1 Business and Community Stakeholders Business and Society: Ethics and Stakeholder Management, 7e Carroll & Buchholtz Copyright ©2009 by South-Western, a division of Cengage Learning. All rights reserved Prepared by Deborah Baker Texas Christian University Chapter 16

2 Quote for the Day  "Is the rich world aware of how four billion of the six billion live? If we were aware, we would want to help out, we'd want to get involved." Bill Gates

3 A Company’s Positive Impact Community Involvement Corporate Philanthropy

4 Standards of Excellence in Corporate Community Involvement 1. Leadership 2. Issues Management 3. Relationship Building 4. Strategy 5. Accountability 6. Infrastructure 7. Measurement Figure 16-1

5 Benefits of Employee Volunteer Programs Improving employee skills and training Encouraging employee teamwork Developing leadership skills Developing the local labor pool Recruiting and retaining employees Improving corporate reputation

6 Corporate Community Involvement Figure 16-2

7 1. Know the community 2. Know the company’s resources 3. Select projects 4. Monitor projects Developing a Community Action Plan

8 Resource-Based Giving  Assess resources  Assess competencies  Determine where resources and competencies will achieve the most good  QUESTION: COST/BENEFIT ANALYSIS??? How would you do one???

9 Philanthropy A desire to help mankind asindicated by acts of charity;love of mankind.

10 Categories of Corporate Contributions Programs 1. The Nondonor 2. The “What’s In It for Us” Donor 3. The “Company President Believes in Art Support” Donor 4. The “We Are a Good Citizen” Donor 5. The “We Care” Donor Figure 16-3

11 To Whom Do Companies Give? 1. Health and human services 2. Education 3. Civic and community activities 4. Culture and the arts Major Categories of Recipients

12 PSU Donors Giving The School of Business Administration (SBA) would not be successful without the collaboration and financial support it receives from its alumni and the business community. Contributions of knowledge, advice and financial support from our alumni, students, faculty, staff and the business community are all vital to the success of the SBA. Your gifts make a difference. Last year, 12% of the SBA's budget came from grants and private contributions while tuition revenues covered approximately 35%. Gifts to the SBA support student scholarships, faculty research and development, technologies, alumni events and classroom improvements, all of which improve the quality of education at the SBA. Partner: $25,000 - $99,000 Ames Family Foundation Knight Foundation KPMG Peat Marwick Foundation PepsiCo/Frito Lay The Ann & Bill Swindells Charitable Trust

13 Managing Corporate Philanthropy 1. Base giving on business resources and capabilities to enhance philanthropic outcomes 2. Focus on philanthropy that will enhance corporate profitability and also make a difference in the community

14 Factors Influencing Corporate Giving Priorities  Aligning closely with business needs  Limits on budgetary resources  Directions from the CEO and / or the Board  Strengthening the brand  Costs of responding to natural disasters  Being more responsive to stakeholders  Changes in the workforce  Other  Employee needs / requests  Community needs  Global giving Figure 16-4

15 Community Partnerships Strategic Philanthropy An approach by which corporategiving and philanthropic endeavorsare designed to fit with the firm’smission, goals, or objectives.

16 Strategic Philanthropy 1. Make as direct a contribution as possible to the financial goals of the firm. 2. Bring contribution programs into sharper alignment with business endeavors. 3. Ensure that philanthropy is well planned and managed.

17 Cause-Related Marketing The direct link of a business’sproduct or service to a specifiedcharity.“Quid pro quo strategic philanthropy.” Businesses enhance their public image and increase sales Nonprofit organizations get cash as well as visibility

18 The Loss of Jobs Outsourcing The relocation of business processesto a different company.

19 Offshore Outsourcing Practices 1. Go offshore for the right reasons 2. Choose your model carefully 3. Get your people on board 4. Be prepared to invest time and effort 5. Treat your partners as equals

20 Business and Plant Closings Before Deciding to Close Diversification New ownership New owner Employee ownership

21 Business and Plant Closings After Deciding to Close Conduct a community impact analysis Provide advance notice Provide transfer, relocation, and outplacement benefits Phase out the business gradually Help attract replacement industry

22 What groups will be affected? How will they be affected? What is the timing of initial and later effects? What is magnitude of the effect? What is the duration of the impact? To what extent will the impact be diffused in the community? Community Impact Business and Plant Closings

23 (WARN) Worker Adjustment and Retraining Notification Act Business and Plant Closings Requires firms with 100 or more workers to provide 60 days advance notice before shutting down or conducting layoffs

24 Business and Plant Closings Directional support Tactical support Informational support Emotional support The Needs of Survivors