Stakeholder Relationships,Social Responsibility, andCorporate Governance
C H A P T E R 2
Chapter Objectives
•To identify stakeholders’ roles in business ethics
•To define social responsibility
•To examine the relationship between stakeholderorientation and social responsibility
•To delineate a stakeholder orientation in creatingcorporate social responsibility
•To explore the role of corporate governance instructuring ethics and social responsibility in business
•To list the steps involved in implementing astakeholder perspective in social responsibility andbusiness ethics
Chapter Outline
•Stakeholders Define Ethical Issues in Business
•Social Responsibility and the Importance of aStakeholder Orientation
•Social Responsibility and Ethics
•Corporate Governance Provides FormalizedResponsibility to Stakeholders
•Implementing a Stakeholder Perspective
Relationships and Business
•Building relationships is one of most important areasin business today
•Stakeholder framework
–Helps identify internal and external stakeholders
–Helps monitor and respond to needs, values, andexpectations of stakeholder groups
What Is a Stakeholder?
•Customers
•Investors
•Employees
•Suppliers
•Government agencies
•Communities
Primary vs. Secondary Stakeholders
•Primary stakeholders: Those whose continuedassociation is necessary for a firm’s survival
•Secondary stakeholders: Are not essential to acompany’s survival
Social Responsibility and Ethics
•Social responsibility can be viewed as a contractwith society
–Economic
–Legal
–Ethical
–Philanthropic
•Business ethics involves carefully thought-outrules (heuristics) of conduct that guide decisionmaking
Corporate Governance
•Accountability
•Oversight
•Control
•Shareholder model
•Stakeholder model
Implementing a StakeholderPerspective
1.Assessing the corporate culture
2.Identifying stakeholder groups
3.Identifying stakeholder issues
4.Assessing organizational commitment to socialresponsibility
5.Identifying resources and determining urgency
6.Gaining stakeholder feedback