Contemporary Business Issues CORP3502

1
Contemporary Business Issues CORP3502

• Deferred/Referred Exam August 2007

2
CORP3502

• Structure as per June exam
• 3 hours duration
• Answer 2 questions (out of 7) in 3 hours
• Remember need a good balance of theory, real-life
  examples, statistics, critical analysis, and good
  descriptive narrative for an excellent answer.

3
Part-seen Exam Format

• This presentation will identify the seven topic
  areas that are covered in the exam.
• However, please remember the
  inter-relationship of these topics when you are
  doing your revision.

4
Expectations

• You have 3 hours to answer 2 questions so we are
  expecting good, detailed, and informed essay
  style answers that include
• Underlying theoretical framework
• Relevant real-life examples

5
Expectations

• Appropriate up-to-date statistics or other
  evidence
• Balanced approach to answer
• Logical conclusion

6
Remember

• This exam will NOT simply repeat questions from
  the June exam.
• However, there may be some overlap on some
  questions.
• You should therefore also refer to the additional
  background information provided for the June
  exam, where relevant.

7
1) Corporate Social Responsibility

• See lecture notes and assignment brief from term
  one for indicative readings
• Carry out further research to update with latest
  articles, statistics, and trends

8
Defining CSR

• Many different opinions about what we mean by CSR
• Morgan (1997) defines the term corporate social
  responsibility (CSR) as The extent to which
  individual firms serve social needs other than
  those of the owners and managers even if this
  conflicts with the maximisation of profits.

9
Defining CSR

• For instance Mallen Baker suggests that CSR is
  about how companies manage the business processes
  to produce an overall positive impact on society
  (Mallen Baker)
• The World Business Council for Sustainable
  Development prefers the following definition.
  "Corporate Social Responsibility is the
  continuing commitment by business to behave
  ethically and contribute to economic development
  while improving the quality of life of the
  workforce and their families as well as of the
  local community and society at large"

10

• Traditionally in the United States, CSR has been
  defined much more in terms of a philanthropic
  model. Companies make profits, unhindered except
  by fulfilling their duty to pay taxes. Then they
  donate a certain share of the profits to
  charitable causes. It is seen as tainting the act
  for the company to receive any benefit from the
  giving.

11

• But the concept of corporate social
  responsibility (CSR) is a fuzzy one with unclear
  boundaries and debatable legitimacy (Lantos).
• Whilst McWilliams and Siegel (2001), define CSR
  as where the firm goes beyond compliance and
  engages in actions that appear to further some
  social good, beyond the interests of the firm and
  that which is required by law.

12
Corporate Social Responsibility

• For the exam you will need to focus on the
  various aspects of corporate social
  responsibility (CSR) identified by Milton
  Friedman (1962) through to Porter Kramer today.
• The ethical dimensions by which some firms want
  to contribute to society by doing what is morally
  and ethically right

13
Corporate Social Responsibility

• - The extent to which business needs to use its
  power in a responsible manner
• - The pluralist approach to integrating social
  and wider stakeholder demands
• - The strategic aspects of CSR see also Porter
  Kramer, and McWilliams et al

14
Corporate Social Responsibility

• - How do all these approaches complement each
  other?
• How do they contradict each other?
• To what extent is the Friedmanite view still
  relevant today?

15
2) Sustainable Development

• See lecture notes and assignment brief from term
  one for indicative readings
• Carry out further research to update with latest
  articles, statistics, and trends

16
Recent events

• See Stern Review (2006) from the former chief
  economist of the World Bank. Findings include
• Carbon emissions have already pushed up global
  temperatures by half a degree Celsius
• If no action is taken on emissions, there is more
  than a 75 chance of global temperatures rising
  between two and three degrees Celsius over the
  next 50 years

17
Recent events

• There is a 50 chance that average global
  temperatures could rise by five degrees Celsius
• Melting glaciers will increase flood risk
• Crop yields will decline, particularly in Africa

18
United Nations Framework Convention on Climate
Change

• Excellent range of up-to-date reports and
  information available at http//unfccc.int/2860.ph
  p
• Plenty on information on background and
  development of Kyoto etc.

19
Recent events

• See also Sustainable Development Commission
  website http//www.sd-commission.org.uk/ Its
  March 2007 report suggests that UK Government
  departments are not on track to meet the carbon
  reduction target of 12.5 by 2010 and have
  increased waste by 20,000 tonnes since last year.
  Recycling, however, has risen by 8 across the
  government estate

20
Sustainable Development - questions

• What role should govt adopt in promoting more
  environmentally friendly business practice?
• What policies are open to govt? How effective are
  each of these measures?
• What is alternative to govt. action

21
Sustainable Development

• To what extent does greater investment in nuclear
  power represent a sensible environmental policy?
• Does your view change if consider this from
  either an anthropocentric or eco-centric
  perspective?

22
Sustainable Development

• Economic case for different types of energy
  policies nuclear, gas, oil, wind power, solar
  etc
• Environmental case?
• Social case?
• Technological issues?

23
3) European Union

• See lecture notes, tutorial notes and assignment
  brief for indicative readings
• Carry out further research to update with latest
  articles, statistics, and trends

24
European Union - recent events

• The European Union recently marked its 50th
  birthday having spectacularly exceeded goals set
  by its six founding nations but facing a crisis
  of confidence due to a failed constitution and
  doubts over further enlargement.

