Social Responsibility

Social ResponsibilityChapter 4Objectives for Section 1Describe social responsibilityIdentify costs and benefits of social responsibilityExplain what a code of ethics isIdentify ethical decisionsSocial Responsibility IssuesSocial Responsibility refers to the duty of a business to contribute to the well-being of a community.A call for more attention to social concernProtection of the environmentInclusion of minorities and women in the workplaceEmployment of physically challenged and older workersHealthy and safe work environment

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Environmental ProtectionA socially responsible business takes action to improve or change operations that cause pollution.A lumber company that consumes trees will sponsor reforestation programsWorkplace Diversity IssuesThe workforce should reflect the groups in a community.Members of these groups should have equal access to education, training, jobs, and career advancement.The removal of employment barriers for women.Accommodation of physically challenged employeesCompliance of the Americans with Disabilities ActElimination of bias against older workersAge Discrimination Act bars employers from using age as a bias for employment decisions, including hiring, promotions, or termination form a job.Protects workers aged 40 and overJob Safety Employees should be able to work in an office or a factory that is free from risks that could cause accidents.Job safety also involves training in how to work safely and what to do in case of an emergency.Safety Standards are enforced by Occupational Safety and Health Administration (OSHA).Employee WellnessWorkers who have good physical health are valuable assets.Stop smoking seminarsCounseling for employees with drug problemsWeigh loss sessionsEating a balanced dietEncourage participation on a sports team or incentives to join a gym.

Mentor GraphicsSocial Responsibility EvaluationOften a controversial issue.Benefits:Expanded justice for groups of societyEnhanced company imageReduced need for government actionsImproved quality of life in a community and around the worldIncreased awareness of social issues among workers, consumers, and others.Social Responsibility EvaluationCostsThere are costs involved when a business takes socially responsible actions.Costs include:Money must be spent for new non-polluting and safer equipmentMoney is spent to on buildings to remove risksSpending on social programs must be at a suitable level so that you still earn a respectable profitBusiness EthicsA socially responsible business engages in ethical business practices.Ethics principles of morality or rules of conductBusiness Ethics rules about how businesses and their employees ought to behaveVideo of Business EthicsCode of EthicsCode of ethics is a set of rules for guiding the actions of employees or members of an organization.i.e. confidentialityShould be a guide of values for all employees within that company

Ethical DilemmasShould a company expand into a profitable market in another country where doing business requires giving expensive gifts to key government officials?Should a company continue to produce a popular product after it discovers a minor defect in it?Ethical Conduct GuidelinesAttitude is determined by top managementFirst and foremost, Management should make ethical decisions.Some companies set up programs designed to promote employee honesty and integrityPersonal phone calls during work hoursTaking supplies from workSharing of confidential informationMisuse of emailHow are ethics changing in todays society?TechnologyTextingCell phone usageSensitivity

Guidelines to consider when making ethical decisionsIs it legal?Does the action violate professional or company standards?Who is affected by the action and how?

Guidelines for writing a Code of Ethics Determine the purpose of the codeTailor the code to the needs and values of the organizationConsider involving employees from all levels of the company in writing the codeDetermine the rules or principles that all members of the organization will be expected to adhere toDetermine how the code will be implemented and where it will be published or postedDetermine how and when the code will be reviewed and revised.Conflict of InterestConflict of interest occurs when an action by a company of individual results in an unfair benefit.

Sample conflict of interest Section 2Government in SocietyGovernment plays a role in all economic systems.Roles of Government:Providing services for members of societyProtecting citizens, consumers, businesses, and workersRegulating utilities and promoting competitionProviding information and support to businessesBuying goods and servicesHiring public employeesRaising revenueLevels of GovernmentThe main goal of the federal government is to oversee the activities that involve two or more states Interstate Commerce is business dealings involving companies in more than one state.For example: the federal government would regulate a trucking company that ships products to several states.Levels of GovernmentState Governments regulate business actions within their own borders.Intrastate commerce refers to a business dealings involving companies that do business in only one state.A truck company that hauls products within a states borders would be regulated by state government.

Levels of GovernmentAll states have assigned some of their legislative power to local governments.County BoardsCity CouncilsLocal governments also provide servicesPoliceFireWorker ProtectionLaws have been set to provide a safe work environment.Laws protect workers based on race, sex, religion, and age.Prejudices and personal biases must not affect a hiring decision.Contract EnforcementContract is an agreement to exchange goods or services for something of value, usually money.Contracts may be written or unwritten. Contract BasicsAgreement: An offer must be made and acceptedCompetent Parties: Those entering into contract must be of legal age and must be mentally competentConsideration: Something of measureable value must be exchanged by the parties involved.Legality: The contract must be for a product or service that may be legally sold; also, no fraud or deception exists in the agreement.Examples of contractsApartment leasesCredit card agreementDocuments that state the terms of a purchase.

Protection of Intellectual PropertyIntellectual Property is purely intangible, with no physical characteristics.PatentsCopyrights TrademarksProtection of Intellectual PropertyA patent gives the inventor the sole right to make, use, or sell the item for 20 years.A copyright protects the creative work of authors, composers, and artists.Copyright protection lasts for the life of the person and extends 70 years after the persons death.A Trademark is a word, letter, or symbol linked with a specific company or product. Also known as a logo.Nike swooshSection 3Government Regulation and AssistanceRegulatory ActivitiesBusiness activity in the United States is structured as a private enterprise or free market system.Government involvement includes regulating utilities and preventing unfair business practices.The government owns almost all of the factors of production.Regulation of UtilitiesMost goods and services you use come from private businessA Public Utility is an organization that supplies a service or product vital to all peopleLocal Telephone ServiceWaterElectricity

Regulation of UtilitiesA public utility is chosen to serve a community.Public Entities are cost effectiveGovernment usually closely regulates utility companies.The rates they charge have to approved by government agencies.

Prevent Unfair Business PracticesGovernment attempts to promote fair competition. Must charge the same for all customersMonopoly exists when a business as control f the market for a product or service.Good Monopoly: public utility when they provide a needed service at a fair price.Bad Monopoly: When a company uses its status to charge high prices and sell poor quality products.

Prevent Unfair Business PracticesAntitrust laws prevent other unfair business practices such as false advertising, deceptive pricing, and misleading labeling. Government Assists BusinessGovernment helps businesses by collecting and reporting valuable information. Census information can help a business decide where a majority of potential customers live.

Government Buys Goods and ServicesTotal federal, state, and local government spending make up about 20 percent of all the goods and services produced in the US.Many businesses depend upon government contracts for their survival.Government Employs WorkersGovernment is the single largest employer in the US economy.About 16 percent of workers are public employees.Police OfficersFirefightersTeachersMeat Inspectors

Government Raises MoneyGovernment must have a way to raise money to fund operations and pay wages to workers.Government income is called revenue.Government can obtain revenue through:Taxes and borrowingFines for traffic and other violationsFees and licensesTaxesA government creates tax policies to pay for the services is provides. Individual Income tax is the largest source of revenue for the government.Sales tax is a state or local tax on goods and services that is collected by the seller.Property tax is based on the value of land and buildingsProperty tax revenue is use to pay for schools and other public services such as police protection and community parks.BorrowingGovernment income from taxes and other sources may not always be enough to covers costs.Borrowing is another activity of the government.Government borrows money by selling bondsBonds issued by the government and backed by full faith and credit