GOOD GOVERNANCE and SOCIAL RESPONSIBILITY

Talking about how do we govern? In GOOD (nature of who we are)

As we exist we are inclined to what we are…
When we govern, it should always be good
Philosophy of Business
“Great things in business are never done by one person. They’re done by a team of people.” - Steve Jobs

 Ang isang negosyo ay hindi maaaring patakbuhin ng isang tao lang, it is done by a team.
 Your buyers/customers is always a part of your business/team.
 To make a business successful, you need other person. Without customers, your business will
not exist at all (sila ang bibili sayo na makakatulong para kumite ang negosyo mo)
 “Stakeholders”/ “Business partner”/ “Product partner” – tawag ng iba (sellers) sa “customers”

Philosophy, in accordance with the definition stated in the Webster’s Dictionary, is a system of
fundamental or motivating principles, the basis of action or belief.

 How then, can we connect or make relevant this characterization of philosophy in relation to
business?
 Having a comprehensive and sensible business philosophy is the foundation of a winning business.
 How?

Essence of Philosophy – what makes you move? What makes you motivate?

Tangible – nakalapat sa katotohanan

Which is which . . .

a. Philosophy of Business
b. Business Philosophy

Are they one and the same?

a. Philosophy of Business
- Considers the essential principles that inspire the creation and operation of a business activity
and the moral obligations that pertain to it to include its role in society.
- Ideas/ like vision
- What makes you put a business? Why did you start a business? Bakit mo naisip yung
business na yun? What would be your role or role of your business in the society? Anong
gagawin mo para bumili ang customers? Ex. To provide food/cater, and Anong gagawin ng
customers to buy your product/business?
b. Business Philosophy
- Intended to represent a mode of doing business or a business viewpoint which is profit-
centered.
- It depicts how a specific business wishes to operate itself instead of concepts and methods.
 - Practices/actions/like mission
- Convert them into action, Apply what’s in your mind (malapat mo sa totoong buhay yung
naiisip mo) Ex. You graduated culinary, then you want to share the idea to others to provide
them food. Ex. Profit-centered ka pero paano ka kikita? - lower the price of your product
para makarating ang customers sa iyo.

We can draw easily the distinction between the two. Let us further elaborate and focus on philosophy of
business as the cornerstone of a triumphant business. The practice of comprehending, appreciating, and
improving a business philosophy could be the foundation that would bind the organization as it hurdles
risks, challenges, and crisis.

Business philosophy, on the other hand, has the following scope and coverage:
1. A set of beliefs and principles that the organization endeavors and strongly holds. This is often
referred to as the Mission/Vision Statement. In the grand scheme of things, this is actually the
“Operational Blueprint”.

2. The goals, objectives, and purpose of doing business.

3. The silhouettes of the values that are deemed important as it mirrors what kind of management
or leaders the business has.

Once the business philosophy has been established, it must be conveyed and practiced by every member
of the organization. Otherwise, it would be a worthless declaration.

Then again, who cares about these so-called mission/vision statement, goals, objectives, and purpose?
How many of us have actually stopped to ponder on these and decipher its importance? What is the use
of having all these business philosophies anyway? What is its significance? Isn’t it that the primary goal of
every business is simply to make profit and making it commercially lucrative?

Philosophy of Business
In today’s generation, many of us are familiar with Global Positioning Services, commonly known as GPS.
Modernization and technology are responsible for this state-of-the-art mechanism which allows people
to navigate with ease and precision.

Similarly, the same analogy may be applied in business philosophy. Without the mission/vision
statement, goals, objectives, purpose, and other related parameters, one could easily get lost amidst the
surge of pressures, challenges, setbacks, and other business-related problems. The philosophy of business
on the other hand, is like GPS – it guides us in the right direction. It tells us where we are, where we are
going, and the right direction to get there.

When you put up a business, saan ito patungo? Anong dahilan/purpose mo in putting up a business?
Like a GPS, it guides us in a right direction. Where we are going? Do we have the right direction to get
there?
Ano ba ang goal? Para saan? Bakit mo ginagawa? What is your ideas?
Looking at another angle, you may view it as the “commandments” that are religiously respected,
followed, and adhered to at all time. Going against such principles is non-conforming and may lead to
problems such as damaged reputation, loss of trust, broken relationships between and among
management, subordinates, and/or consumers in general.

The Philosophy of Business, therefore, is like the heart

Business and conscience of the firm. By setting up a mission, and
Mission Purpose formulating its vision, many untoward incidences may
Role in be avoided and, in the process, generating a
Vision society harmonious working environment.
Goals Moral A well-thought and deliberated philosophy of
obligations business summarizes the overview of the firm’s values,
beliefs, morals, and guiding principles. These are not
easy to fathom. It takes time, attentiveness, and
BUSINESS PHILOSOPHY meticulousness before one can come up with a sound
PHILOSOPHY OF BUSINESS business philosophy.

In doing philosophical composition, one must bear in mind and answer the following questions:

1. What is the nature of my intended business?

2. What principles and concepts underlie its commercial activity?

3. In what kind of image do I wish my business to project? Anong ipapakita mo? Ex. Uniform para
makilala o malaman yung kompanya/ to be easily identified, maliwanag or alam agad

4. Will my values adhere to my intended business? Anong mga values mo? Nararanasan ba?
Nakikita ba? Naeexperience ba? Mahalaga ang values sharing

5. How do I reconcile a business mission with conflicting interests in the market place and society?
Competition – hindi maaalis/ that’s part of doing business, How will you make a kind of
reconciliation? Having a good competition

Truthfully answered, these could be the grounds or basis of a virtuous philosophy of business.
Kapag nasagot itong 5 questions, you can manifest/animating…

Of course, it does not end with the generation of philosophy alone. Once it was agreed upon and
established, its implementation is another important feature. But prior to its execution and realization, it
must first and foremost be conveyed accordingly to its intended recipients. So who are these people? The
message should be relayed to all of its employees – from top rank management down to the rank-and-
file. All must strictly observe the standards set forth by the firm.

