Corporate Governance, CSR, and Ethics Flashcards

Flashcards on Corporate Governance, CSR, and Ethics

Corporate Governance

Refers to the processes which enable the top management of a corporation to direct, monitor, and control the activities of operating management to achieve the strategic vision.

Agency Theory

Emphasizes the need for boards to control management against the latter’s potential for excessive self-interest to the detriment of the stockholders.

Stewardship theory

Recognizes that individuals who are motivated by intrinsic and intangible rewards tend to align themselves as stewards with goals for an involvement and trust-oriented organization.

Stakeholders Theory

Portrays the company’s duty to earn the trust of various stakeholders by behaving in a trustworthy manner towards its stakeholders.

Money laundering

Handling drug cartel's money, ponzi schemes, and shell companies

SEC Code of Corporate Governance

Requires corporations to submit a manual on corporate governance, full disclosure on company activities affecting share price, appointment of independent directors, and recommends separation of the role of chairman and CEO.

Corporate culture

Combined beliefs of members about what is right and wrong in going about its business activities.

Amoral corporation

Pursues winning at any cost; views employees merely as economic units of production.

Legalistic corporation

Concerned with the letter of the law; not the spirit; adopts legalistic code of conduct.

Responsive corporation

Interested in being a responsible corporate citizen, primarily because it is expedient, not because it is right; beginnings of codes of conduct.

Emergent ethical corporation

Recognizes the existence of a social contract between business and society and seeks to instill that attitude throughout the corporation.

Ethical corporation

Balances profits and ethics so completely that employees are rewarded for walking away from compromising actions; includes ethical issues in training; acts as mentors to give moral guidance to new employees.

Due process

The right to be protected against the arbitrary use of authority.

employee security

most significant aspect of work from an employee’s perspective

closed-loop

waste put back to the process

biomimicry

waste of one activity, is the resource of another

Employee at will

Employers are free to fire an employee at any time and for any reason.

Ethical downsizing

Employees should be kept aware, the intent of downsizing should be made known immediately, and legalities should be considered.

DOLE OHSA RA 11058

Aims to provide a working environment free from hazards that cause injury, illness, or death; informs employees on hazards; provides facilities and PPE.

Disaster capitalism

Involves businesses and policy makers exploiting disaster situations to implement profit-focused policies while affected communities are vulnerable.

Corruption

Abuse of public power for private gain.

Circular flow model

Explains the nature of economic transactions in terms of a flow of resources from businesses to households, but does not differentiate natural resources from other factors of production.

Eco-efficiency

Efficient use of natural resources; doing more with less.

Take-make-waste

Businesses take resources, make products, and discard what is left over.

Cradle to grave

Businesses should be responsible for incorporating the end results of its products back into the productive cycle; redesigning products to make it service-based oriented.

Service-based economy

Interprets consumer demand as a demand for services.

disaster capitalist spiral

creating disasters that are then used for profits

the actions that are taken depend on the ideas lying around

seed of disaster capitalism by milton friedman

primary focus of environmental responsibility

shared responsibility towards the natural environment

employee health and safety

healthy and safety are goods that are valyed both as a means for attaining other

anti-democratic

corruption is ______

the market approach

• society is willing to pay for pollution reductiona s the perceived benefits outweigh the costs

• alternative policies that could address pollution and polluytion-related disease would never be considered through market solutions

• markets are incomplete at best in their approach to the overall social good

• what is good and rational for a collection of individuals is not necessarily what is good and rational for a society

the regulatory approach

• late 1990d and early 2000s that unregulated markets are an inadequate approach to environmental challenges

• primary legal avenue was tort law or civil lawsuits

sustainability approach

• circular flow model explains the nature of economic transactions in terms of a flow of resources from businesses to households; does not differentiate natural resources from the other factors of production, model treats economic growth as both the solution to all social ills and also as boundles

representative political system

gives businesses the right to express its views js as other interest groups do

business political activity

needed to counteract other political activity by other groups that affect business