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Ethics and Corporate Social Responsibility
Lesson 01
Lesson's ObjectivesIdentify the meaning of managementDefine organization and societyidentify the relationships among society
& organizationDefine CSR and Identifying the values and
expectations of stakeholdersSocial & Economic consideration and
values
Basic Approach for CSRManagement
◦The process of planning, organizing leading and controlling the work of organization members and of using all available organizational resources to reach stated organizational goals.
Organization◦A group of people working together in a structured
way to achieve a specific goal or set of goals.Who we areFor most of our lives, we are members of one
organization or another.
Basic Approach for CSRThe purpose of that an organization strive
to achieve ◦Organizations often have more than one goals◦Goals are fundamental elements of
organizations◦All organizations have some program for
achieving goal-plan
The management Process
Inputs Transformation system Outputs
Envi
ronm
ent Environm
ent
Environment
Monitoring and control
Cont…Firm takes resources from environment and
gives products/solutions to environmentSolutions must have a value than its inputtedProtect the value of stake holders
◦ “groups and individuals who can affect or are affected by, the achievements of an organization’s mission”
◦ Stakeholder is a party who are directly or indirectly affecting to the organization and being affected by organizational decisions.
◦ Primary/Secondary stakeholders
Expectation/ Value of Stakeholders
Stakeholders
Customers
Employees
Suppliers and business partners
CommunitiesGovernment
Investors
N.G.O
UnionsMedia
Corporate Social ResponsibilityCorporate social responsibility (CSR) also called
corporate conscience, corporate citizenship, social performance, or sustainable responsible business/Responsible Business
CSR it is totally based on holistic concern of the business and its output.
CSR is form of corporate self regulation integrated into a business model. CSR policy functions as a built in, self-regulating mechanism whereby a business monitors and ensures its active compliance with the spirit of the law, ethical standards, and international norms.
Corporate Social ResponsibilityCSR is a process with the aim to embrace
responsibility for the company's actions and encourage a positive impact through its activities on the environment and its stakeholders.
CSR is founded upon the premise that businesses do have another responsibility apart from its economic responsibilities - a responsibility towards the society and its people - a 'social' responsibility.
Corporate Social Responsibility Keith Davis 1960, Corporate Social
Responsibility can be defined as businessmen's decisions and actions taken for reasons at least partially beyond the firms direct economic and or technical interests.
Jules Backman 1975, Corporate Social Responsibility "refers to the objectives or motives that should be given weight, by business in addition to those dealing with economic performances".
Corporate Social Responsibility"the obligation of decision make to take
actions which protect and improve the welfare of society as whole along with their own Internet".(Keith Daris and Robert L Blomstom 1975)
"the continuing commitment by business to behave ethically and contribute to economic development, while improving the quality of Life of the work Force and their families as well as of the local community and society at Large".(Lord Holms and Richard Watts)
Corporate Social ResponsibilityAccordingly at CSR an organization must
obligate with economic consideration, legal consideration, and also ethical consideration under the concepts of corporate social responsibility context.
ValueValues are standards to guide your action,
judgments, and attitudes.It is qualities, characteristics, or ideas
about which we feel strongly.A belief or feeling that someone or
something is worthwhile.◦Our values affect our decisions, goals and
behavior.◦Values define what is of worth, what is
beneficial, and what is harmful.
ValueValues give direction and consistency to
behavior.Values help you know what to and not to
make time for.Values set the direction for one’s life.Following are the major philosophical
views of value:◦Objective◦Subjective
ValueFollowing are the major philosophical views of value:
Objective - The objective value view holds that value is inherent in the object itself.
Subjective - The subjective value philosophical position holds that value is in the eyes of the beholder, not in the object itself.
ValueWe are acquiring values from everything
◦ Ages 1-7 --- parents◦ Ages 8-13 --- teachers, heroes (sports rock,
TV)◦ Ages 14-20 --- peers (values because of peers
or peers because of values?)◦ Ages 21+ --- Yours values are established,
but you may test your values from time to time.But 14-20 & 21+ groups may work with
organization with objective values than subjective.
