Goals:

• Describe social responsibility issues
• Identify benefits of social responsibility
• Explain the purpose of a code of ethics

Key Terms:

• social responsibility
• non-renewable resource
• ethics
• business ethics
• code of ethics

4-1 Social Responsibility

• Social Responsibility Issues
• Social Responsibility – refers to the duty of a business to contribute to the well-being of a community.
• Must weigh the interests and concerns of many groups
• Calls for more attention to social concern
• Protection of the environment, inclusion of minorities and women in the workplace, employment of the physically challenged and older workers, and a healthy and safe work environment
• Environmental Protection
• Conservation  -  saving scarce natural resources
  • A goal of many companies
  • Lumber companies have reforestation programs
• Non-renewable Resources – a natural resource that cannot be replaced when used up.
  • Gas, oil, minerals
•  Pollution – occurs when the environment is tainted with the by-products of human actions.
  • Some production methods cause pollution of lakes, rivers, and air.
  • Socially responsible businesses take action to improve or change operations that cause pollution
  • The federal government has set measureable standards for water and air quality.
  • Enforced by the Environmental Protection Agency (EPA).
• Workplace Diversity
• Businesses are more and more sensitive to the role of women, ethnic groups and physically challenged and older workers.
  • The workforce should reflect the groups in a community
  • Members of these groups must have equal access to education, training jobs, and career advancement
  • A major challenge facing businesses today is learning how to manage a workforce make up of workers who represent the diverse cultures in society.
  • Another issue is removal of employment barriers for women
  • Employers cannot exclude women applicants from physically demanding jobs unless the business can prove the job require physical skills that women do not have
  • Employers have also taken steps to accommodate individuals who are physically challenged
  • The Americans with Disabilities Act (ADA) along with other state and federal legislation has resulted in major improvements in accommodating workers who are physically challenged.
    • Buildings must have access for wheelchairs
    • People with sight or hearing limitations must be accommodated on the job
  • Other laws have been passed to eliminate bias against older workers
  • Passage of the Age Discrimination in Employment Act bars employers from using age as a basis for employment
• Job Safety
• Having a safe place to work is important to all employees
  • Should be able to work in an office or factory free from risks that could cause accidents
  • Work environment should provide full protection from fire and other hazards
  • Workers should know how to handle the unexpected
  • Employees should be trained in how to work safely and what to do in case of an emergency
  • To ensure the right to safety, most employers have put in place a variety of programs to protect workers
  • State and federal governments have also passed laws to make the world safer
  • Safety standards are regulated and enforced by agencies such as OSHA (Occupational Safety and Health Administration).
• Employee Wellness
• A healthy workforce is a productive workforce
• Workers who have good physical health are valuable resources
  • Employers offer stop-smoking seminars, counseling for employees with drug problems and weight-loss sessions
• Clauses that relate to well-being are often included in labor contracts  and company policy manuals
  • These clauses are conditions of work that pertain to the health and safety of employees while on the job
• Some business sponsor sports teams and encourage employees to take part
• Social Responsibility Evaluation
• Benefits
• Expanded justice for groups of society
• Enhanced company image
• Reduced need for government actions
• Improved quality of life in a community and around the world
• Increased awareness of social issues among workers, consumers, and others

• Costs
• Money must be spent
  • New non-polluting  or safer equipment
  • Building repairs to remove risks
  • Wellness and rehabilitation programs
  • Social project sponsored by a company
• A business must make a profit to stay open
  • If there is no profit, the business will close and employees will lose their jobs
  • Spending on social programs must be at a suitable level so a business can still earn a reasonable profit.
• Business Ethics – socially responsible businesses engage in ethical business practices
• Ethics – principles of morality or rules of conduct
• Business Ethics – rules about how businesses and their employees ought to behave.
• Ethical behavior conforms to these rules
• Unethical behavior  violates these rules
• Code of Ethics – a set of rules for guiding the actions of employees or members of an organization
• Once established the code serves as a guide of values for all employees within a company
• Worded in terms of acceptable behavior
• Ethical Conduct Guidelines
• Determined by top management
• Executives who show strong moral character and make ethical decisions set the ethical standards for a business.
• Companies have set up educational programs on ethical behavior for their employees – employees are trained on how to make ethical decisions
  • Is the action legal?
  • Does the action violate professional or company standards?
  • Who is affected by the actions and how?
• Guidelines for writing a code of ethics
  • Determine the purpose of the code
  • Tailor the code to the needs and values of the organization
  • Consider involving employees from all levels of the company in writing the code
  • Determine the rules or principles that all members of the organization will be expected to adhere to
  • Include information about how the code will be enforced
  • Determine how the code will be implemented and where it will be posted
  • Determine how and when the code will be reviewed and revised
• Conflict of interest – when an action by a company or an individual results in an unfair benefit
  • Example:  Company president knows development of a company product is not going well sells his stock in the company prior to this information being made public and the company’s stock dropping in value  because of the announcement
• In addition to workplace codes of ethics, many employees adhere to codes of professional conduct established by their professional associations
  • Accountants
  • Real estate brokers
  • Engineers