Ethics and Social Responsibility

Corporate social responsibility – form of corporate self-regulation integrated into a business model. Business would embrace responsibility for the impact of their activities on the environment, consumers, employees, communities, stakeholders and all other members of the public sphere. Furthermore, business would proactively promote the public interest by encouraging community growth and development, and voluntarily eliminating practices that the sphere, regardless of legality.

Business ethics – form of applied ethics that examines ethical principles and moral on ethical problems that arise in a business conduct and is relevant to conduct of individuals and business organizations as a whole. Applied ethics is a field of ethics that deals with ethical questions in many fields such as medical, technical, legal and business ethics.

E.g; Multinationals company take advantage of international differences such as outsourcing production and services to law-wage countries.

E.g; Foreign countries often use dumping as a competitive threat, selling products at prices lower than their value. This can lead to problems in domestic markets. It becomes difficult for this market to compete with the pricing set by foreign market. It seen as unethical because large companies are taking advantage of other less economically advanced companies.

E.g; Issue of child labor in India and other developing countries – its ethical to do but here in Malaysia and US, it is unethical.

Ethical issues can arise when companies must comply with multiple and sometimes conflicting legal on cultural standards as in the case of multinational companies that operate in countries with varying practices.

E.g; US law forbids companies from paying bribes either domestically or overseas. However, in other parts of the world, bribery is a customary accepted way of doing business.

** Wages – foreign companies like to hired labor from developing countries because its cheap.

** Misuse of the intellectual property systems to stifle competition, patent misuse, copy right misuse, patent troll. E.g; McDonald’s losses court battle against McCurry – the issue of local Indian food outlet, McCurry Restaurant to use ‘Mc’ in its business signage. McCurry signboard carried the words “Restoran McCurry” while McDonalds logo as a whole, consists of a distinctive golden arched “M” and using red color. While McCurry using white (lettering) and grey color. McDonalds accused McCurry copied their name and use it as a brand name / logo. But unfortunately, McDonald’s loss the case and McCurry continued using the name on their signboard.

What skills or competencies would be required for a Corporate Social Responsibility role? – it is vary according to the company / organizations:

1. Environmental responsibilities
2. PR oriented
3. Business skills, impact and vision – decision making, leadership, commercial awareness, IT, innovation, strategic awareness, problem solving
4. Communication, influencing and people skills – political awareness, building teams, open minded.
5. Professional and technical skills – technical expertise, understanding impacts, internal consultant, selling the business case, understanding human rights and society and understanding sustainability.

- Every private or public sector, international and non-profit concerns all need to consider corporate social responsibility. United Nation for example, launched the Global Impact as an initiative to convince international companies to commit to universal principles regarding protection of human rights, labor rights and the environment.

Some examples / cases that related to corporate social responsibility;

1. Shell Sustainability Report 2008 – committed to contribute sustainable development. For them, it means helping to meet the world’s growing need for energy in economically, socially and environmentally responsible way.
2. McDonald’s 2009 Global Best of Green – listed a few McDonalds outlet for people to vote as the best outlet who have done a great social responsibility. ( http://crmcdonalds.com ).
3. Nike – the ultimate resources for business side of Nike is considered design and environment. The purposes are to; (i) reduce waste generated across their entire supply chain, (ii) reduce CO2 emissions, (iii) use chemistry and design innovation to eliminate toxins and waste, (iv) design themselves into ultimate, aspiration goal of creating closed-loop products and business models (products that can be reused and recycled).