Management

Part I: Introduction
Ch. 4. Social responsibility and
ethics

Dan Lungescu, PhD, assistant professor

Irina Salan, PhD, assistant professor
2014-2015

Course outline
Management
Part I: Introduction
Part II: Planning
Part III: Organizing
Part IV: Leading
Part V: Controlling

Part I outline
Management
Part I: Introduction
Ch. 1. Managers job
Ch. 2. The evolution of management
Ch. 3. Organizational environments
Ch. 4. Social responsibility and ethics

Learning objectives
After studying this chapter, you should be able to:
Explain the three major perspectives on corporate social
responsibility.
Identify the six major stakeholder groups frequently
mentioned in conjunction with social responsibility.
Outline approaches that can be used to monitor social
demands and expectations.
Describe internal social response mechanisms available to
organizations.
Contrast the three major types of managerial ethics.
Outline ethical guidelines for managers and explain actions
managers can take to handle ethical situations and avoid
ethical conflicts.

Chapter 4 outline

A. Organizational social responsibility

B. Organizational social responsiveness
C. Being an ethical manager

A. Organizational social responsibility

Organizational social responsibility
The obligation of an organization to seek actions that protect and
improve the welfare of society along with its own interests.

Corporate social responsibility

A term often used in reference to the concept of organizational
social responsibility as applied to business organizations.

Outline A. Organizational social responsibility

Major perspectives on OSR

Invisible hand
A view that holds that the entire social responsibility of a
corporation can be summed up as make profits and obey the law.

Hand of government
A view that argues that the interests of society are best served by
having the regulatory hands of the law and the political process,
rather than the invisible hand, guide the results of corporations
endeavors.

Hand of management
A view that states that corporations and their managers are
expected to act in ways that protect and improve the welfare of
society as a whole as well as advance corporate economic interests.
Outline A. Organizational social responsibility Major perspectives on OSR

Arguments in favor of OSR

Antifreeloader argument
Since business benefit from a better society, they should bear part of the
costs by actively working to bring about solutions to social problems.

Capacity argument
The private sector, because of its considerable economic and human
resources, must make up for recent government cutbacks in social
programs.

Enlightened self-interest argument

Businesses exist at societys pleasure and, for their legitimacy and survival,
businesses should meet the expectations of the public regarding social
responsibility iron law of responsibility:

In the long run, those who do not use power in a manner that
society considers responsible will tend to lose it.
Outline A. Organizational social responsibility Arguments in favor of OSR

Social responsibilities of management

Economic responsibilities
Making a profit.

Legal responsibilities
Obeying the law.

Ethical responsibilities

Discretionary resp.
Ethical
responsibilities
Legal
responsibilities

Behaviors and activities that are expected of

business by societys members.

Discretionary responsibilities
Voluntary beneficial activities that are not
strongly expected of business by societys
members.

Economic
responsibilities

Outline A. Organizational social responsibility Social responsibilities of management

Social stakeholders
Shareholders
Employees
Customers
Local community
Society
International community
Outline A. Organizational social responsibility Social stakeholders

B. Organizational social responsiveness

Organizational social responsiveness
A term that refers to the development of organizational decision
processes whereby managers anticipate, respond to, and manage
areas of social responsibility.

Corporate social responsiveness

A term used in reference to the concept of organizational social
responsiveness as applied to business organizations.

Outline B. Organizational social responsiveness

Monitoring social demands and expectations

Social forecasting
The systematic process of identifying social trends, evaluating the
organizational importance of those trends, and integrating these
assessments into the organizations forecasting program.
Futurists: individuals who track significant trends in the
environment and attempt to predict their impact on the
organization.

Opinion surveys
Surveys of public opinion on various issues of social concern.

Social audit
A systematic study and evaluation of the social, rather than the
economic, performance of an organization.
Outline B. Social responsiveness Monitoring social demands and expectations

Monitoring social demands & expectations (2)

Issues management
The process of identifying a relatively small number of emerging
social issues of particular relevance to the organization, analyzing
their potential impact, and preparing an effective response.

Social scanning
The general surveillance of various elements in the task
environment to detect evidence of impending changes that will
affect the organization's social responsibilities.

Outline B. Social responsiveness Monitoring social demands and expectations (2)

Internal social response mechanisms

Individual executives
Temporary task forces
Permanent committees
Permanent departments
Combination approaches

Outline B. Social responsiveness Internal social response mechanisms

C. Being an ethical manager

Managerial ethics
Standards of conduct and moral judgment used by managers or
organizations in carrying out their business.

Moral management
An approach that strives to follow ethical principles and precepts.

Amoral management
An approach that is neither immoral nor moral but, rather, ignores
or is oblivious to ethical considerations.

Immoral management
An approach that not only lacks ethical principles but is actively
opposed to ethical behavior.
Outline C. Being an ethical manager

Ethical guidelines for managers

Obey the law
Tell the truth
Show respect for people
Stick to the Golden Rule: do unto others as you would have
others do unto you
Above all, do not harm
Practice participation, not paternalism
Always act when you have responsibility
Outline C. Being an ethical manager Ethical guidelines for managers