SOCIAL RESPONSIBILITY AND MANAGERIAL ETHICS

SOCIAL RESPONSIBILITY

 The obligation of organization management to make decisions and take actions that will enhance
the welfare and interests of society as well as the organization.

TWO OPPOSING VIEWS OF SOCIAL RESPONSIBILITY

CLASSICAL VIEW

 Holds that management's only social responsibility is to maximize profits.

SOCIO ECONOMIC VIEW (SOCIAL ECONOMIC)

 It is the view that management's social responsibility goes beyond making profits to include
protecting and improving society's welfare.

ARGUMENTS SUPPORTING BUSINESSES BEING SOCIALLY RESPONSIBLE

FOR • Possession of resources

• Public expectations • Superiority of prevention over cure
• Long-run profits
• Ethical obligation AGAINST
• Public image • Violation of profit maximization
• Better environment • Dilution of purpose
• Discouragement of further government • Costs
regulation • Too much power
• Balance of responsibility and power • Lack of skills
• Stockholder interests • Lack of accountability

SOCIAL RESPONSIBILITY FROM SOCIAL OBLIGATIONS TO RESPONSIVENESS

Social Obligation
• The obligation of a business to meet its economic and legal responsibilities and nothing more.

Social Responsiveness
• When a firm engages in social actions in response to some popular social need.

Social Responsibility

 A business’s intention, beyond its legal and economic obligations, to do the right things and act in
ways that are good for society.

VALUES BASED MANAGEMENT

Values-based Management

• is an approach to managing in which managers establish, promote, and practice an organization's

shared values.
• developing shared values managers are responsible for shaping the organization so that its
values, norms, and ideals appeal strongly to employees.

Purposes of Shared Values

• Guiding managerial decisions

• Shaping employee behavior
• Influencing the direction of marketing efforts
• Building team spirit

The Bottom Line on Shared Corporate Values

• An organization’s values are reflected in the decisions and actions of its employees
 Suggestions for Creating a Good Corporate Values Statement

1. Involve everyone in the company.

2. Allow customizing of the values by individual departments or units.
3. Expect and accept employee resistance.
4. Keep the statement short.
5. Avoid trivial statements.
6. Leave out religious references.
7. Challenge it.
8. Live it.

HOW ORGANIZATIONS GO GREEN

LEGAL (OR LIGHT GREEN) APPROACH

• Firms simply do what is legally required by obeying laws, rules, and regulations willingly and
without legal challenge.

MARKET APPROACH

• Firms respond to the preferences of their customers for environmentally friendly products.

STAKEHOLDER APPROACH

• Firms work to meet the environmental demands of multiple stakeholders—employees, suppliers,

and the community.

ACTIVIST APPROACH

• Firms look for ways to respect and preserve environment and be actively socially responsible.

The "Greening" of Management This recognition of the close link between an organization's decisions
and activities and its impact on the natural environment is referred to as the greening of management.
Global Environmental Problems One "green" issue managers must deal with as they become more
involved in preserving the natural environment is recognizing the key global environmental problems and
how these problems are changing list of global environmental problems:
1.global warming
2.pollution (air, water, and soil)
3.industrial accidents
4.toxic wastes

MANAGERIAL ETHICS

ETHICS
• is the code of moral principles and values that governs the behaviors of a person or group with
respect to what is right or wrong?
•
MANAGERIAL ETHICS
• is just about DECISION WHAT IS “RIGHT” And “Proper” and “Just” in connection with other
people. it is not only question about bribery, theft and collusion. It mainly about Relationship
between customers, supplier & stockholder on one side & Managers and Subordinates on other
side -Hosmer (1987)

REASON TO BEHAVE ETHICALLY

Internal people
• ethical behavior improves the work environment and motivates the employees to do better, it also
evokes a sense of pride and improves company image in the eyes of employee.
External people
• ethical behavior improves the public image of the company and helps in overall development.
Eventually it leads to cultural and behavioral enrichment among internal staff of the organization.

THREE VIEW POINTS OF MANAGERIAL ETHICS

Utilitarian view
• Ethical decisions are made on the basis of their outcomes or consequences.
Rights view
• respects and protects individual liberties and privileges.
Theory of Justice View
 • Managers impose and enforce rules fairly and impartially.

THREE MODELS OF MANAGEMENT ETHICS

Immoral
• Recognize the ethical issue involved and choose to do wrong thing.
Moral
• Recognize the ethical issue involved and choose to right thing.
Amoral
• Do not consider the ethical implications of an action or belief that ethics are irrelevant.

APPROACHES TO ETHICS

CONVENTIONAL APPROACH(CULTURE)
• The rules that we form should be acceptable by the society keeping in mind about the culture.
behavior or act can be terms right or wrongs based on the norms of the society. because of our
notion it may vary time to time or based on the different types of societies.
•
PRINCIPLE APPROACH (RELIGION & SOCIETY)
• The rules formed should not be bias and should not hurt the emotions and religious beliefs of
people in the society.

LAW APPROACH
• the rules formed should be legally acceptable and should not violate any rules of the constitution.

ETHICAL RELATIONSHIP WITH STAKEHOLDER

OWNER & CO-WORKER

• Relationship with owner /stakeholder Manager should be assured of legitimacy and expediency
of interest of the owners of the company. Loyal, responsible for fulfillment of task and owner’s
strategy.
• Relationship with Co-worker Manager should be Democratic & self-confident.

Reported by: Rodelia C. Opada