Ethics and Social Responsibility

Topics: Social responsibility, U.S. Securities and Exchange Commission, Foreign Corrupt Practices Act Pages: 3 (982 words) Published: September 8, 2013
Ethics and Social Responsibility
Tiffany Hafferkamp
Management/498
August 30, 2013
Professor King

When creating strategic plans for a company, not only should management consider the best interests of the company and increasing the bottom line, but management must also consider the impact the actions of the company will have on external stakeholders of the company. The purpose of a business is to create a product or service and generate profits, but not without at least considering the expense policies will cost internal and external shareholders. The concept that companies have a responsibility beyond making a profit is called social responsibility. Being socially responsible means not harming other entities or individuals in society. Stakeholders who are affected by a company’s actions are not limited to the internal stakeholders, consisting of shareholders, management and employees, but external stakeholders including: suppliers, creditors, customers, government agencies, the community and special interest groups, can be affected as well. Often times, external stakeholders are not even thought of as stakeholders by the company until a problem arises. Being socially responsible may be to According to Wheelan and Huger, Archie Carrol asserts that companies have four responsibilities: economic, legal, ethical and discretionary (2010). While economic and legal responsibilities are a must for all companies, companies can benefit from establishing and following through with ethical and discretionary responsibilities. One way that a company may benefit from acting ethically and responsibly is that by taking a proactive approach, a company may avoid government involvement by means of rules, regulations, and penalties. A lack of concern for social responsibility may result in increased government involvement, which may end up being even more costly for a company than actively being socially responsible. The second way a socially responsible company may...

References: SEC Charges Siemans AG for Engaging in World Wide Bribery. (2008). Retrieved from
http://www.sec.gov/news/press/2008/2008-294.htm
Wheelan, T. L., & Hunger, J. D. (2010). Concepts in strategic management and business policy
(12th ed.). Upper Saddle River, NJ: Pearson Education
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