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© Prentice Hall, ObjectivesObjectives 1.An understanding of the term corporate social responsibility. 2.An appreciation of the arguments both for and against the assumption of social responsibilities by business. 3.Useful strategies for increasing the social responsiveness of an organization. 4.Insights into the planning, organizing, influencing, and controlling of social responsibility activities. 5.A practical plan for how society can help business meet its social obligations. 6.An understanding of the relationship between ethics and management.

© Prentice Hall, Fundamentals of Social Responsibility (S.R.) The Davis Model of Corporate S.R. Proposition 1: S.R. arises from social power 2: Business shall operate as a two-way open system 3: Calculate and consider social costs and benefits 4: Pass social costs on to the consumer 5: Businesses should be involved in certain social problems

© Prentice Hall, Fundamentals of Social Responsibility (S.R.) Areas of Corporate S.R. Varying Opinions on S.R. Arguments for Business Performing S.R. Activities Arguments Against Business Performing S.R. Activities Conclusions About the Performance of S.R. Activities by Business Performing Required S.R. Activities Voluntarily Performing S.R. Activities Communicating the Degree of S.R. Involvement

© Prentice Hall, Fundamentals of Social Responsibility (S.R.)

© Prentice Hall, Fundamentals of Social Responsibility (S.R.)

© Prentice Hall, Social Responsiveness Determining If a Social Responsibility (S.R.) Exists Social Responsiveness and Decision Making Approaches to Meeting Social Responsibilities Socially responsive approach: 1. Incorporate social goals 2. Seek comparative industry norms 3. Present reports 4. Experiment with different approaches 5. Attempt to measure the cost of social programs Management approaches: 1. Social obligation approach 2. S.R. approach 3. Social responsiveness approach

© Prentice Hall, Social Responsiveness

© Prentice Hall, Social Responsiveness

© Prentice Hall, Social Responsibility Activities and Management Functions Planning Social Responsibility (S.R.) Activities The Overall Planning Process Converting Organizational Policies on S.R. into Action Phase 1 consists of recognition by top managers of social obligation Phase 2 involves staff personnel as well as top management Phase 3 involves division management in addition to above personnel

© Prentice Hall, Social Responsibility Activities and Management Functions

© Prentice Hall, Social Responsibility Activities and Management Functions

© Prentice Hall, Social Responsibility Activities and Management Functions

© Prentice Hall, Social Responsibility Activities and Management Functions

© Prentice Hall, Social Responsibility Activities and Management Functions Organizing Social Responsibility (S.R.) Activities Influencing Individuals Performing S.R. Activities Controlling S.R. Activities Areas of Measurement 1. The economic function area 2. The quality-of-life area 3. The social investment area 4. The problem-solving area The Social Audit: A Progress Report

© Prentice Hall, Social Responsibility Activities and Management Functions

© Prentice Hall, How Society Can Help Business Meet Social Obligations 1. Set rules that are clear and consistent 2. Keep the rules technically feasible 3. Make sure the rules are economically feasible 4. Make the rules prospective, not retroactive 5. Make the rules goal-setting, not procedure-prescribing

© Prentice Hall, Business Ethics A Definition of Ethics Why Ethics Is a Vital Part of Management Practices Productivity Stakeholder relations Government regulation A Code of Ethics

© Prentice Hall, Business Ethics

© Prentice Hall, Business Ethics Creating an Ethical Workplace 1. The golden rule 2. The utilitarian principle 3. Kant’s categorical imperative 4. The professional ethic 5. The TV test 6. The legal test 7. The four-way test Following the Law: Sarbanes–Oxley Reform Standards

© Prentice Hall, Business Ethics

© Prentice Hall, Questions