ETHICS AND SOCIAL

RESPONSIBILITY IN
STRATEGIC MANAGEMENT
August 31, 2017
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Ethics and Social Responsibility

Inside Story The dark side of
Bangladeshs leather trade

https://www.youtube.com/watch?v=BygXhh2ff44

Prentice Hall, 2004
Social Responsibility
Broader responsibility
Private corporation has
responsibilities to society that
extend beyond making a profit.
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Friedmans Traditional
View
There is one and only one
social responsibility of business
to use its resources and
engage in activities designed to
increase its profits
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Responsibilities of Business
Carrolls Four Responsibilities
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Social Responsibility Benefits

Environmental concerns may enable
the firm to charge premium prices
and gain brand loyalty

Trustworthiness may help generate

enduring relationships with suppliers
and distributors without spending
time and money policing contracts

Can attract outstanding employees

who prefer working for a responsible
firm

More likely to attract capital from

investors who view reputable
companies as desirable
Example of CSR by Siemen
What cause are these companies
supporting?
Corporate Stakeholder
Defined
A large number of groups with interest in a business
organization activities

Stakeholder
Employees wage and salary
Lender interest
Landlord rent
Government tax
Owner profit
 Chapter 2
Prentice Hall, 2004
Wheelen/Hunger
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Reasons for Unethical Behavior

Moral Relativism

Morality is relative to some personal,

social or cultural standard and that
there is no method for deciding whether
one decision is better than another.
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Reasons for Unethical Behavior

Moral Relativism (different standard):

1. Naive
2. Role
3. Social Group
4. Cultural
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Social Responsibility
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Social Responsibility

Code of Ethics:
Specifies how an organization expects
its employees to behave while on the
job.
 Chapter 2
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Social Responsibility
Ethics
The consensually accepted standards of behavior
for an occupation, trade, or profession

Morality
The precepts of personal behavior based on
religious or philosophical grounds

Law
Formal codes that permit or forbid certain
behaviors
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Approaches to Ethical Behavior

Utilitarian
Actions and plans judged by consequences

Individual Rights
People have fundamental rights to be respected
in all decisions

Justice
Distribution of costs and benefits to be
equitable, fair, and impartial

Categorical imperatives
golden rules - Not restrict others behavior