25
European Union

• The now 27-member EU with almost 500 million
  people was created as the European Economic
  Community (EEC) under the Treaty of Rome by
  Belgium, France, Italy, Luxembourg, the
  Netherlands and West Germany on March 25, 1957

26
European Union

• "The European unification idea came from the
  realisation that Europe's nation-states would -
  if left on their own - never break out of the
  vicious circle of war and destruction," said
  German Chancellor Angela Merkel in a recent
  speech at the Munich Security Conference

27
European Union

• What is purpose of single market?
• Has EU been successful or not? Justify your
  answer.
• Is there evidence that single market is moving
  towards a more mature status?
• Evidence?

28
European Union

• There appears to be increased migration of
  workers within the EU.
• Evidence?
• Is this a good thing or not?
• Theory?

29
European Union

• Look at issues relating to competition policy
• Advantages disadvantages of the policy
• Is it encouraging more cross border takeovers?
• Evidence?
• Are these takeovers generally successful?

30
4) Single Currency

• See lecture notes, tutorial notes and assignment
  brief for indicative readings
• Carry out further research to update with latest
  articles, statistics, and trends

31
4) Single Currency

• Another landmark agreement was the creation of
  the euro single currency in 2002. So far 13 EU
  states have replaced their old national
  currencies with the euro .

32
4) Single Currency

• What is the economic case for and against the
  Euro?
• What are the advantages to business?
• What are the disadvantages?

33
4) Single Currency

• What is the social case for the Euro?
• For and against?
• What are the key political considerations?

34
4) Single Currency

• Why have Denmark, Sweden and UK chosen to remain
  outside the single currency?
• Is it inevitable that they will join soon?

35
5) Management Consultants

• See lecture notes, tutorial notes and assignment
  brief for indicative readings
• Carry out further research to update with latest
  articles, statistics, and trends

36
Management Consultants

• Total fee income for the top consultancy firms in
  UK grew by 455m last year, a 9.6 rise. Growth
  in the previous financial year had hit nearly14,
  adding 574m to total fee income.

37
Management Consultancy

• Management Consultancy emerged as a separate
  profession in the US following the radical
  reshaping of financial regulations in the 1930s.
• Prior to that, the few firms offering what we
  would today consider to be consulting advice
  served primarily as bankers, cost accountants and
  engineers.

38
Management Consultants - questions

• McKenna (2006) explicitly links the recent
  international business scandals, such as Enron,
  to the growth in management consultancy. In
  particular, he is critical of the consulting
  industrys lack of professional standards.
• Is this a valid criticism?

39
Management Consultants

• Has the increased use of management consultants
  has led to a fall in the ethical standards and
  behaviour of large corporations around the world?
• What examples evidence do you have?

40
Management Consultants

• Why do companies employ consultants?
• Can the benefits of consultancy be easily
  identified and quantified?
• What are the issues involved in deciding whether
  to employ consultants or not?

41
6) Chinese Economy

• See lecture notes, tutorial notes and assignment
  brief for indicative readings
• Carry out further research to update with latest
  articles, statistics, and trends

42
China

• Do you understand nature of Chinese economy a
  combination of govt. central control (a planned
  economy) and free market.

43
China

• How does the Hybrid market system above compare
  to UK?
• Is the Chinese economic system sustainable in
  present form? Does it challenge USA economists
  notion of the efficiency and efficacy of the free
  market?

44
China

• Is it reasonable for EU USA to impose tariffs
  on Chinese imports?
• Examples?
• Theory?
• Do tariffs protect western industries against
  unfair Chinese competition or are they simply a
  crude attempt to prop up uncompetitive
  manufacturing in the West?

45
China

• What rights and responsibilities does China have
  as a member of WTO?
• To what extent does China subsidise its exports?
• Direct measures eg tax relief and subsidies etc
• Indirect measure keeping currency value low etc

46
China

• Is there danger of the Chinese economy
  overheating?
• What measures, if any could western governments
  employ to counter Chinese competition?
• To what extent would these measures be either
  harmful or beneficial to China?

47
7) Knowledge economy

• See lecture notes, tutorial notes and assignment
  brief for indicative readings
• Carry out further research to update with latest
  articles, statistics, and trends

48
Knowledge economy

• What do we mean by knowledge economy?
• How important is the concept of knowledge economy
  to the future prosperity of the UK

49
Knowledge economy

• How is knowledge created?
• To what extent are knowledge flows
  multidirectional?
• To what extent are firms willing to invest in
  training and skilling of their workforce?

50
Knowledge Management

• What are the barriers or disincentives that stop
  firms investing in knowledge management, and
  building the knowledge base of their workforce?
• How might government encourage employers to do
  more in this respect?

51
Knowledge Management

• What role do Universities play in increasing
  knowledge in society.
• To what extent should employers and universities
  work together to improve the knowledge base of
  the UK?

52
Conclusion

• These notes are guidelines only. Make sure you
  read the actual questions on the exam paper
  carefully.
• Good luck you can contact me by email
  mkcor_at_dmu.ac.uk for some further general advice
  over the summer.
• Martyn