Value vs. PricePrice relates to the actual number of rupees a
commodity or service brings when it is sold. Price is therefore a fact.
Value relates to the worth of a commodity. This is more of a theoretical concept rather than an actual fact.
“Price is what you pay. Value is what you
get.”
Market Value “Market value” means: The most probable
price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeably, and assuming the price is not affected by undue stimulus.
Values is identified with a two perspective as◦ western value◦ Eastern Value
Western Vs Eastern ValueWestern culture is a body of knowledge derived from
reason. This foundation of reason has made possible a vast accumulation of understanding related to reality or nature, including human nature.
This understanding is represented in several core
ideas and values, which include individualism, happiness, rights, capitalism, science and technology.
Western culture can also be referred to as advanced culture; this is because its ideas and values promote the development and sustainment of advanced civilization
Western Vs Eastern ValueNon-western culture is a body of ideas and values
derived fundamentally from mysticism/spiritualism or subjectivism, as opposed to reason. And it is characterized essentially by anti-individualism, self-sacrifice, tyranny-dominations, the view that humanity is depraved and/or helpless, and a hostility or indifference to economic progress, science and technology.
Nonwestern culture can also be referred to as uncivilized culture. This is because it’s essential ideas and values are fundamentally opposed to the ideas and values that lead to the development and sustainment of civilization.
Differences – East and WestEast
Internal self controlCommunalHierarchyModestyHarmony
Saving faceSilence oriented
Time is lifeRespect for status
Truth orientedNosy and curious
HypocriticalSharingAccept
Long term orientedIndirect
InterdependentBeing
WestExternal control
IndividualEquality
AchievementWinning
PrideNoise orientedTime is money
Respect for resultsFact orientedValue privacy
OpenSelfishControl
Short term orientedDirect
IndependentDoing
Owner/Entrepreneur – Cultural Differences
In Sri LankaFriends will ask the owner to hire their sons and nephews
In US Friends put up their money for the owner
In IndiaThe administrative system will put up
monumental red tape
In UKEveryone tries to
discourage the owner by explaining why it is likely
to fail and then scratch his car
In Hong KongWhen someone starts a
new business venture, the entire family works
around the clock to make it a success
Asian vs. Western Family Controlled Firm
Asian Family FirmTo hold the family together and family infighting exists
To give family members a jobThe family’s prestige and
honor
To honor the ancestral founders of the firm
Loyalty is valued over professional and bureaucratic
status
Western Family firmFamily loyalties are weak
Communications are bureaucratized
Outside directors or close associates of the controlling
family
Succession challenges
Unemotional - determined by impersonal and economic
criteria
Asian vs. Western - Values
Asian
GroupTrust
CompromiseFlexible
Western
IndividualisticStick to rules
ConfrontReasoning
Asian vs. Western - Action
Asian
Long termCollaborative
Customer focused
Western
Short termControl
“Show me the money”
Asian vs. Western – Management Style
Asian
RelationshipFlexible
AdaptiveUnderstanding
Western
RationalStructuredDirective
Doing
Asian vs. Western - Organization
Asian
Informal“Jack of All
Trades”Integrated
Co-operative
Western
Formal“Master of
None”FragmentedCompetitive
Cultural Stereotyping & Global Manager !!
The Humanity of the FRENCH
The Generosity of the DUTCH
The Candor of the JAPANEESE
The Charm of the GERMAN
The Punctuality of the SPANIARD
The Compassion of the ENGLISH
The team Spirit of ARAB
The Gentle Tact of the AUSTRALIAN
The Efficiency of the RUSSIAN
The Discipline of the ITALIAN
The Patience and Language Ability of the AMERICAN
Did you know The 19th Century belonged to Europe, the
20th to America and the 21st will be the Asian century”
Goldman Sach’s BRICS study predicts that by the year 2050, three of the four largest economies in the world will be Asian: China, USA, India and Japan (in that order) and no European economy will be among the top four.