Chap3

© Prentice Hall, 2005 1 - 1


ObjectivesObjectivesObjectivesObjectives1.An understanding of the term corporate social responsibility.

2.An appreciation of the arguments both for and against the assumption of social responsibilities by business.

3.Useful strategies for increasing the social responsiveness of an organization.

4.Insights into the planning, organizing, influencing, and controlling of social responsibility activities.

5.A practical plan for how society can help business meet its social obligations.

6.An understanding of the relationship between ethics and management.


Fundamentals of Social Responsibility (S.R.)Fundamentals of Social Responsibility (S.R.)Fundamentals of Social Responsibility (S.R.)Fundamentals of Social Responsibility (S.R.)The Davis Model of Corporate S.R.

Proposition

1: S.R. arises from social power

2: Business shall operate as a two-way open system

3: Calculate and consider social costs and benefits

4: Pass social costs on to the consumer

5: Businesses should be involved in certain social problems


Fundamentals of Social Responsibility (S.R.)Fundamentals of Social Responsibility (S.R.)Fundamentals of Social Responsibility (S.R.)Fundamentals of Social Responsibility (S.R.)Areas of Corporate S.R.

Varying Opinions on S.R.Arguments for Business Performing S.R. Activities

Arguments Against Business Performing S.R. Activities Friedman argues that making business managers simultaneously responsible to business owners for reaching profit objectives and to society

for enhancing societal welfare sets up a conflict of interest that could potentially cause the demise of business as it is known today. According to Friedman, this demise will almost certainly occur if business is continually forced to perform socially responsible actions that directly conflict with private organizational objectives

Conclusions About the Performance of S.R. Activities by BusinessPerforming Required S.R. Activities

Voluntarily Performing S.R. Activities

Communicating the Degree of S.R. Involvement


Fundamentals of Social Responsibility (S.R.)Fundamentals of Social Responsibility (S.R.)Fundamentals of Social Responsibility (S.R.)Fundamentals of Social Responsibility (S.R.)


Fundamentals of Social Responsibility (S.R.)Fundamentals of Social Responsibility (S.R.)Fundamentals of Social Responsibility (S.R.)Fundamentals of Social Responsibility (S.R.)


Social Responsiveness: Social Responsiveness: the degree of effectiveness and efficiency an organization displays in pursuing its social

responsibilities.

Social Responsiveness: Social Responsiveness: the degree of effectiveness and efficiency an organization displays in pursuing its social

responsibilities. Determining If a Social Responsibility (S.R.) Exists Social Responsiveness and Decision Making

Approaches to Meeting Social Responsibilities According to Lipson, a desirable and socially responsive approach to

meeting social obligations does the following

Socially responsive approach:1. Incorporates social goals into the annual planning process. 2. Seeks comparative industry norms for social programs. 3. Presents reports to organization members, the board of directors, and stockholders on social 4. responsibility progress. 5. Experiments with different approaches for measuring social performance. 6. Attempts to measure the cost of social programs as well as the return on social program investments.

Three Management approaches (S.P. Sethi) :1. Social obligation approach2. S.R. approach3. Social responsiveness approach


Social ResponsivenessSocial ResponsivenessSocial ResponsivenessSocial Responsiveness


Social ResponsivenessSocial ResponsivenessSocial ResponsivenessSocial Responsiveness


Social Responsibility Activities and Management FunctionsSocial Responsibility Activities and Management FunctionsSocial Responsibility Activities and Management FunctionsSocial Responsibility Activities and Management FunctionsPlanning Social Responsibility (S.R.) Activities

The Overall Planning Process

Converting Organizational Policies on S.R. into Action Phase 1 consists of recognition by top managers of social obligation

Phase 2 involves staff personnel as well as top management

Phase 3 involves division management in addition to above personnel


Social Responsibility Activities and Management FunctionsSocial Responsibility Activities and Management FunctionsSocial Responsibility Activities and Management FunctionsSocial Responsibility Activities and Management Functions








Social Responsibility Activities and Management FunctionsSocial Responsibility Activities and Management FunctionsSocial Responsibility Activities and Management FunctionsSocial Responsibility Activities and Management FunctionsOrganizing Social Responsibility (S.R.) Activities

Influencing Individuals Performing S.R. Activities

Controlling S.R. Activities

Areas of Measurement

1. The economic function area

2. The quality-of-life area

3. The social investment area

4. The problem-solving area

The Social Audit: A Progress Report


Areas of Measurement1. The economic function area: A measurement should be made of whether the organization

is performing such activities as producing goods and services that people need, creating jobs for society, paying fair wages, and ensuring worker safety. This measurement gives some indication of the economic contribution the organization is making to society.

