Managing Social Responsibility and Ethics Lesson 4

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Questions and Answers

What is the main focus of the classical view of management’s social responsibility?

To maximize profits for stockholders (correct)

To address ethical behavior within the organization

To engage in social activism and improve community welfare

To ensure environmental sustainability

How does social responsibility differ from social obligation?

Social responsibility involves profit maximization only

Social obligation includes community engagement

Social obligation is limited to legal compliance only

Social responsibility includes a wider intention to benefit society (correct)

What characterizes social responsiveness in a business context?

Meeting only legal obligations

Engaging in actions based on popular social needs (correct)

Focusing solely on profit margins

Actively avoiding social issues

What is a potential negative consequence of focusing exclusively on maximizing profits?

Increased costs and a negative impact on society Signup and view all the answers

What does it mean for a firm to have a moral responsibility to society?

To contribute positively to societal welfare Signup and view all the answers

Which of the following statements best reflects the socioeconomic view of management’s responsibilities?

Management should consider their impact on community welfare Signup and view all the answers

Why may a business decide to engage in activities considered socially responsible?

To align with public expectations and improve brand image Signup and view all the answers

What is the role of management in encouraging ethical behavior within an organization?

To create a culture that values ethical standards and accountability Signup and view all the answers

Which argument suggests that a business is socially responsible only when it pursues its economic interests?

Violation of profit maximization Signup and view all the answers

Which approach to social responsibility focuses on complying with legal requirements?

Legal (light green) approach Signup and view all the answers

What does the stakeholder approach emphasize in terms of environmental responsibility?

Addressing the demands of multiple stakeholders Signup and view all the answers

What primary obligation did Avon fulfill by changing its practices in response to PETA's protest?

social obligation Signup and view all the answers

Which approach looks for ways to protect the earth's natural resources directly?

Activist (dark green) approach Signup and view all the answers

What is a significant reason businesses are encouraged to pursue social responsibility?

It can reduce government regulation. Signup and view all the answers

Which of the following arguments against social responsibility claims that businesses already possess considerable power?

Too much power Signup and view all the answers

What is a common argument against businesses engaging in social responsibility due to skill limitations?

Managers lack the necessary skills to address social issues Signup and view all the answers

Which of the following is NOT a reason against pursuing social responsibility?

Enhancing public image Signup and view all the answers

Which argument supports the idea that socially responsible actions can lead to better long-run profits?

Businesses addressing social issues beforehand reduces future costs. Signup and view all the answers

In what way can employees and customers influence corporate behavior toward environmental standards?

Through public statements and demands for action Signup and view all the answers

How does the market approach to environmental responsibility operate?

It responds to customer preferences and demands Signup and view all the answers

What can be considered a public expectation concerning businesses and social responsibility?

Companies should engage in actions that benefit both their image and society. Signup and view all the answers

Why might stockholder interests be positively affected by social responsibility?

It creates a favorable public image that leads to increased profits. Signup and view all the answers

What is an ethical obligation for businesses in terms of social responsibility?

To support charitable initiatives and public projects. Signup and view all the answers

How can the possession of resources by businesses contribute to social responsibility?

They can support public projects that require assistance. Signup and view all the answers

What approach to sustainability involves the use of laws and regulations?

Legal approach Signup and view all the answers

At which level of moral development do individuals define moral values independently of societal influence?

Principled Signup and view all the answers

Which test encourages individuals to consider how they would feel if their actions were made public?

The Front Page/Social Media Test Signup and view all the answers

What is crucial for the effectiveness of a code of ethics within an organization?

Management's support and treatment of violators Signup and view all the answers

What is the term for individuals or organizations that aim to use innovative methods to improve societal conditions?

Social entrepreneurs Signup and view all the answers

Under what circumstances might ethical employees act unethically?

Under unrealistic job goals Signup and view all the answers

Which ethical test asks whether an action aligns with the individual's conscience?

The Conscience Test Signup and view all the answers

What is the main role of top management in fostering ethical behavior in organizations?

Upholding shared values and setting cultural tone Signup and view all the answers

What is a common reason for resistance to change in organizations?

Fear of loss Signup and view all the answers

Which technique is most effective when resisters have the expertise to contribute?

Participation Signup and view all the answers

What could be a disadvantage of using facilitation and support?

It can be expensive Signup and view all the answers

When might negotiation be a viable technique for reducing resistance?

When resistance comes from a powerful group Signup and view all the answers

Which technique could potentially backfire by causing the change agent to lose credibility?

