UNIT IV

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Unit I
Moral Values and Ethics: Values Concepts, Types and Formation of Values, Ethics and Behaviour.
Values of Indian Managers; Managerial Excellence through Human Values; Development of Ethics,
Ethical Decision Making,
Business Ethics- The Changing Environment and Stakeholder Management, Relevance of Ethics and
Values in Business, Spiritual Values. Modern Business Ethics and Dilemmas, Overview of Corporate
Social Responsibilities (CSR) and Sustainability. (12 Hours)
Unit II
Managing Ethical Dilemmas at Work: The Corporation and External Stakeholders, Corporate
Governance: From the Boardroom to the Marketplace, Corporate Responsibilities towards Consumer
Stakeholders and the Environment; The Corporation and Internal Stakeholders; Values-Based Moral
Leadership, Culture, Strategy and Self-Regulation; Spiritual Leadership for Business Transformation.
Organizational Excellence and Employee Wellbeing through Human Values. (10 Hours)
Unit III
Corporate Social Responsibility: A Historical Perspective from Industrial Revolution to Social
Activism; Moral Arguments for Corporate Social Responsibility, Development of Corporate
Conscience as the Moral Principle of Corporate Social Responsibility, Corporate Social Responsibility
of Business, Employees, Consumers and Community. Corporate Governance and Code of Corporate
Governance, Consumerism, Current CSR Practices of the Firms in India and Abroad. Challenges of
Environment: Principles of Environmental Ethics, Environmental Challenges as Business
Opportunity, Affirmative Action as a form of Social Justice. (10 Hours)
Unit IV
Issues in Moral conduct of Business and CSR: Failure of Corporate Governance, Social Audit,
Unethical Issues in Sales, Marketing, Advertising and Technology: Internet Crime and Punishment,
Intellectual Property Rights, Corruption in Business and Administration. BS / ISO Guideline on CSR
Management (ISO-26000). (10 Hours) 2
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 Corporate social responsibility (CSR) promotes a vision of business
accountability to a wide range of stakeholders, besides shareholders and
investors. Key areas of concern are environmental protection and the
wellbeing of employees, the community and civil society in general, both
now and in the future.
The concept of CSR is underpinned by the idea that corporations can no
longer act as isolated economic entities operating in detachment from
broader society. Traditional views about competitiveness, survival and
profitability are being swept away.
Some of the drivers pushing business towards CSR include:
1. The shrinking role of government: In the past, governments have relied on
legislation and regulation to deliver social and environmental objectives in
the business sector. Shrinking government resources, coupled with a distrust
of regulations, has led to the exploration of voluntary and non-regulatory
initiatives instead.
2. Demands for greater disclosure: There is a growing demand for corporate
disclosure from stakeholders, including customers, suppliers, employees,
communities, investors, and activist organizations.

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3. Increased customer interest: There is evidence that the ethical conduct of
companies exerts a growing influence on the purchasing decisions of
customers. In a recent survey by Environics International, more than one in
five consumers reported having either rewarded or punished companies based
on their perceived social performance.
4. Growing investor pressure: Investors are changing the way they assess
companies' performance, and are making decisions based on criteria that
include ethical concerns.
5. Competitive labour markets: Employees are increasingly looking beyond
paychecks and benefits, and seeking out employers whose philosophies and
operating practices match their own principles. In order to hire and retain
skilled employees, companies are being forced to improve working
conditions.
6. Supplier relations: As stakeholders are becoming increasingly interested in
business affairs, many companies are taking steps to ensure that their
partners conduct themselves in a socially responsible manner. Some are
introducing codes of conduct for their suppliers, to ensure that other
companies' policies or practices do not tarnish their reputation.

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 Some of the positive outcomes that can arise when businesses adopt a policy
of social responsibility include:
1. Company benefits:
Improved financial performance;
Lower operating costs;
Enhanced brand image and reputation;
Increased sales and customer loyalty;
Greater productivity and quality;
More ability to attract and retain employees;
Reduced regulatory oversight;
Access to capital;
Workforce diversity;
Product safety and decreased liability.

