ch05 Management’s Social and Ethical Responsibilities

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Copyright Houghton Mifflin Company. All rights reserved. 5-1

Chapter 5

Managements Social andEthical Responsibilities


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Chapter Outline

Social Responsibility: Definition and

Perspectives

What Does Social Responsibility Involve?

What Is the Role of Business in Society?

Arguments For and Against Corporate SocialResponsibility


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Chapter Outline(continued)

Toward Greater Social Responsibility

Social Responsibility Strategies

Who Benefits from Corporate Social

Responsibility?

The Future of Corporate Social Responsibility


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The Ethical Dimension of Management

Practical Lessons from Business Ethics

Research

Personal Values as Ethical Anchors

General Ethical Principles


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Encouraging Ethical Conduct

Ethics Training

Ethical Advocates

Codes of Ethics

Whistle-blowing


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WHAT DOES CORPORATE SOCIAL

RESPONSIBILITY INVOLVE?

Corporate social responsibility: thenotion that corporations have an obligation toconstituent groups in society other than

stockholders and beyond that prescribed by

law or union contract.

Voluntary action

An emphasis on means, not ends


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Source: Nancy C. Roberts

and Paula J. King, The

Stakeholder Audit Goes

Public. Reprinted from

Organizational Dynamics,

Winter 1989. 1989,

American Management

Association International.

Reprinted by permission of

American Management

Association International,

New York, NY. All rights

reserved.

http:/hwww.amanet.org

Figure 5.1 A Sample Stakeholder Audit

for an Automobile Company


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Figure 5.2 A Continuum of Social

Responsibility Strategies


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RESPONSIBILITY INVOLVE?(continued)

For Discussion:

1. Why is voluntary action a key to corporate

social responsibility?


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RESPONSIBILITY INVOLVE?(continued)

For Discussion:

2. Could an emphasis on means rather than

ends encourage well-meaning but sociallyirresponsible actions? (For example, some

college organizations sponsor social events

on behalf of needy groups, such as disabled

children, who actually get very little if anybenefit after program expenses have been

paid.)


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Source: Data from Mark N. Vamos and Christopher Power, A Kinder, Gentler Generation of Executives?

Business Week(April 23, 1990): 86-87.

Figure 5.3 Present and Future

Executives Support the Concept of

Corporate Social Responsibility


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ARGUMENTS FOR AND AGAINST

CORPORATE SOCIALRESPONSIBILITY

Arguments for:1. Business is unavoidably involved in social issues.

2. Business has the resources to tackle todays complex

societal problems.

3. A better society means a better environment fordoing business.

4. Corporate social action will prevent government

intervention.


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CORPORATE SOCIAL

RESPONSIBILITY(continued)

Arguments against:

1. Profit maximization ensures the efficient use of

societys resources.

2. As an economic institution, business lacks the ability

to pursue social goals.

3. Business already has enough power.

4. Because managers are not elected, they are not

directly accountable to the people.


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CORPORATE SOCIALRESPONSIBILITY

(continued)

For Discussion:

Which set of arguments do you find most

convincing? Why?


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Enlightened self-interest: realization thatbusiness ultimately helps itself by helping to

solve societal problems.

ENLIGHTENED SELF-INTEREST


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ENLIGHTENED SELF-INTEREST(continued)

For Discussion:1. Do you personally endorse the concept ofenlightened self-interest? Why or why not?

2. Is the reality of short-term costs versus long-

term benefits a fatal flaw for the concept ofenlightened self-interest in the business

world?


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THE ETHICAL DIMENSION OF

MANAGEMENT

Ethics: The study of moral obligationinvolving the distinction between right and

wrong.


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ETHICS SURVEY

Instructions: Based on your personal work experience,rank (from 1 = most common to 10 = least common) the

following ten ethical hot spots said to be associated with

unethical and illegal conduct in the workplace.Rank

1. Balancing work and family _____

2. Poor internal communications _____

3. Poor leadership _____

4. Work hours, work load _____

5. Lack of management support _____


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ETHICS SURVEY

(continued)

Rank

6. Need to meet sales, budget or profit goals _____

7. Little or no recognition of achievements _____

8. Company politics _____

9. Personal financial worries _____

10. Insufficient resources _____


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ETHICS SURVEY

(continued)

For Discussion:

1. What do the results of this survey tell you about

the future of ethics in the workplace?

2. What can management do to improve the climate

for ethical conduct?


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PERSONAL VALUES AS ETHICAL

ANCHORS

Instrumental value: an enduring belief thata certain way of behaving is appropriate in all

situations (e.g., ambitious, courageous,loving).

Terminal value: an enduring belief that acertain end-state of existence is worth striving

for and attaining (e.g., an exciting life,

freedom, social recognition).


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ANCHORS(continued)

Discussion: of value conflict based on your

value profile in Table 5.2:

Intrapersonal value conflict: Will your top

three instrumental values help you achieve

your top three terminal values, or is there afundamental and frustrating conflict?


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ANCHORS(continued)

Individual-organizational value conflict:

Do your top-ranked values clash with those

promoted by your organizations culture? Intercultural value conflict: How well do

differing values explain conflict and

misunderstanding between racial, gender,

ethnic, religious, and cultural groups intodays world?


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GENERAL ETHICAL PRINCIPLES

1. Self-interests

2. Personal virtues

3. Religious injunctions

4. Government requirements

5. Utilitarian benefits


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GENERAL ETHICAL PRINCIPLES(continued)

6. Universal rules

7. Individual rights8. Economic efficiency

9. Distributive justice

10. Contributive liberty


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GENERAL ETHICAL PRINCIPLES(continued)

For Discussion:

1. Which of these ethical principles drives most of your

behavior?

2. How situational are your ethical principles? Do you

switch from one ethical principle to another as

dictated by convenience?

3. Is situational ethics a problem for managers?

Explain.


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HOW TO MAKE AN ORGANIZATIONAL

CODE OF ETHICS EFFECTIVE

1. Refer to specific practices such as

kickbacks, payoffs, receiving gifts, and

falsifying records.

2. Top management must firmly support the

code by communicating it broadly and role

modeling appropriate behavior.3. The code must be equitably enforced with

stiff penalties for noncompliance.


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HOW TO MAKE AN ORGANIZATIONAL

CODE OF ETHICS EFFECTIVE(continued)

For Discussion: What would you say to

a manager who declares corporatecodes of ethics a waste of time?

ch05 Management’s Social and Ethical Responsibilities

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