Global Business 2e
C ha p t e r 17
Managing Corporate
Social Responsibility
Globally
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LEARNING OBJECTIVES
After studying this chapter, you should be able to:
1. Articulate a stakeholder view of the firm.
2. Apply the institution-based and resource-based views
to analyze corporate social responsibility.
3. Participate in three leading debates concerning
corporate social responsibility.
4. Draw implications for action.
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CORPORATE SOCIAL
RESPONSIBILITY (CSR)
Corporate social responsibility (CSR)
Consideration and response to issues
beyond narrow economic, technical, and
legal requirements to accomplish social
benefits along with traditional economic
gains which the firm seeks
Stakeholder
Any group or individual who can affect or is
affected by the organization’s objectives
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BIG PICTURE
PERSPECTIVE
A key goal for CSR is global sustainability
global sustainability
Ability to meet the needs of the present without
compromising the ability of future generations to
meet their needs around the world
? In your own words, is CSR important and why?
© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
PRIMARY AND SECONDARY
STAKEHOLDERS
Primary stakeholder groups
Constituents on which the firm relies for its
continuous survival and prosperity
Secondary stakeholder groups
Those who influence or affect, or are
influenced/affected by, the corporation but
are not engaged in transactions with the
corporation and are not essential for its
survival
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PRIMARY AND SECONDARY
STAKEHOLDERS
Triple bottom line
Economic, social, and environmental
performance that simultaneously
satisfies economic, social, and
environmental performance measures of
all stakeholder groups
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© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
FUNDAMENTAL DEBATE
ON CSR
As free markets spread around the world, the
gap between the haves and have-nots
has widened
Even within developed economies the income
gap between upper and lower echelons of
society also has widened
In addition new disasters and scandals often
propel CSR to the forefront of public policy
and management discussions
© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
INSTITUTIONS AND CSR
Code of conduct (code of ethics)
Set of written policies and standards
outlining proper practices for the
organization
? Can you name at least three key issues that
you would address if you were writing a code of
conduct for a firm?
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INSTITUTIONS AND CSR
Reactive strategy
Strategy that only responds to CSR causes
when required by disasters and outcries
Defensive strategy
Strategy that focuses on regulatory
compliance but with little actual
commitment to CSR by top management
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INSTITUTIONS AND CSR
Proactive strategy
Strategy that anticipates CSR and
endeavors to do more than is required
Accommodative strategy
Strategy characterized by some support
from top managers, who may view
CSR as a worthwhile endeavor
© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
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RESOURCES AND CSR
Social issue participation
Firms’ participation in social causes not
directly related to the management of
primary stakeholders
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DOMESTIC VS
OVERSEAS CSR
When companies have enough resources, it
would be nice to take care of domestic
employees and communities
However, when confronted with relentless
pressures for cost cutting and restructuring,
managers have to prioritize
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RACE TO THE BOTTOM VS
RACE TO THE TOP
MNEs may have an incentive to shift
pollution-intensive production to developing
countries, where environmental standards
may be lower
To attract investment, developing
countries may enter a “race to the bottom”
by lowering (or at least not tightening)
environmental standards and some may
become “pollution havens
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ACTIVE VS INACTIVE CSR
ENGAGEMENT OVERSEAS
Increasingly MNEs are expected to
actively engage in CSR
MNEs that fail to do so are often
criticized by NGOs
© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.