Session 3 Societal Context & Labour Context What is the importance of corporate social responsibility (CSR)?

WHAT IS BUSINESS & SOCIETY? Business: private, commercially oriented organizations Society: a community/national or group of people with common values, traditions, institutions, activities & interests Business Community Consumers Owners Government Employees

THE BUSINESS-SOCIETY RELATIONSHIP Assuming a relationship between business and society connects to notions of ‘embeddedness’ and organizations as ‘open systems’

SHOULD BUSINESS HAVE ANY RESPONSIBILITIES TO SOCIETY? AND IF SO, WHAT IS THE NATURE OF THOSE REPSONSIBILITIES?

CORPORATE SOCIAL RESPONSIBILITY CSR is: The obligation of decision makers to take actions which protect and improve the welfare of society as a whole along with their own interests. IE….

Corporate Social Responsibility (CSR) obligations that involve going beyond: the production of goods/services at a profit the requirement of competition, law or custom

 To create policies, make decisions & engage in actions that are desirable in terms of the values & objectives of society. i.e. ethical responsibilities to society Corporate Social Responsibility (CSR)

BUSINESS & SOCIETY: CONTEMPORARY CONCERNS Business helping society Business helping society Example: Levi’s Example: Levi’s

THE ROLE OF BUSINESS IN SOCIETY: CORPORATE SOCIAL RESPONSIBILITY Examples of CSR: 3M & health of employees Merck Pharmaceutical & River Blindness Can you think of examples of companies that have recently demonstrated CSR?

THE ROLE OF BUSINESS IN SOCIETY: CORPORATE SOCIAL RESPONSIBILITY The social responsibility of business encompasses the economic, legal, ethical and discretionary (philanthropic) expectations that society has of organizations at a given point in time (Carroll, 1979). A PYRAMID OF RESPONSIBILITIES!

THE CSR PYRAMID Philanthropic Responsibilities Be a good corporate citizen Ethical Responsibilities Be Ethical Legal Responsibilities Obey the Law Economic Responsibilities Be Profitable (Adapted from Karakowsky, Carroll, Bucholtz, 2007)

THE CSR PYRAMID Components can be interdependent rather than mutually exclusive. e.g., serving ethical responsibilities does not necessarily mean that profit (economic responsibilities) will be sacrificed – or vice versa.

THE CSR PYRAMID However, there may also be tensions between the components – e.g., “profits versus ethics”.

THE CSR PYRAMID Our discussion of this pyramid has already implied that business is responsible to more than simply its owners or shareholders! Rather there exists a network of STAKEHOLDERS FOR WHICH THESE REPSONSIBILITIES EXITS What or who are the stakeholders of business? Find out in our next module!

THE STAKEHOLDERS OF BUSINESS

STAKEHOLDERS, BUSINESS & SOCIETY WHAT IS A STAKE? An Interestor share An Interest or share in an activity A Right A Right - a legal right e.g. to fair treatment or a moral right, e.g. to expect satisfactory service Ownership Ownership – a legal title to an asset/ property

A stakeholder is any individual or group who can affect or is affected by the actions, decisions, policies, practices or goals of the organization STAKEHOLDERS, BUSINESS & SOCIETY

STAKEHOLDER VIEW OF THE FIRM: Primary & Secondary Stakeholders Adapted from KCB, 2007 F I R M Government & Regulators Shareholders/ owners etc Employees Customers/ consumers Local Communities Suppliers etc Soc. Pressure Groups CompetitorsTrade Bodies Media & Academics

Should business have some kind of moral obligation to society? Is CSR a desirable goal?

DEBATING CORPORATE SOCIAL RESPONSIBILITY AGAINST CSRFOR CSR Sole responsibility of business is to make a profit Business should conform to social rules Business is not equipped to manage CSR Business talent, capital & expertise could ensure CSR Business has enough power – shouldn’t dictate morality Could use its power for CSR, i.e. using its power positively Costs of CSR would be passed on to consumers & limit national competitiveness CSR provides long term benefits by enhancing business environment OTHER ARGUMENTS…?

THE LABOUR CONTEXT EMPLOYEES ARE IMPORTANT STAKEHOLDERS IN ANY BUSINESS. WHAT OBLIGATIONS DOES BUSINESS HAVE TOWARD LABOUR? HOW DO UNIONS HELP ADDRES LABOUR ISSUES?

THE EMPLOYEE STAKEHOLDER EMPLOYEE RIGHTS Guarantees of fair treatment in the workplace granted by courts, legislatures or employers. Provide workers with: Desired outcomes Protection from unwanted outcomes

Visible minorities DESIGNATED EMPLOYEE GROUPS Persons with Disabilities AboriginalsWomen

WOMEN Segregated Lower status occupations Under-representation in many areas Career barriers Gender-stereotyping

First Nations/Aboriginals Vastly underrepresented in the workforce Education & employment gaps Educational, geographical and perceptual barriers

INDIVIDUALS WITH DISABILITIES Higher unemployment rate compared to national average Access, physical and attitudinal barriers Economic barriers and social discrimination

VISIBLE MINORITIES Account for most of the growth in the labour force Barriers include: cultural difference issues, foreign credential issues, language issues Highest unemployment rates

THE EMPLOYEE STAKEHOLDER PROTECTING EMPLOYEE RIGHTS The Case of: Women, Aboriginal people, people with disabilities, members of visible minorities Legal Protection Against Discrimination Canadian Charter of Rights & Freedoms The Canadian Human Rights Act

THE EMPLOYEE STAKEHOLDER EMPLOYMENT EQUITY Treating people fairly by recognizing individual differences “treating people fairly by recognizing that different individuals and groups require different measures to ensure fair and comparable results”

THE EMPLOYEE STAKEHOLDER EMPLOYMENT EQUITY Deal with systemic discrimination & inequality at work

THE EMPLOYEE STAKEHOLDER EMPLOYMENT EQUITY Eliminates employment barriers for specified groups

THE EMPLOYEE STAKEHOLDER EMPLOYMENT EQUITY Redresses past discrimination

THE EMPLOYEE STAKEHOLDER EMPLOYMENT EQUITY Improve access and foster equity

UNIONS Unions are the organizations most directly responsible for representing the interests of Canadian working people. - workers’ associations formed to enhance their power in dealings with employees

Union membership Why have unions membership rates fallen? - Manufacturing decline - Part time work - Focus on public sector

UNION ACTIONS The mutual insurance function of unions Collective bargaining Legal enactment

COLLECTIVE BARGAINING - Negotiated outcomes - Increasing issues reflect increasing diversity of workforce

Political action and expanded scope - Social unionism - - economic development, human and labour rights overseas

UNION IMPACTS - Impact on productivity - Impact on management - Impact on society

ARE UNIONS STILL NEEDED? - What would society look like without unions? - Workplace representation - -balancing interests of big business with labour interests

KEY LEARNING POINTS  CSR: Responsibilities extend beyond just those to the owners or Shareholders of the business Stakeholders CSR Debate Labour context/employee Stakeholder: Designated employee groups Labour unions