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CHAPTER 1 Social Responsibility Framework

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Page 1: Corporate social responsibility

CHAPTER 1

Social Responsibility FrameworkSocial Responsibility Framework

Page 2: Corporate social responsibility

Chapter Objectives

• To define the concept of social responsibility• To examine the global nature of social responsibility• To discuss the benefits of social responsibility• To discuss the framework for understanding social

responsibility

Page 3: Corporate social responsibility

What do you believe organizations should be responsible for

accomplishing?

Page 4: Corporate social responsibility

Social Responsibility Defined

The adoption by a business of a strategic focus for fulfilling the economic, legal, ethical and philanthropic responsibilities expected of it by its stakeholders

Page 5: Corporate social responsibility

Social Responsibility Defined (cont.)

• Businesses should look beyond their self-interests and recognize that they belong toa larger group that expects responsible participation.

• Applies to all types of businesses

• Adopts a strategic focus

• Fulfills societal expectations

Page 6: Corporate social responsibility

Social Responsibility Defined (cont.)

• Economic responsibilities

• Legal responsibilities

• Ethical responsibilities

• Philanthropic responsibilities

Page 7: Corporate social responsibility

Who are the keystakeholders of the organization?

Page 8: Corporate social responsibility

Social Responsibility Defined (cont.)

• Requires a stakeholder orientation – Customers– Employees– Investors– Stockholders– Suppliers– Government– Communities

Page 9: Corporate social responsibility

Stakeholders

Those constituents who have a stake in, or claim on, some aspect of a company’s products, operations, markets, industry, and outcomes

Page 10: Corporate social responsibility

Global Nature of Social Responsibility

• Who determines social responsibility on a global scale?– Host country– Home country– Outside organizations

Page 11: Corporate social responsibility

Benefits of Social Responsibility

• Greater trust with stakeholders

• Greater customer satisfaction

• Stronger employee commitment

• Stronger investor loyalty

• Greater profitability

• Countries with greater trust-based institutions foster a productivity-enhancing environment.

Page 12: Corporate social responsibility

Social Responsibility Builds Trust

• Trust is the glue that holds organizational relationships together.

• Stephen Covey contends that low trust results in organizational decay and relationship deterioration.

Page 13: Corporate social responsibility

Social ResponsibilityStrengthens Employee Commitment

• The greater a company’s dedication to employees, the greater the likelihood that employees will take care of the organization.

Page 14: Corporate social responsibility

Social ResponsibilityContributes to Investor Loyalty

• Investor relationships require dependability, trust, and commitment.

• Shareholders are concerned about ethics, social responsibility, and corporate reputation.

• Half of investors sell their stock within one year.


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