This assignment is a discussion on the topic of corporate social responsibility. In the assignment, I have argued if business can be moral entities. I have used information from various academic sources about the issue. I have also related the topic to a real life experience, whereby I have selected an article from PR Newswire business media about Toyota Company’s involvement in corporate social responsibility.
The discussion therefore begins with a brief description of the topic and theoretical framework, summary of the article about the company, how the company has used or is utilising the practice of corporate social responsibility and finally how the topic can be applied in general business settings.
Corporate Social Responsibility
This concept is generally used to refer to the relationship between businesses and their environment. All the businesses operate in social, political, economic and natural settings.
The concept therefore takes into account how businesses interact with these environments, either positively or negatively. The topic of corporate social responsibility can be broken down into four main components, namely, ethical, economic, philanthropic and legal components (Aras & Crowther, 2010).
The ethical component of corporate social responsibility comprises the expectations of the society for any business. Such expectations include doing what is just, fair and right, using the law as the basis of organisational behavior, avoiding questionable practices and running a business in a manner which does not compromise the well-being of the people and their environment (Baken, 2004).
The economic component comprises taking care of the interests of the shareholders, investors and customers, profit making and benefits’ maximization, minimization of the costs in undertaking the business and formulation as well as implementation of strategic policies which propel business forward (Aras & Crowther, 2010).
The legal component includes the respect and compliance of the business to the policies, such as environmental laws, consumer laws, laws which protect the employees as well as ensure respect of contractual agreements between a business and its clients or employees (Carroll, 2008).
Finally, the philanthropic component basically entails returns to the society from the business. Businesses may do this in a variety of ways like establishing or supporting programs which directly benefit the society like health, education and cohesion programs as well as activities which boost harmonious living of people from diverse backgrounds (Carroll, 1979).
Theoretical Perspectives to Corporate Ethics
One of the theoretical perspectives to business ethics is the normative approach. This approach constitutes two theoretical perspectives, namely, utilitarianism and deontology. The two vary in terms of how they contextualise business ethics.
However, they have one thing in common, which is they are characterised by centralization of decision making on issues touching on ethics. This means that in both cases, the employees play minimal or no role at all in influencing and setting the ethical climate for organisations (Jamali & Mirshak, 2007).
In business ethics, utilitarianism is about considering several courses of action, considering the costs involved and choosing the course of action, which produces maximum good for the maximum number of people irrespective of the negative effects of the maximization of the good, in this case, profits (Britannica Educational Publishing, 2011).
Utilitarianism is an ethical model of reasoning which emphasises on the maximization of good and happiness and the minimization of the reverse of happiness and good. Its key proponents are John Struat Mill and Jeremy Bentham..
According to them, the principles of human interaction are based on the overall good. In this sense, therefore, good is looked from an objective sense that it should produce ‘good’ for the maximum number of people (Scarre, 1996).
Utilitarianism is based on the principle, ‘the end justifies the means’; meaning if the end of a process or action is good, then the means of achieving that outcome are also good and justifiable.
According to the model, for an action to be considered ethically or morally correct, it should have an outcome which benefits the maximum number of people. What this means is that people should focus on the end of a process but not the means of attaining to that end (Kizza, 2010).
Due to this reason, utilitarianism is considered a consequentialist theory because it focuses on the consequences of an action. An action may therefore be both correct and incorrect or moral and immoral at the same time.
Take the example of killing, which is considered by many as immoral as well as illegal. From the utilitarian point of view, killing of one person to save the lives of a hundred people may be justified in that the killing of that person has an intrinsic value, which is saving lives of many people (Scarre, 1996).
On the other hand, deontology requires employees to perform their duties as per the given instructions, leaving no room for them to give their opinion regarding the consequences of their actions as they perform their duties, but rather, carrying out their tasks, as instructed, because doing otherwise considers as unethical behaviour (Britannica Educational Publishing, 2011).
The other perspective to corporate ethics is the decision making model, which begins with clarification of the issues on which ethical decisions are to be made.