There are numerous avenues as to how such information may be disseminated across all borders
concerned. It may be during the hiring process, websites, company periodicals, and posters, framed and
wall-mounted displays. The objective of which is to remind one and all of the philosophy of business.
Moral and Ethical Basis of Business
We all know that ethics is an established set of rubrics or guidelines that identify conduct and define
what is right and wrong demeanor.

Ethics, however, is not limited on a personal level. Even businesses espouse ethics. They, too,
have moral obligations to fulfill.

Though ethics in business is not in all instances written in black and white, common sense would
tell us that such unwritten codes of values and principles govern our decision-making within the
realms of the industry. Standards are usually grounded on the organization’s culture and this sets
apart in terms of behavior as to what is acceptable or otherwise.

 It redefines actions of what you are engaging to

 When you establish a business, you are manifesting – a kind of projecting
 Mahalaga ang common sense sa pagmamanage (for employees and owners)
 Ano ang culture ng mga employees when they work inside the company?

Three Models of Management Ethics

Amoral

Moral Immoral

3 Models of
Management
Ethics

1. Moral – conforms to high standards of ethical behavior.

2. Amoral

a. Intentional – does not consider ethical factors. (sinadya)

b. Unintentional – casual or careless about ethical considerations in business. (careless,
unconscious, unaware kaya nga unintentional)

3. Immoral – style lacking ethical principles and dynamic antagonism to what is ethical. (ginawa siya
without the standardize ethical principle) (directly antagonism) (sinadyang hindi lagyan ng ethical
principle, sinadyang contradictory to ethical policy/principle)
Learning what is supposed to be accepted as ethical standards, the important question now is: “Why do
people behave ethically?” Only few of us are behaving ethically dahil yun ang nasa isip nya na tama.

Most of us behave ethically . . .

1. To evade punishment

2. To get some “reward” for being “good”

Many of us behave ethically . . .

1. To be agreeable and acceptable to family, friends and superiors

2. To be a “good citizen”

Few of us behave ethically . . .

1. To do what is right

There are times, of course, when we doubt our decisions or actions. After all, values and morals are
personal. What is considered proper for some does not equate to be the same for all. It all depends on
the following:

a. The person (owner)

b. The perspective (magki-click ba yung business?)

c. The recipient – as to how one would view and accept the said conduct

First, let us name the different personalities involved in doing business as well as their differences in terms
of perspectives. Evaluating both angles would help us understand the necessity and depth of such
demeanor. Management should tailor fit their philosophy of business and take into consideration all
involved, as well as all those who will be affected by the said endeavor.

A SHAREHOLDER owns part of the company through shares of stock, making them stockholders.

A STAKEHOLDER has an interest and/or concern in the operation as well as the performance of a
company.

Simply put,

SHAREHOLDER STAKEHOLDER
Owners Employees
Members of the Corporation Suppliers
Stockholders Customers
Various agencies including government
Competitors
Community
Media
General Public
Others
And . . .

Shareholders are always stakeholders, but stakeholders are not always shareholders.

Stakeholders are divided into two:

a. Internal Stakeholders

b. External Stakeholders

To illustrate:

Both shareholder and stakeholder have different perspectives at looking at business.

Shareholders focus on making decisions that would benefit the best interest of the owners of the firm. Of
course, these are grounded on the motive to maximize profit and its return on investment. No business
was ever put up just to eagerly expect loss of savings and venture. Every businessman in his right mind
wants to earn and make the most of his initial outlays through the generation of profit. But shareholders
cannot just put profit as the only emphasis for business survival. The success or failure of any enterprise
depends largely on the stakeholders’ perception, acceptance, and respect for the said business. The
philosophy of business, therefore, as well as all decisions that the firm may formulate should work for the
good of the entire populace concerned.

Success and failure depends on how customers will patronize the product.

Business – it is not only for your own good but for the entire goodness of people/society (kaya nga
nagbusiness ka eh)

Ethical Behavior in Business matter of responding to how ethically the business is?
There are times when conflict of interest would arise in certain situations. As such, we tend to face a thin
line between what should or should not. Confusion? Dilemma? What to do next? How to decide?

The Four-Fold Test in Decision-Making Evaluation

1. Truthfulness - How honest and accurate is my decision?

2. Fairness- Am I being just and reasonable to everyone concerned?

 3. Goodwill - Will it build goodwill and positive image to the organization?

4. Beneficial - Will it be favorable to all parties who have vested interest in the outcome?

Ethics in an Organization: Who Conceives? And who is Responsible?

The firm’s leaders are responsible for setting the tone that should be adhered to by every member of the
firm. These are standards that are acceptable as conduct for everyone concerned. The managers have a
duty to set an example for all to look up to. Obediently following ethical manners should be rewarded
accordingly as this would motivate people to do what is supposed to be right. Now, imagine if
management’s focus is solely on generating profit. Chances are, all of its subordinates are led to that
direction as well. The leaders will direct its people.

Principles of Commendable Business Ethics (helps us to attain success of business)

Ethical standard must be met, attainable and viable, hindi yung nasa taas na hindi maaabot

Community
Trustworthiness Transparency
Involvement

Accounting
Be Responsible Respectfulness
Control

When there is chaos – no ethical principle, and there will be collapse in business

For the business to be a success, one must work diligently. Just like a game, there should be a strategy in
order to win. Planning ahead is just one step. Business endeavors must be rallied both legally and ethically.

Irrespective of whether it is personal or professional . . .

Ethical standards must be set.

But more importantly,
Ethical standards must be met.

Ethics is the foundation of a civilized society. This includes business and the people on it. Without ethical
principles, chaos would transpire and all else is certain to collapse eventually.

Steps to Ethical Decision Making

 STEP 5

STEP 4

STEP 3

STEP 2

STEP 1

Ethical Decision Models

 Utilitarian Model

- An ethical decision is one that produces the

greatest good for the greatest number of people.
- Yung magagamit ng mas maraming tao.

 Moral Right Model

- An ethical decision is one that best maintains

and protects the fundamental rights and privileges of
the people affected by it.

