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Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -1
Chapter 10Business Ethics/ Social Responsibility/ Environmental Sustainability
Strategic Management: Concepts & Cases
13th EditionFred David
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -2
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -3
Business Ethics
Social Responsibility
Environmental Sustainability
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -4
Business Ethics
Principles of conduct within organizations that guide decision making and behavior
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -5
Business Ethics
Code of Business Ethics A document that provides behavioral
guidelines that cover daily activities and decisions within the organization
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -6
Ethics Culture
Ethics training should include: A message from the CEO Development and discussion of codes
of ethics Procedures for discussing and
reporting unethical behavior
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -7
Ethics Culture
To align ethical and strategic decision making: Incorporate ethical considerations into long-
term planning Incorporate ethical considerations into
performance appraisals Encourage whistle-blowing Monitor department and corporate
performance regarding ethical issues
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -8
Business Ethics
Social Responsibility
Environmental Sustainability
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -9
Social Responsibility
Actions an organization takes beyond what is legally required to protect or enhance the well-being of living things
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -10
Social Policy
Concerns what responsibilities the firm has to its employees, consumers, environmentalists, minorities, communities, shareholders, and other groups
Should be considered during each stage of strategy formulation, implementation, and evaluation
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -11
Business Ethics
Social Responsibility
Environmental Sustainability
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -12
Environmental Sustainability
The extent that an organization’s operations and actions protect, mend, and preserve rather than harm or destroy the natural environment
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -13
Environmental Sustainability
Strategies of companies are scrutinized and evaluated from a natural environment perspective
Employees, consumers, governments, and society are resentful of firms that harm rather than protect the natural environment
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -14
Sustainability Report
Reveals how a firm’s operation impact the natural environment
These reports are not required, but are a good business practice
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -15
Managing Environmental Affairs in the Firm Managers must formulate strategies that preserve
and conserve natural resources and control pollution Environmental strategies could include
Developing or acquiring green businesses Divesting or altering environment-damaging
businesses Striving to become a low-cost producer through
waste minimization and energy conservation Pursuing a differentiation strategy through green
product features
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -16
Reasons Why Firms Should “Be Green” Consumer demand Public opinion Environmental advocacy groups Federal and state environmental regulations Lenders Consumers, suppliers, distributors, and
investors Liability suits and fines
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -17
ISO 14000/14001 Certification
International Organization for Standardization (ISO)
A network of standards institutes of 147 countries
Largest developer of sustainability standards in the world
Compliance is voluntary
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 10 -18
ISO 14000/14001 Certification
ISO 14000 - a series of voluntary standards in the environmental field
ISO 14001 – a set of standards included within ISO 14000 Adopted by thousands of firms worldwide to
certify that they are conducting business in an environmentally friendly manner
Results in an environmental management system (EMS)
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