CSR and Globalization

What is Corporate Social Responsibility (CSR)?

focuses on the triple bottom line: people, planet, and profits, evaluating organizations on social and environmental impact alongside financial performance.

What are social audits?

assess an organization's responsibility to employees, communities, and the environment.

What is the difference between social responsibility and corporate social responsibility?

Social responsibility refers to a manager's duty to benefit society and the organization, while corporate social responsibility emphasizes the organization's duty to serve both internal and external stakeholders beyond profits.

What are the four priorities in Archie Carroll's CSR pyramid?

1. Economic responsibility (make a profit), 2. Legal responsibility (obey laws), 3. Ethical responsibility (act ethically), 4. Philanthropic responsibility (give back to communities).

Why are Millennials attracted to certain companies?

drawn to companies that prioritize social impact and meaningful contributions beyond financial success.

What are internal stakeholders?

include employees, owners, and the Board of Directors, who have a vested interest in the organization.

What roles do the Board of Directors play in an organization?

oversees direction and financial performance, hires the CEO, and sets strategic goals.

What are external stakeholders?

are those outside the organization who are affected by it, including customers, suppliers, and local communities.

What is the Task Environment?

consists of groups that have a daily impact on the organization, such as customers, competitors, suppliers, and distributors.

What are some examples of external stakeholders in the General Environment?

Examples include economic factors (unemployment, inflation), technological innovations, sociocultural trends, demographic shifts, and political/legal influences.

What is an ethical dilemma?

occurs when managers face situations requiring choices between right and wrong, which may involve unethical or illegal actions.

What are ethics and values?

____are standards of right and wrong guiding behavior, while ____are deeply held beliefs that shape ethical decisions.

What are common unethical behaviors at work?

behaviors include misusing company time, abusive behavior, employee theft, workplace cheating, and violating internet policies.

What are the four ethical approaches in decision-making?

1. Utilitarian (greatest good for the greatest number), 2. Individual (best long-term interests of the individual), 3. Moral Rights (respect fundamental rights), 4. Justice (fairness and equal treatment).

What are Kohlberg's three levels of moral development?

1. Preconventional (follow rules, obey authority), 2. Conventional (conform to expectations), 3. Postconventional (guided by internal values).

How can organizations promote ethics?

building a strong ethical climate, screening employees, implementing codes of ethics, providing training, rewarding ethical behavior, and protecting whistle-blowers.

What was the Blue Bell Ice Cream crisis?

In 2015, a Listeria outbreak traced to Blue Bell plants led to multiple product recalls, layoffs, and furloughs after the company initially responded by quietly pulling products.

What was the initial response of Blue Bell Ice Cream to the Listeria outbreak?

The initial response was to quietly pull products without public warning.

What impact did the Blue Bell Ice Cream crisis have on its workforce?

The crisis resulted in 37% layoffs and 1,400 furloughs.

What is the significance of strategic alliances?

are partnerships between organizations that allow them to achieve advantages neither can perform as well alone.

What are clawbacks in the context of local communities?

are rescinding tax breaks when firms fail to deliver promised jobs.

What role do special interest groups play in the external environment?

influence issues and advocate for specific causes, such as PETA for animal rights.

What percentage of layoffs occurred in the workforce impact?

37%

How many employees were furloughed?

1,400

What poor manufacturing practices were reported?

Oil dripping into food, pooling melted ice cream, and reusing contaminated mix.

What did the FDA find in the Blue Bell plant?

Recurring bacteria since 2013, with inadequate cleaning practices admitted by the company.

What financial action saved Blue Bell from collapse?

A $125 million loan from the Sid Bass family, which took a one-third ownership.

What legal consequences did Blue Bell face in 2020?

Pled guilty to criminal charges and paid $19 million in fines.

What improvements did Blue Bell implement after the crisis?

Enhanced testing at facilities, testing every batch before shipping.

What is the takeaway from Blue Bell's contamination issue?

Slow response, poor sanitation, and lack of transparency turned a manageable issue into a major crisis.

Define globalization.

The shrinking of time and space through technology, communication, and travel, leading to increased interdependence among nations.

What is the U.S. rank in global competitiveness?

3rd

What is the projected U.S. retail sales figure for e-commerce?

$341 billion

What are the positive effects of globalization?

Lower costs through outsourcing and better communication among nations.

What are the negative effects of globalization?

Interconnected economies where declines in one market affect others.

What skills are needed for careers impacted by globalization?

Cultural awareness, language skills, flexibility, and networking.

What are the two types of global organizations?

Multinational Corporations (MNCs) and Multinational Organizations (non-profits).

What is the importance of international management?

Requires cultural understanding and global awareness for success.

What are the characteristics of ethnocentric managers?

