Corporate Responsibility and Society MNGT 5990

1. Corporate Responsibility and SocietyMNGT 5990 Fall 2013 - Shanghai, PRC Robert Serben, Ph.D. Week 1 - Foundations

2. Introductions • Please introduce yourself with the following format: • Name • Your occupation • What you would like to gain from this course Corporate Social Responsibililty

3. Course objectives Students will be able to: • Identifyconflicting interests and values between organizations and their members, stakeholders, and publics. • Identify and evaluate the ethical and social claims and appeals organizations and individuals employ to justify their values and actions. • Applymajor ethical theories including utilitarianism, ethics of duty, and virtue ethics to concrete organizational and personal situations. • Critically evaluate case studies and their own careers applying appropriately the concepts of the corporation and of Corporate Social Responsibility (CSR). • Recognize ethical issues confronting managers, including organizational challenges to their integrity Corporate Social Responsibililty

4. Teaching methods • Lecture • Discussion • Team activities • Case studies Corporate Social Responsibililty

5. Your role • You are in control of your learning - and your grade • Attend class, be on time, read and prepare • Stay involved and active in class • Your opinion is an important contribution • What you invest is what will be returned to you Corporate Social Responsibililty

6. My role • Present course content • Discussion starter • Encouragement Corporate Social Responsibililty

7. Professional courtesy • Place cell phones on vibrate • Receive telephone calls outside of class • No texting in class • Personal computer use limited to taking class notes and team projects • Only one conversation – the class conversation Corporate Social Responsibililty

8. Grading Corporate Social Responsibililty

9. Class discussions • Learning = • In class discussions: Your views are important • “I’m not sure” – acceptable answer • “It all depends…” acceptable answer + + X Motivation Content Interactions Reflection Corporate Social Responsibililty

10. This week Corporate Social Responsibililty

11. End of course team project • CSR Consulting Company • Headquarters: Shanghai • Offices in: New York, Chicago, London, Berlin, Johannesburg, Mumbai, Singapore, Jakarta • Services: Help businesses set objectives and evaluation strategies for corporate social responsibility programs. • Objective: Help clients understand the value of CSR for their business Corporate Social Responsibility

12. Perceptions Corporate Social Responsibility

13. What do you think of… Finance Marketing CSR Operations Corporate Social Responsibililty

14. Groups When thinking about creating and maintaining a successful business, which are the most important groups that need to be considered? Corporate Social Responsibililty

15. The Perfect Company • Please identify three to five word or phrases of the perfect company or business – from your point of view The Perfect Company 1. 2. 3. 4. 5. Corporate Social Responsibililty

16. CSR foundational concepts Corporate Social Responsibililty

17. Business/Society relationship Create much of the wealth and well-being in societies Capable of harm (example: pollution Globalized capabilities Corporate Social Responsibililty

18. CSR “Corporate social responsibility” A collection of evolving terms, concepts, theories, and practices to describe one essential idea: • That business has the responsibility to do more than comply with the minimum requirements of law and the generation of a profit for its owners. Corporate Social Responsibililty

19. “Just Good Business” • CSR now seen as “mainstream” • Stronger interest by governments • Societies and stakeholders have higher expectations • Three layers • Traditional philanthropy • Risk management • Value creation Corporate Social Responsibililty

20. ISO – Social responsibility • ISO 26000 – “Business and organizations do not operate in a vacuum. Their relationship to the society and environment in which they operate is a critical factor in their ability to continue to operate effectively. It is also increasingly being used as a measure of their overall performance.” • Found at:http://www.iso.org/iso/home/standards/iso26000.htm Corporate Social Responsibililty

21. Shareholder value • “The Dow Jones Sustainability Index created a commonly accepted definition of CSR: "a business approach that creates long-term shareholder value by embracing opportunities and managing risks deriving from economic, environmental and social developments." This definition encompasses a broad range of corporate values and concerns, including reputation, transparency, social impact, ethical sourcing, profitability and civil society -- the list goes on. As a result of the interdependent nature of CSR, integration of its values remains a challenge for many organizations.” • “The balanced scorecard and corporate social responsibility : aligning values for profit.” Web location: http://www.greenbiz.com/news/2005/10/23/balanced-scorecard-and-corporate-social-responsibility-aligning-values-profit Corporate Social Responsibililty

