Chapter 1



THE BUSINESS and SOCIETY RELATIONSHIP

Prepared by Deborah Baker Texas Christian University Chapter 1- 1

BUSINESS & SOCIETY Ethics and Stakeholder Management Carroll & Buchholtz 6e

Business and Society: Ethics and Stakeholder Management, 6e ‡ Carroll & Buchholtz Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved

All rights reserved . abuse of corporate power. & workplace safety What is the role of business vs. loss of jobs to foreign countries. whistle blowing. the role of government in our society? What must a co. toxic waste disposal. a division of Thomson Learning. product liability. do to be considered socially responsible?  Chapter 1.2 Business and Society: Ethics and Stakeholder Management. scrutiny & scandals! Issues: executive compensation. political action committees Businesses must deal with societal concerns: the ´rightsµ movement. 6e ‡ Carroll & Buchholtz Copyright ©2006 by South-Western. sexual harassment.The Business & Society Relationship     Business criticism.

interest groups. more powerful.3 Business and Society: Ethics and Stakeholder Management. (shared interests & beliefs or common cause) Society ‡Larger corporations are more visible. a division of Thomson Learning. more impact on society ‡Business & society interrelate in a macroenvironment Chapter 1.Business & Society Business The collection of private. 6e ‡ Carroll & Buchholtz Copyright ©2006 by South-Western. a community. a nation. more criticized. profit-oriented organizations. All rights reserved . A broad group of people.

All rights reserved .The Macroenvironment Segment Social Economic Political Technological Focus Demographics. 6e ‡ Carroll & Buchholtz Copyright ©2006 by South-Western. a division of Thomson Learning. social values Nature & direction of the economy Government influence Technological advancements What kinds of ethical issues are we facing? Chapter 1.4 Business and Society: Ethics and Stakeholder Management. lifestyles.

U.S. All rights reserved .5 Business and Society: Ethics and Stakeholder Management. exert power over one another)   Organizations & groups have overlapping goals causing confusion (who do we trust?) Pursuit of self-interest promotes conflict & inefficiency Chapter 1. 6e ‡ Carroll & Buchholtz Copyright ©2006 by South-Western. a division of Thomson Learning. as a Pluralistic Society Power is diffused among society·s many groups & organizations Strengths Weaknesses     Prevents domination Maximizes freedom of expression Individuals are loyal to many organizations or groups Built-in checks & balances (B.

a division of Thomson Learning.Stakeholders  What is a stakeholder?  Anyone impacted by the organization s D/M  Who are they?  What makes an environment complex?  More SH means more uncertainty Chapter 1.6 Business and Society: Ethics and Stakeholder Management. All rights reserved . 6e ‡ Carroll & Buchholtz Copyright ©2006 by South-Western.

Stakeholders Community Government Business Owner Consumer Employees Consumer activists Product liability threats Chapter 1. 6e ‡ Carroll & Buchholtz Copyright ©2006 by South-Western.7 Business and Society: Ethics and Stakeholder Management. a division of Thomson Learning. All rights reserved .

htm Business and Society: Ethics and Stakeholder Management.Special-Interest Society Special Interests groups       make life more complex for business!! number in the tens of thousands pursue their own limited agenda are more active. a division of Thomson Learning.goodmoney.8 http://www. diverse & focused attract a significant following (more $ and power) often work at cross purposes.com/directry_active. 6e ‡ Carroll & Buchholtz Copyright ©2006 by South-Western. with no unified set of goals. @ Chapter 1. All rights reserved . intense.

All rights reserved . a division of Thomson Learning. 6e ‡ Carroll & Buchholtz Copyright ©2006 by South-Western.9 Business and Society: Ethics and Stakeholder Management.Factors in the Social Environment Creating Atmosphere of Criticism of Business?  Affluence and education greater expectations & more criticism  Public awareness through television  Entitlement mentality  Rights movement  Victimization philosophy  Revolution of rising expectations (creating social problem) Chapter 1.

10 1990s Business and Society: Ethics and Stakeholder Management. a division of Thomson Learning. 6e ‡ Carroll & Buchholtz Copyright ©2006 by South-Western. All rights reserved .Society·s Expectations versus Business·s Actual Social Performance Society·s Expectations of Business Performance Social Performance: Expected and Actual Social Problem Social Problem Business·s Actual Social Performance 1960s Time Chapter 1.

All rights reserved . a division of Thomson Learning.11 Business and Society: Ethics and Stakeholder Management.What is society·s #1 criticism of business? Abuse of power ExamplesChapter 1. 6e ‡ Carroll & Buchholtz Copyright ©2006 by South-Western.

those who do not use power in a manner society considers responsible will tend to lose it  When power gets out of balance. forces respond & pressure B. » Physicians & HMOs Chapter 1.12 Business and Society: Ethics and Stakeholder Management. 6e ‡ Carroll & Buchholtz Copyright ©2006 by South-Western. a division of Thomson Learning. » Enron & Arthur Anderson » Tobacco co. E. to be more responsible to bring it back into balance.Iron Law of Responsibility  In the long run. All rights reserved .

6e ‡ Carroll & Buchholtz Copyright ©2006 by South-Western. a division of Thomson Learning. All rights reserved . creating confusion Laws or Regulations: ´Rules of the Gameµ Business Two-Way Shared Understandings of Each Other Society or Stakeholder Groups Chapter 1.13 Business and Society: Ethics and Stakeholder Management.The Social Contract Changing as expectations change.

All rights reserved .14 Business and Society: Ethics and Stakeholder Management. wrong Stakeholder Management What is it? Chapter 1. 6e ‡ Carroll & Buchholtz Copyright ©2006 by South-Western.Focus of the Book Managerial Approach Business Ethics Right vs. a division of Thomson Learning.

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