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 Some of the positive outcomes that can arise when businesses adopt a policy
of social responsibility include:
2. Benefits to the community and the general public:
Charitable contributions;
Employee volunteer programmes;
Corporate involvement in community education, employment and
homelessness programmes;
Product safety and quality.
3. Environmental benefits:
Greater material recyclability;
Better product durability and functionality;
Greater use of renewable resources;
Integration of environmental management tools into business plans, including
life-cycle assessment and costing, environmental management standards, and
eco-labelling.

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 Nevertheless, many companies continue to overlook CSR in the supply chain -
for example by importing and retailing timber that has been illegally
harvested. While governments can impose embargos and penalties on
offending companies, the organizations themselves can make a commitment
to sustainability by being more discerning in their choice of suppliers.
The concept of corporate social responsibility is now firmly rooted on the
global business agenda. But in order to move from theory to concrete action,
many obstacles need to be overcome.
A key challenge facing business is the need for more reliable indicators of
progress in the field of CSR, along with the dissemination of CSR strategies.
Transparency and dialogue can help to make a business appear more
trustworthy, and push up the standards of other organizations at the same
time.

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 Corporate Governance must be protective of community values for:
Life,
Environment,
Societal traditions and aspirations, and
Economic well being
Corporate Governance must also be:
Constructive in providing monetary returns to shareholders
- Protective of shareholder fiscal and reputational reputation value
Failure of Corporate Governance occurs when the Corporation is not able to
fulfil one or more of these duties.
Getting down to the details of governance, focus can be on five issues
Chairman and CEO: It is considered good practice to separate the roles of
the Chairman of the Board and that of the CEO. The Chairman is head of the
Board and the CEO heads the management. If the same individual occupies
both the positions, there is too much concentration of power, and the
possibility of the board supervising the management gets diluted.

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 Audit Committee: Boards work through sub-committees and the audit
committee is one of the most important. It not only oversees the work of the
auditors but is also expected to independently inquire into the workings of
the organisation and bring lapse to the attention of the full board.
Independence and conflicts of interest: Good governance requires that
outside directors maintain their independence and do not benefit from their
board membership other than remuneration. Otherwise, it can create
conflicts of interest. By having a majority of outside directors on its Board.
Flow of information: A board needs to be provided with important
information in a timely manner to enable it to perform its roles. A
governance guideline of General Motors, for instance, specifically allows
directors to contact individuals in the management if they feel the need to
know more about operations than what they are being told.
Too many directorships: Being a director of a company takes time and
effort. Although a board might meet only four or five times a year, the
director needs to have the time to read and reflect over all the material
provided and make informed decisions. Good governance, therefore, suggests
that an individual sitting on too many boards looks upon it only as a sinecure
for he or she will not have the time to do a good job.
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 Social audit is a process of reviewing official records and determining
whether state reported expenditures reflect the actual monies spent on the
ground.
A formal review of a company's endeavors in social responsibility. A social
audit looks at factors such as a company's record of charitable giving,
volunteer activity, energy use, transparency, work environment and worker
pay and benefits to evaluate what kind of social and environmental impact a
company is having in the locations where it operates.
In the era of corporate social responsibility, where corporations are often
expected not just to deliver value to consumers and shareholders but also to
meet environmental and social standards deemed desirable by some vocal
members of the general public, social audits can help companies create,
improve and maintain a positive public relations image.
Social auditing creates an impact upon governance. It values the voice of
stakeholders, including marginalized/poor groups whose voices are rarely
heard. Social auditing is taken up for the purpose of enhancing local
governance, particularly for strengthening accountability and transparency in
local bodies.

