1. Strategic Approaches to Improving Ethical Behavior
Social Responsibility and Business
FERRELL • THORNE • FERRELL
4TH EDITION
CHAPTER 6
Strategic Approaches to Improving Ethical Behavior

2. The Need for Organizational Ethics Programs
Organizations are held accountable for the conduct of their employees.
Without such programs, employees may not understand acceptable behavior.
Organizations can create unethical corporate cultures.
Pressure to succeed
Rewarding the wrong behavior
Stakeholders demand greater ethical and social responsibility.

3. Codes of Conduct
Formal statements that describe what an organization expects of its employees
Reflect the board of directors and senior management’s desire for organizational compliance
Assess key risks for the organization

4. Ethics Officers Assess organizational needs and risks
Develop and distribute the code of ethics
Conduct ethics training programs
Establish and maintain a confidential system to respond to ethics questions
Make certain the company is in compliance with government regulation
Monitor and audit ethics conduct
Take action when there is a code violation
Review and update the code

5. Ethics Training and Communication
Educates employees about the firm’s policies, expectations, relevant laws and regulations, and general social standards
Makes employees aware of available resources, support systems, and personnel who can assist with ethics and legal advice
Can empower employees

6. Establishing Systems to Monitor and Enforce Ethical Standards
Help or assistance lines
Report and request assistance with ethical concerns
Observation and feedback
Determine level of adequacy in handling ethical issues
Whistle-blowing
Exposing an employer’s wrongdoing to outsiders, such as the media or government agencies
Protection for accurate exposures

7. Leaders influence Corporate Culture
Organizational leaders use their power and influence to shape corporate culture. Power refers to the influence that leaders have over the behavior and decisions of subordinates.
Transformational vs. transactional leaders
Exerting power is one way to influence the ethical decision-making framework.

8. Five Power Bases
There are five power bases from which one person may influence another:
Reward power
Coercive power
Legitimate power
Expert power
Referent power

9. Employee Relations Social Responsibility and Business CHAPTER 7
FERRELL • THORNE • FERRELL
4TH EDITION
CHAPTER 7
Employee Relations

10. Psychological Contract
The beliefs, perceptions, expectations, and obligations that make up the agreement between individuals and the organizations that employ them
Largely unwritten
Details of the contract develop through interactions with managers and coworkers and through perceptions of the corporate culture

11. Changes in Employees’ Psychological Contract with Employers

12. Legal Responsibilities to Employees
Employment at will
Wages and benefits
Labor unions
Health and safety
Equal Opportunity Employment
Sexual Harassment
Unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature

13. Ethical Responsibilities to Employees
Training and development
Diversity
Allow for work/life balance
Assist employees in balancing work responsibilities with personal and family responsibilities
Provide flexibility
Flextime, Job sharing, Child care, Elder care, Health clubs

14. Philanthropic Activities
Corporate giving affects employee attitudes toward the organization.
Employees benefit from participating in volunteerism programs and other philanthropic projects.
Builds teamwork skills
Educates employees
Example: More than 30,000 volunteers support the Ronald McDonald House Charities, donating one million hours of service per year (Source: 11/30/09).

15. Consumer Relations Social Responsibility and Business CHAPTER 8
FERRELL • THORNE • FERRELL
4TH EDITION
CHAPTER 8
Consumer Relations

16. Consumer Economic Issues
Consumers are primary stakeholders because their awareness, purchase, use and repurchase of products is vital to a company’s existence.
Consumers and business are connected by an economic relationship.
Consumers exchange money for goods or services.
Consumers expect the products they purchase to perform as guaranteed by the sellers.
In the early 1900s “let the buyer beware” typified the power that business- not consumers- wielded in exchange relationships. This is still true in less developed parts of the world.

17. Motivations for Illegitimate Consumer Complaints

18. Additional Legal Issues and Relevant Laws
Health and safety
Pure Food and Drug Act
Credit and ownership
Home Ownership and Equity Protection Act
Marketing, advertising, and packaging
Federal Trade Commission Act
Telemarketing and Consumer Fraud and Abuse Prevention Act

19. Additional Legal Issues and Relevant Laws (cont.)
Sales and warranties
Product liability- a business’s legal responsibility for the performance of its products
Toy Safety Act
International issues
Consumerism protect consumers from an imbalance of power

20. Ethical Issues Consumer Bill of Rights Right to choose Right to safety
Right to be informed
Right to be heard
Right to seek redress
Right to privacy

21. Philanthropic Issues
Consumers are increasingly concerned with organizations’ social responsibility.
Organizations are increasingly linking philanthropic efforts with consumer interests in order to strengthen ties to consumers.
Avon—breast cancer fundraising
Home Depot—Habitat for Humanity
Eastman Kodak—World Wildlife Fund

