Lesson #1: Corporate Social Responsibility What is it? How is it done?

Where is the Line? How far does responsibility extend? Only to executive? To common shareholders? (Only return – or more?) To other stakeholders? To all the world?

Tradeoffs Object of firm is to create value Competing interests Balance the effects

Outside Bodies Power to enforce the agenda of a stakeholder (NGO) Stronger in some environments than in others (US vs. China) Courts and litigation “Court” of world opinion Own sense of right vs. wrong

Stakeholder Analysis Who are the stakeholders? What are their interests? How will they be affected by a decision and its subsequent action? How can their interests be protected?

Ethical Considerations People as ends, not means Weakest stakeholder deserves consideration Decisions based in what is “right,” not who has power.

Take-Away Lessons Cannot operate in isolation All stakeholders (pleasant or not) must be considered Inaction is an action Consistent organizational policies

People and governments see business as a source of prosperity, integral with society. We must do so also.