Social and Ethical Responsibility of Management

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Social and Ethical Responsibility of Management
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Organizations Social Responsibilities
Social responsibilities
Dont violate principlesof right and wrong
Obey the Law
Make a Profit
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Whats Social Responsibility?

• Corporate Social Responsibility
• The idea that business has social obligations
  above and beyond making a profit.
• Business has an obligation to constituent groups
  in society other than stockholders and beyond
  that prescribed by law.
• Social Responsibility is the ethical
  accountability framework for the industry which
  defines principles, policies and practices and
  codes of conduct designed to ensure
• the protection of stakeholders,
• the sustainability of industry, and
• quality of life improvements in the communities
  in which it operates.

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Stakeholder Model
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Responses to Demands for Social Responsibility
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Approaches To Corporate Social Responsiveness
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Arguments Supporting Businesses Being Socially
Responsible

• Public expectations
• Long-run profits
• Ethical obligation
• Public image
• Better environment
• Discouragement of further government regulation
• Balance of responsibility and power
• Shareholder interests
• Possession of resources
• Superiority of prevention over cures

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Arguments Against Businesses Being Socially
Responsible

• Violation of profit maximization
• Dilution of purpose
• Costs
• Too much power
• Lack of skills
• Lack of accountability

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Areas of Social Responsibility

• Stakeholders customers, employees, and
  investors.
• The natural environment environmentally
  sensitive products, recycling, and public safety.
• The general social welfare charitable
  contributions, and support for social issues such
  as child labor and human rights.

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ORGANISATIONAL SOCIAL RESPONSIVENESS

• A term referring to the development of
  organisational decision processes where managers
  anticipate, respond to and manage areas of social
  responsibility.
• Two aspects
• Monitoring social demands and expectations
• Internal social response mechanisms

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MONITORING SOCIAL DEMANDS/EXPECTATIONS

• Social forecasting
• Opinion surveys
• Social audits
• Issues management
• Social scanning

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SR Management Process

• Planning
• Leadership People Focus
• Client Stakeholder Focus
• Process Management
• Outcome Assessment

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Dilemmas in Business

• A dilemma exists when you have a choice between
  two or more options.
• A business dilemma exists when an organizational
  decision maker faces a choice between two or more
  options that will have various impacts on (a) the
  organizations profitability and competitiveness
  and (b) its stakeholders.

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ETHICS

• Ethics (also called moral philosophy), involves
  systematizing, defending, and recommending
  concepts of right and wrong behavior.
• Business ethics is the application of general
  ethical principles to business dilemmas.

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TYPES OF MANAGERIAL ETHICS

• Immoral management
• Lacks ethical principles, concern for profit
  only
• Amoral management
• Ignores, or oblivious to, ethical issues
• Moral management
• Conscious attention to ethical standards and
  issues

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WHAT INFLUENCES ETHICAL BEHAVIOR?

• THE ORGANIZATIONS ROLE
• Structure
• Culture

THE INDIVIDUALS ROLE
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Determinants of Individual Ethics
Family Influences
SituationalFactors
Values andMorals
Experiences
PeerInfluences
Individual Ethics
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ETHICAL GUIDELINES FOR MANAGERS

• Obey the law.
• Tell the truth.
• Show respect for people.
• Stick to the Golden Rule.
• Above all, do no harm.
• Participation not paternalism.
• Responsibility requires action.

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MECHANISMS FOR ETHICAL MANAGEMENT

• Increasing awareness of diversity
• Top management commitment
• Codes of ethics
• Ethics committees
• Ethics audits
• Ethics hotlines
• Ethics training

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Process of Rationalization

• Mental strategies that allow employees (and
  others around them) to view their corrupt acts as
  justified
• Denial of responsibility ..no choiceeveryone
  does it
• Denial of injuryno one is really injured
• Denial of victimthe violated party deserves it
• Social weightingcomparisonothers do worst
  things
• Appeal to higher authoritiesloyalty to boss or
  co.
• Ledger approachaccrued creditswe deserve it

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THANK YOU