22. Community Relations and Strategic Philanthropy
Social Responsibility and Business
FERRELL • THORNE • FERRELL
4TH EDITION
CHAPTER 9
Community Relations and Strategic Philanthropy

23. Community Stakeholders
Issues of concern include:
Pollution of the environment
Land use
Economic advantages to the region
Discrimination
Exploitation of workers and consumers
Neighbor of choice
An organization that builds and sustains trust within the community

24. Responsibilities to the Community
Economic issues
Legal issues
Ethical issues
Philanthropic issues

25. Economic Issues Business is vital to the community.
Buyer-seller interaction stimulates the economy.
Companies hire, train, and buy supplies, raw materials, utilities, advertising services, and other local goods and services.
A company’s departure or retrenchment from a community can be devastating to the local economy.
Downsizing
Plant closings

26. Legal Issues
A company must operate within legal and regulatory parameters.
Companies are granted a license to operate.
Business license
Sales tax number
Many mega-retailers have faced rejection because people believe they threaten small “mom & pop” businesses.

27. Ethical Issues
Companies may evaluate the role and impact of their decisions on communities from an ethical perspective.
Business leaders are taking greater responsibility for determining how they can assist in improving communities.
Improving public schools and education
Assisting in the development of mass transit
Supporting environmental initiatives

28. Philanthropic Issues
Historically this has meant providing support for worthy causes.
Gifts
Grants
Other resources
Volunteer programs
Employees donate time in support of social causes (volunteerism).
Communities benefit from the application of new skills and initiative toward problems; and companies develop better community relations.

29. Strategic Philanthropy
The synergistic use of an organization’s core competencies and resources to address key stakeholders’ interests and to achieve both organizational and social benefits
Goes beyond traditional benevolent philanthropy
Involves both financial and non-financial contributions to stakeholders
Involves employees, organizational resources, and expertise

30. Cause-Related Marketing
An organization’s products are tied directly to a social concern.
Percentage of sales are usually donated to a cause appealing to a relevant target market.
Overall goal is to increase product sales for a defined period of time.
Charity partners often assist in promoting the alliance (e.g., Habitat for Humanity partnered with Home Depot).
American Express pioneered this process in 1983 by donating a percentage of credit card sales to the Statue of Liberty and Ellis Island Restoration Fund.

31. Sustainability Issues
Social Responsibility and Business
FERRELL • THORNE • FERRELL
4TH EDITION
CHAPTER 11
Sustainability Issues

32. Sustainability
Sustainability is the potential for long-term well-being of the natural environment, including all biological entities, as well as the interaction among nature and individuals, organizations, and business strategies.
Sustainability includes the assessment and improvement of business strategies, economic sectors, work practices, technologies, and lifestyles while maintaining the natural environment.

33. Global Environmental Issues
Natural environment
Air, Water, Land Pollution
Global Warming
Acid Rain
Deforestation
Urban Sprawl
Waste Management
Genetically Modified Food

34. Ways to Curb Environmental Issues
DOE – Jabatan Alam Sekitar
Environmental Legislation
Alternative energy – wind, solar, hydro, biofuel, electric etc.
Recycling
Green Marketing
Emissions reduction
Socially Responsible Buying
Environmental Management – ISO 14000

35. Social Responsibility in a Global Environment
Social Responsibility and Business
FERRELL • THORNE • FERRELL
4TH EDITION
CHAPTER 12
Social Responsibility in a Global Environment

36. The Global Marketplace
The expanding global marketplace requires that executives and managers develop the ability to conduct business effectively and socially responsibly in
different regions of the world.

37. Employee Issues in Global Environment
Wages and benefits relative to home country standards
Attitudes toward employees from different genders and ethnicities, especially in executive positions
Existence of collective bargaining efforts
Laws and regulations for employee rights, health, and safety
Norms of employee volunteering
Availability and comfort with open-door policies and other management practices

38. Consumer Issues in Global Environment
Laws and regulations on product safety and liability
Presence and power of consumer rights groups
Respect for the product needs of subcultures and minority groups
Attitudes and accommodations for customers with disabilities

39. Shareholder Issues in Global Environment
Laws and regulations regarding ownership and corporate governance
Stability and governance of stock exchanges
Willingness and ability to participate in shareholder meetings

40. Supplier Issues in Global Environment
Ethical and social considerations in the supply chain
Prices offered to suppliers in developed countries and developing countries in comparison to other suppliers
Availability and attitudes toward minority suppliers

41. Community Issues in Global Environment
Norms of community relations and dialogue
Expectations of community service and/or philanthropy
Rights of indigenous people
Availability and quality of infrastructure (roads, utilities, schools, etc.)

42. Environmental Issues in Global Environment
Environmental law and regulations
Availability of “green” electricity, recycled materials, and other environmentally friendly inputs
Environmental expectations relative to those in home country
Use of natural resources to achieve business goals