MEANING AND SCOPE OF SOCIAL
RESPONSIBILITY
Introduction
1. What are the responsibilities of business
organizations?
2. How many of these responsibilities must managers
fulfill?
MEANING AND SCOPE OF SOCIAL
RESPONSIBILITY
Approaches to social responsibility- Several views
have been developed of the responsibilities of business
e.g.
 Milton Friedman,
 Archie Caroll, and
 Andrew Carnegie.
MEANING AND SCOPE OF SOCIAL
RESPONSIBILITY
 Friedman is of the view that the social responsibility of
business is to increase profit within the requirements
of the law.
If a business person acts “responsibly” by cutting the
price of the firm’s produce to prevent inflation, by
making expenditures to reduce pollution, or by hiring
the hard-core unemployed, that person is spending
the shareholders’ money for a general interest.
MEANING AND SCOPE OF SOCIAL
RESPONSIBILITY
 Archie Carroll is of the view that managers of business
organisation have four responsibilities:
 economic,
 legal,
 ethical, and
 discretionary.
MEANING AND SCOPE OF SOCIAL
RESPONSIBILITY
 Economic responsibilities are to produce goods and
services of value to society so that the firm can repay
its creditors and stockholders.
 Legal responsibilities are defined by government in
laws that are expected to be obeyed
MEANING AND SCOPE OF SOCIAL
RESPONSIBILITY
 Ethical responsibilities are to follow the generally held
beliefs about how one should act in society.
 Discretionary responsibilities are the purely
voluntary obligations a corporation assumes, i.e.
philanthropic contributions. The difference between
ethical and discretionary responsibilities is that few
people expect an organisations to fulfil ethical ones.
MEANING AND SCOPE OF SOCIAL
RESPONSIBILITY
 Andrew Carnegie, the founder of US Steel
Corporation, views corporations’ social responsibilities
on two main principles: The Charity Principle and
The Stewardship Principle.
 1. The charity principle require the more fortunate
members of society to assist its less fortunate
members, including the unemployed, the
handicapped, the sick and the elderly.
MEANING AND SCOPE OF SOCIAL
RESPONSIBILITY
 The stewardship principle required businesses and
wealthy individuals to view themselves as the
stewards, or caretakers, of their property. Carnegie
holds the idea that the rich hold their money “in trust”
for the rest of society and can use it for any purpose
that society deems legitimate.
DEFINITIONS OF CORPORATE
SOCIAL RESPONSIBILITY ( CSR)
 Forstater et al. (2002) define CSR as:
“ a company’s actions that contributes to sustainable
development through the company’s core business
activities, social investment and public policy debate.”
DEFINITION OF CSR (CON’T)
 McWilliams and Siegel (2001) define CSR as: “actions
that appear to further some social good beyond the
interest of the firm and which are required by law.”
DEFINITION OF CSR (CON’T)
 Corporate social responsibility may be defined in this
course as:
“ A business strategy which involves a business
identifying its stakeholder groups, and going beyond
its legal obligations to incorporate their needs and
values into the day-to-day decisions and activities of
the organisation”.
KEY CONCEPTS
Some key words appear in these definitions:
 Stakeholder
 Concerns/ needs
 Voluntary
THE PRICNCIPLES OF CSR
 Effects of organisations’ activities on society
As a result of these effects, three principles form the
justification for CSR engagements by firms:
1. Sustainability
2. Accountability
3. Transparency
PRINCIPLES OF CSR
Sustainability
 Sustainability implies that society must at all times use
no more of its resources than can be generated. It is
concerned with how the actions of the present have
recurring effects upon the opportunities of the future.
PRINCIPLES OF CSR (CON’T)
Accountability
 Here an organisation must recognise that its actions
generally affect the external environment and
therefore assume responsibility for the effects of its
actions.
PRINCIPLES OF CSR
 Transparency
 Transparency, in principle, means that all acts are
obvious or communicated to all concerned. As a
principle of CSR, transparency indicates that
organisations make clear all reports of their actions
and that those reports, whether in facts or figures, give
accurate and detailed information of the relevant
information.
CRITICISMS /ARGUMENTS AGAINST
CSR
 Friedman (1962) argues that the only social
responsibility of business is to make profit within the
law. Some arguments against CSR are based on the
following issues:
 “The business of business is business.”
