Chapter Three: Society, Ethics, and Sustainability Quiz

Social Responsibility

• Social responsibility is the managerial obligation to take action that protects and improves both the welfare of society as a whole and the interests of the organization.
• Areas of social responsibility include:
  • Urban/Consumer Affairs
  • Community Volunteerism
  • Employment Practices
  • Ecology Conservation (Going Green)

Arguments For and Against Social Responsibility

• Arguments for social responsibility:
  • Businesses are a subset of society and have a responsibility to help maintain and improve overall welfare.
  • Performing social responsibility activities earns greater organizational profits.
• Arguments against social responsibility:
  • Businesses being socially responsible conflict with profit interests of business owners.
  • Socially responsible public activities conflict with private organizational objectives.
  • Unethical to use owner profits for society's interests.

Social Obligation, Responsiveness, and Responsibility

• Social obligation: a business's intention to meet its legal responsibilities and nothing more.
• Social responsiveness: when a firm engages in social actions in response to some popular social needs.
• Social responsibility: the obligation of the business to meet its legal responsibilities and beyond.

Federal Agencies and Social Responsibility

• Equal Employment Opportunity Commission: investigates and conciliates employment discrimination complaints.
• Environmental Protection Agency: formulates and enforces environmental standards.
• Consumer Product Safety Commission: reduces consumer misunderstanding of product design, labeling, and more.
• Occupational Safety and Health Administration: regulates safety and health conditions in nongovernment workplaces.
• National Highway Traffic Safety Administration: reduces traffic accidents through regulation of transportation-related manufacturers and products.

Social Responsiveness and Decision Making

• Social responsiveness is the degree of effectiveness and efficiency an organization displays in pursuing its social responsiveness.
• Stakeholders include stockholders, suppliers, banks, government agencies, employees, consumers, competitors, and local communities.

Approaches to Meeting Social Responsibilities

• Incorporate social goals into annual planning process
• Seek comparative industry norms for social programs
• Present reports to owners and stakeholders
• Experiment with different approaches
• Attempt to measure cost of social programs

Meeting Social Responsibility Challenges

• Social Audit Challenge: process of measuring social responsibility activities to assess organizational performance.
• Philanthropy Challenge: promotes welfare of others through general monetary donations to social causes.
• Sustainability Challenge: conserving national resources, reducing waste, recycling, and protecting threatened species.

Sustainability

• Sustainability is the degree to which a person or entity can meet its present needs without compromising the ability of others to meet their needs.
• A sustainable organization is one that can meet its present needs without compromising future generations' ability to meet theirs.
• Triple Bottom-Line: economy, environment, and society.

Ethics in Management

• Ethics is the capacity to reflect on values in the corporate decision-making process.
• Ethical managers strive for management practices that are fair and just.
• Benefits of ethics in management practices include:
  • Increased Productivity
  • Improved Stakeholder Relations
  • Minimizing Government Regulation
• Code of Ethics: a formal statement that acts as a guide for how employees should act and make decisions.