22. Strategic CSR – class text • “The incorporation of a holistic CSR perspective within a firm’s strategic planning and core operations so that the firm is managed in the interests of a broad set of stakeholders to achieve maximum economic and social value over the medium to long term.” • P. xiii. Glossary of Terms. Class text. Corporate Social Responsibililty

23. Strategic CSR is not • Exclusively philanthropic charitable giving • Unrelated to the business strategy • Solely for image building • Rigid Corporate Social Responsibililty

24. Strategic CSR is about Corporate Social Responsibililty

25. Strategic CSR is • Strengthening the strategic capabilities of the organization • Activities supportive of unique business needs • A balanced relationship among stakeholders • Adaptable to changing conditions • Medium to long term view Corporate Social Responsibililty

26. Fundamental points Business does not exist in a vacuum The environment surrounding business is always changing CSR takes a longer term view of success Corporate Social Responsibililty

27. CSRdefinition: Two componenets 1 2 CSR: A responsibility among stakeholders to hold the business accountable for its actions. (Who?) CSR: A view that business assumes a responsibility to pursue goals in addition to profit. (Why?) Corporate Social Responsibililty

28. CSR current state Characteristics And… Seen as valuable • Recognizes the power of business to do good or harm • Growing in acceptance • Variable/fluid in application • Evolving in theory • Controversial • “Just Good Business.” The Economist. • Location: http://www.economist.com/node/10491077 Corporate Social Responsibililty

29. Largest CSR survey “While corporate responsibility reporting was broadly considered an ‘optional’ activity only a few years ago, more organizations are generating CR reports to meet rising stakeholder demands for greater accountability, transparency and accuracy in assessing parts of the business that are not necessarily financial, but which contribute to the overall value of the company.” http://www.kpmg.com/US/en/IssuesAndInsights/ArticlesPublications/Documents/corporate-responsibility-reporting-2011.pdf Corporate Social Responsibililty

30. The CSR hierarchy – p.6 Discretionary Responsibilities Strategic CSR Ethical Responsibilities Legal Responsibilities Economic Responsibilities Corporate Social Responsibililty

31. Three arguments for CSR • Moral argument: • Successful operations reflects the values of the larger society • Rational argument: • Maximize performance by minimizing restrictions • Economic argument: • Reflects concerns of stakeholders over medium to longer term Corporate Social Responsibililty

32. Fortune – 2011 Global 500 (top 10) Web location: http://money.cnn.com/magazines/fortune/global500/2011/snapshots/10344.html Corporate Social Responsibililty

33. CSR Value Corporate Social Responsibililty

34. Value Corporate Social Responsibililty

35. How do we know? • Watch (observe) • Compare to context • Compare to others • Look for benefits Corporate Social Responsibililty

36. CSR relevancy • Five trends that seemingly will grow throughout the 21st century: • Growing affluence • Ecological sustainability • Globalization • Free flow of information • Brands Corporate Social Responsibililty

37. CSR relevancy Five mega - issues Five demanding stakeholders “Green" consumers Activist shareholders Civil society / NGOs Governments and regulators Financial sector • Climate change • Pollution / health • Globalization backlash • The energy crunch • Erosion of trust http://www.greenbiz.com/news/2005/10/23/balanced-scorecard-and-corporate-social-responsibility-aligning-values-profit Corporate Social Responsibility

38. Why strategic CSR is important Consumers want to buy products from companies they trust • Regulate that which can’t be trusted Suppliers want to form partnerships with companies they can rely on • Something for both of us Corporate Social Responsibililty

39. Why strategic CSR is important Employees want to work for companies they respect • Treat me well and I’ll treat you well Investors want to support firms they believe are socially responsible • Money loves safety Corporate Social Responsibililty

40. CSR Corporate Social Responsibililty

41. CSR Interactivity • Each team to visit a website • Wison: http://www.wison.com/index.php?lang=en • Lenovo: http://www.lenovo.com/us/en/ • Changan:http://www.globalchana.com • How difficult was it to find the CSR page? • What did the CSR page tell you about: • Aims • Audiences Corporate Social Responsibililty

42. Next week - Stakeholders Business Preparation: Corporate Social Responsibililty

43. Next week Corporate Social Responsibililty