Copyright © 2008 McGraw-Hill Ryerson Ltd. 1 Chapter Thirteen Civil Society Stakeholders Prepared by Mark Schwartz, York University Canadian Business and.

Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 1

ChapterThirteen

Civil Society Stakeholders

Prepared by Mark Schwartz, York University

Canadian Business and Society: Canadian Business and Society: Ethics & ResponsibilitiesEthics & Responsibilities


Chapter Outline

Civil Society: Definition Non-Governmental Organizations (NGOs) The Case for NGOs NGO Tactics Strategies for Relationships with NGOs Partnership Relationships with NGOs The Media Stakeholder Policy Development, Educational, and Religious

Institutions


Civil Society: Definition

Civil society is composed of the voluntary, community, and social organizations or institutions that contribute to the functioning of society but are not related to or supported by government.


Civil Society Civil society is usually regarded to be a counterbalance to the state

(and more recently also to business) guarding against the abuse of power and ensuring that the people’s best interests are served.

State Sector

Market Sector

Civil Society Sector


Non-Governmental Organizations (NGOs): Definition Any group that holds shared values or

attitudes about an issue confronting society and advocates for changes relating to the issue.

Usually, but not always, non-profit.


NGO Societal Issues Most Relevant to Business Animal rights Technology Economic Social

development

Workers’/human rights

Environment Religious

activism


Civil Society

1995 UN report suggested that nearly 29,000 international NGOs exist

Different in terms of the issues they focus on Scope of their operations Different forms and structures Varied mixture of activities


CSOs

TypeCommunity groupCampaign group

Research organizationBusiness association

Religious groupTrade union

Technical body

StructureInformalFormal

Co-operativeProfessional

EntrepreneurialNetworkFocus

Natural environmentSocial issuesDevelopment

Poverty alleviationHuman rights

Animal welfare

ScopeIndividual

Grass-rootsLocal

RegionalNational

TransnationalGlobal

ActivitiesAcademic research

Market researchProtests and DemosBoycott co-ordination

Policy researchInformation provision

Campaigning


The Case for NGOs

Identifying opportunities and risks Influence on public opinion Innovation possibilities Reputation and trust by the public Expertise on specific issues Employee engagement


NGO Tactics

Pressure on governments to change policies

Damaging publicity Disrupt annual meetings Develop shareholder social

policy resolutions Damaging physical property Picket managers’ homes Sponsor demonstrations or

picket corporate locations

Organize boycotts Launch letter-writing

campaigns Initiate legal proceedings Develop anti-business

websites Support anti-business

documentaries Provide support for

alternative sources of goods and services (e.g., fair-trade products)


Strategies for Relationships with NGOs Proactively engage NGO Do not underestimate NGO’s influence Reversing a decision from a project shouldn’t

be viewed as a defeat Sometimes selective concessions are

sufficient Sometimes better to deal with “realist” NGO,

not radical ones A preemptive strategy may be feasible


Partnership Relationships with NGOs Four key ingredients to a successful

partnership: Corporate and NGO leaders must show

leadership The corporation must be open to change Must be a commitment to being committed Partners must have a shared goal

Source: Canadian Business for Social Responsibility, 2005


Drivers towards business – CSO partnershipsDrivers for business engagement with CSOs Drivers for CSO engagement with business

Consumer expectations Growing interest in markets

NGO credibility with public Disenchantment with government as provider of solutions

Need for an external challenge Need for more resources

Cross-fertilization of thinking Cross-fertilization of thinking

Greater efficiency in resource allocation Credibility of business with government

Desire to head off negative public confrontation and protect image

Access to supply chains

Desire to engage stakeholders Greater leverage


Civil Society Organizations as Stakeholders

The stake held by CSOs is quite different from that held by other stakeholder groups

CSOs very rarely contribute any resources directly to corporations

The stake held by CSOs is largely one of representing the interests of individual stakeholders (including non-human stakeholders)

The stake of CSOs is indirect and representative



Two types Sectional Groups – include trade unions, professional associations,

student bodies etc. Promotional Groups – promoting specific causes or issues

Section groups Promotional groups

Membership Closed Open

Represent Specific section of society Issues or causes

Aims Self-interest Social goals

Traditional Status Insider Outsider

Main approach Consultation Argument

Pressure exerted through Threat of withdrawl Mass media publicity



Sectional groups have been said to enjoy insider status whilst promotional groups have largely been outsiders

Promotional groups have tended to have less easy access to governmental or corporate policy-making

Since they do not represent a readily identifiable constituency, it is not obvious whom exactly they are speaking for

Promotional groups have tended to need to mobilize mass public opinion before they are heard or involved in any kind of decision making


CSO Tactics

Indirect action – research and communication (issue around provision of misleading information)

Violent direct action – is often illegal but it often generates the most publicity


CSO Accountability

CSO accountability being questioned is not surprising when one considers that they have often been the parties most vociferously questioning the accountability of corporations

Questions about CSO accountability have largely mirrored the same questions that have been raised in relation to corporations

Accountability of CSOs to their supposed beneficiaries that tends to raise the most debate.


Globalization and civil society organizations Three main areas where globalization is

reshaping the relations between corporations and CSOs:

Engagement with overseas CSOs

Global issues and causes

Globalization of CSOs


The Media Stakeholder

Dealing with the media is part of managers’ responsibilities

Legitimacy of business is dependent upon public’s knowledge of events and issues

Information spread through newspapers, periodicals, radio, television, and social media (i.e., online technologies)


The Interaction Between Business and the MediaBusiness complaints: Reporters not

sufficiently knowledgeable

Only interested in “bad” news

Inherent bias Do not respect “off-the-

record” comments

Media complaints: Businesspeople

dishonest Use excuse that they

are only accountable to shareholders

Overreact to reporting process


Ownership and the Media

Business enterprises now own and operate major media outlets.

Issues: Newspaper monopolies Interlocking ownership between print and broadcasting

media Licensing process favours some corporations over others Newspaper chains more focused on profits than

professional journalism


Changes in Media Attitudes Toward Business Now increased coverage of business and

CSR in the media Now more favourable approach to business

coverage Business more prepared to work with the

media The media as a stakeholder influences

business, but business can also influence the media


Policy Development Institutions (Think Tanks) An organization that researches and analyzes

various important social, economic, and political issues confronting society

Funded by government, corporations, trade unions, wealthy individuals, universities

Examples: C.D. Howe Institute, Conference Board of Canada, Fraser Institute


Religious Institutions

Influence of religion on business: The impact on managerial decision making The existence of businesses supplying religious

goods and services Spirituality in the workplace Corporate response to religious activism


Educational Institutions

Business now involved in the educational system from kindergarten to university

Two distinct approaches: Mutually beneficial partnership; or Educational institutions should be unencumbered

from corporate influence


Civil Regulation

Civil society can be a source of regulation of corporations

Increasingly important role in forming codes of practice and even other more formal elements of rule setting and regulation

Civil society can act as a conduit through which individual citizens can exert some kind of leverage on, or gain a form of participation in corporate decision making and action

Copyright © 2008 McGraw-Hill Ryerson Ltd. 1 Chapter Thirteen Civil Society Stakeholders Prepared by Mark Schwartz, York University Canadian Business and.

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