 Justice Model

- An ethical decision is one that distributes

benefits and among individuals in a fair, equitable, or
impartial way. (makatuwiran, makatarungan)

Graph kung
paano
gumagalaw yung
tatlo
Philosophy of Business as Part of Applied Philosophy
What is applied philosophy in the first place? How does it differ from plain and simple philosophy?

While Philosophy, in its very essence, is the study of the basic and fundamental nature of understanding,
truth, and existence, particularly when pondered as an academic discipline, Applied Philosophy, as the
term suggests, is the application of those principles and concepts stemmed from and based on philosophy
to a study of our practical affairs and activities.

Philosophy in Business
Business is an activity rather than a philosophy. However, there are loads of diverse and distinctive
philosophies that can be applied to the activities of business. The philosophy applied is vital not only to
the commercial and monetary feat of the business, but more so to the consequential influence and effect
of the business undertakings on the community. Such effect may go whichever way possible. It may either
be constructive or destructive.

The Three (3) Major Components of the Philosophy of Business are:

1. The essential ideologies that inspire the realization and management of a business venture.

2. The nature and purpose of the said business.

3. The moral obligations that relate to it.

Additionally, deliberation about the disposition and function of ethical principles need not contradict a
role for moral judgment.

Also, philosophy is more on pursuing queries, reservations, and uncertainties. In other words, it can be
likened to the phrase “questioning minds”. As such, philosophy, in philosophical perspective, is not much
on answering our questions but to further question the given answers.

Have you heard the mantra?

“Too much talk, not enough action.”
Some things are easier said than done. Naturally, most business would like to project an image that is
acceptable to the majority. They would find means and ways to protect their reputation. However,
without proper discipline, things could go astray. If you look closely under investigative lens, one could go
past the scopes and restrictions of what is expected and what is reality. Armed with a philosophical mind,
you would know that it is basically not what to think but how to think.

Whereas businesses have their own models and methods as a way to condense intricacies and
complications, philosophy explores its conceptual framework and progresses. It addresses blind-spots
that the business may encounter from time to time by thinking out-of-the-box. Go beyond certainties and
theoretical preconditions, as they say. By doing so, business leaders of the future would be trained to be
keen on managing complexities not only for the confines of the business per se but integrating the needs
of the society and the general public as well.
We do not deny, however, that concepts, models, and strategies in business are no longer important.
Business rely on the effectiveness of such to run the business smoothly. But attention should be given in
detail of you clamor for improvements. Some of the said models, concepts, and strategies may be adjusted
to fit right with the changing of times.

Lastly, just thinking. . .

 Is philosophically really needed in doing business?

 Does philosophy have any relevance in business?
 Is it a passport to a successful business venture?

RULES and UNDERLYING PRINCIPLES of BUSINESS

According to business dictionary, the underlying principles of business are the fundamental norms, rules
or values that represent what is desirable and positive for a person, organization, or community, and help
in determining the rightfulness or wrongfulness of its actions. Principles are more basic than policy and
objectives and are meant to govern both.

Basic Principles of Business Rules

1. Rules are subject to change

- Lahat ng bagay ay nagbabago, even rules can be change

- Let all be reminded that all are subject to change, including business rules. Policies can be
changed in relation to responsiveness to management practices. A corporate rule must make
sense and good judgement for all participants including:

a. Investors

b. Business undertakings, and

c. Active business affairs and aftermaths within scope.

- Rules are not supposed to be between management and employees alone but takes into
account the community and all those involved in the said business.

2. There is no such thing as absolute business rule in any business model.

- Business rules should be tailored-fit to the purpose, demands, and goals of the business.
- Ex. Bakit lumilipat sa Vietnam, China, Thailand, etc. ang (ex. Shoe company) ng Pilipinas?
 Kasi mura ang bayad/labor doon (for example ililipat ang pabrika)
 Hindi pwedeng gayahin ng Pilipinas ang polisiya ng ibang bansa, ex. China, Vietnam, etc.

3. There are no business rules ‘til you say there are.

- Never assume that people know. There are oftentimes a necessity for a structure (sometimes
formal) business vocabulary – a fact model.
- Do’s and Don’ts are critical in the day-to-day operation of any business enterprise. It can make
or break any endeavor. A core business rule will define what is acceptable or otherwise.
- Kung anong sinabi ng boss, edi yun.
 4. A business rule should always be feasible.
- What’s the use of a business rule if it is not:
a. Realistic
b. Workable
c. Attainable
d. Achievable
e. Practical

In other words,

A business rule that is impossible to implement is useless!

The standard for business strategy – the Business Motivation Model – compares a business policy to a
business rule as follows:

A business policy tends to be:

a. Less structured
b. Less discrete (hindi na kailangan pag-usapan /pagdiskusyunan pa, ex. Oras ng pagpasok)
c. Less atomic (maliit man o Malaki, it is just the same thing; it must be practice)
d. Less complaint with standard business vocabulary, and
e. Less formally articulated.

There are of course, numerous business philosophies that you can apply on your respective undertakings.
The above-mentioned are just the basics to give you an idea. In deciding to come up with such business
philosophy, just bear in mind the following:

a. Follow what works for you

b. Do what is legally right
c. Do what is morally right

Business rules offer a powerful tool. But rules are just rules. It should be acted upon. Stay focused and
with the right techniques, it is just a matter of time before the business would take off.

BUSINESS as a SOCIAL INSTITUTION (social institution – the way you relate with other people)
- New Perspective and Paradigm Shift
At some point in time, we kind of believe that society exists to “support” business. Such support can be
manifested through patronage. But have you ever stopped to consider it to be the other way around?
Remember, aside from products and/or services, businesses are made up of people. It is the people who
make the business running. The earnings of these people make it possible for them to provide for the
needs of their respective families, send their children (if any) to school, and support the community in
general.
PERSPECTIVE

Of course, this is just one way of looking at business as a social institution. Try to visualize business as a
vessel for the “shared experiences”. It is literally a place where adults mingle, converge and connect in
the involvement of labor. It is where one can expand social connections and discover opportunities that
could be part of his career development. His professional journey begins through this social institution.

