Social Responsibility and Ethics
How important is it for organizations and managers to be socially responsible and
ethical? In this chapter, we’re going to look at what it means to be socially responsible
and ethical and what role managers play in both. Focus on the following learning
outcomes as you read and study this chapter.
5.1 Discuss what it means to be socially responsible and what factors influence that
5.2 Explain green management and how organizations can go green.
5.3 Discuss the factors that lead to ethical and unethical behavior.
5.4 Describe management’s role in encouraging ethical behavior.
5.5 Discuss current social ...view middle of the document...
In at time when it is
popular to lay blame on executives and other high level employees for wrong doing,
everyone in an organization deserves to be treated fairly. Ask students how they would
feel if accusations were brought against them in their job. What if they had lost a job
based on groundless accusations?
In studying this chapter, your students will have the opportunity to consider how socially
responsible an organization needs to be in the light of the impact of social involvement
on managerial decision making and economic performance. Issues such as the
greening of management and values-based management are examined as well.
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In addition, Chapter 5 probes the ethical dimensions of managerial decision making.
Students will read about factors that have the potential to influence an individual’s ethics
and actions and to improve the ethical behavior of an organization. As the chapter
closes, timely issues of social responsibility and ethics are presented, and students are
challenged to think about how they will manage responsibly and ethically as future
managers in a changing world.
This chapter discusses issues involving social responsibility and managerial
ethics and their effect on managerial decision making. Both social responsibility
and ethics are responses to a changing environment and are influenced by
WHAT IS SOCIAL RESPONSIBILITY?
Managers regularly face decisions that have dimensions of social responsibility.
Examples include employee relations, philanthropy, pricing, resource
conservation, product quality and safety, and doing business in countries that
violate human rights. There are two opposing views of social responsibility. The
classical view is the view that management’s only social responsibility is to
maximize profits. Economist and Nobel laureate Milton Friedman is the most
outspoken advocate of this view. Friedman argues that managers’ primary
responsibility is to operate the business in the best interests of the
stockholders—the true owners of the organization. The socioeconomic view is
the view that management’s social responsibility goes beyond the making of
profits to include protecting and improving society’s welfare. This view purports
that corporations are not independent entities responsible only to stockholders.
From Obligations to Responsiveness to Responsibility. Social obligation
occurs when a firm engages in social actions because of its obligation to
meet certain economic and legal responsibilities. Social responsiveness
is seen when a firm engages in social actions in response to some
popular social need. Social responsibility is a business’s intention,
beyond its legal and economic obligations, to do the right things and act
in ways that are good for society.
Should Organizations be Socially Involved? How do socially responsible
activities affect a...