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Introduction: Corporate Social

Responsibility (CSR); Business Ethics;
A business case for CSR

Dr. Eugene Hickland

Business Ethics and

Learning Outcomes

To critically understand Corporate Social Responsibility (CSR)

To critically understand Business Ethics
To critically evaluate how CSR & Business Ethics is managed & implemented
To critically understand stakeholder theory and implications of for Managing
Business Ethics/Ethical Decision Making

To critically examine how CSR & Business Ethics can be integrated into the
corporate governance framework

To critically assess the relationship between employees, HRM, HRD & CSR and
Business Ethics

To have a critical understanding of the complex relationship between suppliers,

competitors, the Global Value Chain & CSR & Business Ethics

Learning Outcomes

To critically understand the role of the consumer & social marketing in the CSRBusiness Ethics relationship

To have a critical understanding of the complex relationship between suppliers,

competitors, the Global Value Chain & CSR & Business Ethics

To critically understand the role of the consumer & social marketing in the CSRBusiness Ethics relationship

To have a critical understanding of social accounting and socially responsible

investment and finance

To have a critical understanding of key regulatory institutions (e.g., the ILO, OECD)
& policy interventions such as the UN Millennium Development Goals, the UN Global

Compact & philanthropy.

To critically evaluate a posited CSR and organisational performance link: Is there a

business case for CSR & Business Ethics?

Learning Outcomes

To critically understand the importance of social innovation

To critically understand the importance of environmental
management & sustainable development

To have a critical understanding of the future of CSR

The module bridges across many subject areas: accounting, crosscultural management, economics, finance, HRM, innovation
management & marketing.


Team assignment 3,000 words, based on case studies contained in the

Crane & Matten, Business Ethics book. There are 4-5 questions at the

end of each of the selected case study that you need to answer.

The assignment brief (also in hard copy) and the cases are scanned and
on Blackboard. You will be assigned into your teams by the next

The assignment is due by 5pm on Friday, 20th November (Turnitin

& hard copy)

The assignment = 50% of your overall mark (5% of which is peer

assessment. The assessment forms will be posted on Blackboard).

The exam = 50%. 2 hours. Normally, this involves answering 2 (of 6)

questions with multiple parts.

Key terms, CSR and the business case for CSR

Introduction of Key Terms

The debate: a business case for CSR?
The debate against current usage of CSR

What is business ethics

Business ethics is the study of business situations,

activities, and decisions where issues of right and wrong
are addressed- Ethics provide rationality for morals

Businesses are institutions

What level do ethics apply- macr0, micro or meso?

In practice ethics is often dilemmas
Modern Rights as theories developed in 3 stages political,
social and cultural (Campbell, 2006) a pre-occupation for
over 2,000 years (Herbert, 2002)

Defining business ethics in action

constitutive parts of business ethics:

Individual business ethics

Management ethics

Organisational ethics

Societal business ethics


Ethics and the law



Defining ethics, morality and laws

Morality: is concerned with the norms, values and

beliefs embedded in social processes which define right
and wrong for an individual or a community (often
linked to religion and the law).

Ethics: is concerned with the study of morality and the

application of reason to elucidate specific rules and
principles that determine right and wrong for any given
situation (do you abide by the moral code of
country/village in which you reside?).
These rules and principles are called ethical theories.


Relationship ethics, morality and laws






can be
to any

solutions to
incl CSR


Why is business ethics important?


Power and influence of business in society

Potential to provide major contribution to society
Potential to inflict harm

Increasing demands from stakeholders

Lack of business ethics education or training
Continued occurrence of ethical infractions
Evaluating different ways of managing business ethics


What is CSR?

No consensus see discussion in

Blowfield & Murray, Ch 1 quite a lot of

customised interpretation to suit

individual companies.

Corporate Social Responsibility


Six components of CSR (McGeough, 2015)

Stakeholder Responsibility
Discretionary Initiatives
Corporate Values
Ethical Conduct
Mutual Benefits
Effective Action

CSR is voluntary


What are we seeing more CSR?

Pressure from consumers & investors who expect organisations

to behave responsibly.

Consumer awareness especially your generation about

green issues; sustainability; ethical treatment of employees,
especially in the developing world.

Legislation national level; EU.

Institution pressure from organisations such as the UN; OECD & the
International Labour Organisation (ILO):

Media & Social Media Pressure

A rise in the business case for CSR.


The case for CSR

Human Resources helps with recruitment & selection of

employees & staff morale

Risk Management investment in ethical brand equity

Brand Differentiation:
USP (Unique Selling Point)
Build brand loyalty
Reputation & brand attractiveness
In sum, CSR has the potential to add value to organisations;
enhance their performance & sustainability.

Why not CSR

May take management focus away from core business activity a


May appear cosmetic & tokenistic without genuine social benefit.

May make a business more vulnerable (appear more unethical) if
things go wrong eg in their global supply chain (example we just saw
in Bangladesh & Lidls).

Reduce profitability & shareholder value?

Restriction to free trade eg UK govts, under Thatcher, opposition

to trade sanction against South Africa during apartheid.

Classic case against CSR

The Friedman doctrine (Milton Friedman, Nobel Prize, Economics,

1976): states that the only social responsibility of business is to increase
profits (especially shareholder value), provided that the company stays
within the rules of the law. Friedman stated that:

There is one and only one social responsibility of business to use its
resources to engage in activities designed to increase its profits so long
as it stays within the rules of the game which is to say that it engages
in open and free competition without deception or fraud (Friedman,
1970, cited in Beauchamp & Bowie (2001): p. 55).



The study of business ethics is entwined with

culture, context and laws

CSR is a business strategy based on

sustainability or business advantage?

Examine the debates and business examples of

implementing an ethical agenda and developing

CSR programmes

Further Readings

Blowfield & Murray, Chs 1, 2, 4

Crane & Matton, Chs 1 & 2
Friedman, M. (1970), The Social Responsibility
of Business is to Increase its Profits, New York
Times Magazine, 13 September

Burchell (Ed.), Section 3: pp. 84-89.