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 Objectives of social audit
Assessing the physical and financial gaps between needs and resources
available for local development.
Creating awareness among beneficiaries and providers of local social and
productive services.
Increasing efficacy and effectiveness of local development programmes.
Scrutiny of various policy decisions, keeping in view stakeholder interests and
priorities, particularly of rural poor.
Estimation of the opportunity cost for stakeholders of not getting timely
access to public services.
Advantages of social audit
(a) Trains the community on participatory local planning.
(b) Encourages local democracy.
(c) Encourages community participation.
(d) Benefits disadvantaged groups.
(e) Promotes collective decision making and sharing responsibilities.
(f) Develops human resources and social capital

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To be effective, the social auditor must have the right to:
seek clarifications from the implementing agency about any decision-making,
activity, scheme, income and expenditure incurred by the agency;
consider and scrutinize existing schemes and local activities of the agency;
and
access registers and documents relating to all development activities
undertaken by the implementing agency or by any other government
department.
This requires transparency in the decision-making and activities of the
implementing agencies. In a way, social audit includes measures for
enhancing transparency by enforcing the right to information in the planning
and implementation of local development activities.

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 Acquiring new customers is hard work. Just ask any sales representative
working at a start-up or an expansion stage company. Trying to sell a new,
unproven or unbranded product can be a struggle, especially in B2B markets
where product acquisition costs are high and sales opportunities are few and
far between.
Often, this struggle to acquire new customers incentivizes sales
representatives and sales organizations to adopt fraudulent and/or unethical
sales practices to boost closing percentages and contract values. These near-
sighted sales practices may generate short-term gains, but will almost always
result in permanent damage to a companys brand and customer
relationships.
Unethical sales practices to be avoided:
Making promises and commitments to customers that your product
development team cannot fulfil. Customers often will make purchase or
contract renewal decisions based on product or service upgrade timelines.
Failing to meet product functionality or service upgrade timelines may leave
customers in a rut and will result in unsatisfied customers. Thus, it is very
important to keep new developments under wraps until the engineering team
is certain that the new product developments will be completed before
promised delivery dates. 14
 Misrepresenting promotions or products to close a deal with a prospective
customer or up-sell a current customer. Tricking customers may work in the
short-run through increased customer acquisition rates and up-sell
percentages, but in the long-run it will lead to brand reputation damage and
deteriorating customer retention rates that will almost always out-weigh the
short-run benefits. Thus, companies need to ensure that sales representative
and account manager incentives are deterring them from misrepresenting
products and/or promotions.
Leaving customers in the dark about promotion or pricing changes. Not
being transparent about promotion period end dates and/or price changes is
a slimy way to increase contract values in the short-term, but almost always
will result in disgruntled customers. The cost of non-disclosure is substantial
with promotion end dates and price changes as it shows a break in the circle
of trust, which will permanently alter a customer relationship and often will
cause a customer loss.
Skipping contract commitment disclosures. Customers hate to be caught
off-guard and be tied to commitments that are contained in the fine print
of a deal. Doing so upsets customers and leads to decreased levels of
customer satisfaction and declining retention rates.
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 Even if disclosing contract commitments upfront will decrease sales
opportunities on the front end, it will ensure that you are only selling to good
customers that will value your products and promote them to peers and
colleagues.
Making sales final before a customer has had ample time to try-out a
product. Product sales are as important as product advocates, as positive
publicity and recommendations generate new lead opportunities and sales.
Having unsatisfied customers only leads to customer detraction, so it is in a
companys best interest to establish free product trial periods and/or 15 or
30 day full refund policies to let customers try out your products. Doing so
will also signal to your customers you are confident that you are selling a top
of the line product, which will boost product interest.
By establishing reasonable customer expectations, being transparent about
contractual issues and allowing customers to test-out products during a trial
period or offering a 15 to 30 day refund policy, sales team will weed out bad
customers and set customer management and product management teams up
for success in building long-lasting customer relationships with every newly
acquired customer.