BEYOND ECONOMICS: BUSINESS as a SOCIAL INSTITUTION

Typical Business Goal: Make More Money. (Interest/goal of most businesses: kumita ng pera, to gain
money)

It is obviously the desire of most businesses. And there is nothing wrong with it – as long as it is pursued
with mindfulness to business as a social institution. However, when greed enters the picture and conflicts
of interests are not resolved, the principle of mutual benefit is no longer applicable and exploitation is not
far behind. It is thus very important that business culture and its qualities as a social institution should be
in synchronization.

(There is always change in business, and business rules must always be change.)

New Perspective and Paradigm Shift

Imagine yourself eating your favorite fruit – apple. You love this fruit so much that you eat it regularly. As
you grow, you come to realize that there is more to apple than just being a fruit. The same fruit can be an
apple pie, an apple smoothie, an apple tart, an apple muffin, as part of ingredient for salads, and it can
also be combined with other fruits to produce delicious desserts. When your taste buds discover all these
apple delicacies, you would now have choices and some sort of transformational preferences. Same is
true in business.

A paradigm is a model composing of cluster of ideas about how things should be done, made, or thought
about.

In short, a paradigm is . . .

a. Your perspective
b. Your point of view
c. Your beliefs about what’s true

Can we say that your paradigm will remain the same all your life? Of course NOT! There is what we call a
PARADIGM SHIFT. This happens every time there’s a significant change in the way an individual or group
perceives something. The long-standing paradigm is now replaced by a new set of beliefs or way of
thinking. This is very natural. We each have our own personal paradigms or lenses through which we vision
the world. Exposure to new information and experiences can change our perspective or outlook in life.

Personal Paradigm Shift can also be viewed between two individuals in a relationship. And since no two
people ae exactly alike, compromises and adjustments have to be made for the connection to have a
chance to succeed. In more such cases, both parties must agree to make it work by being more
understanding and make sacrifices along the way whenever necessary. It will definitely never work of only
one would be willing to make the shift and the other is not reciprocating.

If there is such a thing as personal paradigms, then there is also its counterpart in business. Organizations
have Corporate Paradigms with respect to the ways and means by which they suppose their objectives
and targets will be best accomplished. Similarly, societies have Cultural Paradigms that consists of sets of
beliefs, norms, and practices – all of which are subject to change.

Corporate paradigm shifts may be:

a. Internally-driven
b. Externally-driven

Business enterprise, regardless of size, experience paradigm shifts. They may occur usually due to changes
in management. Whenever a firm decides to make adjustments to suit the new controlling administration,
expect some transformations and adjustments. New sets of executives, directors, and managers may
come from the merging of two corporations. There may be instances wherein one company may be
acquired by another firm mostly due to financial reasons. As such, new policies may be introduced.
Common examples of such changes are the implementation or abolition of flexible work-time schedule.
One firm may find it more sensible to allow its employees to report to work on their preferred time as this
would minimize tardiness. Others are very strict when it comes to time management. All must report on
the standard 8 – 5 work time frame. Another is dress code. Some does not mind the use of casual clothes
to work as long as it’s decent enough. Others prefer the more uniformed corporate look as this gives the
impression of being more professional. When organizations merge, expect new policies as it undergoes
internally-driven corporate paradigm shift. As an employee, of course, you have the option to accept such
changes and blend in or get out of the new merged corporation and seek a new job elsewhere. The choice
is yours to make.
INTEGRITY

Integrity

 A component of character that can be developed.

 It is the cornerstone of ethical behavior.

 It is the quality of being honest with yourself and others

and living a life that is parallel with your moral ideologies.

 It is choosing your thoughts and actions based on values

rather than personal gain.

 Improving personal integrity necessitates probing one’s

philosophies, beliefs, and value system, and taking conscious
strides to conduct and perform in ways that are coherent
with your respective ethical protocol.

 The key concepts of integrity are honesty and

congruency.

 The hallmark of ethical leadership.

INTEGRITY – how do you relate with other people; mabuting tao ka kapag may integrity ka dahil ang
ginagawa mo ay tama.

HONESTY – katapatan; katotohana ang ginagawa

People with integrity . . .

 Act in accordance with a personal code of principles

 Gain the trust of others

 Extend to all people the same respect and consideration that you desire

 Apply the same moral standards in all situations

Ways to Foster and Cultivate Integrity

1. Recognize facets of your behavior that necessitate modification or transformation.

2. Establish your whys and wherefores for not conducting with remarkable personal integrity.
3. Confront the barriers and impediments that weaken you to divert from the truth thus defying
moral code.
4. Practice truthfulness.
5. Compose an inventory of responsibilities and behaviors in which you will become more reliable
in.
6. Respect the possessions of others.
7. Pay attention to and regard the views and conclusions of others.
 8. Do more than you expect others to do.
9. Anticipate a trial and error progression that entails tenacious determination.
10. Solicit the support and advice of others.
11. Develop your accountability.
12. Grow to be more self-regulating and rise out of rough times.

What does integrity have to do with business? A lot. (Kapag may integrity ka, anong magagawa nito
sa business?)

It is important to understand the importance of integrity and how it will affect our performance in
everyday life, including business management.

Defining and Understanding the Relevance of CSR

Corporate Social Responsibility is one of the most significant features in establishing your firm’s public
image and reputation. Currently, CSR has become a catchphrase as corporate associations with non-
profit endeavors have turn out to be more and more essential in the public eye. In its crux, business
should consider not just earning profits but go beyond its perimeters and instead put attention and
emphasis on how the industry can further promote, advance, and benefit the greater community.

CSR is “the continuing commitment by business to contribute to economic development while

improving the quality of life of the workforce and their families, as well as of the community and
society at large.” -World Business Council for Sustainable Development

So Why Does CSR Matter?

As an individual and a consumer, people “feel” about a company on their observation, assessment,
and experience of the firm’s CSR. Simply put, a company’s reputation is based on the public’s feelings
about what your business is doing that affects the community at large. Stronger stakeholder support
is very much evident whenever a business exudes a good reputation based on their CSR initiatives.

