CHAPTER 9 CORPORATE SOCIAL RESPONSIBILITY AND GLOBAL ISSUES IN OPERATIONS MANAGEMENT.

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CHAPTER 9 CORPORATE SOCIAL RESPONSIBILITY AND GLOBAL ISSUES IN OPERATIONS MANAGEMENT

What is corporate social responsibility? Corporate social responsibility (CSR) involves businesses assessing how their operations impact all stakeholder groups. It is an ongoing commitment to improving the quality of life of the workforce, community and society in general. Businesses who embrace CSR try and behave ethically.

What is corporate social responsibility? Pressure to behave ethically can come from employees, customers, shareholders, the community, the media and suppliers. When implemented through operations, CSR can improve productivity and contributes to the success of the business.

What is corporate social responsibility? Productivity can be improved through a commitment to reducing waste, and customers that see a business behaving ethically may prefer their goods or services over another less ethical company. CSR covers corporate governance, sustainability and environment, the ethical treatment of employees and customers, human rights and community involvement.

What is corporate social responsibility? The United Nations established Global Compact, a program aimed at promoting CSR. Signatory businesses agree to adopt 10 principles covering human rights, labour, the environment and anti-corruption.

What is corporate social responsibility? In the past, businesses measured their performance in financial terms only. The rise of CSR has lead to the implementation of triple bottom line reporting. In addition to economic performance, CSR businesses report on their social and environmental performance as well.

What is corporate social responsibility? To help with CSR, some businesses have implemented an environmental management system (EMS). An EMS sets out how environmental performance will be monitored, implements environmental management practices into everyday operations and details plans and strategies for improving environmental performance.

What is corporate social responsibility? CSR has an impact at every stage of the operations process. Inputs need to sourced from socially responsible suppliers, and be done so in a sustainable way. Operations processes should also be created that reduce waste and the use of resources, ensuring that the output is also produced ethically.

Global issues in operations management Management of operations systems today requires a global perspective. In a globalised economy, supply chains increasingly involve overseas components. This includes the sourcing of materials, manufacturing, outsourcing and distribution.

Global issues in operations management The advantages of participating in a global supply chain include: The ability to take advantage of cost differences between nations Access to skills and resources not available locally The creation of jobs and economic opportunities in disadvantaged areas

Global issues in operations management Disadvantages of global supply chains include: Hidden costs Financial and political risks Time Loss of Australian jobs Risk of losing IP

Global issues in operations management CSR factors need to also be considered. This includes, for example, the impact on the environment of shipping goods globally, the treatment of workers in other countries and the political implications of dealing with certain governments.

Global issues in operations management Other factors that influence the global supply chain include: Impact of currency exchange rates Tariffs and import restrictions Legal and cultural differences (including IP laws) Political stability