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 Ethical marketing involves making honest claims and helping to satisfy the
needs of customers. Besides being the right thing to do, ethical marketing
can have significant benefits for your business. For example, if customers
believe youll live up to your word, brand loyalty will develop, customer
retention will increase and your customers will tell others of their good
experiences.
Misleading Advertising: Outright false advertising is illegal. For example,
reporting that your product is safe for people to use when it isnt can land
you in serious trouble. Misleading advertising might not rise to the level of
false advertising, but its unethical and can hurt your reputation with the
public. For example, if you claim your product is much better than it actually
is, your company will appear untrustworthy. While its important to put your
best foot forward in marketing, avoid crossing the line by making dishonest or
exaggerated claims.
Exploitation: Manipulating people by exploiting their fears is unethical. For
example, exaggerating the risks people face so you can sell them insurance is
a form of manipulation, as is tricking your customers into buying overpriced
or useless extended warranties. This approach is called the fear-sell tactic
and is especially nefarious when it targets people who are disadvantaged in
some way.
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 Spam: Delivering a sales message to potential customers is part of a
marketers job, but it's unethical to flood consumers with an onslaught of
advertisements -- especially when they have not given you express permission
to contact them. For example, email spam and robo-calling -- using
automatic dialers to contact many people without permission -- typically are
unethical marketing activities. Further, these practices might anger
customers rather than attract them to your business.
Pushy Sales Tactics: Its a salespersons job to convince customers to buy a
product, but being overly aggressive is unethical. For example, suppose a
customer seems interested in a purchase but asks for more time to consider
the deal. An unethical salesperson might bully the customer into making a
quick decision, perhaps by lying about how the deal will expire soon or how
another customer is interested in the same item. The line between being
persuasive and being a bully isnt always clear, so it's more ethical to focus on
helping customers make informed decisions rather than focusing on making
the sale at any cost.

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 Advertisement is considered unethical in the following situations:
When it has degraded or underestimated the substitute or rival's product.
When it gives false or misleading information on the value of the product.
When it fails to give useful information on the possible reaction or side
effects of the product.
When it is immoral.
Ways of Unethical advertising:
Surrogate advertisement: is prominently seen in cases where advertising a
particular product is banned by law. Advertisement for products like
cigarettes or alcohol which are injurious to heath are prohibited by law in
several countries and hence these companies have to come up with several
other products that might have the same brand name and indirectly remind
people of the cigarettes or alcohol of the same brand.
Puffery: as a legal term refers to promotional statements and claims that
express subjective rather than objective views, such that no reasonable
person would take literally.
Exaggeration: Exaggerating about a brand in the advertisement

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 Unverified claims: It includes advertisements of energy drinks which tells
us about the number of vitamins and how they help children to grow strong
and tall.
Women stereotyping: Women are generally associated with household works
and is not supposed to be a good decision maker which contributes to women
stereotyping. Women shown as doing domestic work which reflects
stereotype image of women.
Comparative advertisements: Nowadays advertisers are engaged in
unhealthy brand comparison with the help of advertising. Such comparisons
create problems and confusions for the right choice of the product as far as
audience are concerned.
Use of children in advertising: Children are easily persuaded and have a
large pull on today's markets, as is known by all advertisers, even ones who
do not intend for their products to be consumed by children.

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 Scientific advances allow businesses to use technology to reach goals more
easily and more completely than ever before. In some areas, however, such
applications of technology start infringing on the rights of individuals and
may be unethical.
Governments and ethically operated companies are aware of these
limitations. Governments have passed privacy laws and regulated
communication companies.
Some companies self-censor and apply internal policies to limit unethical
behaviour. Businesses that wish to be considered ethical must look at
whether applying certain technologies may harm some individuals and
constrain such applications to what is absolutely necessary.
Privacy Individual privacy is one area that has been identified clearly as a
base for unethical business behaviour through the application of
technologies. Companies can track Internet usage, buying habits and
individual movement as well as collect personal information about millions of
customers or even potential clients. While governments have passed
legislation restricting the collection of personal data and allowing individuals
some control over what companies can collect and store, ethical businesses
must decide -- independently of legislation -- what is appropriate behaviour.

