1. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-1 Chapter 1  THE BUSINESS and SOCIETY RELATIONSHIP BUSINESS & SOCIETY Ethics and Stakeholder Management Carroll & Buchholtz 6e Prepared by Deborah Baker Texas Christian University

2. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-2 Chapter 1 Learning Outcomes 1. Characterize business, society, and their interrelationships. 2. Describe pluralism and identify its attributes, strengths, and weaknesses. 3. Clarify how our pluralistic society has become a special-interest society. 4. Identify, discuss, and illustrate the factors leading up to business criticism. 5. Single out the major criticisms of business and characterize business’s general response. 6. Categorize the major themes of the book: managerial approach, ethics, and stakeholder management.

3. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-3 Chapter 1 Outline  Business and Society  Society as the Macroenvironment  Our Pluralistic Society  Our Special-Interest Society  Business Criticism and Corporate Response  Focus of the Book  Structure of the Book  Summary

4. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-4  Business criticism and scandals  Issues, such as executive compensation, abuse of corporate power, and sexual harassment  Broad societal concerns, such as the “rights” movement, discrimination, loss of jobs to foreign countries, and workplace violence The Business and Society Relationship

5. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-5 Business and society interrelate in a macroenvironment as stakeholders. Business and Society Business The collection of private,profit-oriented organizations Society A broad group of people and otherorganizations, interest groups,a community, a nation.

6. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-6 Society as the Macroenvironment Social Economic Political Technological

7. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-7 Segments of the Macroenvironment Social demographics, lifestyles, social values SegmentFocus Political interactions between firms, politics, and government Economic nature and direction of the economy Technological changes in technological advancements

8. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-8 Pluralistic Society StrengthsWeaknesses  Prevents concentration of power  Maximizes freedom of expression and action  Disperses individual allegiances  Creates diversified set of loyalties  Provides checks and balances  Pursuit of self-interest  Proliferates organizations and groups with overlapping goals  Forces conflicts to center stage  Promotes inefficiency

9. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-9 Business and Stakeholder Relationships Business CommunityGovernment Employees Consumer Owner Environmental groups General public Local State Federal Corporate raiders Private citizens Institutional Investors Consumer activists Product liability threats Unions Older employees Women and minorities Civil Liberties activists

10. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-10 Special-Interest Society Special Interests groups…  make life more complex for business  number in the tens of thousands  pursue their own limited agenda  are more active, intense, diverse and focused  attract a significant following  often work at cross purposes, with no unified set of goals http://www.goodmoney.com/directry_active.htm @

11. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-11 Social Environment, Business Criticism, and Corporate Response Factors in the Social Environment AffluenceEducationAwareness Rising ExpectationsRights Movement Entitlement Mentality Victimization Philosophy Business Criticism Increased concern for the Societal Environment A Changed Social Contract

12. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-12 Factors in the Social Environment  Affluence and education  Awareness through television  Revolution of rising expectations  Entitlement mentality  Rights movement  Victimization philosophy

13. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-13 Society’s Expectations versus Business’s Actual Social Performance Society’s Expectations of Business Performance Social Performance: Expected and Actual 1960s1990s Time Social Problem Business’s Actual Social Performance Social Problem

14. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-14 Business Criticism: Power  Use and abuse of power  Business power refers to the ability or capacity to produce an effect or to bring an influence to bear on a situation or people  Iron Law of Responsibility  In the long run, those who do not use power in a manner society considers responsible will tend to lose it

15. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-15 Levels and Spheres of Corporate Power Macro Level Intermediate Level Micro Level Individual Level Economic Social/Cultural Individual Technological Environmental Political Levels Spheres

16. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-16 Elements in the Social Contract Laws or Regulations: “Rules of the Game Two-Way Shared Understandings of Each Other Society or Societal Stakeholder Groups Business

17. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-17 Focus of the Book Managerial Approach Ethics Stakeholder Management

18. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-18 1.The Business and Society Relationship 2.Corporate Citizenship: Social Responsibility, Responsiveness and Performance 3.The Stakeholder Approach to Business, Society, and Ethics 1.The Business and Society Relationship 2.Corporate Citizenship: Social Responsibility, Responsiveness and Performance 3.The Stakeholder Approach to Business, Society, and Ethics PART ONE BUSINESS, SOCIETY, AND STAKEHOLDERS STRATEGIC MANAGEMENT FOR CORPORATE STAKEHOLDER PERFORMANCE 4.Strategic Management and Public Affairs 5.Issues Management and Crisis Management 4.Strategic Management and Public Affairs 5.Issues Management and Crisis Management PART TWO Structure and Flow of Book

19. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-19 6.Business Ethics Fundamentals 7.Personal and Organizational Ethics 8.Business Ethics and Technology 9.Ethical Issues in the Global Arena 6.Business Ethics Fundamentals 7.Personal and Organizational Ethics 8.Business Ethics and Technology 9.Ethical Issues in the Global Arena PART THREE BUSINESS ETHICS AND MANAGEMENT EXTERNAL STAKEHOLDER ISSUES 10.Business, Government and Regulation 11.Business’s Influence on Government and Public Policy 12.Consumer Stakeholders: Information Issues and Responses 13.Consumer Stakeholders: Product and Service Issues 14.The Natural Environment as Stakeholder 15.Business and Community Stakeholders 10.Business, Government and Regulation 11.Business’s Influence on Government and Public Policy 12.Consumer Stakeholders: Information Issues and Responses 13.Consumer Stakeholders: Product and Service Issues 14.The Natural Environment as Stakeholder 15.Business and Community Stakeholders PART FOUR Structure and Flow of Book

20. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-20 16. Employee Stakeholders and Workplace Issues 17. Employee Stakeholder: Privacy, Safety, and Health 18. Employment Discrimination and Affirmative Action 19. Owner Stakeholders and Corporate Governance 16. Employee Stakeholders and Workplace Issues 17. Employee Stakeholder: Privacy, Safety, and Health 18. Employment Discrimination and Affirmative Action 19. Owner Stakeholders and Corporate Governance PART FIVE INTERNAL STAKEHOLDER ISSUES CASES Structure and Flow of Book

21. Business and Society: Ethics and Stakeholder Management, 6e Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 1-21 Selected Key Terms  affluence  business  business ethics  business power  economic environment  education  entitlement mentality  ethics  Iron Law of Responsibility  macroenvironment  pluralism  political environment  revolution of rising expectations  rights movement  social contract  social environment  social problem  society  special-interest society  stakeholders  technological environment  victimization philosophy