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Session 3 Societal Context & Labour Context
What is the importance of corporate social responsibility (CSR)?
WHAT IS BUSINESS & SOCIETY?
Business: private, commercially oriented organizations
Society: a community/national or group of people with common values, traditions, institutions, activities & interests
Business
Community
Consumers
Owners
Government
Employees
THE BUSINESS-SOCIETY RELATIONSHIP
Assuming a relationship between business and society connects to notions of ‘embeddedness’ and organizations as ‘open systems’
SHOULD BUSINESS HAVE ANY RESPONSIBILITIES TO SOCIETY? AND IF SO, WHAT IS THE NATURE OF THOSE REPSONSIBILITIES?
CORPORATE SOCIAL RESPONSIBILITY
CSR is: The obligation of decision makers to take actions which protect and improve the welfare of society as a whole along with their own interests. IE….
Corporate Social Responsibility (CSR)
obligations that involve going beyond:
the production of goods/services at a profit
the requirement of competition, law or custom
To create policies, make decisions & engage in actions that are desirable in terms of the values & objectives of society.
i.e. ethical responsibilities to society
Corporate Social Responsibility (CSR)
BUSINESS & SOCIETY: CONTEMPORARY CONCERNS
Business Business helping societyhelping society
Example: Levi’sExample: Levi’s
THE ROLE OF BUSINESS IN SOCIETY:CORPORATE SOCIAL RESPONSIBILITY
Examples of CSR:
• 3M & health of employees
• Merck Pharmaceutical & River Blindness
Can you think of examples of companies that have recently demonstrated CSR?
THE ROLE OF BUSINESS IN SOCIETY:CORPORATE SOCIAL RESPONSIBILITY
• The social responsibility of business encompasses the economic, legal, ethical and discretionary (philanthropic) expectations that society has of organizations at a given point in time (Carroll, 1979).
• A PYRAMID OF RESPONSIBILITIES!
THE CSR PYRAMID
Philanthropic ResponsibilitiesBe a good corporate citizen
Ethical ResponsibilitiesBe Ethical
Legal ResponsibilitiesObey the Law
Economic ResponsibilitiesBe Profitable
(Adapted from Karakowsky, Carroll, Bucholtz, 2007)
THE CSR PYRAMID
• Components can be interdependent rather than mutually exclusive.
e.g., serving ethical responsibilities does not necessarily mean that profit (economic responsibilities) will be sacrificed – or vice versa.
THE CSR PYRAMID
• However, there may also be tensions between the components –
e.g., “profits versus ethics”.
THE CSR PYRAMID
• Our discussion of this pyramid has already implied that business is responsible to more than simply its owners or shareholders!
• Rather there exists a network of STAKEHOLDERS FOR WHICH THESE REPSONSIBILITIES EXITS
• What or who are the stakeholders of business? Find out in our next module!
THE STAKEHOLDERS OF BUSINESS
STAKEHOLDERS, BUSINESS & SOCIETY
WHAT IS A STAKE?WHAT IS A STAKE?
An InterestAn Interest or shareor share in an activity A RightA Right - a legal right e.g. to fair
treatment or a moral right, e.g. to expect satisfactory service
OwnershipOwnership – a legal title to an asset/ property
A stakeholder is any individual or group who can affect or is affected by the actions, decisions, policies, practices or goals of the organization
STAKEHOLDERS, BUSINESS & SOCIETY
STAKEHOLDER VIEW OF THE FIRM: Primary & Secondary Stakeholders
Adapted from KCB, 2007
F I R M Government& Regulators
Shareholders/owners etc
Employees
Customers/consumers
LocalCommunities
Suppliers etc
Soc. PressureGroups
Competitors Trade Bodies
Media & Academics
Should business have some kind of moral obligation to society?
Is CSR a desirable goal?
DEBATING CORPORATE SOCIAL RESPONSIBILITY
AGAINST CSR FOR CSR
Sole responsibility of business is to make a profit
Business should conform to social rules
Business is not equipped to manage CSR
Business talent, capital & expertise could ensure CSR
Business has enough power – shouldn’t dictate morality
Could use its power for CSR, i.e. using its power positively
Costs of CSR would be passed on to consumers & limit national competitiveness
CSR provides long term benefits by enhancing business environmentOTHER ARGUMENTS…?
THE LABOUR CONTEXT
EMPLOYEES ARE IMPORTANT STAKEHOLDERS IN ANY BUSINESS.
WHAT OBLIGATIONS DOES BUSINESS HAVE TOWARD LABOUR?
HOW DO UNIONS HELP ADDRES LABOUR ISSUES?
THE EMPLOYEE STAKEHOLDER
EMPLOYEE RIGHTSGuarantees of fair treatment in the
workplace granted by courts, legislatures or
employers.
Provide workers with: Desired outcomes Protection from unwanted outcomes
Visible minorities
DESIGNATED EMPLOYEE GROUPS
Persons with Disabilities
AboriginalsWomen
WOMEN
Segregated Lower status occupations Under-representation in many
areas Career barriers Gender-stereotyping
First Nations/Aboriginals
Vastly underrepresented in the workforce
Education & employment gaps Educational, geographical and
perceptual barriers
INDIVIDUALS WITH DISABILITIES Higher unemployment rate
compared to national average Access, physical and attitudinal
barriers Economic barriers and social
discrimination
VISIBLE MINORITIES
Account for most of the growth in the labour force
Barriers include: cultural difference issues, foreign credential issues, language issues
Highest unemployment rates
THE EMPLOYEE STAKEHOLDER
PROTECTING EMPLOYEE RIGHTS
The Case of: Women, Aboriginal people, people with disabilities, members of visible minorities
Legal Protection Against Discrimination Canadian Charter of Rights & Freedoms The Canadian Human Rights Act
THE EMPLOYEE STAKEHOLDEREMPLOYMENT EQUITYTreating people fairly by
recognizingindividual differences
“treating people fairly by recognizing that different individuals and groups require different measures to ensure fair and comparable results”
THE EMPLOYEE STAKEHOLDEREMPLOYMENT EQUITY
Deal with systemic discrimination & inequality at work
THE EMPLOYEE STAKEHOLDER
EMPLOYMENT EQUITY
Eliminates employment barriers for specified groups
THE EMPLOYEE STAKEHOLDEREMPLOYMENT EQUITY
Redresses past discrimination
THE EMPLOYEE STAKEHOLDEREMPLOYMENT EQUITY
Improve access and foster equity
UNIONSUnions are the organizations
most directly responsible for representing the interests of Canadian working people.
- workers’ associations formed to enhance their power in dealings with employees
Union membership
Why have unions membership rates fallen?
- Manufacturing decline
- Part time work- Focus on public sector
UNION ACTIONS
The mutual insurance function of unions
Collective bargaining
Legal enactment
COLLECTIVE BARGAINING
- Negotiated outcomes
- Increasing issues reflect increasing diversity of workforce
Political action and expanded scope- Social unionism
- - economic development, human and labour rights overseas
UNION IMPACTS
- Impact on productivity
- Impact on management
- Impact on society
ARE UNIONS STILL NEEDED?- What would society look like
without unions?
- Workplace representation
- -balancing interests of big business with labour interests
KEY LEARNING POINTS
CSR: Responsibilities extend beyond just those to the owners or Shareholders of the business
• Stakeholders
• CSR Debate
• Labour context/employee Stakeholder:Designated employee groupsLabour unions