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 Security Companies monitor employees and visitors and collect much
additional information in the name of security. Ethical issues arise from the
continuous monitoring of employee activity and the recording of security
camera images. An unjustified level of employee surveillance is ethically
questionable; the ethical company must try to establish a level of monitoring
it can justify. The surveillance of non-employees, such as visitors or suppliers'
representatives, must be constrained to an even lower level to be ethically
acceptable.
Communication Where it used to be difficult to monitor telephone
conversations due to the nature of the analog signal, companies and
governments can easily monitor digital, text-based communication, such as
email. Computers can scan the text of millions of messages for words that are
of interest to investigators and identify the sender. Companies that employ
such technologies must ask themselves about the ethical implications of such
surveillance, especially if it is carried out without the knowledge or explicit
agreement of employees.
Content With new technologies allowing the easy creation and distribution of
images and videos, both individual employees and companies need guidelines
as to what is acceptable. Without such guidelines, some of this content will be
offensive to some of the company staff and to some members of the public.
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 Internet/Cyber crime is a generic term that refers to all criminal activities
done using the medium of computers, the Internet, cyber space and the
worldwide web.
Cyber law is a term used to describe the legal issues related to use of
communications technology, particularly cyberspace, i.e. the Internet.
In essence, cyber law is an attempt to apply laws designed for the physical
world, to human activity on the Internet.
It has a separate chapter XI entitled Offences in which various cyber crimes
have been declared as penal offences punishable with imprisonment and fine.
They are:
1. Hacking: Hacking means unauthorized attempts to bypass the security
mechanisms of an information system or network. Also, in simple words
Hacking is the unauthorized access to a computer system, programs, data and
network resources.
Law & Punishment: If crime is proved under IT Act, accused shall be punished
for imprisonment, which may extend to three years or with fine, which may
extend to five lakh rupees or both. Hacking offence is cognizable, bailable,
compoundable with permission of the court before which the prosecution of
such offence is pending and triable by any magistrate.
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 2. Data Theft: Data Theft is a growing problem, primarily perpetrated by
office workers with access to technology such as desktop computers and
handheld devices, capable of storing digital information such as flash drives,
iPods and even digital cameras. The damage caused by data theft can be
considerable with todays ability to transmit very large files via e-mail, web
pages, USB devices, DVD storage and other hand-held devices.
Law & Punishment: Data Theft offence is cognizable, bailable, compoundable
with permission of the court before which the prosecution of such offence is
pending and triable by any magistrate.
3. Spreading Virus or Worms: In most cases, viruses can do any amount of
damage, the creator intends them to do. They can send your data to a third
party and then delete your data from your computer. They can also ruin/mess
up your system and render it unusable without a re-installation of the
operating system. Most have not done this much damage in the past, but could
easily do this in the future. Usually the virus will install files on your system
and then will change your system so that virus program is run every time you
start your system. It will then attempt to replicate itself by sending itself to
other potential victims.

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 Law & Punishment: Spreading of Virus offence is cognizable, bailable,
compoundable with permission of the court before which the prosecution of
such offence is pending and triable by any magistrate.
4. Identity Theft: Identity theft is a form of fraud or cheating of another
persons identity in which someone pretends to be someone else by assuming
that persons identity, typically in order to access resources or obtain credit
and other benefits in that persons name.
Law & Punishment: Theft offence is cognizable, bailable, compoundable with
permission of the court before which the prosecution of such offence is
pending and triable by any magistrate.
5. E-mail Spoofing: E-mail spoofing is e-mail activity in which the sender
addresses and other parts of the e-mail header are altered to appear as
though the e-mail originated from a different source. E-mail spoofing is
sending an e-mail to another person in such a way that it appears that the e-
mail was sent by someone else.
Law & Punishment: Email spoofing offence is cognizable, bailable,
compoundable with permission of the court before which the prosecution of
such offence is pending and triable by any magistrate.

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 Intellectual property (IP) is a legal term that refers to creations of the mind.
Under intellectual property laws, owners of intellectual property are granted
certain exclusive rights. Some common types of intellectual property rights
(IPR) are copyright, patents, and industrial design rights; and the rights that
protect trademarks, trade dress, and in some jurisdictions trade secrets.
Intellectual property rights are themselves a form of property,
called intangible property.
Intellectual property rights include patents, copyright, industrial design
rights, trademarks, trade dress, and in some jurisdictions trade secrets.
A patent is a form of right granted by the government to an inventor, giving
the owner the right to exclude others from making, using, selling, offering to
sell, and importing an invention for a limited period of time, in exchange for
the public disclosure of the invention. An invention is a solution to a specific
technological problem, which may be a product or a process.
A copyright gives the creator of an original work exclusive rights to it, usually
for a limited time. Copyright may apply to a wide range of creative,
intellectual, or artistic forms, or "works".[1