 Useless PR exercise
 The idea of theft
 Lack of Regulation of CSR
CRITICISMS/ARGUMENTS AGAINST
CSR
 Imposes unequal cost to organisations
CRITICISMS/ARGUMENTS FOR CSR
Arguments in favour of firm CSR engagements are
based on:
 Interdependence of firm and society
 Stakeholder interest may transcend financial benefits
 Benefits of CSR (1)Helps attract qualified staff
(2) Minimizes government intervention
ARGUMENTS FOR CSR
 Improves Corporate Image – Goodwill
 Leads to improved financial performance
PROMINENCE OF CSR
 Key drivers of CSR engagements in recent years
have been identified as:
 Sustainable development
 Globalization
 Governance ( UN, OECD, Signing of Compacts)
 Corporate sector impact
 Communications (Technological Advancement)
 Ethical consumerism
PROMINENCE OF CSR (CON’T)
 Finance (pressure from investors)
 Strategic Business Tool
 Social awareness and education
 Crises management
FORMS OF CSR ISSUES
 Areas of Social Responsibility Concerns:
 Concern for Consumers
 Are products safe and well designed?
 Are products priced fairly?
 Are advertisements clear and not deceptive?
 Are credit terms clear?
 Is adequate product information available?
 Are customers treated fairly by salespeople?
FORMS OF CSR (CON’T)
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Concern for Employees
Are employees paid fair wages?
Are employees provided safe work environment?
Are workers hired, promoted, and treated fairly without
regard to sex, race, colour, or creed?
 Are employees given special training and educational
opportunities?
 Are handicapped people given employment opportunities?
 Does the business help rehabilitate employees with
physical, mental, or emotional problems?
FORMS OF CSR
 Concern for Environment
 Is the environment adequately protected from unclean
air and water, excessive noise, and other types of
pollution?
 Are products and packages biodegradable or
recyclable?
 Are any by-products that pose a safety hazard to
society (such as nuclear waste or commercial solvents)
carefully handled and properly treated or disposed of?
FORMS OF CSR
 Concern for Society in General
 Does the firm supports minority and community
enterprises by purchasing from them or
subcontracting to them?
 Are donations made to help develop and support
education, art, health, and community development
programmes?
 Is the social impact of plant locations or relocations
considered by managers who make those decisions?
CORPORATE SOCIAL INITIATIVES
 What is corporate social initiatives?
 Kotler and Lee (2005) who defined corporate social
initiative as “ major activities undertaken by a
corporation to support social causes and to fulfill
commitments to corporate social responsibility.”
CORPORATE SOCIAL INITIATIVES
(CON’T)
 The second is from Hess et al. (2002, p. 110), who said,
social initiative in the business context is defined here
as any program, practice, or policy undertaken by a
business firm to benefit society.
CORPORATE SOCIAL INITIATIVES
(CON’T)
 Options for Doing Good
 Six major initiatives under which most social
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responsibility-related activities fall have been
identified by Kotler and Lee (2005) as:
Cause promotions
Cause-related marketing
Corporate social marketing
Corporate philanthropy
Community volunteering and
Socially responsible business practices
CORPORATE SOCIAL INITIATIVES
(CON’T)
Cause promotions
 A corporation provides funds, in-kind contributions,
or other corporate resources to increase awareness
and concern about a social cause or to support
fundraising, participation, or volunteer recruitment for
a cause. The corporation may initiate and manage the
promotion on its own; it may be a major partner in an
effort; or it may be one of several sponsors.
CORPORATE SOCIAL INITIATIVES
Cause-Related Marketing (CRM)
 Cause related marketing has been defined as the process
of formulating and implementing marketing activities that
are characterized by an offer from the firm to contribute a
specified amount to a designated cause when customers
engage in revenue-providing exchanges that satisfy
organizational and individual objectives. (Varandarajan &
Menon 1998, p. 60).
 In adopting CRM, a corporation commits to making a
contribution or donating a percentage of revenues to a
specific cause based on product sales.
CORPORATE SOCIAL INITIATIVES
(CON’T)
Corporate Social Marketing
 A corporation supports the development and/or
implementation of a behavior change campaign
intended to improve public health, safety, the
environment, or community well being. The
distinguishing feature is the behavior change focus,
which differentiates it from cause promotions that
focus on supporting awareness, fundraising, and
volunteer recruitment for a cause.
