Strategic CSR - PowerPoint by hcj

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									CORPORATE SOCIAL
 RESPONSIBILITY
  Business Environment
  Ch. 5, Steiner & Steiner




            CSR              1
             Class Objectives
• Corporations will want to establish a Strategic
  CSR policy consistent with their view of their
  Social Contract
• CSR can be described for its sources (causes) and
  its principles, but its effectiveness is hard to
  evaluate
• Corporations have six responses to the multiple
  pressures they will receive from society
• There are skills sets that can be developed to
  improve CSR.
                        CSR                       2
 Corporate Social Responsibility
        (Steiner. P. 120)
• Corporate duty, to
• Create wealth, and
• Protect social assets
  – Avoid harm
  – Preserve
  – Enhance


                          CSR      3
        CSR Related to AIDS
• International Aids Vaccination Initiative
  – Non-profit, well funded (Bill & Melinda)
     • Invest in small US Pharmaceuticals
     • Broker US Pharm. & Develop. Countries
• License to manufacture cheap alternative
  for Africa
  – Could affect prices in the U.S.

                         CSR                   4
    History of Corporate Social
       Responsibility (CSR)
• Corporate lesson in the Rodney King Riots?
  – McDonalds
  – Shell Corporation




                        CSR                5
       “Resistance” to CSR?
• Adam Smith – “invisible hand”
• Social Darwinism
• Ultra Vires




                    CSR           6
 “Justification” for CSR--Bowen
• Ethical duty to consider broad social
  impacts of decisions
• Reservoirs of skill and energy
• Power in keeping with a broad social
  contract
• Enligtened self-interest to improve society
• Voluntary action will head off negative
  reactions?
                      CSR                       7
    Case Against CSR--Friedman
•   Use its resources for profit
•   Engage in activities for profit
•   Increase its profits
•   Within rules of the game




                         CSR          8
       Case Against CSR (cont.)
•   CSR money reduces shareholder profit
•   Is it what stockholders want?
•   Consumers paying for it
•   Separation
    – church/state
    – corporate/state


                        CSR                9
   Supremacy of CSR in the US
• CED -- 1971
  – Inner Circle—products & jobs
  – Intermediate Circle—environment, hiring, safety
  – Outer Circle—evolving
• Business Roundtable Statement on CSR – 1981
  – Economic/Social responsibilities are compatible
  – ALL CORPORATE RESPONSIBILITIES ARE
    …INTERWINED


                           CSR                        10
 Basic Elements (causes) of CSR
• Market forces
• Mandatory programs
• Voluntary Social Programs




                    CSR           11
 General Principles for Strategic
              CSR
• Law: corporate and stakeholder regulations
• Primarily by economic criteria: ROE &
  Shareholder value
• Address the adverse social impacts they
  cause
• Varies by corporate characteristics
• Meet legitimate shareholder needs
• Guided by winds of social direction
                     CSR                       12
       Criteria for Rating CSR
• Published Screens
  – Domini Social Equity Fund
  – Council on Economic Priorities – p. 138
• Personal screens – what is on your list?
• WSJ in 2000 for top 50 using



                       CSR                    13
    CSR and Profit – Related?
• Investing on CSR is noble but less
  profitable p. 139
• Scholars and profit – no conclusions
• Local programs – examples that work?




                    CSR                  14
          CSR Internationally
• European Nations
  – Regulations and taxes
  – Unraveling because of US/other competition
• Japan
  – Confucianism – direct relationship responibility
  – Emperor Meiji’s “Imperial Oath”
  – Weaker Stakeholders
• LDCs
  – India is an exemplar
  – Economic performance alleviates poverty
                           CSR                         15
              Levi Strauss
• Evaluate pros/cons of LS decision to
  stay/leave in 1993
• Evaluate pros/cons of LS decision to return
  in 1998
• What is the responsibility of a company like
  LS in improving HR in China?


                      CSR                    16
  Review main points of CSR in
          Chapter 5:
• Corporations will want to establish a
  Strategic CSR policy consistent with their
  view of their Social Contract
• CSR can be described for its
  – Sources (causes)
  – Principles, but
  – Effectiveness is hard to evaluate

                        CSR                    17
  IMPLEMENTING
CORPORATE SOCIAL
    PROGRAMS
  Steiner & Steiner, Ch. 6
   Business Environment


            CSR              18
             Class Objectives
• Corporations will want to establish a Strategic
  CSR policy consistent with their view of their
  Social Contract
• CSR can be described for its sources (causes) and
  its principles, but its effectiveness is hard to
  evaluate
• Corporations have six responses to the multiple
  pressures they will receive from society
• There are skills sets that can be developed to
  improve CSR.

                        CSR                       19
          Royal Dutch Shell
• Responsible corporate member
• Observe county laws
• Support human rights
• Proper regard or health, safety, &
  environment
• Sustainable development

                      CSR              20
    Six Patterns of Social Response
•   Rejection
•   Adversary strategy
•   Resistance strategy
•   Compliance
•   Accommodation
•   Proactive strategy

                          CSR         21
      Pressures for Undertaking
              Programs
•   Government – jaw boning
•   Community interests & demands
•   Environmental concerns
•   Competitive responses
•   Stockholder/investor pressures
•   Philanthropy
•   Crises
                      CSR            22
      Implementation Procedures
           (SKILL SETS)
•   Issues Management
•   Crisis management
•   Corporate philanthropy
•   Business in education




                      CSR         23
         Issues management
• What is it?
  – Identify important social issues
  – Potential of concern to the company
  – Develop responses




                       CSR                24
Issues management methodology
•   Intuition
•   Scenario planning
•   Probability/Impact matrix
•   Setting priorities
•   Shaping public opinion
•   Legislation
•   Compliance
                       CSR      25
          Crises management
• Examples
  – Bhopal in India
  – Exxon Valdez oil spill
• Steps
  – Assess possibilities
  – Prepare process
  – Game it

                           CSR   26
        Corporate philanthropic
             allocations
•   Priorities: education, health,
•   10% of pre-tax “profits” vs 1-2% actual
•   Buffett & Gates are significant contributors
•   How will you give?




                        CSR                    27
       Philanthropic Programs
• Community Economic Development
  – Target and Home Depot at Habitat
• Strategic philanthropic self-interest
• Cause related marketing
  – Current web sites
• Business in Education
  – How much is OK?

                        CSR               28
               Social audits
• Measure program contributions
  – Central East Rotary summarized giving 6 years
• Kellogg Foundation
  – 80% of start-ups vanished w/i five years
     How would you respond if you were on the board?




                         CSR                           29
             Class Objectives
• Corporations will want to establish a Strategic
  CSR policy consistent with their view of their
  Social Contract
• CSR can be described for its sources (causes) and
  its principles, but its effectiveness is hard to
  evaluate
• Corporations have six responses to the multiple
  pressures they will receive from society
• There are skills sets that can be developed to
  improve CSR
                        CSR                       30

								
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