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Business 0 The and Society Relationship Chapter 1 1 Prepared by Deborah Baker Texas Christian University Business and Society: Ethics and Stakeholder Management, 7e Carroll & Buchholtz Copyright 2009 by South-Western, a division of Cengage Learning. All rights reserved 0 The Business and Society Relationship Business scandals Business issues Broad societal concerns 2 0 Business and Society The collection of private, commercially oriented organizations A broad group of people and other organizations, interest groups, a community, a nation. Business Society Business and society interrelate in a macroenvironment as stakeholders. 3 0 Society as the Macroenvironment Social Economic Political Technological 4 0 Segments of the Macroenvironment Segment Social Focus Demographics, lifestyles, social values Nature and direction of the economy in which business operates Processes for passing of laws and election of officials. Interactions between firms, politics, and government Changes in technological advancements taking place in society 5 Economic Political Technological 0 A Pluralistic Society Strengths Prevents concentration of power Weaknesses Pursuit of self-interest Proliferates organizations Forces conflicts to center stage Maximizes freedom of expression and action and groups with overlapping goals Disperses individual allegiances Creates diversified set of loyalties Promotes inefficiency Provides checks and balances 6 0 Business and Stakeholder Relationships Figure 1-2 7 0 Stakeholders Stakeholders Individuals or groups with which business interacts who have a vested interest in the firm. External stakeholders Internal stakeholders 8 0 Special-Interest Society Special Interests groups make life more complex for business and government number in the tens of thousands pursue their own focused agenda are more active, intense, and diverse focused attract a significant following often work at cross purposes, with no unified set of goals 9 Social Environment, Business Criticism, and Corporate Response Affluence Education Awareness 0 Factors in the Social Environment Rising Expectations Entitlement Mentality Business Criticism Rights Movement Victimization Philosophy Increased Concern for the Societal Environment Figure 1-3 A Changed Social Contract 10 0 Factors in the Social Environment Affluence and education Awareness through television and the Internet Revolution of rising expectations Entitlement mentality Rights movement Victimization philosophy 11 Societys Expectations Versus Businesss Actual Social Performance Societys Expectations of Business Performance 0 Social Performance: Expected and Actual Social Problem Social Social Problem Problem Businesss Actual Social Performance 1960s Time Figure 1-4 2000s 12 0 Business Criticism: Use & Abuse of Power Business Power The ability or capacity to produce an effect or to bring influence Iron Law of Responsibility In the long run, those who do not use power in a manner society considers responsible will tend to lose it 13 0 Elements in the Social Contract Laws or Regulations: Rules of the Game Business Society or Societal Stakeholder Groups Two-Way Shared Understandings of Each Other Figure 1-6 14 0 Focus of the Book Managerial Approach Business Ethics Stakeholder Management 15 0 Urgent vs. Enduring Issues 1. Short-Term: Issues or crises arise on the spur of the moment and management must formulate quick responses. 2. Long-Term: Issues or problems are a long-term concern and management must develop a thoughtful organizational response. 16 0 Business Ethics Ethics Refers to issues of right, wrong, fairness, and justice. Business Ethics Focuses on ethical issues that arise in the commercial realm. 17 ... View Full Document

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