Developing CSR Program:

CSR programs may or may not be exactly in relation to your respective business’s products and/or
services. You should actually not restrain or limit yourself in selecting what sort of programs you will
affiliate your business with. The choices are basically diverse and wide-ranging.

Then, again, as mentioned, CSR may focus on other matters such as:

a. Environment
b. Philanthropy
c. Ethical labor practices
d. Others.

These efforts can range from donating money to non-profits to implementing ecologically-friendly policies
in the workplace.

CSR is important for companies, nonprofits and employees alike. CSR is something “extra” that companies
do to improve their local and global communities.
Social Responsibility: Business Importance
Over the last several years, social responsibility has been a by-word in the business industry. The clamor
has been noticeably increasing over time. It does not matter if the focus is environmental, economically
driven or empowering women. The social issues may be local, national, or global. Business have seen the
relevance of social responsibility and have actually incorporated it in their respective business strategy.
Concern for the health and welfare of the majority other than merely generating more profit is truly
commendable.

How Corporations Benefit from Corporate Social Responsibility

How Non-Profits Benefit from Corporate Social Responsibility

How Employees Benefit from Corporate Social Responsibility

1. Positive Workplace Environment – maliwanag at magaan

2. Increase in creativity – nakakapag isip nang maayos ang business pati na rin ang empleyado
4. Promotes Individual Philanthropy – hindi napipilitan, naeencourage sila, naeengganyo na gumawa
ng sariling philanthropic actions

Top CSR Consulting Firms

CSR History and Evolution

The Early Classical Period
Corporate Social Responsibility was viewed as an upshot of the industrial development progression at that
time. With the growth and expansion of vast companies in 1870s, the undertakings of these firms
progressively disturbed other group domains. Commencing 1900 past 1920, further regulation centered
on business social responsibilities was approved under the banner of the assembly of sponsored social
reforms in the forthcoming era.

The Immediate Post-War Period

The discussion and deliberation around the social responsibility of commerce and industry had attained
its momentum following World War II. By now corporate philanthropy had already turn out to be an
element of standard social composition and business structure. Two (2) ideologies fashioned the nitty-
gritties for current understandings on Corporate Social Responsibility. These were the principle of
stewardship and charity.

Trends During the 1970s

In the course of 1970s, the feel of the hostilities and war based on Corporate Social Responsibility changed
to a certain extent. The attention and emphasis in the war budged from corporate responsibility to the
corporate responsiveness concept. This contemporary focus on responsiveness transformed the
importance from what corporations could do to survive to what they could actually offer and could
contribute to enhance the world by way of sustainability.

Responding to the needs; not only about

responsibility but responsiveness

Shifts During the 1990s

In the 1990s, the model of Corporate Social Responsibility materialized as the upshot of innovative forms
of stakeholder engagement and social regulation, increased demands of stakeholder and government
regulation for reporting and Corporate Social Responsibility. Opponents and researchers enhanced their
assessment to embrace opinions based on the sustainability, business ethics, corporate social
performance, green marketing, and stakeholder theory.

CSR – Business Responsibilities in the 21st Century

- Establish and validate a pledge and obligation to commit to society’s values and be part of the
cause by becoming a factor in promoting society’s social, environmental, and economic goals
through worthy engagements.
- Protect society from the undesirable and damaging effects of business operations, products,
and/or services.
- Share benefits of business pursuits both with key stakeholders and shareholders.
- Validate that a business can actually make more by doing the right thing.
CSR and Business Ethics
Social responsibility is a principled charter and advocates that an individual or an organization
has a duty to perform for the benefit of the society. It is therefore the commitment to contribute
something towards the welfare and interests of the society in which it operates.
According to the International Organization for
Standardization (ISO), this relationship to the
society and environment in which businesses
operate is “a critical factor in their ability to
continue to operate effectively. It is also
increasingly being used as a measure of their
overall performance.”

Social Responsibility takes on a distinctive connotation for each industry and each business within that
industry. However, the fundamental classification stays constant:

“To positively impact society while also improving the company’s management.”
Example: Power generating plants might resolve to reduce emissions or make some operational
adjustments in some way that could help the environment and lessen pollution.

At large, social responsibility is more valuable

when affirm takes it willingly. It can boost the
morale of everyone involved if they are engaged in
worthy causes. Social responsibility may be
required to some degree by certain laws and by the
government but its impact is much different when
it is done voluntarily.

Corporate Social Responsibility refers to business

practices encompassing schemes that do well to
society. It can embrace an extensive diversity of
campaigns from donating a percentage of a
business’ proceeds to charitable organizations, to
executing “greener” commercial set-ups.
Some of the types of social responsibility that current businesses are practicing involve:
Environmental efforts:
One major emphasis of corporate social responsibility is the environment. Industries irrespective
of magnitude have a large carbon footprint. Trimming down the negative impact caused by such
operations is very much welcomed and appreciated.
Philanthropy:
Businesses also exercise social responsibility by contributing to local and national charitable
institutions. Sharing of resources whether in the form of monetary assistance, goods and services
of the business, or volunteering time to assists in local community programs are truly beneficial
and commendable.
Ethical labor practices:
By way of handling employees fairly and honorably, businesses can also establish their corporate
social responsibility. This is particularly real of businesses that operate in intercontinental settings
with labor laws that vary from those in the home country.
Volunteering:
Presence in volunteer events reveals in great deal about a company’s candor and genuineness. It
is expected that whenever you are part of a volunteer project that you are not expecting anything
in return otherwise it defeats the purpose of sincerity.
(When society or community or barangay or school are in need, tumutugon agad sila
(immediate response), pinapadala agad ang employee doon sa place na may kailangang
tugunan.)

Business Ethics
(How business is being done?)
ETHICS – a matter of character, dahil sa ethics nagkakaroon tayo ng
character/ugali/asal/behavior
ETHICS – personal character/ personal attitude
BUSINESS ETHICS – What should be our conduct/behavior/character/pagkakakilanlan when
doing a business? Ex. What should you contribute or share and applied in the company?
Business Ethics

What is Business Ethics?

