CRS - CH5

Corporate Social Responsbility (CR)

Ethical responsibilities that buz have towards society as they operate within it, which includes obeying laws and meeting social demands for goods and services.

3 Different Levels of Ethical Responsbilities

Do not cause harm to others

Prevent Harm

Ethical respnosbilties to do good

Do not cause harm to others

A duty or an obligation.

Enforced by legal punishment

Prevent Harm

Good Samaritan

Use renewable energy

Ethical Responsiblites to do Good

Volunteering

Sponsoring a charity event

Tort Law

Laws covering acts or omission that gives rise to injury or harm to another and amounts to a civil wrong for which courts impose liability.

Economic Model

directs managers to maximize profit and shareholder wealth within legal limits

Views business as an instiuttion (business is creaitng jobs and wealth that provide further social benefits)

Managerial Capitalism

Places shareholders at the center of the corporation. No social responsbilties beyond the econoimca dn legel ends for which it was created. Bus free to contribute to soical causes as a matter of philanthropy. Good for reputation/tax deducation (underlying motivation)

Stakeholder Model

both businesses and employees have ethical responsibilities that extend beyond mere legal compliance. (neither bus or employees exempt from ordinary ethical responsbility)

bus has an ethical duty to respect human rights (Norman Bowie)

Stakeholder Theory

Recognizes that every business decision affects a wide variety of people, benefiting some and imposing costs on other.

Asks managers to condier the consequences of its decisions

Integrative Model

Part of the managerial responsbility to shareholders is to serve the social good (serving shareholders also involves a moral duty to benefit the social good)

orgs that puruse soical ends as the very core of this mission (ex: nonprofits)

some for-profit orgs have social goalas as a central part of their strategic mission

Sustability in CSR

Means a firm’s financial goals must be balanced against, and may be overriden by, environmental considerations

Corporate Sustainability Report

provides all stakeholders with financial and other information regarding a firm’s economic, environmental, and social performance