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CHAPTER 12
Social Responsibility in a
Global Environment
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Chapter Objectives
• To define cultural intelligence and its importance
• To discuss the global nature of stakeholder
relationships
• To examine the importance of national
competitiveness
• To describe the role of business in global
development
• To explore global standards for social responsibility
reporting
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The expanding global marketplace
requires that executives andmanagers develop the ability to
conduct business effectively and
socially responsibly indifferent regions of the world.
The Global Marketplace
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Cultural Intelligence
• The ability to interpret and adapt
successfully to different national,
organizational, and professionalcultures
• Three components:
– Cognitive – Motivational
– Behavioral
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Using Cultural Intelligence (CQ)
• A person with high CQ is skilled at recognizing how one
individual is influenced by national, professional, and
organizational cultures. For example, there are multiple layers
of cultural effects to manage when an Irish manufacturing
process expert from a consulting firm works with a Croatianengineer for a government agency. The Irish expert would
have to interpret and act according to Croatia’s national
culture, laws and governmental system, the agency’s role and
scope, the engineering profession’s code of ethics, and theengineer’s personality and values.
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Employee Issues in Global
Environment
• Wages and benefits relative to home country standards
• Attitudes toward employees from different genders and
ethnicities, especially in executive positions
• Existence of collective bargaining efforts• Laws and regulations for employee rights, health, and safety
• Norms of employee volunteering
• Availability and comfort with open-door policies and other
management practices
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Consumer Issues in Global
Environment
• Laws and regulations on product safety and
liability
• Presence and power of consumer rights groups
• Respect for the product needs of subcultures
and minority groups
• Attitudes and accommodations for customerswith disabilities
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Shareholder Issues in Global
Environment
• Laws and regulations regarding ownership and
corporate governance
• Stability and governance of stock exchanges
• Willingness and ability to participate in
shareholder meetings
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Supplier Issues in Global
Environment
• Ethical and social considerations in the supply
chain
• Prices offered to suppliers in developed
countries and developing countries in
comparison to other suppliers
• Availability and attitudes toward minority
suppliers
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Environmental Issues in Global
Environment
• Environmental law and regulations
• Availability of “green” electricity, recycled
materials, and other environmentally friendly
inputs
• Environmental expectations relative to those in
home country
• Use of natural resources to achieve business
goals
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Global Reporting Initiative (GRI)
• Emphasizes consensus and continuous
improvement in developing and maintaining
the GRI Sustainability Reporting Framework,
which seeks to provide transparency
• Includes three categories of core indicators:
economic, environmental, and social
performance
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