CORPORATE SOCIAL INITIATIVES
(CON’T)
Corporate Philanthropy
 A corporation makes a direct contribution to a charity
or cause, most often in the form of cash grants,
donations, and/or in kind services. This initiative is
perhaps the most traditional of all corporate social
initiatives and for many decades was approached in a
responsive, even ad hoc manner.
CORPORATE SOCIAL INITIATIVES
Community Volunteering
 A corporation supports and encourages employees,
retail partners, and/or franchise members to volunteer
their time to support local community organizations
and causes.
CORPORATE SOCIAL INITIATIVES
(CON’T)
Socially Responsible Business Practices
 A corporation adopts and conducts discretionary
business practices and investments that support social
causes to improve community well-being and protect
the environment. Initiatives may be conceived of and
implemented by the organization or they may be in
partnership with others.
CAUSE PROMOTIONS
 Differences Between Cause Promotions and other
forms of corporate social initiatives
 It differs from cause-related marketing in that
contributions and support are not tied to company
sales of specified products.
 It differs from social marketing in that the focus is not
on influencing individual behavior change. Although
cause promotion campaigns have calls to action, they
are most commonly in the areas of contributing, such
as by donating money or time or by signing petitions.
CAUSE PROMOTIONS
 It differs from philanthropy in that it involves more
from the company than simply writing a check, as
promotional campaigns will most often require
involvement in the development and distribution of
materials and participation in public relations
activities, and will include visibility for the
corporation's sponsorship.
 Although a cause promotion may include employee
volunteerism, it goes beyond this to participating as
well in the development and implementation of
promotional materials.
CAUSE PROMOTIONS (CON’T)
 Typical cause promotions
 Corporate cause promotions most commonly focus on the
following communication objectives. Cause promotion
programmes are of the following forms:
 Building awareness and concern about a cause by
presenting motivating statistics and facts; by sharing real
stories of people or organizations in need or who have
been helped by the cause.
 Persuading people to find out more about the cause by
visiting a special web site or by requesting an
informational brochure or tool kit.
CAUSE PROMOTIONS (CON’T)
 Persuading people to donate their time to help those in
need.
 Persuading people to donate money that will benefit a
cause.
 Persuading people to donate nonmonetary resources, such
as unwanted cell phones and used clothing.
 Persuading people to participate in events, such as
attending an art show featuring minority professional
photographers, participating in a fundraising walk, or
signing a petition to ban or promote a social an issue
CAUSE PROMOTIONS
 By their very nature, cause promotion activities have a
common theme of communications. They utilize publicity,
printed materials, special events, web sites, and
advertising, featuring the logo and key messages of the
company as well as those representing the cause.
CAUSE PROMOTIONS
Potential corporate benefits:
 Strengthens Brand Positioning
 Builds traffic and customer loyalty
 Creates brand preference with target markets
 Provides customers convenient ways to contribute and
participate in social causes
 Provides opportunities for employees to get involved in
something they care about
 Creates partnerships with society
 Strengthens corporate Image
CAUSE PROMOTIONS
 When should a corporate cause promotion be
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considered?
When a company has easy access to the target markets.
When the cause can be connected and sustained by a
company's products.
When the opportunity exists to contribute underutilized inkind services, such as in-house printing or corporate
expertise.
When employee involvement will support the cause and
employees get excited.
CAUSE PROMOTION
 Developing a cause promotion campaign plan:
 Identify campaign partners (if needed)
 Design a campaign plan -Develop a creative brief
 Components of creative brief:
 1. Target audiences
 2. Communication objectives: This is a statement of what
we want our target audience to know (facts, information),
believe (feel), and perhaps do (e.g., donate or volunteer for
a cause), based on exposure to our communications
CAUSE PROMOTION
 3.What benefits to promise?
 4. Openings. This refers to the times, places and situations
when the audience will be most attentive to and able to act
on the message.
 5. Positioning and requirements. This section describes
the overall desired tone for the campaign (e.g., serious
versus light hearted), as well as requirements such as the
use of corporate logos.
 6. Campaign goals e.g., desired reach and frequency
goals, number of people to sign up for the race.
CAUSE-RELATED MARKETING
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Meaning of Cause-Related Marketing (CRM)
Key features:
1. Link with product sales or transaction
2.Corporate contribution is conditional- dependent on
sales or transaction
 3. Requires a formal agreement and coordiation with
charity organisation
 4. Requires co-branding advertisements, and tracking
consumer purchases and activities.
