What is “Global Corporate Social

Responsibility”?
 Questions to consider:
– Do you care where a product is made?
– Do you care how the workers are treated that make a
product?
– Would you pay more for a product if the company that
produces it uses green energy? How much more?
– If a business has a fire that spreads to the whole city block,
and it’s not the businesses fault, do you think the business
should do anything to help those affected by the fire? Would
you stop using that business’ products if it did not? Would
you start using that business’ products if it did? What if the
fire started at the business, should it help the community?
 What is meant by “Global”?
• Aspects of business take place around the world and
have a transnational impact
– Production [different parts of a car produced in different
places]
– Labor [labor can be imported from anywhere, not just local]
– Financial system operates globally [businesses sell in different
places, making taxes difficult]
– International influence [businesses can influence change in
national/state governments
– Global system governance [need global organizations, such as
the UN/WTO/World Bank to regulate/adjudicate trade issues
 What is meant by “Corporate”?
• Corporation= a firm/business that has a legal
existence & is separate and distinct from its
owners
• Corporations are owned by
stockholders/shareholders who share in
profits/losses generated by the firm
 Corporate Cont.
• Corporations have 3 distinct characteristics:
– 1) Legal existence (similar to a person) – firms can
buy/sell/own/make a contract/sue/be sued – all of this is
just like a person
– 2) Limited liability – a firm and its owners are limited in
their liability to creditors/others in that they are liable
only up to the resources of the firm – not the owner’s
personal wealth
– 3) Continuity of existence – a firm can live beyond the life
spans of its owners because ownership can be
transferred by sale/gift of shares
 What is meant by “Social”?
• Of or relating to human society
• The interaction of the individual and the group
or the welfare of human beings as members of
society
What is meant by “Responsibility”?
• Liable to be called on to account as the primary
cause, motive, or agent
– If you take responsibility for your own actions, you
show accountability
• Examples of accountability:
– A government is accountable for the laws/decisions that affect
citizens
– A person has accountability for his/her actions and behaviors
 What is meant by “Global
Corporate Social Responsibility”?
• A business approach to improve society in some way
• Contributing to sustainable development by
delivering economic and/or social and/or
environmental benefits for all stakeholders (though
not necessarily sharing these benefits equally and not
necessarily doing all 3)
• Implementing this approach across the business,
which moves products and has reach across the world
and recognizes that business affects a variety of
people in different ways
5 Areas of Corporate Responsibility
– Environmental dimension (natural, clean/cleaner/concern
for it)
– Social dimension (contribution to society and integrating
social concerns into the business, also the community
impact of business)
– Economic dimension (contribution to the economic
development of the area)
– Stakeholder dimension (how a business interacts with
employees/suppliers/customers/communities)
– Voluntariness dimension (actions a business takes based
on ethics, what it does beyond legal requirements)
 What is “Capitalism”
– Private individuals/corporations own the means of
production (land/factories/machinery/natural
resources) required to manufacture and produce
goods
– These private individuals derive income from
ownership (of the means of production) by using
wealth to create more wealth
– Basic drive in this society=pursuit of profit
 What is “Capitalism” Cont.
– Capitalist corporations have owners (shareholders) who
exercise a level of control over the company depending on how
many shares they own & they receive a share of profits in
return for investment
– Workers sell their labor to the corporation for a wage, meaning
that in a capitalist system labor is a commodity just like
anything else (table/computer). In this system, some workers
make a lot and some make a little depending on their value
– Capitalism requires a free market economy where goods are
bought/sold according to the laws of supply and demand – so
they need a political system that supports this goal, i.e. one in
favor of free trade