Manipulation and co-optation Signup and view all the answers

What is a primary disadvantage of using coercion to facilitate change?

It may undermine the change agent's credibility Signup and view all the answers

What happens when education and communication do not succeed in reducing resistance?

Trust and credibility issues are likely present Signup and view all the answers

What is the primary purpose of participation in the change process?

To increase involvement and acceptance Signup and view all the answers

What is the primary distinction between creativity and innovation?

Creativity is about generating ideas; innovation is about executing them. Signup and view all the answers

Which characteristic is NOT commonly associated with innovative organizations?

High levels of external control Signup and view all the answers

What role does an Idea Champion play in an organization?

To support and facilitate the implementation of innovations Signup and view all the answers

What does disruptive innovation entail?

Radical changes in industry standards and practices Signup and view all the answers

How can organizations encourage individuals to be more creative?

By providing minimal external controls Signup and view all the answers

What is the focus of a design thinker within an organization?

To understand customers as real people with real problems Signup and view all the answers

Which of the following options would likely inhibit innovation within an organization?

Making decisions based on strict procedures Signup and view all the answers

Sustaining innovation refers to which of the following?

Incremental improvements to existing products Signup and view all the answers

Study Notes

This lesson covers social responsibility, green management, ethical behavior, and managing change and disruptive innovation.
Students will be able to discuss social responsibility, explain green management, analyze factors leading to ethical and unethical behavior, and describe a manager's role in encouraging ethical behavior.

Classical view: A firm's sole responsibility is maximizing profits for shareholders.
Socioeconomic view: A firm's responsibility extends to protecting and improving society's welfare, including legal, social, and political issues.

Social obligation: Meeting economic and legal responsibilities is the minimum expectation.
Social responsiveness: Responding to social actions in response to social needs.
Social responsibility: Going beyond legal and economic obligations to do what is right for society.

How Organizations Go Green

Legal approach: Following the minimum required rules and regulations.
Market approach: Responding to customer preferences regarding environmental concerns.
Stakeholder approach: Meeting environmental demands of multiple stakeholders (employees, suppliers, community).
Activist approach: Seeking ways to protect the earth's natural resources.

Ethical Dilemma Tests

Golden rule test: Would you want others to do this to you?
What-if-Everybody-Did-This test: Would everyone doing this be beneficial/detrimental?
Family test: How would your family/significant others feel if you performed this action?
Conscience test: Does this action align with your personal moral values?
Front-page/social media test: Would you feel comfortable if this action were publicized?

Codes of Ethics and Decision Rules

Code of ethics: A formal statement of an organization's primary values and ethical rules for employees to follow.
Importance of leadership: Top management's commitment to ethical values and actions directly influences employees.
Job goals: Unrealistic job goals may pressure employees to compromise ethical standards.

Managing Change and Disruptive Innovation

Organizational change: Any alteration in people, structure, or technology within an organization.
Change agent: Someone who acts as a catalyst and assumes responsibility for managing the change process.
External forces: Consumer needs/wants, governmental regulations, technology, and the economy.
Internal forces: New organizational strategies, workforce composition, new equipment, and employee attitudes.
Four main areas of change focus for managers: Strategy, Structure, Technology, and People.

Resistance to Change

Reasons for resistance: Uncertainty, habit, fear of loss, belief that change is inconsistent with organizational goals.
Techniques for reducing resistance: Education and communication, participation, facilitation and support, negotiation, manipulation and cooptation, coercion.

Creativity and Innovation

Creativity: Ability to combine ideas in a unique way or make unusual associations.
Innovation: Taking creative ideas and turning them into tangible products, services, or processes.

Characteristics of an Innovative Organization

Accepting ambiguity, tolerating the impractical, minimal external controls, tolerating risk, tolerating conflict, focusing on ends over means, providing positive feedback.

Idea Champion

An individual who actively and enthusiastically supports new ideas, overcomes resistance, and ensures their implementation.

Design-thinking mentality

A mindset that focuses on understanding customers and their problems, rather than simply targeting demographics or sales stats.

Disruptive vs. Sustaining Innovation

Disruptive innovation: Products, services, or processes that change industry rules.
Sustaining innovation: Small, incremental changes in established products/services.

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Description

Explore the key concepts of social responsibility, ethical behavior, and green management in this lesson. Understand the differences between classical and socioeconomic views, and learn how managers can promote ethical practices within their organizations. This lesson aims to equip students with the tools to navigate complex ethical challenges in business.