After doing the clarification, what follows is the evaluation of the clarified decisions, which paves the way for arriving at a precise decision on the most appropriate course of action. The decision is then implemented with modifications coming after the implementation (Marshall, 2007).
This model is more or less similar to the normative approach to ethics because during the implementation stage, the guiding principle is mainly the maximization of profits and minimization of the costs.
This is done usually with a view of ensuring that organisation realises its objectives with the use of minimum resources possible. The decision making model, similar to a normative approach, exclusively involves the corporate leaders with the employees playing insignificant roles in the same.
Summary of the Article
The article is titled “Al, Today and Toyota Lend a Hand to Local Las Vegas Charity” and is obtained from the PRNewswire united business media. The article is about how the Toyota Company has been participating in the ‘lend a hand’ program series since the year 2009.
The program is aimed at supporting community programs in Las Vegas through linking the community programs with potential well-wishers, mainly businesses and corporations (PRNewswire, 2011).
For example, the organisation undertakes a program in which free meals and hospitality services are provided to needy children. In the article, the company donated a brand new Toyota Sienna to the program as a way of giving back to the community (PRNewswire, 2011).
The Toyota Company and Corporate Social Responsibility
The company has been involving itself in corporate social responsibility activities for many years through supporting programs on education, environmental safety and philanthropy. Since 1991, the company has donated $500 million to such programs.
Apart from donating a brand new Toyota Sienna to the culinary training academy (CTA) organisation, as mentioned in the article, the company has another charity program on its Facebook account. The program is dubbed “100 cars for good” and entails engaging the public in sending their donations to purchase 100 cars for charity programs in the United States (PRNewswire, 2011).
Application of Corporate Social Responsibility in General Business settings
Corporate social responsibility can be applied in all the businesses by holding them accountable and responsible for the welfare of the society. All the companies participate in one way or another, either consciously or unconsciously in corporate social responsibility.
Recently, with the advent of climate change, there has emerged the trend through which many companies have started engaging themselves in climate change mitigation measures. Other organisations engage themselves in various programs which positively impact on the welfare of the communities.
This practice also helps the corporations establish and maintain a good public image, which in turn increases customers’ and shareholders’ confidence and interest in the companies (Visser & McIntosh, 1998).
As discussed in the assignment, corporate social responsibility is about the relationship between businesses and society. It is composed of four main components, namely, legal, economic, philanthropic and ethical components. Many corporations engage themselves in various social responsibility affairs.
One of such companies is the Toyota Company, which has been actively involved in environmental, educational and philanthropic programs in the United States as discussed in the article titled ‘Al, Today and Toyota Lend a Hand to Local Las Vegas Charity’.
Corporate social responsibly helps the organisations cultivate and maintain a good public image, which boosts investor and customer confidence in the company, which in turn increases their stability.
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Baken, J. 2004, The Corporation: The Pathological Pursuit of Profit and Power, Constable, Vancouver.
Britannica Educational Publishing 2011, Thinkers and Theories in Ethics, The Rosen Publishing Group, New York, NY.
Carroll, A. B. 1979, Three-Dimensional Conceptual Model of Corporate Social Performance, Academy of Management Review 4: 497-505.
Carroll, A. B. 2008, A History of Corporate Social Responsibility, In The Oxford Handbook of Corporate Social Responsibility, edited by Crane, McWilliams, Matten Moon & Siegel, OUP, Oxford.
Jamali, D. & Mirshak, R. 2007, ‘Corporate social responsibility (CSR): Theory and practice in a developing country context’, Journal of Business Ethics 72, pp.243-262.
Kizza, M. 2010, Ethical and Social Issues in the Information Age, 4th ed, Springer, New York, NY.
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PRNewswire, 2011, ‘Al, Today and Toyota Lend a Hand to Local Las Vegas Charity’, PRNewswire business media. Web.
Scarre, G. 1996, Utilitarianism, Routledge, New York, NY.
Visser, W. & McIntosh, A. 1998, ‘A Short Review of the Historical Critique of Usury’, Accounting, Business & Financial History 8(2): 175-189.