CHAPTER 16 THE EFFECT OF CHANGE ON STAKEHOLDERS AND CORPORATE SOCIAL RESPONSIBILITY

Effect of change on stakeholders Change in a business can have an impact on all stakeholders, who include: Managers Employees Customers Suppliers The general community Shareholders

Effect of change on stakeholders During a period of change, managers might have to implement change and learn new skills, while also dealing with changes to their position. Managers may need to adapt their management style for the change to be successful.

Effect of change on stakeholders Employees are often affected by change in a business. Change can have an impact on their job description, roles, location and skills required. Change can have a negative impact on staff, so ensuring employees are on-board with any change is crucial.

Effect of change on stakeholders Customers can be impacted by organisational change. The products that they purchase can change, as well as the access that they have to them. Businesses that don’t consider the impact change has on customers may lose loyalty and miss out on potential sales.

Effect of change on stakeholders Change can have a significant impact on suppliers. They may lose business due to a change in a process or, conversely, gain new contracts. Changes in specifications may also require suppliers to adapt their own business operations.

Effect of change on stakeholders Changes in business can have direct and indirect impacts on the general community. A large business expanding into a new area might require the community to allocate more resources for increased traffic, or the decision to close or locate can take people away from a particular location. Significant small businesses can also have an impact on the community, particularly in small towns.

Effect of change on stakeholders Shareholders are often impacted by change. A business actioning change may do so to increase revenue and, therefore, improve shareholder dividends. A change might also have a negative effect. The owner of a small business may have to wear the cost of a change until it begins paying off, if it does at all.

Corporate social responsibility when implementing change in a business Corporate social responsibility (CSR) should be considered when making any change. It can have a significant influence on stakeholders and can contribute to the success of the change.

Corporate social responsibility when implementing change in a business In some cases CSR can be the cause for a change. The implementation of ethical practices and procedures can be met positively by stakeholders when done properly. Conversely, changes that don’t consider CSR can be received negatively by stakeholders, reducing revenue and hindering the success of the business.

Corporate social responsibility when implementing change in a business Corporate social responsibility includes the moral and ethical decisions made by businesses. It includes questions of what the business can do for society. If a business is socially responsible, it adopts behaviours that will help achieve broad societal values.

Corporate social responsibility when implementing change in a business Examples of strategies adopted by businesses to transform commitment to corporate responsibility into practical action include: articulating a business philosophy and incorporating it into vision and mission statements that set out the social responsibility ideals a code of ethics that incorporates social responsibility and is applied throughout the business employment policies that also support and re ect social responsibility; for example, employees’ volunteer or pro bono work completed during business hours, mentoring programs, community forums and corporate community partnerships strategic philanthropy that involves a business having a plan for the long term that necessitates a commitment to behaving in an ethical manner and contributing in some way to the community.

Corporate social responsibility when implementing change in a business Corporate social responsibility has become the norm, and surveys and polls published and conducted in both Australia and the United States have identified that customers expect organisations to contribute to the economic, social and environmental agendas of the countries they operate in. People are starting to focus on corporate citizenship ahead of brand reputation or financial factors when forming impressions about the businesses they are going to interact with.

Corporate social responsibility when implementing change in a business Stakeholders have different social responsibility issues and expectations with different implications. Stakeholders usually consider social responsibility from their own perspective. Read Page 362 – 363 Think, note take and discuss each of the stakeholders and their individual expectations of an organisation and how an organisations can accommodate these expectations