E2-Approaches to ethics and social responsibility

Gray, Owens and Adams

Corporate and Personal ethical stances
'CSR strategy' and 'strategic CSR

Gray, Owens and Adams

SEVEN POSITIONS ALONG THE CONTINUUM: GRAY, OWEN AND
ADAMS
These are
1. Pristine Capitalists
The value underpinning this position is shareholder wealth maximisation,
and implicit within it is the view that anything that reduces potential
shareholder wealth is effectively theft from shareholders
2. Expedients
Also believe in maximising shareholder wealth, but recognise that some
social responsibility may be necessary
So, a company might adopt an environmental policy or give money to charity
if it believes that by so doing, it will create a favourable image that will help
in its overall strategic positioning
3. Proponents of social contract
Businesses enjoy a licence to operate and that this licence is granted by
society as long as the business acts deserving of that licence.
So, businesses need to be aware of the norms in society so that they can
adapt to them.
If an organisation acts in a way that society finds unacceptable, the licence
can be withdrawn by society, as was the case with Arthur Andersen after the
collapse of Enron.
4. Social ecologists
Recognise that business has a social and environmental footprint and
therefore bears some responsibility in minimising the footprint it creates.
An organisation might adopt socially responsible policies because it feels it
has a responsibility to do so.

5. Socialists
Those that see the actions of business as manipulating, and even oppressing
other classes of people.
Business is a concentrator of wealth in society and so the task of business,
social, and environmental responsibility is very large much more so than
merely adopting token policies
Business should recognise and redresses the imbalances in society and
provides benefits to stakeholders well beyond the owners of capital.
6. Radical feminists
Also seek a significant re-adjustment in the ownership and structure of
society.
They argue that society and business are based on values that are usually
considered masculine in nature such as aggression, power, assertiveness,
hierarchy, domination, and competitiveness.
It would be better if society and business were based instead on
connectedness, equality, dialogue, compassion, fairness, and mercy
(traditionally seen as feminine characteristics).
7. Deep ecologists
The most extreme position, strongly believing that humans have no more
intrinsic right to exist than any other species
The worlds ecosystems of flora and fauna are so valuable and fragile that it
is immoral for these to be damaged simply for the purpose of human
economic growth.

Corporate and Personal ethical stances

Johnson and Scholes illustrate the range of possible ethical stances for
organisations and individuals:

Short-term shareholder interests (annual ROI)

Applies to entities which:

aim to just to maximise short-term shareholder profits; and

only meet the minimum obligation required by law.

Interest is in short-term dividends rather than long-term capital growth.

There will be conflicts between short-term and long-term strategies and decisions.

Long-term shareholder interests (Capital growth)

Applies to entities which:

aim to maximise long-term shareholder profits (capital growth)

are interested in the Long-term strategies and decisions.
meet the obligations required by law.

Stakeholder obligations (Understand all their needs)

Without appropriate relationships with groups such as suppliers, employers and
customers, the organisation would not be able to function.
Therefore, we now move from not just looking at shareholders interests but further
afield to others who are affected by the company

Shaping Society (Apply own ethics into society)

The role of shaper of society is demanding and largely the concern of public sector
organisations and charities, though some well-funded private organisations or very
powerful and wealthy individuals might act in this way.
The legitimacy of this approach for organisations depends on the framework of
corporate governance and accountability.
So here it goes beyond even those affected by the company - to looking at society
and the world as a whole.

'CSR strategy' and 'strategic CSR

Strategic CSR looks at those good corporate social responsibility activities that are
the KEY focus of a business and hence its strategy
If you buy clothes at Loft by design in France - they come with ethical concepts
even printed on their clothes such as build community or keep money in the
local community
Not only is this an outward expression but also all purchases result in books being
made available in parts of the world without such resources.
Consequently all materials and work is done locally and sustainably regardless of
the effect on cost. This is quite a big thing when your competition is say Primark
who will use the cheapest source of clothing.
However this good CSR becomes a strategy. It gives a purpose to everything the
company does and therefore then gains a niche in the market where like minded
customers will be

The idea of strategic CSR is very specific and goes beyond we are green etc it
permeates all KPIs and objectives