 The study of what is right and wrong in terms of human behavior and conduct in business.
 The study of perceptions of people about:
a. Morality
b. Moral Norms
c. Moral Rules
d. Ethical Principles
As they apply to people and institutions in business.
 The study, evaluation, analysis and questioning of ethical standards, policies, moral
norms, and ethical theories that managers and decision makers use in resolving moral
issues and ethical dilemmas affecting business.

Social Responsibility and Business Ethics are every so often being confused to be one and the same in
terms of impressions and concepts. Then again, the social responsibility crusade is just but one facet of
the general regulation of business ethics. The social responsibility undertaking developed due to
intensified civic awareness about the role of business enterprise in facilitating to promote and uphold
highly ethical routines in society and especially in the ecological setting.
What it Means to be Socially Responsible and Ethical?
The theory of social responsibility is fostered on a system of ethics, wherein assessments, resolutions, and
measures must be ethically justified and supported before carrying on the task. No business would like to
be under fire for instigating actions that could cause more harm and damage to an individual, the society,
or the environment in general. Such actions are considered socially irresponsible and would be reflected
on the company and would eventually backfire on the firm.

Moral principles that are integral in humanity form an idiosyncrasy amid right and wrong. Thus, each
person or entity has an obligation to function in mode of conduct that is favorable to many as opposed to
personal gratification.

When Do Social Responsibility and Ethics Apply?

The theory of social responsibility and ethics operates in both individual and group dimensions.
Remember that a group is made up of individuals. The concept of ethics and social responsibility must
start on a personal note. You simply cannot share anything in a group if you do not have it in you. It must
start from within. You must believe in it and live with it, so you can spread and be effective by making an
impact. Companies have fostered a structure of social responsibility that is custom-built to their company
setting.

1. Leadership – leader -> namamahala, nagbibigay ng direksyon sa kasama kung anong mga dapat gawin
at tamang gawin, hindi lang basta nag uutos.

2. Performance and Working Environment – they should generate a kind of inspiration to be productive.
3. Deontology (or interest/intention)

– The end of the business rationale/principle

– Ano bang gusto monng mangyari, makita at gustong patunguhan

–What is the target/aim/goal of the company? (It should be clear to employees, staff and everyone
inside the company so that the company can attain success.)

–We should know what kind of obligation we should do, and we know what the goal is

Benefits of Business Ethics (the benefits we can gain from business ethics)

1. Goodwill of the People.

2. Business Ethics have Substantially 3. Ethical Practices Support
The public would generally want to Improved the Society. Employees’ Growth.
build long term relationships with
Creation of anti-trust laws, unions and Ethics in the workplace help
groups that execute their tasks on the
other regulatory bodies has been a employees face reality, both
principle of ethics. Likewise, a sound
factor to the enhancement of the beneficial and detrimental – in the
public image leads to continual
society. organization.
allegiance and entices new investors.

4. Strong Teamwork and High

5. High Profit.
Productivity.
Reputation of the business and its
Constant change and channel of
share prices also build-up if the firm
communication will guarantee the
act upon Corporate Social
employee complements to the value
Responsibility (CSR).
of the organization.

1. Goodwill of the People – kagandahan para sa tao, maitutulong

4. Strong Teamwork and High Productivity – ex. Kapag nagkakaisa ang mga empleyado, magiging
maayos ang lahat

5. High Profit – if you do good social responsibility, you will have high profit.

Very good in terms of realizing…to help improve the community, makikilala ka, and can build trust
to your business/company.

Types and Characteristics of CSR

Types of CSR
1. Ethical CSR

o Simply put, it is all about the responsibility to circumvent and prevent damage,
impairment and/or social grievances.
o A matter of what kind of response
 o Pagresponse/pagtugon ayon sa nararapat para maiwasan ang damage, impairment
and/or social grievances.

2. Altruistic CSR

o It is the participation and promoting to support common good at the viable outlays of the
company for noble, humane, or charitable causes.
o Forgetting your own self para lang makatulong

3. Strategic CSR

o It is regarding the organization’s social welfare responsibilities that benefit mutually the
business and its stakeholders.
o Ex. Kahit malayo gagawa ka ng paraan. For example, to help victims of disaster (like
typhoon) kahit multinational company ka, or nasa ibang bansa then nasa Pilipinas ang
tutulungan.

Characteristics of CSR
The primary characteristics of Corporate Social Responsibility are the fundamental attributes of the
model that be likely to get replicated in some way either in the academic or consultative realms as
defined by CSR. There may be others that some corporations may engage to, as these may be
customized to tailor fit the philosophy of a respective business. The core characteristics that are
evident in many types of business endeavors are the following:

1. Voluntary.
Various characterizations of Corporate Social Responsibility will stereotypically perceive it as ensuing
around voluntary undertakings that drive outside those stipulated by the decree. A lot of business
firms are at this point are fairly used to pondering duties and accountabilities further than the
permissible minimum. Moreover, in effect, the enhancement of self-regulatory Corporate Social
 Responsibility ingenuities from various activities are time and again comprehended as a means of
anticipating supplementary parameter within acquiescence with communal ethical standards.

- magkukusa, pupunta doon at ipakikilala ang business sa community, or sila

2. Internalizing and/or Managing Externalities.

Mutually and in sync, this feature of Corporate Social Responsibility, where externalities are the
progressive (positive) and undesirable, damaging, and destructive (negative) side effects of economic
behavior of others on the company. A common and timeless case of externality is pollution and
contamination.

- “paano, anong gagawin?”

- Nagcocover up / They try to cover up all the mess being done by the corporation
- Ex. Feeding programs, medical assistance(nakaplano na o nakahanda na, ilalabas na lang)

3. Multiple Stakeholder Orientation.

All business ventures, regardless of size, nature, and orientation, have obligations to their respective
shareholders. Nonetheless, enterprise depend on several players including providers, staffs, patrons and
the neighborhood for the business to continue functioning as an operational entity, and not only to survive
but to flourish in time. As such, they must consider the plight of all concerned when dealing with CSR.

