Part VI: A Sustainable Perspective

Chapter 12: Sustainable Value Creation

1. Sustainable Value Creation

• The goal of the textbook is to refocus the CSR debate on the way
business is conducted:

Demanding that managers expand the goals of the firm suggests

a problem with the ends of capitalism (i.e., profit). In contrast,
the underlying principles of strategic CSR suggest that any
problem with capitalism, as currently practiced, is with the
means. The pursuit of profit (the best measure we have of long-
term value added) is not the problem; it is the methods by which
profit is sought that can be problematic. In short, it is not what
firms do but how they do it that matters.

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 2

2. Values, Morals, and Business Ethics
• Business ethics versus CSR versus strategic CSR:

 Business ethics traditionally differs from CSR in two ways:

1. While CSR tends to take more of a macro perspective and
evaluates the extent to which firm behavior affects society as a
whole, business ethics focuses on more micro issues, such as
individual behavior and decision-making.
2. While CSR is often externally focused and tied more closely to
functions such as marketing, business ethics focuses internally on
creating an ethical environment and has its roots in legal
compliance.
 Strategic CSR bridges both the macro and the micro, the external
and the internal, to present a comprehensive management
philosophy of the firm across all stakeholders.

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 3

3. Values, Morals, and Business Ethics

• Morals versus ethics:

“When we teach children not to steal, we are teaching

them morality. When you have a conflict between two
or more things that morality requires, that’s when
ethics steps up to the plate.”

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 4

5
5. Value Versus Values

What is the relationship between value and values? If

something is valuable, does that mean it is necessarily
based on values?

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 6

6. Objective + Subjective Value

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 7

7. Value Creation

• Strategic CSR delivers an operational and strategic advantage to the

firm. As such, it is central to the goal of value creation, which is the
primary purpose of a firm’s top management:

Value creation: The generation of a perceived benefit for an

individual or group, as defined by that individual or group

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 8

8. Value Creation

The essential difference between firms that do strategic CSR

well and those that do it poorly, therefore, is a greater
sensitivity to the interests of the firm’s stakeholders--today,
tomorrow, and 6 months from now. This provides the firm
with an acute ability to understand when the (stakeholder-
defined) rules that define its operating environment have
changed and a framework with which to apply that
knowledge to the firm’s strategic advantage.

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 9

9. Strategic CSR + Value Creation

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 10

10. Conscious Capitalism

• Conscious capitalism is based on four principles that encourage the

development of values-based businesses:

1. Higher purpose
2. Stakeholder interdependence
3. Conscious leadership
4. Conscious culture

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 11

11. Values-Based Business

• A genuine implementation of strategic CSR throughout operations

lays the groundwork for a values-based business.
• Values-based businesses stand for something positive, something
that both defines and unites the organization. Strategic CSR provides
a road map to achieving this goal:

Values-based business: A for-profit firm that is founded on a

vision and mission defined by a strategic CSR perspective

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 12

12. Zappos’ Core Values

1. Deliver WOW Through Service

2. Embrace and Drive Change
3. Create Fun and A Little Weirdness
4. Be Adventurous, Creative, and Open-Minded
5. Pursue Growth and Learning
6. Build Open and Honest Relationships With Communication
7. Build a Positive Team and Family Spirit
8. Do More With Less
9. Be Passionate and Determined
10. Be Humble

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 13

14
14. Strategic Decision-Making in a Values-Based Business

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 15

15. Ben & Jerry’s

• There are three parts to Ben & Jerry’s mission:

“Our Product Mission drives us to make

fantastic ice cream—for its own sake.
Our Economic Mission asks us to manage
our Company for sustainable financial growth.
Our Social Mission compels us to use
our Company in innovative ways
to make the world a better place.”

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 16

16. Strategic CSR Is Good Business

Strategic CSR is good for the firm--good in that it is effective

business, but good also in that it is ethical, moral, and values
based. Strategic CSR creates value for the firm’s broad range
of stakeholders in a way that is sustainable.

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 17

17. The Most Socially Responsible Firm

Patagonia

versus

Amazon (or Apple or Walmart)

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 18

18. Strategic CSR Debate

• Motion:

All for-profit firms are values-based businesses.

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 19

19. Questions for Discussion and Review
1. What does it mean for an organization to be ethical? What is the
difference between an unethical act and an illegal act?
2. Have a look at the MBA Oath (http://mbaoath.org/). What do you
think? Is this something you could take? Is it something all
business students should take?
3. In your view, what does a values-based business look like? Think of
an example that you have seen or read about in the news: What do
you think would be different about working for a firm like that?
4. Look at Ben & Jerry’s values (https://www.benjerry.com/values/).
What do you think about the company’s Product Mission,
Economic Mission, and Social Mission? What about the social
causes the firm adopts? Does this information make you more or
less likely to buy the firm’s ice cream? Is this what a for-profit firm
should be doing?
5. Watch this video: https://youtu.be/EseNAh9UwjI. Do you agree
that business is “a moral endeavor”?

Chandler, Strategic Corporate Social Responsibility, 5e. © SAGE Publishing, 2020 20