1. Lecture 1 Corporate social responsibility: history, main notions & its role

2. Contents 1. Social cultural & economical conditions of CSR emerging & development. 2. CSR essence and role. 3. CSR main theories 4. Pros and cons of CSR 5. CSR priorities and forms

3. Social cultural & economical conditions of CSR emerging & development.

4. Property and management were separated resulting in differences in management priorities 1932 The separation of property and management was proved scientifically Management revolution attained significant results Berle & Means

5. Main management tasks at the mass production stage 1. 1. High pace of production growth 2. Production costs lowering. 3. Production of the limites assortment of standard goods

6. MAIN CHARACTERISTICS OF COMPETITION  Suppression  Ravaging & acquisition  Non-interference of the state into business.

7. 1930-th 1930-th  The demand for the basic consumer goods was close to saturation  World economic crisis errupted  The state interference in economy grew  Marketing emerged within management  Consumerism (the consumers’ rights protection) emerged).

8. Management capitalism resulted in corporate philanthropy

9. Social responsibility in the USA  Social benefits  Pension programs  Health care

10. 1960-th & 1970-th Period of significant society hostility to business

11. 1970-th Managers are to maximize the owner’s profit M. Friedman

12. 1980 “the decade of greed".  The state supports the aggressive American corporations seeking global profitability  The agreements with trade unions are broken  The compensation decreases  The working places decrease  Technological operations are moved abroad to profit from labor force and bad regulation

13. 1990-th  Resurrection of interest to social responsibility  Hostility and suspicion towards business are still observed  “The best & the smartest” from the USA and Europe have built their careers

14. CSR ESSENCE

15. The end of 50-th Transition to the postindustrial society The characteristics of the postindustrial society 1. Zero-growth theory 2.The increase of the society requirements to the business social responsibility and ecology 3.The problem of lack of irreplaceable natural resources 4. The increase of the role of intangible resources 5. High personal requirements to interesting work, leisure, health 6. Globalization of economy and competition, international markets development

16. The most important characteristic of postindustrial society – social mission social mission and business responsibility before the society

17. The term «corporate social responsibility» adequately characterizes the relations between the business and the society

18. Three main concepts of CSR

19. The concept of “corporate egoism” Is formed on the basis of classical term of the Nobel prize recipient in Economic Sciences M. Friedman “the business only business is the profit maximizing within the existing rules of play” CSR is the fulfillment of social duties set by the state The term “the company of owners” (M. Friedman) CSR is providing the economical and financial interests of the owners and yielding high profits Characteristic for Anglo-Saxon model of capitalism

20. The concept of “corporate altruism” CSR means the participation of charity and social programs in business The concept of “stakeholders company” is used. The company is a social community where owners cooperate with managers, business partners, personnel, consumers, society representatives, the social responsibility being the result of their common activity. Characteristic for the continental model of capitalism which is acknowledged in Europe and Japan.

21. Advantages & disadvantages of the corporate social responsibility

22. Pros   Long-term favorable for business perspectives are created. Social programs of business contribute to the well-being of the community   Public expectations.   Providing the resources for social problems solving   Moral obligation to be socially responsible

23. Cons  Breaking the principle of profit maximization. Spending resources on social needs decreases the profit  Expenses on social involvement. The means spent on social projects are expenses causing the rise in prices  Span of reporting to public  Lack of experience in solving social problems

24. The priorities of the CSR

25. «FORD» $120 mln. of social investments 52% - education 28% – local community

26. «British Petroleum» $ 74 mln 36% - education 31% – local community 21% – health & environmental protection

27. «TOTAL» 30% – economic development 21% – health & social development 18% – local community development

28. THANK YOU