Chapter15 - CG Chapter 15 Corporate Social Responsibility...

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CG Chapter 15 Corporate Social Responsibility and Sustainability Three significant changes have taken place: 1) Corporate governance compliance has increasingly become mandatory 2) Risk analysis and risk management have become an integral part of corporate governance process 3) CSR and sustainability have been added to the corporate governance portfolio Debate: Company has only one objective: to make tong term sustainable profits Vs. Because a company can and does affect interest and even the lives of people, it should be accountable/responsible to societal interest Carroll (1979) – Corporate responsibility has four levels 1) Economic responsibility – first the social responsibility to be profit oriented and market driven 2) Legal responsibility – to adhere to society’s laws and regulations as price for society’s license to operate 3) Ethical responsibilities – honor society’s wider social norm and expectations of behavior 4) Discretionary responsibilities – undertake voluntary activities and expenditure which exceed society’s minimum expectations (CSR) - CSR raises strategic concern about the nature and purpose of companies - Recognize a responsibility for their impact on all stakeholder - CSR goes to the heart of corporate governance - Business ethics concern an organization’s behavior in society - Ethical concerns raise philosophical, ideological, and moral issues - Rooted in social, religious, and cultural contexts - Corporate philanthropy involves charitable giving by a company - May be part of overall CSR program CSR: Strategies and Policies Bad corporate behavior - Increase direct economic costs (damages, restitution, product recalls, fines, etc.) -
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This document was uploaded on 11/10/2011.

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Chapter15 - CG Chapter 15 Corporate Social Responsibility...

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