2. The quality-of-life area: The measurement of quality of life should focus on whether the organization is improving or degrading the general quality of life in society. Producing high-quality goods, dealing fairly with employees and customers, and making an effort to preserve the natural environment are all indicators that the organization is upholding or improving the general quality of life. As an example of degrading the quality of life, some people believe that cigarette companies, because they produce goods that can harm the health of society overall, are socially irresponsible.

3. The social investment area: The measurement of social investment deals with the degree to which the organization is investing both money and human resources to solve community social problems. Here, the organization could be involved in assisting community organizations dedicated to education, charities, and the arts.

4. The problem-solving area: The measurement of problem solving should focus on the degree to which the organization deals with social problems, such as participating in long- range community planning and conducting studies to pinpoint social problems.




How Society Can Help Business Meet Social ObligationsHow Society Can Help Business Meet Social ObligationsHow Society Can Help Business Meet Social ObligationsHow Society Can Help Business Meet Social Obligations1. Set rules that are clear and consistent

2. Keep the rules technically feasible

3. Make sure the rules are economically feasible

4. Make the rules prospective, not retroactive

5. Make the rules goal-setting, not procedure-prescribing


Business EthicsBusiness EthicsBusiness EthicsBusiness EthicsA Definition of Ethics

Why Ethics Is a Vital Part of Management PracticesProductivity

Stakeholder relations

Government regulation

A Code of Ethics


Business EthicsBusiness EthicsBusiness EthicsBusiness Ethics


Business EthicsBusiness EthicsBusiness EthicsBusiness Ethics Creating an Ethical Workplace1. The golden rule—Act in a way you would expect others to act toward you. 2. The utilitarian principle—Act in a way that results in the greatest good for the greatest 3. concerning the Company's confidential internal reporting system can be located on the Company's Intranet. The

Company will not retaliate or allow retaliation for reports made in good faith. 4. Kant’s categorical imperative—Act in such a way that the action taken under the circumstances could be a

universal law, or rule, of behavior. 5. The professional ethic—Take actions that would be viewed as proper by a disinterested panel of professional

peers. 6. The TV test—Managers should always ask, “Would I feel comfortable explaining to a national TV audience why I

took this action?” 7. The legal test—Is the proposed action or decision legal? Established laws are generally considered minimum

standards for ethics. 8. The four-way test—Managers can feel confident that a decision is ethical if they can answer “yes” to the following

questions: Is the decision truthful? Is it fair to all concerned? Will it build goodwill and better friendships? Will it be beneficial to all concerned?


Accountability Any violation of this Code may result in disciplinary action, including termination, and if warranted, legal

proceedings. This Code is a statement of certain fundamental principles, policies and procedures that govern the Netflix Parties in the conduct of the Company's business. It is not intended to and does not create any rights in any employee, customer, supplier, competitor, shareholder or any other person or entity. The General Counsel and/or the Audit Committee will investigate violations and appropriate action will be taken in the event of any violation of this Code.

Waivers and Amendments of the Code The Company is committed to continuously reviewing and updating our policies and procedures. Therefore, this

Code is subject to modification. Any amendment or waiver of any provision of this Code must be approved in writing by the Company's Board of Directors and promptly disclosed pursuant to applicable laws and regulations. Any waiver or modification of the Code by a Senior Financial Officer will be promptly disclosed to stockholders if and as required by law or the rules of the stock exchange or over the counter trading system on which Netflix's stock is traded or quoted.

Number of people.

Following the Law: Sarbanes–Oxley Reform Standards


Business EthicsBusiness EthicsBusiness EthicsBusiness Ethics


QuestionsQuestions

Chap3

Business

socially responsive

social responsibility

social responsibility

prentice hall

social responsiveness

social programs

business performing

general quality