 5. involves more promotion, especially paid advertising
CAUSE-RELATED MARKETING
 Typical corporate cause-related marketing initiatives include:
1. A specified cedi amount for each product sold
2. A percentage of the sales of a product or transaction is pledged to the charity.
3. A portion of the sale of an item, sometimes not visibly disclosed, will be donated to a
charity.
4.The company matches consumer contributions related to product-related.
5.It may be for a specific time frame or open-ended
6. The corporation may decide to set a ceiling for their contribution from sales (e.g.
Lysol contributing five cents for each product coupon redeemed, up to Gh 225,000).
7. The offer may be for a specific, designated product or for several or all products
CAUSE-RELATED MARKETING
 When should a cause-related marketing (CRM)
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initiative be considered?
Those with products that enjoy a large market or mass
market appeal.
Have well-established and wide distribution channels.
Product differentiation that offers consumers an
opportunity to contribute to a favorite charity
When increased product sales, visibility, or co-branding
with a popular cause would support corporate marketing
objectives and goals for a product or products.
CAUSE-RELATED MARKETING
 It may also be most successful in situations where a
company has an existing, ideally long-term association
with a cause or charity and then adds this initiative to the
lineup, in an integrated fashion.
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CAUSE-RELATED MARKETING
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Steps in Cause-Related Planning Process
Situational Assessment:
1.identifying the company's marketing needs
2. identifying a social issue to support: What are the major
social concerns of target markets? Of these, which one is most
closely aligned with the company's core values and has the
strongest potential for connections with products that would
support marketing objectives.
 3. potential partners are explored. How large is their
membership or donor base and what is their reputation in the
community.
CAUSE-RELATED MARKETING
 Setting Objectives
 quantifiable goals, e.g. Increase in sales, desired
fundraising levels.
 Selecting Target Audiences
1. Identify their characteristics,
2. needs, and
3. media consumption habits
 Determine the Marketing Mix (4Ps or 7Ps)
 Developing Budget
 Implementation and Evaluation Plans
CORPORATE PHILANTHROPY
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Meaning and Forms of Corporate Philanthropy
Corporate philanthropy may be defined as a direct contribution by
a corporation to a charity or cause, most often in the form of cash
grants, donations and/or in-kind services (Kotler and Lee, 2005).
Typical Philanthropic Programs
Providing cash donations
Offering grants
Awarding Scholarships
Donating products
Donating services
Providing technical expertise
Offering the use of equipment
CORPORATE PHILANTHROPY
 Benefits of Corporate Philanthropy:
 Reputation as Corporate Citizen
 Reputation for Consumer Centricity
 Reputation as an Ethical Organisation
 Building and Securing a Strong Brand Position
 Strengthening the Corporation's Industry
CORPORATE PHILANTHROPY
 Potential Concerns of Philanthropic Programmes:
 Selecting the Social Cause- Reputation of charity
organisation
 Implementing Corporate Philanthropic PorgrammeMonotoring the use of donations for intended purpose.
Difficulty in quantifying donations that are in kind.
CORPORATE PHILANTHROPY
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 Key Success Factors (KSFs) of Corporate Philanthropy:
 Align corporate giving with business activities.
 Clarify the role of officers and directors
 Establish standards of independent for board
members
 Measure financial and social performance.
 Communicate Results
 Celebrate Success
CORPORATE PHILANTHROPY
 Developing Philanthropic Endeavors
 The process begins with reference to already established
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philanthropic priorities, those that have been chosen by the
company as areas of focus based on a variety of factors
including business goals, employee passions, and Customer
concerns.
Determining levels of contributions
Developing a communication plan
establish monitoring and evaluation system to keep track of
total cash contributions, estimate the value of any service, and,
provide feedback on programmes and impacts on society.
Design tracking and measurement tools.
COMMUNITY VOLUNTEERING
 Meaning of Community Volunteering
 Community volunteering is an initiative in which the
corporation supports and encourages employees, retail
partners, and/or franchise members to volunteer their time
to support local community organizations and causes
Kotler and Lee (2005).
