its talent pool for when it could hire again.

A.     Peter Drucker’s view of social responsibility.

suggests that companies should ensure that their social responsibilities also become business opportunities.

A.     Peter Drucker’s view of social responsibility.

Cohen (2010) cited that WHO/WHAT highlights considerations for workers that are part of the responsibility of a corporate leader just as much as the profits, survival, and growth of the business or organization.

Government cannot solve many social problems.

The management thoughts of Drucker about corporate social responsibility were summarized as follows:

This suggests that companies may tailor their program to help eradicate existing social problems while maintaining business stability and profitability.

The corporate mission comes first.

The management thoughts of Drucker about corporate social responsibility were summarized as follows:

The first social responsibility of the business is to make a profit sufficient to cover operational costs in the future.

The corporate mission comes first.

The management thoughts of Drucker about corporate social responsibility were summarized as follows:

Once the organization failed in its primary mission, its initiative for social responsibility would go out of existence.

The corporate mission comes first.

The management thoughts of Drucker about corporate social responsibility were summarized as follows:

So, if this basic social responsibility of fulfilling the organization’s purpose is not met, no other social responsibility can be met either.

The unlimited liability clause.

The management thoughts of Drucker about corporate social responsibility were summarized as follows:

An unlimited liability clause means that the organization assumes full legal responsibility for the future outcome of their initiatives, their company’s debts, and all other financial commitments.

A.     Albert Carr’s view of social responsibility.

argues that business is a game and that business ethics differs from private life ethics.

A.     Albert Carr’s view of social responsibility.

Wheelen (2018) cited that WHO views business practices such as bluffing and not telling the truth as normal and morally acceptable in business.

A.     Albert Carr’s view of social responsibility.

WHO also claims that one cannot apply a single standard of ethics universally as situations differ.

A.     Edward Freeman’s view of social responsibility.

WHO holds a very favorable view of social responsibility.

A.     Edward Freeman’s view of social responsibility.

Wheelen (2018) cited that Freeman believes in a “Stockholder Theory,” that any person or organization that has an underlying interest in the business should also play a role of participation in the business’ actions and decisions --- responsibility to customers, responsibility employees, responsibility to financers, responsibility to suppliers, and responsibility to communities.

Stockholder Theory

any person or organization that has an underlying interest in the business should also play a role of participation in the business’ actions and decisions --- responsibility to customers, responsibility employees, responsibility to financers, responsibility to suppliers, and responsibility to communities.

stakeholder

A WHAT is someone with an interest or concern in a particular business undertaking.

Stakeholder analysis

WHAT involves the identification and evaluation of corporate stakeholders.

. Bamford et al. (2018)

WHO cited that the process of analyzing stakeholders can be accomplished by following a three-step process as follows:

1.      Identify primary stakeholders.

Bamford et al. (2018) cited that the process of analyzing stakeholders can be accomplished by following a three-step process as follows:

The WHAT stakeholders are those who directly connect with the corporation and have sufficient bargaining power to affect corporate activities directly.

1.      Identify primary stakeholders.

Bamford et al. (2018) cited that the process of analyzing stakeholders can be accomplished by following a three-step process as follows:

These include customers, employees, suppliers, shareholders, and creditors.

1.      Identify secondary stakeholders.

Bamford et al. (2018) cited that the process of analyzing stakeholders can be accomplished by following a three-step process as follows:

The WHAT are those who have only an indirect stake in the corporation and are also affected by corporate activities.

1.      Identify secondary stakeholders.

Bamford et al. (2018) cited that the process of analyzing stakeholders can be accomplished by following a three-step process as follows:

These usually include non- governmental organizations, activists, local communities, trade associations, competitors, and the government.

1.      Analyze stakeholder influence over strategic decisions.

Bamford et al. (2018) cited that the process of analyzing stakeholders can be accomplished by following a three-step process as follows:

The primary decision criteria used by management are generally economic, which is why secondary stakeholders may be ignored or discounted as unimportant.

1.      Analyze stakeholder influence over strategic decisions.

Bamford et al. (2018) cited that the process of analyzing stakeholders can be accomplished by following a three-step process as follows:

For a firm to fulfill its ethical or discretionary responsibilities, it must seriously consider the needs and wants of its secondary stakeholders in any strategic decision.

Ethics

According to Camillus et al. (2021), WHAT is the consensually accepted standard of behavior for an occupation, a trade, or a profession.

Morality

WHAT , in contrast, constitutes one’s rules of personal behavior based on religious or philosophical grounds.

law

On the other hand, WHAT refers to formal codes that permit or forbid certain behaviors and may or may not enforce ethics or morality.

comprehensive statement of ethics

Given these definitions, a WHAT to use in making decisions for a specific occupation, trade, or profession is important to be identified by all corporations or businesses.

1.      Utilitarian approach.

three (3) basic views on ethical behavior

This approach proposes that actions and plans should be judged by their consequences.

1.      Utilitarian approach.

three (3) basic views on ethical behavior

Therefore, people should behave in a way that will produce the greatest benefit to society and produce the least harm or the lowest cost.

1.      Utilitarian approach.

three (3) basic views on ethical behavior

A problem with this approach is the difficulty in recognizing all the benefits and costs of any particular decision.

1.      Utilitarian approach.

three (3) basic views on ethical behavior

Camillus et al. (2021) stated that research reveals that CEOs prioritize only the stakeholders who have the most power (ability to affect the company), legitimacy (legal or moral claim on company resources), and urgency (demand for immediate attention).

1.      Utilitarian approach.

three (3) basic views on ethical behavior

Therefore, only the most obvious stakeholders will likely be considered while others are ignored.

most power

(ability to affect the company),

most legitimacy

(legal or moral claim on company resources),

most urgency

(demand for immediate attention).

1.      Individual rights approach.

three (3) basic views on ethical behavior

This approach proposes that human beings have certain fundamental rights that should be respected in all decisions.

1.      Individual rights approach.

three (3) basic views on ethical behavior

A particular decision or behavior should be avoided if it interferes with the rights of others.

1.      Individual rights approach.

three (3) basic views on ethical behavior

A problem with this approach is in defining “fundamental rights.”

1.      Individual rights approach.

three (3) basic views on ethical behavior

Some constitution includes a “bill of rights” or a list of important rights to a country’s citizens, which may or may not be accepted worldwide.

1.      Individual rights approach.

three (3) basic views on ethical behavior

The approach can also encourage selfish behavior when someone defines a personal need or want as a “right.”

1.      Justice approach.

three (3) basic views on ethical behavior

This approach proposes that decision-makers can be equitable, fair, and impartial in distributing costs and benefits to individuals and groups.

1.      Justice approach.

three (3) basic views on ethical behavior

It follows the principles of distributive justice wherein people who are similar on relevant dimensions such as job seniority should be treated similarly.

 

1.      Justice approach.

three (3) basic views on ethical behavior

In addition, it follows fairness wherein liberty should be equal for all persons.

1.      Justice approach.

three (3) basic views on ethical behavior

The justice approach can also include the concepts of retributive justice, wherein punishment should be proportional to the offense, and compensatory justice, wherein wrongs should be compensated in proportion to the offense.

retributive justice

wherein punishment should be proportional to the offense

compensatory justice

wherein wrongs should be compensated in proportion to the offense.