4. Alignment of Social and Economic Responsibilities.

It is unimaginable for a firm to be socially responsible while neglecting its economical responsibilities. This
should not be the case. Being socially responsible is important. But so is business profitability. Therefore,
there should be a parallel of alignment to have a win-win situation. Corporations can benefit economically
from being social responsible.

- Tinutulungan ang community, ex. Giving works or trabaho sa mga tao (for economic stability)

5. Practices and Values.

Business have specific set of programs on how to deliver their schemes and
tactics as they see fit when dealing with social concerns. This all depends
on the firm’s philosophy. Consider not only the stuffs that company do in
the social ring, but then again, and more importantly, why do they do it.

- Values – pananaw, vision and mission

- Effective ang impact ng practices

6. Beyond Philanthropy.
Philanthropy in Corporate Social Responsibility is primarily about humanity and compassion. It is basically
extending help to those in need such as charitable cases or the less fortunate. Through CSR, corporations
make an impact to the society at large.

- A matter of charity/compassion – na may impact

 - More of generosity (hindi tungkol sa kung sinong natulungan) Ex. Kapag natulungan, huwag
mong sasabihin na “ay natulungan na po kayo ngayon, bukas na po kayo ulit o sa susunod na
lang po kayo ulit” hindi dapat ganon, dapat tumulong na walang mindset kung sinong
natulungan.

Forms and Dimensions of CSR

Perhaps the most recognized and acknowledged model of Corporate Social Responsibility which
tackles the forms of CSR is known as the “Four-Part Model of Corporate Social Responsibility” as
proposed by Archie Carroll. This model is illustrated in the following figure.

1. Economic Responsibility

2. Legal Responsibility

3. Ethical Responsibility – social responsible actions of the company

4. Philanthropic Responsibility – kamay ng pagtulong/pagdamay/pakikisalamuha/pakikipag usap ng

isang negosyo.

Pagpapakita kung anong klase ng CSR meron ang isang kompanya

Carroll’s CSR Pyramid is a simple framework that helps argue how and why organizations should meet
their social responsibilities.

The basis of what we consider to be the modern definition of CSR is rooted in Archie Carroll’s “Pyramid of
Corporate Social Responsibility.”

As stated by Carroll, CSR is a multi-layer model comprising of four inter-connected standpoints of

responsibilities, i.e., economic, legal, ethical, and philanthropic. He exhibited these various responsibilities
as sequential tiers within a pyramid.
“Corporate social responsibility encompasses the economic, legal, ethical, and philanthropic expectations
placed on organizations by society at a given point in time.” - Archie Carroll

The Four Responsibilities

Philanthropic Economic
Responsibility – Ethical Legal Responsibility –
involves being a Responsibility – Responsibility – organization’s
good corporate organization’s defined by management are
citizen by management are governments in to produce goods
contributing to follow the laws that and services of
resources to the generally held management are value to society so
community, thus beliefs about the expected to that the firm may
improving the behavior in a comply; play by the repay its creditors
quality of life of society. rules. and shareholders.
others.

LEGAL RESPONSIBILITY – Ex. Nagbabayad ng buwis; Complying with the requirements of the
government

The Dimensions of CSR

Legal compliance
Business ethics, values, and principles
Corporate governance
Employee rights and welfare
Human rights
Commitment to socio-economic development
Accountability and transparency
Market relations
Ecological concerns
Sustainability
Next topic next meeting (continuation…)

Driving Forces Behind CSR (forces that pushes us to move)

So…What keeps us moving?

Drivers Pushing Business towards CSR:

The International Institute for Sustainable Development reported that the concept of CSR is “underpinned
by the idea that corporations can no longer act as an isolated economic entity operating in detachment
from the broader society”. Traditional views about the competitiveness, survival and profitability are
being swept away.

Other notable drivers pushing business to CSR are as follows:

1. The Shrinking Role of the Government.

- In the past, governments relied on legislation and regulations to deliver social and
environmental objectives to the business sector. Dwindling resources, coupled with
distrust of regulations, has led companies to explore other alternatives that is voluntary
and non-voluntary in relations to CSR. In a sense, it has a positive impact on the CSR
activities of the companies as it gives flexibility on the choice of programs and projects
that a particular company will implement.

2. Demands for Greater Disclosure

- There is a continuous growing demand for corporate disclosure from stakeholders,
including customers, suppliers, employees, communities, investors and activist
organizations.
 3. Increased Customer Interests
- There is a clear evidence that the ethical conduct of corporations exerts a growing
influence on the purchasing decision of customers.

4. Growing Investor’s Pressure

- There is a marked changed in the way investors assess companies and they have included
ethical concerns in their criteria.
5. Competitive Labor Markets
- Employees, especially in developed countries, are now looking beyond paychecks and
benefits. Companies are forced to improve working conditions to retain good employees.
6. Supplier Relations
- As stakeholders are becoming increasingly interested in business affairs, companies take
steps to ensure that their partners conduct themselves in socially responsible manner.
Some even introduce code of conduct for suppliers to ensure that their reputation is not
tarnish in the process.

The recent escalation in CSR disclosures by corporations worldwide signaled the significance of CSR in
continuing quest for sustainable development according (Azim et al., 2011)

Cene Bavec in his research work entitled: Social Responsibility and Professional Ethics in Management:
Some Empirical Evidences at Country Levels (2012) noted that Italy, Slovak Republic, Romania, Portugal,
Greece, Lithuania, and Poland demonstrate different societal and ethical practices compared to countries
like New Zealand, Canada, Switzerland, Australia, Finland, and Norway.

Global Trends in CSR

CSR is well-established in many countries throughout the world. The practice however, is contested and
considered controversial by its detractors. Beyond Europe, USA and few other countries, adoption of CSR
is still, limited and fragmented (Volodina et al., 2009) N. E. Hurst in 2004 in his research paper entitled:
Corporate ethics, governance and social responsibility: Comparing European business practices to those
in the United States, he found out that European companies are more committed to CSR compared to
companies in the US. Hurst’s points is supported by the following as reported by the International Institute
for Sustainable Development (2013) in relation to the European Union green paper on CSR:

 Since the early 1990s, the European Commission has taken an active interest in CSR.

