Chapter 4 Corporate Social Responsibility and Managerial Ethics

Chapter 4 Corporate Social Responsibility and Managerial Ethics Chapter 4, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Ninth Canadian Edition Copyright © 2009 Pearson Education Canada 1

Learning Outline After you read this chapter you should know the following learning objectives: • #1: What is corporate social responsibility? • #2: Can being socially responsible help performance? • #3: How do organizations go green? • #4: How do values influence management? • #5: What is ethics and how can ethical behaviour be encouraged? Chapter 4, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Ninth Canadian Edition Copyright © 2009 Pearson Education Canada 2

What Is Corporate Social Responsibility? • The Classical View – Maximize profits for the benefit of the stockholders – Doing “social good” unjustifiably increases costs Chapter 4, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Ninth Canadian Edition Copyright © 2009 Pearson Education Canada 3

What Is Corporate Social Responsibility? • The Socio-economic View – Management should also protect and improve society’s welfare – Corporations are responsible not only to stockholders – Firms have a moral responsibility to larger society “to do the right thing” Chapter 4, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Ninth Canadian Edition Copyright © 2009 Pearson Education Canada 4

Exhibit 4 -2 Arguments For and Against Social Responsibility • For – Public expectations – Long-run profits – Ethical obligation – Public image – Better environment – Discouragement of further – – • Against governmental regulation Balance of responsibility and power Stockholder interests Possession of resources Superiority of prevention over cure Chapter 4, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Ninth Canadian Edition Copyright © 2009 Pearson Education Canada – Violation of profit maximization – Dilution of purpose – Costs – Too much power – Lack of skills – Lack of accountability 5

Values-Based Management • Values-based Management – Managers establish and uphold an organization’s shared values • Purposes of Shared Values – – Guiding managerial decisions Shaping employee behaviour Influencing the direction of marketing efforts Building team spirit • The Bottom Line on Shared Corporate Values – An organization’s values are reflected in the decisions and actions of its employees Chapter 4, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Ninth Canadian Edition Copyright © 2009 Pearson Education Canada 6