 Volunteer efforts may include employees volunteering their
expertise, talents; ideas, and/or physical labor. Corporate
support may involve providing paid time off from work,
matching services to help employees find opportunities of
interest, recognition for service, and organizing teams to
support specific causes the corporation has targeted.
Typical Community Volunteering
Programmes
 Corporate support for employee volunteering ranges
from programs that simply encourage their
employees to give back to their communities to those
representing a significant financial investment and
display of recognition and reward. Examples
representing types of support include the following:
 Promoting the ethics through corporate
communications that encourage employees to
volunteer in their community and that may provide
information on resources to access in order to explore
volunteer opportunities.
Typical Community Volunteering
Programmes
 Suggesting specific causes and charity that the employee
might want to consider and providing detailed information
on how to get involved, often with causes and charities
supported by other current social initiatives.
 Organizing volunteer teams for a specific cause or event,
such as blood donations to a hospital, breast cancer
screening.
 Providing paid time off during the year to do volunteer
work with typical benefits ranging from offering two to five
days of annual paid leave to do volunteer work on company
time, to more vigorous programs that provide
opportunities for an employee to spend a year on behalf of
the company working in developing country.
Typical Community Volunteering
Programmes
 Awarding cash grants to charities where employees spend
time volunteering; grant amounts are then often based on
numbers of hours reported by employees.
 Recognizing exemplary employee volunteers through
gestures such as mentions in internal newsletters, awards
of service pins or plaques, and special presentations at
department or annual company meetings.
NB: Types of projects that employees volunteer in range from
those that contribute to a local community to ones that
improve health and safety for individuals, to those that
protect the environment
Potential Benefits of Community
Volunteering
 This initiative creates a win-win-win situation for employees,
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society and the organization.
Employees Benefits
It provides unique opportunity for employees to contribute
directly to society in areas of social concern they are personally
interested in.
It gives relief to employees from the pressure of their normal
working routine, which may be a form of stress relief.
Increasing employee satisfaction and motivation. A company's
reputation for community involvement, including support for
employees to volunteer for causes, can influence their morale, as
well as their choices about where they work.
 Organisational Benefits
 Building genuine relationships in the community
 Contributing to business goals
 Enhancing Corporate Image
 Providing opportunities to showcase products and
services
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Potential Concerns
 Specific Nature of Concerns
 This can get expensive.
 With so many employees, efforts may get spread over
so many issues that we don't really make a social
impact.
 Similarly, when efforts among employees are dispersed
throughout the market, even the globe, how do we
realize business benefits for company as well
 Being able to track efforts and outcomes for this
initiative can be the most difficult of all.
Key Success Factors (KSFs) of
Community Volunteering Projects
 The following factors are useful to serve as a guide:
 When selecting a social issue:
 Choose issues and organizations that are relevant to
the lives of the company’s employees
 Conduct due diligence, learn from history but always
innovate. It is critical to learn from past efforts by
companies and foundations.
 Support causes and projects that improve the social
and economic environment in the locations where the
company has its physical facilities.
KSFs of Community Volunteering
Projects
 Ensure that the projects, issues and organizations
supported reflect the values of the company and have
the support of senior leadership involvement,
including the CEO and chairman of the board.
KSFs of Community Volunteering
Projects
 When developing the programme plan
 Engage employees throughout the company in the effort-
employees at the top, middle, and bottom.
 Develop partnership between Community Affairs and
brand the managers
 Collaborate with community organizations that are behind
the most innovative responses to the social issue.
 Make sure there is a connection between the effort and the
core of the company. In our case we endeavored to connect
our employees to programmes they were already broadly
aware of, had significant interest in, and were able to
partner with.
KSFs of Community Volunteering
Projects
 When implementing the programme
 Stay committed to the issue for an extended period of
time instead of jumping around between different
causes. Positive change takes time, requiring a longterm investment. Be patient, many of the benefits of
supporting worthy causes are not immediately evident.
 Make sure you don't compromise the content of what
you do. Keep your eye on the most valued customer,
which must be the community in which you are
engaged. Provide your employees with the tools and
resources they need to be successful,
 Include promotional strategies. To reach employees and
the community you are serving, you must publicize your
programs both internally and externally and capitalize on
efforts to recognize and share employee contributions and
effective practices whenever possible. However, let the
organization or community receiving support from the
company tell the story of the company’s involvement.
 Develop and implement measurement systems.
