Lecture --- Corporate Social Responsibility.pptx

Lecture on CSR in tourism, business and hospitality industries with a focus on business management.

1. Lecture: CORPORATE SOCIAL RESPONSIBILITY (CSR) AND ETHICS   Essential Reading: Parker, B. (2005).  Introduction to globalization and business : Relationships and responsibilities  (2nd ed.). London: SAGE Chapter 15 08 November 2023

2. Lecture Objectives Understand CSR definitions and corporate interest Explore Theories related to CSR Discuss Global Ethics and Businesses

3. What is CSR?

4. Definitions and Relationships Corporate social responsibility (CSR) is the process by which businesses negotiate their role in society Volunteer actions of a firm that benefit society beyond legal obligations and direct company interests In the business world, ethics is the study of morally appropriate behaviors and decisions, examining what " should be done ” Although the two are linked in most firms, CSR activities are no guarantee of ethical behavior

5. Recent Evidence of CSR Interest A general Google search turns up over 836 million results to “Corporate Social Responsibility” and 141 million to “Corporate Social Responsibility and ethics” Journals increasingly “rate” businesses (and NGOs) on socially responsive criteria: Best place to work Most admired Best (and worst) corporate reputation

6. CSR Pyramid ( Tulder & Mil 2023; Schwartz and Carrol 2003) https://www.researchgate.net/publication/4883660_The_Pyramid_of_Corporate_Social_Responsibility_Toward_the_Moral_Management_of_Organizational_Stakeholders

7. Sustainability demands by diners   M&S love for heritage?

8. Reasons for CSR Activities CSR activities are important and even expected by the public they are easily monitored worldwide CSR activities help organisations hire and retain the people they want CSR activities contribute to business performance

9. Maximise firm’s profits to the exclusion of all else Balance profits and social objectives Do what it takes to make a profit; skirt the law; fly below social radar Fight social responsibility initiatives Comply; do what is legally required Integrate social objectives and business goals Lead the industry and other businesses with best practices Do more than required; e.g. engage in philanthropic giving Articulate social value objectives Corporate Social Responsibility Continuum Freidman Carol, Drucker

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11. Businesses CSR Activities Philanthropy give money or time in kind to charity Integrative philanthropy—select beneficiaries aligned with company interests Examples? Philanthropy will not enhance corporate reputation if a company fails to live up to its philanthropic image or if consumers perceive philanthropy to be manipulative

12. Integrate CSR Globally Incorporate values to make it part of an articulated belief system McDonald's: “ We believe that being a good corporate citizen means treating people with fairness and integrity, sharing our success with the communities in which we do business, and being a leader on issues that affect customers ” Act worldwide on those values Cause-related marketing Cause-based cross sector partnerships Engage with stakeholders Primary stakeholders Secondary stakeholders

13. Business Ethics Development The cultural context influences organisational ethics - Some school of thought believe that everyone has their own ethics – what is considered right or wrong depends on the time, place, preferences and practices of a group or individual Top managers also influence ethics The combined influence of culture and top management influence organisational ethics and ethical behaviors

14. Unethical practices -> unlawful actions If bribery is perceived to be a national practice, then most companies in that society may use bribery If a top manager is unethical, then he/she may set a lead that others follow High demands for performance and profitability led Enron employees first to cut ethical corners and finally to break laws as well: According to one Enron insider: "If your boss was [fudging] and you have never worked anywhere else, you just assume that everybody fudges earnings. Once you get there and you realized how it was, do you stand up and lose your job? It was scary. It was easy to get into 'Well, everybody else is doing it, so maybe it isn't so bad"

15. I always tell the truth even when I lie

16. The Evolving Context for Ethics From domestic where ethics are shared To international where ethics are not shared, when companies: Make assumptions that ethics are the same Ethical tyranny— t hey adapt to us Ethical belief— w e adapt to them To global which requires an integrative approach to ethics NIKE Inc. was "founded on a handshake“ based on trust, teamwork, honesty and mutual respect

17. Emergence of a Global Business Ethic Growing sense that responsibility for righting social wrongs belongs to all organisations Growing business need for integrative mechanisms such as ethics E thics reduce operating uncertainties Voluntary guidelines avoid government impositions Ethical conduct is needed in an increasingly interdependent world—everyone in the same game Companies wish to avoid problems and/or be good public citizens

18. Ways Companies Integrate Ethics Top management commitment in word and deed Company codes of ethics Supply chain codes Develop, monitor, enforce ethical behavior Seek external assistance

19. External Assistance with Ethics Industry or professional codes Certification programs, e.g., ISO 9000 Adopt/follow g lobal c odes Examples to follow i.e. Caux Round Table Principles Government Principles Good Citizens Principles

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21. 22 PRINCIPLES FOR GOVERNMENT

22. 23 PRINCIPLES FOR GOOD CITIZENSHIP

23. Reasons for Businesses to Engage in Development of a Global Code of Business Ethics Create the same opportunity for all businesses if there are common rules Level the playing field They are needed in an interconnected world They reduce operating uncertainties If businesses don’t collaborate, they may not like what others develop

24. Four Challenges to a Global Ethic Global rules emerge from negotiations and will reflect values of the strong Global rules may be viewed as an end rather than a beginning Organizations may hide behind global codes & find loopholes then use the rules in defense Rules can depress innovation and creativity Rules are static but globalisation is dynamic

25. Some other points to consider/explore in your own time -No organisation will tell you that they are strictly a profit-making mechanism -Deregulation of governance aims to reduce red tape and cost obligations of organisations, but it also permits non-transparent and unethical operations -In a deregulated world companies are marketing their CSR strategies to greenwash their unsustainable activities. -Without Brexit the UK businesses would have had to obey the labour, banking, environmental and social legislations of the EU, whereas Brexit implicitly wants to pursue more US version, where those above and entitlement for maternity, paternity leave are not as supportive. -Example: US Private student loan companies are not forced to cancel loans of students who have been victims of fake universities like the Trump University. Student loan companies continue to charge interest fees and the law takes years before it brings such universities to justice

26. References Kotler, P., & Lee, N. (2008).  Corporate social responsibility: Doing the most good for your company and your cause . John Wiley & Sons. Drucker, P. F. (1984). Converting social problems into business opportunities: The new meaning of corporate social responsibility.  California Management Review (Pre-1986), 26 (000002), 53. Retrieved from https://hallam.idm.oclc.org/login?url=https://www-proquest-com.hallam.idm.oclc.org/docview/206322257?accountid=13827 Parker, B. (2005). Introduction to globalization and business : Relationships and responsibilities (2nd ed.). London: SAGE