They believe their home culture is superior and often exhibit parochialism.

What is a polycentric manager's approach?

They rely mainly on local managers in foreign offices, believing they understand local practices best.

Define geocentric management.

A blend of similarities and differences to use the most effective practices worldwide.

What are the five major methods of global expansion from lowest to highest risk?

Global outsourcing, importing & exporting, countertrading, licensing & franchising, joint ventures, and wholly owned subsidiaries.

What are tariffs and their types?

are taxes on imports; types include revenue tariffs and protective tariffs.

What are quotas in trade?

Limits on imports to prevent 'dumping' of goods.

What are quotas in international trade?

Limits on imports to prevent 'dumping' (selling abroad below cost).

What is the purpose of embargos and sanctions?

Bans or restrictions on trade, such as the Cuba embargo and sanctions on North Korea.

What is the role of the WTO?

monitors and enforces trade agreements among 164 nations.

What does the World Bank do?

Provides low-interest loans for development projects, though it has been criticized for supporting harmful practices.

What is the function of the IMF?

Acts as a lender of last resort to struggling economies, such as Greece.

What is a trading bloc?

A group of nations within a geographical region that have agreed to remove trade barriers with one another.

What are the countries involved in NAFTA/USMCA?

United States, Canada, and Mexico.

What is the significance of BRICS?

An association of emerging economies: Brazil, Russia, India, China, and South Africa, each with unique economic characteristics.

What are low-context cultures?

Cultures that value direct, explicit communication and written contracts, such as the US and Germany.

What are high-context cultures?

Cultures that rely on situational cues and relationships, such as China and Japan.

What is the GLOBE Project?

A study involving 150 scholars and 62 cultures, identifying nine cultural dimensions affecting leadership and organizational behavior.

What does 'power distance' refer to in cultural dimensions?

The expectation of unequal power distribution within a society.

What is 'uncertainty avoidance'?

The reliance on rules and regulations to reduce risk in a culture.

How does language influence business culture?

With over 7,000 ____ spoken worldwide, ____ affects communication styles and business interactions.

What is the significance of interpersonal space in different cultures?

Distance preferences vary, for example, 3-4 feet in the US versus closer distances in Latin America.

What challenges do expatriates face when working abroad?

High turnover rates due to difficulty adapting to new cultures and family struggles.

What are some key behaviors for success in international business?

Being patient, listening, respecting local customs, and learning the language.

What cultural misunderstanding occurred between Mr. Vail and Akari?

Mr. Vail's task-oriented, fast approach clashed with Akari's relationship-oriented, patient style.

What was Akari's response to Mr. Vail's approach?

He preferred building rapport and discussing contracts slowly, highlighting the importance of hierarchy.

What does 'cultural adaptability' mean in international business?

The ability to balance urgency with respect for trust-building and relationship development.

What is the Foreign Corrupt Practices Act?

A law that prohibits bribery and unethical labor practices in international business.

What is the impact of religion on workplace practices?

Religion can strongly influence practices, such as the presence of prayer rooms in Muslim countries.

What is the importance of understanding cultural differences in business?

It is essential for building strong global business relationships and succeeding as an international manager.

Institutional collectivism

Loyalty to organization vs. individual goals.

In-group collectivism

Pride in family, friends, departments.

Gender egalitarianism 

Minimizing gender inequality

Assertiveness

Competitive vs. modest behaviors.

Future orientation 

Focus on planning/saving vs. tradition.

Performance orientation

Rewarding excellence and achievement.

Human orientation

– Encouraging kindness, fairness, generosity

Why and How Companies Expand Internationally

- Suppliers – Access to cheaper or more plentiful raw materials.

- New Markets – More customers abroad.

- Lower Labor Costs – Example: maquiladoras in Mexico.

- Financial Capital – Opportunities to find foreign investors.

- Avoid Tariffs/Quotas – Setting up subsidiaries abroad helps bypass trade restrictions.

Idealism 

This is the extent to which you think there is always a clear “right” or “good” action.

Relativism

This is the extent to which you think there are, or are not, absolute moral rules when making ethical judgments.

Situationists

– Persons who are high on both idealism and relativism scales. The typical attitude is to “reject moral rules” and advocate that each situation should be analyzed individualistically.

Subjectivists

Persons who are low on idealism, but high on relativism. The typical attitude is to approach moral situations “based on personal values rather than universal moral principles.”

Absolutists

Persons who are high on idealism but low on relativism. The typical attitude is to approach moral questions with the assumption that “the best possible outcome can be achieved by following universal moral rules.”

Exceptionalists 

– Persons who are low on both idealism and relativism. The typical attitude is to think there are moral absolutes but to be “pragmatically open to exceptions.