Running Head: Chapter Summary
Chapter 5 Summary
Principles of Management
Mayville State University
October 2, 2014
Chapter 5 Summary is being submitted to Professor Robert Johnston on October 2, 2014, by Jamal Branco as part of his studies in Principles of Management at Mayville State University
Social Responsibility Definition and Perspectives
Most companies today are intimately involved in social programs that have no direct connection with the bottom line. These programs include everything from support of the arts and urban renewal to environmental protection and education reform. But like all aspects of social management the act of social responsibility needs to be carried in an effective and efficient manner. What Does Corporate Social Responsibility Involve?
Corporate Rate Social Responsibility (CSR) - The notion that corporations have an obligation to constituent groups in society other than stockholders and beyond that prescribed by la or union contract.” Archie B. Carroll believes the burgeoning global economy requires a more encompassing perspective on CSR. Working from the bottom to the top which in global corporation should: Make a profit consistent with expectations for international business Obey the law of host countries as well as international law
Be ethical in its practices, taking host country and global standards into consideration Be a good corporate citizen, especially as defined by the host country’s expectations. All four responsibilities are intertwined and need to be fulfilled if a global corporation or any company in any situation, for that matter is to be called socially responsible. However in the long term each company needs to satisfy the bottom three levels before exercising philanthropic responsibilities. What is the Role of Business in Society?
The debate of actual business is a debate that is quite popular. It comes down to the question of is a business an economic entity responsible only for making a profit for its stockholders? Or is it a socioeconomic entity obligated to make both economic and social contributions to society? The key to attaining short run profits was to provide the society with needed goods and services. Reflecting society’s broader expectations for business (for example, safe and meaningful jobs, clean air and water, charitable donations, and safe products), many think the time has come to revamp the classical economic model, which they believe to be obsolete. Some companies go to the point to conduct stockholder audit to protect themselves from management problems. This growing practice involves systematically identifying all parties that might possibly be affected by the company’s performance. According to socioeconomic view, business has an obligation to respond to the needs of all stakeholders while pursuing a profit. Arguments for and Against Corporate Social Responsibility
The role of business has spiked a lot of arguments both for and against it here are some examples. Arguments For:
Business is unavoidably involved in social issues in other words it doesn’t matter whether business is a solution to the problem or is the actual problem regardless business is always going to be involved in our society. Business has the resources to tackle today’s complex societal problems. A better society’s means a better environment for doing business. Corporate social action will prevent government intervention. Arguments Against:
Profit maximization ensures the efficient use of society’s resources. By buying goods and services, consumers collectively dictate where assets should be deployed. Social expenditures amount to theft of stockholders’ equity. As an economic institution, business lacks the ability to pursue social goals. Business already has enough power.
Because managers are not elected, they are not directly accountable to the people. Social Responsibility Continuum
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