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 An industrial design right protects the visual design of objects that are not
purely utilitarian. An industrial design consists of the creation of a shape,
configuration or composition of pattern or color, or combination of pattern and
color in three-dimensional form containing aesthetic value. An industrial design
can be a two- or three-dimensional pattern used to produce a product, industrial
commodity or handicraft.
A trademark is a recognizable sign, design or expression which
distinguishes products or services of a particular trader from the similar products
or services of other traders.
Trade dress is a legal term of art that generally refers to characteristics of the
visual appearance of a product or its packaging (or even the design of a building)
that signify the source of the product to consumers.
A trade secret is a formula, practice, process, design, instrument, pattern, or
compilation of information which is not generally known or reasonably
ascertainable, by which a business can obtain an economic advantage over
competitors or customers.
Violation of intellectual property rights, called "infringement" with respect to
patents, copyright, and trademarks, and "misappropriation" with respect to trade
secrets, may be a breach of civil law or criminal law, depending on the type of
intellectual property involved, jurisdiction, and the nature of the 27action.
 Corruption is an universal phenomenon. It is not something new either.
Corruption in one form or another existed since time immemorial.
Corruption at the highest levels distorts competition so denying the public
access to the competitive marketplace. It induces wrong decisions resulting in:
wrong projects, wrong prices, wrong contractors, substandard delivery to
recoup overpricing, promotes corruption at lower levels and eroded public
confidence in leaders.
At lower levels, petty corruptions are damaging because they add to
transaction costs, exclude those who cannot pay, foster contempt for public
servants amongst public and erode capacity for revenue collection.
Genesis of corruption can be explained by looking at three levels -
international, national and individual institutional levels.
Competitiveness of international markets provides multinational companies of
various sizes with an incentive to offer bribes to gain an advantage over
competitors.
At the national level basic development strategy of any government moulds
opportunities and incentives for corruption. At the same level three
relationships - between the government and the civil service, between the
government and the judiciary and between the government and the civil
society - also affect the nature and discussions of corruption. 28
 Three areas of government activity - customs administration, business
regulation and management of foreign aid - act as sources of corruption at the
level of individual institutions.
Corruption takes many forms. These forms are: acceptance of money and
other rewards for awarding contracts, violation of procedures to advance
personal interests, kickbacks from developmental programmes or multi-
national corporations, pay-offs for legislative support, diversion of public
resources for private use, overlooking illegal activities, intervening in the
justice process, nepotism, common theft, overpricing, establishing non-
existing projects and tax collection and tax assessment frauds.
Corruption is not cost-neutral. There have been claims that not everything is
bad about corruption. Its effects can be positive too. Corruption, among other
things, assists in capital formation; fosters entrepreneurial abilities, allows
business interest to penetrate bureaucracy and permits the logic of market to
insinuate itself into transactions from which public controls exclude it.
It may not be possible to eradicate corruption completely but then vigorous
and determined actions will go a long way to minimize it. The measures
suggested are too many and defy any easy characterization. To contain and
minimize corruption a number of measures have been recommended.
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 These include: driving out corruption by means of usually one-off purges or
campaigns, setting up of anti-corruption boards, commissions and the like,
campaign for moral regeneration or moral re-armament, strengthening of
checks on abuse of power and the enhancement of accountability of the
powerful as well as public officials, ensuring transparency and openness in
governmental activities, develop positive social attitudes, enforcing a code of
public ethics, supporting the role of media, improving educational procedures.
To reduce corruption drastically, a number of fundamental changes must be
brought about. These include: reducing the opportunities for corrupt
transactions by cutting back the states activities; emergence of new centres
of power outside the bureaucracy; development of competitive party politics;
ascendance of universalistic norms; effectuation of far-reaching administrative
reform measures affecting policy, institutional and process levels;
strengthening of preventive structures and tightening of prosecuting
techniques

