Business, Government, and Society

Dr Taran Patel,
Associate Professor, Grenoble Ecole de
Management,
FRANCE
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Your evaluation for this module

END OF TERM EXAM 50%
GROUP PRESENTATIONS 40%
IN CLASS PARTICIPATION 10%

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Session 1
Introducing Business, Government, and Society
Defining key terms

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The role of business, government and

society

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The role of business, government and

society
EMPLOYMENT
PRODUCTS
AND
SERVICES

PROFITS

REGULATIONS

INFRASTRUCTURE

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NORMS

VALUES
IDEOLOGIES

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THE FOUR KEY MODELS

OF THE BGS
RELATIONSHIP
The Market Capitalism Model
The Dominance Model
The Countervailing Forces Model
The Stakeholder Model

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THE FOUR KEY MODELS OF

THE BGS RELATIONSHIP

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THE FOUR KEY MODELS OF

THE BGS RELATIONSHIP

The Market Capitalism Model: Criticism

Accused of generating inequality and harnessing the opportunism and self-interest of a few rich and powerful elite
Vladimir Lenin, Bernard Mandeville, Karl Marx among many critiques
Business models can be created to satisfy just about any human vice

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THE FOUR KEY MODELS OF

THE BGS RELATIONSHIP

The Dominance Model:

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The dominance model is supported by detractors of capitalism

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The underlying assumption is that the government and businesses dominate the masses

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THE FOUR KEY MODELS OF

THE BGS RELATIONSHIP

The Countervailing Forces Model:

The underlying assumption is that the public, the government, businesses, and the
environment constantly interact with one another. During such interactions there is an
exchange of power such that no one entity becomes more powerful than the others.
A systemic approach: Businesses influence the other players, and are influenced by them

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THE FOUR KEY MODELS OF

THE BGS RELATIONSHIP

The Stakeholder Model:

To be discussed in detail in the next session
Definition of stakeholders:
The term stakeholder has been most commonly defined as any group or individual who
can affect or is affected by the achievement
of the firms objectives (Freeman, 1984: 25).
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THE FOUR KEY MODELS OF

THE BGS RELATIONSHIP

Definition of stakeholders:
Rhenman (1964): stakeholders are individuals and groups who depend on theAccrditation
firm in order to achieve their personal goals and on whom the firm depends for its existence

Carroll (1989, 1993): a stakeholder is an individual or group that asserts to have one or more of the kinds of stakes in business. Just as stakeholders may be affected by the actions,
decisions, policies, or practices of the business firm, these stakeholders also may affect the organizations actions, decisions, policies or practices. With stakeholders, therefore, there is a
potential two-way interaction or exchange of influence.

DEFINING ETHICS IN BUSINESS

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How is ethics defined?

OSullivan defines ethics as any set of detailed rules
defining a code of (morally) good or right conduct for
people in a community (curtsey: OSullivan, P. MBA
class slides).
Tenbrunsel and Smith-Crowe (2008) distinguish
between moral and amoral decision-making, and
stress that either can lead to ethically acceptable or
unacceptable decisions. They argue that there is no
linear, compelling link between moral awareness,
moral decision making and the ethicality of the
outcome.
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FOR THE NEXT SESSION

Please read Porter and Kramers (2011) paper on
Shared Value Creation from HBR
Please also read Its hard to be good from HBR

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