Mgmt 440--F19 Chapters 5 and 6 (1).ppt - Business and...

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Business and Society (MGMT 440)
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Also known as CSR, corporate citizenship, stakeholder management, and sustainability. Premise is that companies have obligations beyond those imposed by law. However, what are those additional obligations?
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No precise definition of CSR, though text (page 123) says that it is the duty of a corporation to create wealth in ways that avoid harm to, protect, or enhance societal assets.” So . . . how does a corporation create wealth in ways that will Avoid harm to societal assets – avoid negative impacts. Enhance societal assets – positive impacts.
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It is a moral duty to promote social justice because it is the “right thing to do.” Benefits that stem from CSR External benefits – good publicity for those outside the company. Internal benefits – good morale for those inside the company.
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CSR is an unwarranted cost since management’s focus should be profit- maximization for the benefit of ownership. CSR has no definitive meaning Reasonable people disagree about if and how a company should be socially responsible. Could the “how” of CSR raise problems inside and outside the company? What if company’s CSR is unpopular with stakeholders? CSR is more politics than business – the market, not politics, should direct the company.
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Inclination was to be thrifty, but charity thrived, too. Great fortunes made by individuals who were generous givers; e.g. , Steven Girard, John D. Rockefeller, Andrew Carnegie. However, charity often influenced by “social Darwinism” (Herbert Spencer) – best to donate for benefit of large institutions ( e.g. , universities) or to build grand projects ( e.g. , concert halls) instead of giving to one poor individual What supports this sort of “impersonal” charity? Does donating to “something big” also operate to give glory to donor? Could this motivate someone to donate?
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