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 ISO, the International Organization for Standardization, launched an
International Standard providing guidelines for social responsibility (SR)
named ISO 26000 or simply ISO SR. It was released on 1 November 2010.
Its goal is to contribute to global sustainable development, by encouraging
business and other organizations to practice social responsibility to improve
their impacts on their workers, their natural environments and their
communities.
ISO 26000 offers guidance on socially responsible behaviour and possible
actions. There are three ways it is different from the more widespread
standards designed for companies to use to meet particular requirements for
activities such as manufacturing, managing, accounting and reporting.
1) ISO 26000 is a voluntary guidance standard- that is, it does not contain
requirements such as those used when a standard is offered for "certification".
There is a certain learning curve associated with using ISO 26000, because
there is no specific external reward - certification - explicitly tied to ISO
26000. ISO recommends that users say, for example, that they have "used ISO
26000 as a guide to integrate social responsibility into our values and
practices."

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 2) ISO 26000 is designed for use by all organizations, not only businesses and
corporations. Organizations, such as hospitals and schools, charities (not-for-
profits), etc. are also included. ISO 26000 makes particular efforts to show
that its flexibility means that it can be applied by small businesses and other
groups as well [2] So far, many of the earliest users of ISO 26000 have been
multi-national corporations, especially those based in Europe, and East Asia,
particularly Japan.
3)ISO 26000 was developed through a multi-stakeholder process, meeting in
eight Working Group Plenary Sessions between 2005 and 2010, with additional
committee meetings and consultations on e-mail throughout the five year
process. Approximately five hundred delegates participated in this process,
drawn from six stakeholder groups: Industry, Government, NGO (non-
governmental organization), Labour, Consumer, and SSRO (Service, Support,
Research and Others - primarily academics and consultants).
Leadership of various task groups and committees was "twinned" between
"developing" and "developed" countries, to ensure viewpoints from different
economic and cultural contexts.

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 Since ISO operates on a parliamentary procedure form based on consensus, the
final agreed-on standard was the result of deliberation and negotiations; no
one group was able to block it, but also no one group was able to achieve its
objectives when others strongly disagreed. The goal was to make ISO 26000
accessible and usable by all organizations, in different countries, precisely
because it reflects the goals and concerns of each and all of the stakeholder
groups in its final compromise form.
The Seven Key Principles, advocated as the roots of socially responsible
behavior, are:
Accountability
Transparency
Ethical behavior
Respect for stakeholder interests (stakeholders are individuals or groups who
are affected by, or have the ability to impact, the organization's actions)
Respect for the rule of law
Respect for international norms of behavior
Respect for human rights
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 The Seven Core Subjects, which every user of ISO 26000 should consider, are:
Organizational governance
Human rights
Labor practices
Environment
Fair operating practices
Consumer issues
Community involvement and development
The ISO 26000 Scope states "This International Standard is not a management
system standard. It is not intended or appropriate for certification purposes or
regulatory or contractual use. Any offer to certify, or claims to be certified, to
ISO 26000 would be a misrepresentation of the intent and purpose and a
misuse of this International Standard. As this International Standard does not
contain requirements, any such certification would not be a demonstration of
conformity with this International Standard."

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 As a guidance document the ISO 26000 is an offer, voluntary in use, and
encourages organizations to discuss their social responsibility issues and
possible actions with relevant stakeholders.
As service providers, certification bodies do not belong to an organizations
stakeholders. ISO 26000 encourages its users to reconsider an organization's
social responsibility or "socially responsible behaviour" and to identify/select
from its recommendations those where the organization could/should engage
in contributions to society. ISO 26000 encourages its users to report to their
stakeholders, and get feedback, on actions taken to improve their social
responsibility.
It is also an important step in the development of business-led social
responsibility initiatives which evidence suggests is much more effective than
government regulated social responsibly policies.
The need for organizations in both public and private sectors to behave in a
socially responsible way is becoming a generalized requirement of society. It is
shared by the stakeholder groups to develop ISO 26000: industry, government,
labour, consumers, nongovernmental organizations, and others, in addition to
geographical and gender-based balance.

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