Independent process and outcome evaluations must be in
place to determine what is working and what is not, and
the type of resource investments that will help you to be
successful.
When is Community Volunteering
Ideal?
 When current social initiatives would benefit from a
volunteer component.
 When a group of employees express an interest in a
specific cause that has strong connections with business
and corporate citizenship goals
 When a community need emerges, especially an
unexpected one that is a good match for the resources and
skills of a workforce.
 When technological advances make it easier to match
employees to
volunteer, opportunities.
 When a strong community organization approaches a
business for support, represents an issue of interest to
employees, and has a natural connection to strategic
corporate citizenship and business goals.
 When a volunteer effort might open new markets or
provide opportunities for new product development and
research.
Community Volunteering
Programme Development Process
 Develop guidelines for employee involvement.
 Determine types and levels of employee support.
 Develop an internal communications plan.
 Develop a recognition plan.
 Develop an external communications plan.
 Develop a plan for tracking and assessment.
THE PHILOSOPHY OF CORPORATE ETHICS
 What is Ethics?
 Brady (1986) refers to ethics as “those standards or
morals a person sets for himself or herself regarding
what is good and bad or right and wrong”.
 Ethics is defined as “.... an individual’s personal beliefs
regarding what is right and wrong or good or bad”.
 Distinguish ethics from involuntary actions- carefully
reasoned out actions.
 The need for ethical behaviour has resulted in code of
ethics for various occupations e.g teachers, doctors etc.
The Origins of Ethics
 Religious Doctrines
 Law
 Science
 Study of Society
 Power of Authority
Arguments underpinning ethics
 Deontological Ethics
 According to deontologists (those who argue from this
stand), certain actions are right or wrong in
themselves- these we are aware of without being told;
thus making legitimate the claim that there is an
underlying innate code of ethics that must be obeyed
or upheld.
 The problems with this positions are concerned with
how we know which acts are wrong and how we
distinguish between a wrong act and an omission.
Arguments underpinning ethics
 Teleological Ethics
 Teleologists, however argue that what determines a
good act, is the outcome of that act. Therefore if the
outcome is good then the act is deemed as good. It
distinguishes between ‘the right’ and ‘the good’, with
‘the right’ encompassing those actions which
maximize ‘the good’. It is like the expression, ‘The end
justifies the means’.
Arguments underpinning
ethtics
 Utilitarianism
 Utilitarianism, similar to teleologists, posits that
outcomes are all that matter in determining what is
good and that the way in which a society achieves its
ultimate good is through each person pursuing his/her
own self interest. The philosophy states that the
aggregation of all these self interests will automatically
lead to the maximum good for society at large.
Ethical relativism and
objectivism
 Relativism is the denial that there are certain universal
truths or moral principles. Two forms exist:
 ‘Conventionalism’, which argues that a given set of
ethics or moral principles which define what is moral
behaviour and ethical standards are set, not absolutely,
but according to the dictates of a given society at a
given time and are only valid within a given culture at a
particular time
 ‘Subjectivism’, that sees individual choice as the key
determinant of the validity of moral principles.
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conventionalism
 Difficulty with conventionalism are:
 Ethical standards change over time within one society
and vary from one society to another.
 There exist several ethical codes belonging to several
other bodies within any one society, as such what
determines which ones one must conform to. This
results in conflict with standards of society.
Conventionalism
 Tendency to behave differently at different times and
when we are with different groups of people.
 Objectivism on the other hand is in direct opposition
to ethical relativism and holds the view that although
moral principles may differ between cultures, some
moral principles have universal validity whether or not
they are universally recognized. There are two key
variants of ethical objectivism: ‘strong’ and ‘weak’.
Objectivism
 Strong objectivism hold the view that certain actions
that are intrinsically, universally and unconditionally
unethical.
 Weak objectivism however holds the view that certain
actions may have wide application but are intrinsically,
universally and unconditionally unethical.
Ethics and Business
 Need for business managers to achieve organisational
objectives while being ethical.
 For example, one classic study of business ethics
reported that at some point in their careers 75% of the
responding managers felt a conflict between profit and
considerations of being ethical (Baumhart, 1961). Later
studies noted that the majority of managers also felt
that this pressure to be unethical (Steven et al., 1977).
Forms of unethical practices
 Manufacture of wholesome products
 Illegal Business Practices
 Method of Management (e.g. Organised criminal
management Enron).
