Copyright 2013 The McGraw-Hill Companies, Inc. All rights reserved.

Chapter 4
Corporate
Social
Responsibility
Copyright 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
4-2
Corporate Social Responsibility
Actions of an organization that are targeted
towards the achievement of a social benefit
over and above maximizing profits for its
shareholders and meeting all its legal
obligations
4-3
Management without Conscience
Instrumental approach: Perspective that the
only obligation of a corporation is to maximize
profits for its shareholders in providing goods
and services that meet the needs of their
customers
Social contract approach: Perspective that a
corporation has an obligation to society over
and above the expectations of its shareholders
4-4
Management by Inclusion
Actions of corporations impact:
Customers
Employees
Suppliers
Communities
Impacts
Positive
Negative
4-5
Management by Inclusion
Going beyond generating profit attracts a lot of
attention
Alcohol manufacturers have a long-term
perspective and spread awareness about
drinking responsibly
4-6
The Driving Forces Behind CSR
Transparency Knowledge
Sustainability Globalization
The Failure of
the Public Sector
4-7
The Driving Forces Behind CSR
Corporations that choose CSR run the risk of
creating adverse results
Employees feel that they are working for an
insincere organization
Public sees little more than a token action
concerned with publicity rather than
community
Organization does not perceive much benefit
from CSR and so sees no need to develop the
concept

4-8
Types of CSR
Organizations pursue a defined sense of social conscience in managing
financial responsibilities to shareholders, legal responsibilities to local
community and society as a whole, and ethical responsibilities to do
the right thing for all their stakeholders
Ethical CSR
Organizations take a philanthropic approach by underwriting specific
initiatives to give back to the companys local community or to
designated national or international programs
Philanthropic initiatives are authorized without concern for the
corporations overall profitability
Altruistic CSR
Philanthropic activities targeted towards programs that will generate
the most positive publicity for the organization, but runs the risk of
being perceived as self-serving behavior on the part of the
organization
Strategic CSR
4-9
Carbon Footprint
Total carbon dioxide emissions on an annual
basis
Carbon neutral - Way to off set damage being
done to the environment through greenhouse
gas emissions by purchasing credits from
carbon-positive projects
Kyoto Protocol - Requires developed nations to
reduce their greenhouse gas emissions by
funding projects in developing countries in
return for carbon credits