 In 1993, the then president of the EC, Jacques Delors, called on Europe’s business community to
take a more active stance against social exclusion.

 On March 2000, the Council of Ministers, during their meeting in Lisbon, made a renewed appeal
for business to adopt a more sustainable approach, in every sense of the word.

 In 2001, this interest manifested itself in the form of a green paper (or consultation document)
entitled “Promoting a European framework for corporate social responsibility.”
With all these developments, US companies continued to be devoted to structured business ethics and
governance process. In other parts of the world, especially for developing countries, the trend is for CSR
to be institutionalized. There has been a great debate on whether CSR should be mandated or voluntary.
Still, it was observed that companies in developing countries continue to resist serious CSR engagement
and reporting. In the early days, there was no formal format or accepted standards for corporate reporting
on CSR. This led to a wide variation in reporting and format. Nowadays, environmental issues have been
joined on the agenda of social considerations and the reporting process has been broadened into an audit
on corporate responsibility.

According to Wayne Visser (2012), there are five stages of CSR evolution that are products of five
“economic ages” in the different countries mentioned. These are shown in the table below.

1. Defensive CSR
This is the first stage which is termed as greed. CSR initiatives are done as a means of defending
the direct interests of the shareholders.

2. Charitable CSR
Charity is the central interest of all CSR initiatives and usually conducted by Foundations.

3. Promotional CSR
Companies at this age realized that they must earn the “license to operate” in the area where
they are situated and thus, implement promotional CSR.

4. Strategic CSR
Companies focused on their core business and aligned it with the needs of the beneficiaries.
 5. Systemic CSR
According to Visser, all the ages mentioned above have their own defects. This age however, is
the final and desired economic age of responsibility with systemic CSR in operations. The
initiatives are interconnected between society, the planet and the economies. Adherence to the
3 Ps (people, planet and profit) appeared to be the basic guide in this approach to CSR. It blended
not just the economic dimension but also, the care for the environment and people that triggered
several companies to excel in the practice of CSR worldwide. These companies implemented
variety of initiatives that can be the model for others to follow in participating in this phenomenon
called CSR. It is definitely open for replication.

Examples of Top Corporate Social Responsibility Initiatives in 2017

Levi’s
This company demonstrates social responsibility to a large extent through sustainability initiatives that
are “sewn into the fabric” of the company.

Levi’s accomplished this through:

 It integrated its factories even before the law required it and established a comprehensive
workplace code of conduct for their manufacturing suppliers.

 It launched the Workers Well-being program to improve the lives of the apparel workers outside
of the factory walls.

 It is the first company in their industry to establish global guidelines for water equality standards
for their suppliers.

 First company also to provide financial incentives for garments suppliers in developing countries
to upgrade environmental, health, safety and labor standards.

 It strived to leverage their iconic brands to drive positive, sustainable change and profitable
business results.

 It introduced scientific approach in making their product life cycle even more sustainable which
led to the “water-less process and water-less collection”.

 It also pioneered in the practice of reducing the use of energy, water, chemicals and other
materials in the apparel industry.

Starbucks
Established in 1970, this company has always operated with sensitivity to social responsibility and is
committed to sustainability and strengthening communities through:

 The company has committed to farmers as partners in Conservation International’s “Sustainable

Coffee Challenge”. Starbucks is working to increase the prosperity and resilience of the one million
 farmers and workers who grow Starbucks coffee around the world by investing in coffee
communities, sharing technical coffee knowledge and innovating new agricultural approaches.

 Provide 100million trees to farmers by 2025 as part of its commitment to one billion coffee trees
through the Sustainable Coffee Challenge.

 Build and operate 10,000 Greener Retail stores globally by 2025 under its new verification
program that promotes environmental building standards, energy efficiency and partner
engagement.

 Hire 25,000 veterans and military spouses by 2025 to help in generating livelihood and
employment to the senior sector of the community.

 Continue the Starbucks College Achievement Plan and target to graduate 25,000 scholars by 2025
and increase the program’s accessibility and performance.

 Provide opportunity to youth by employing 100,000 youth by 2020 and reach out to young people
who are disconnected from work and school.

 Hire 10,000 refugees globally by 2022.

General Electric
The GE Foundation contributed US$88 million to community and educational programs in 2016.

 They also matched the contributions made by their employees and retirees through the Matching
Gifts Program.

 The foundation’s signature projects focused on health-care access for communities around the
world.

 It also brings innovative skills in learning and building sustainable solutions to identified health
problems.

 The Foundation is powered by the generosity and talent of its employees who have strong
commitment to their communities.

IBM
It has a project called “Citizen IBM”. This promotes discussion on IBM’s corporate citizenship program and
how its employees are donating time, talent and technology to assist communities around the world.

 At IBM Foundation, Earth Day is celebrated in keeping with their tradition to advance science
knowledge which is the cornerstone of technological achievement.

 It gives grant to three groups of scientists who are working at the forefront of climate change and
environmental research.
  It also has chosen three groundbreaking research projects from more than 70 applications around
the world for their potential to make a contribution to our misunderstanding of climate change
impacts and potential solutions.

 For their World Community Grid’s Network, over 700,000 volunteers all over the world have
already powered important environmental discoveries in clean energy and clean water.

IKEA
A home furnishing company founded in Sweden in 1943. It was founded by Ingvar Kamprad,
who began peddling useful items to neighbors on his bicycle. At the end of 2009 financial year, IKEA
operated 267 stores in 25 countries. Its CSR activities, handled through a Foundation, are as follows:

 When disasters and conflicts turn children’s lives upside down, IKEA’s partner need quick access
to funds to provide life-saving assistance. The IKEA Foundation supports “Save the Children” with
emergency funding so they can send their staff to hard-hit communities in 24 hours.

 This on-going partnership, which began in 2013, has helped over 300,000 children and adults
during the more than 30 emergencies all over the world. These include earthquakes which hit
Indonesia, and the Philippines, and fighting in Iraq, Uganda and South Sudan.

 IKEA’s grant help set up temporary classrooms and provide teaching kits and other essentials such
as food and hygiene supplies.