 Business and Sex
Understanding ethics as a
practice
 Consequently, several ethical maxims are used as the
theoretical foundation for a variety of industry
statements on ethics. Typical of the more simplistic
maxims are:
 The utilitarian principle- Act in a way that results in
the greatest good for the greatest number.
 The professional ethics- Take only actions that would
be viewed as proper by a disinterested panel of
professional colleagues.
Ethical maxims
 The golden rule – Act in the way you would expect
others to act towards you.
 Kant’s categorical imperative- Act in such a way that
the action taken under the circumstances could be a
universal law or rule of behaviour.
 The TV test – A manager should always ask, ‘Would I
feel comfortable explaining to a national TV audience
why I took this action?
Management of human
resource and ethics
 Building an Ethical Foundation for the Employer-
Employee Relationship
 Despite the common corporate mantra that “people
are our greatest asset,” many workers feel
unappreciated or underutilized (or both) in their jobs,
and many managers tend to view their employees as
their job titles rather than as individuals.
 There are four elements of employer-employee
relationship critical to the creating an ethical
workplace environment:
 Fairness: Employees at every level should be held to
the same standards of conduct. If high performers are
allowed to get away with unethical behaviour, other
employees’ morale and thus productivity and ethical
standards will suffer.
 Communication: Most companies are pretty good at
sharing information from the top down. But the
companies with the best workplace environment also
allow communication to flow from the bottom up.
Top management cannot fix a problem if they are not
aware of it, and employees are the most likely sources
of information about problems that can affect a
company’s health.
 Respect: Employees deserve consideration as
individuals rather than simply as cogs in the company
machine. Recognizing individuals’ talents, skills, and
goals helps develop employees into even more valuable
members of the organization, which, in turn, helps a
company thrive.
 Trust: Many mangers cling to the notion that people
do not like to work and will goof off at any opportunity.
Yet various studies have shown that employees who
telecommute tend to work more hours (an average of
58 hours per week, compared to the standard 40 inoffice hours) and are more productive than their
cubicle-bound counterparts. Certainly, companies will
always have some employees who require more
supervision than others.
Discrimination
 Discrimination is the act of treating someone
differently – typically by restricting or excluding the
person from opportunities that are available to others
– solely because of that person’s membership in a
certain class or category of people.
 Discrimination almost always involves stereotyping, or
making assumptions about an individual based on
perceptions about the individual’s class or category as a
whole. (E.g. Men stereotyped as rational, robust and
strong; Women stereotyped as emotional and weak).
Common Types of
Discrimination
 Ageism is discrimination against a person or a group
of people based on assumptions about age-related
limitations. Both young and old- experience, strength,
 Disability discrimination: Unfair treatment based
on physical or mental disabilities also is ethically
unsound. Employees with genuine disabilities,
whether they are temporary or permanent, often
appreciate managers’ efforts to make life a little easier
for them.
 Gender discrimination: Gender discrimination
usually (but not always) involves less favourable
treatment of women in the workplace. Women may
receive lower wages for the same work that men
perform, for example, or they may be passed over for
promotion to senior or executive-level positions.
 Men can be subjected to gender discrimination, too.
Employers may deny men’s requests for time off to
attend to family matters like doctor’s appointments or
school activities, for example, while routinely granting
such requests from female workers.
 Racial and ethnic discrimination: Racial and ethnic
discrimination most often refers to unfair treatment
from an employer, such as refusing to hire a Ghanaian
to certain jobs in the country or paying them lower
wages even if they have the same qualifications and
experience as an expatriate. This is often the case for
the Black Stars coaching job.
 Religious discrimination: Religious discrimination
refers to treating people differently because of their
religious beliefs and practices.
 Do businesses have to provide paid time off to allow
certain employees to pray several times a day?
Ensuring Employee Safety
 Businesses have a legal and moral obligation to
provide safe work environments for their employees
and produce safe goods and services for their
customers.
 The price for neglecting safety can include:
 Civil fines for violating safety laws and regulations
 Criminal charges and penalties for negligence and
other behavior that meets the threshold for criminality
 Judgments and awards to victims and their families
 Increased regulations or government supervision of
operations
 Expenses for implementing mandated safety or
remedial measures
 Consumer boycotts of products and services
 Loss of trust among customers, stockholders,
employees, and potential investors
 Bankruptcy