© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 4-1 Business and Society POST, LAWRENCE, WEBER Socially Responsive Management Chapter 4

© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 4-2 Figure 4-1 Contrast between corporate social responsibility, corporate social responsiveness, and corporate citizenship

© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 4-3 Figure 4-2 A three-stage model of corporate social responsiveness STAGE Organizational Policy Learning Commitment Time (years) Degree of responsiveness to a specific issue High Low Identity problem Formulate policy Specialized learning Administrative learning Organizational changes

© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 4-4 Figure 4-3a Summary of audit standard characteristics CERES Global Reporting Initiative Origin:1997 Focus: Link economic, environmental, and social sustainability Self-reported benefits: 1) Internal vehicle for evaluating policy versus performance 2) Structure for effective dialogue with stakeholders 3) Framework for sharing and promoting dialogue with stakeholders

© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 4-5 Figure 4-3b Summary of audit standard characteristics ISO Origin: 1996 Focus: Support environmental protection in balance with socioeconomic needs Self-reported benefits: 1) Identify areas for energy reduction 2) Reduce environmental risk 3) Maintain compliance with legislation and regulation 4) Receive environmental leadership rewards 5) Prevent pollution and reduce waste 6) Improve stakeholder relations 7) Receive more favorable insurance rates 8) Gain a competitive advantage

© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 4-6 Figure 4-3c Summary of audit standard characteristics ISEA AA 1000 Origin: 1999 Focus: Quality social and ethical accounting, auditing, and reporting Self-reported benefits: 1) Support effective stakeholder relations 2) Effective in diverse global operations 3) Build synergy with emerging businesses 4) Link planning tools to quality models 5) Build accountability in public sector 6) Enhance overall performance

© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 4-7 Exhibit 4-A Principles of corporate citizenship Good corporate citizens strive to conduct all business dealings in an ethical manner, make a concerned effort to balance the needs of all stakeholders, while working to protect the environment. 1) Engages in fair and honest business practices in its relationship with stakeholders. 2) Sets high standards of behavior for all employees. 3) Exercises ethical oversight of the executive and board levels. 4) Strives to manage the company for the benefit of all stakeholders. 5) Initiates and engages in genuine dialogue with stakeholders. 6) Values and implements dialogue. 7) Fosters a reciprocal relationship between the corporation and community. 8) Invests in the communities in which corporation operates. 9) Respects the rights of consumers.

© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 4-8 Exhibit 4-A(continued) Principles of corporate citizenship 10) Offers quality products and services. 11) Provides information that is truthful and useful. 12) Provides a family-friendly work environment. 13) Engages in responsible human-resource management. 14) Provides an equitable reward and wage system for employees. 15) Engages in open and flexible communication with employees. 16) Invests in employee development. 17) Strives for a competitive return on investment. 18) Engages in fair trading practices with suppliers. 19) Demonstrates a commitment to the environment. 20) Demonstrates a commitment to sustainable development.

© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 4-9 Exhibit 4-B Significant philanthropic contributions Bill Gates, cofounder of Microsoft Corporation, along with his wife, Melinda, pledged $22 billion to the Bill and Melinda Gates Foundation, which finances international vaccination and children’s health programs. Ted Turner, founded of CNN and vice chairman of Time Warner, pledged nearly $1.5 billion to the United Nations Foundations and Turner Foundation to support international children’s health and environmental programs. James E. Stowers, Jr., founder of American Century, a mutual-fund company, along with his wife, Virginia, pledged $360 million to the Stowers Institute for Medical Research, which supports biomedical research projects. Patrick J. McGovern, founder of International Data Group, along with his wife, Lore Harp-McGovern pledged $350 million to the Massachusetts Institute of Technology and the McGovern Institute for Brain Research. Martha R. Ingram, chairperson of Ingram Industries, a holding company, pledged $300 million to Vanderbilt University for cancer research, scholarship programs, athletics and programs for the business and music schools.

© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 4-10 Exhibit 4-C Community service improves employee job skills Helene Curtis, a Chicago-based personal care company, integrated volunteerism into its management development program. The program gives employees the chance to learn and apply experiences gained through community service to their personal and professional growth. The program’s goals are: 1) to recognize the value of business skills gained through community service, 2) give employees opportunities to apply those skills to business situations, 3) provide managers and employees with alternative ways to develop business skills, 4) provide a low-risk learning experience for both employees and the corporation, and 5) contribute to the betterment of the organization and the community.

© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved. McGraw-Hill/ Irwin 4-11 Exhibit 4-D America’s corporate conscience awards, 2000 Diversity award: Denny’s Restaurant Global ethics award: Bristol-Myers Squibb Employee empowerment award: Carris Reels Environmental stewardship award: Collins and Aikman Floorcoverings, Ricoh Corporation, and Horizon Organic Holding Corporation Source: Wall Street Journal, April 27, 2000, p. A1