Socially responsible, but to whom?

1. Socially responsible, but to whom? Cindy MacKenzie Jessica McGraw Margaret MacDonald

2. What is Corporate Social Responsibility (CSR)? “A business outlook that acknowledges responsibilities to stakeholders not traditionally accepted, including suppliers, customers, and employees as well as local and international communities in which it operates and the natural environment.” • The Dictionary of Sustainable Management • http://www.sustainabilitydictionary.com/c/csr_corporate_social_responsibility.php

3. Investor relations: The process by which the corporation communicates with and manages its investors (people who purchase income-producing assets) http://financial-dictionary.thefreedictionary.com/Investor+relations Community relations: The planned, active, and continuous participation by an organization with and within a community, usually to maintain and enhance its environment to the benefit of both the organization and the community. http://en.mimi.hu/marketingweb/community_relations.html

4. Case: Investor Relations versus Community Relations • FunJet Airlines • Wildly successful • Motto: “Fun for all and all for fun” • Has increased goal capital since putting out an IPO (initial public offering), making it a cash cow • Community relations program proposal • Focus on fun, cultural programming • Boss is mildly supportive • Investor relations executive is not

5. Position 1: In a publicly-owned corporate entity, the thrust of the social responsibility program should be focused on making money for investors who place their trust in the organization by buying stock. For CSR: • Major investment with no determined end date • Primary responsibility to the investor: without investors, corporations wouldn’t exist • Providing for the community is the role of the government • Takes away from concentration on business practices • CSR is “window dressing” • Lower economic efficiency/profit • Requires skills businesses may lack • Giving to the arts is hard to link with bottom-line profitability • * Bonus to CEO has nothing to do with CSR

6. Position 2: Organizations, even in the profit-making sector, have ethical responsibilities to contribute to the social fabric of their communities; social responsibility means considering a wide array of publics even at the expense of investors Against CSR: FunJet Airline’s main focus is fun Reputation management Better ability to recruit, train and retain staff Improved innovation and competitiveness Operational efficiency/cost savings Improved customer relationships Ability to address change Access to capital Benefits to kids in the performing arts space

7. Delta’s Force for Local Good: http://www.delta.com/about_delta/global_good/index.jsp Alaska Airlines/Horizon Air http://www.alaskaair.com/as/www2/company/csr/giving-guidelines.asp Southwest Airlines http://www.southwest.com/about_swa/southwest_cares/our_communities.html

8. Against CSR: Questions

9. Do you see any issue with giving away investors’ money that they invested to make a profit when it’s for a good cause? How much say should they have in where the money’s going?

10. Do you assume corporations have other motive s when they engage in CSR? If the results of CSR initiatives have a positive impact on the community, would ulterior motives really matter? (end justifies the means) http://www.youtube.com/watch?v=ouqk8CdmFrk&feature=PlayList&p=0D24C8E73821EB29&playnext=1&playnext_from=PL&index=20

11. What does CSR mean to you? Does it affect the decisions you make on a daily basis as a consumer?

12. Which position is more representative of the airline’s corporate culture? Does making something “more in line” with the culture make it more ethical? “CSR has many different manifestations. In one way or another, however, its common thread is the goal of integrating the public interest into the corporation’s mission.” http://www.freeonlineresearchpapers.com/southwest-airlines-ethics

13. Is it more important that an organization’s employees actually “do something” active within the community, or is giving money enough? Is active involvement more ethical than giving money?

14. How much is enough? Is it ethical enough for an organization to concentrate CSR initiatives on things directly related to their business (i.e. helping the environment because your airline pollutes the atmosphere?) OR Should an organization go above and beyond activities related to their business?

15. “Corporate social responsibility (CSR) means that a corporation should be held accountable for any of its actions that affect people, their communities, and their environment…However, being socially responsible does not mean that a company must abandon its other missions.” http://www.freeonlineresearchpapers.com/southwest-airlines-ethics