CASE STUDY 2 – NYSEG CSR PROGRAM The NYSEG case touches upon a complicated topic: that of management of a corporation directly deciding upon and providing policies which redistribute wealth away from the corporate shareholders and into the hands of other stockholders. In this case, NYSEG’s Project Share is essentially a form of welfare where NYSEG takes corporate resources and profits and reallocates them to poor customers or customers with severe debt issues. In my opinion, what is strikingly unusual about this program is the extent to which it becomes involved in the lives of its customers. Customers identified for Project Share may receive financial counseling, help with substance addiction, and help connecting with other welfare services. The main question posed by this assignment is whether or not NYSEG’s Project Share is both altruistic and good business. I believe that it is…to an extent. In the subsequent paragraphs, I will explain my position, as well as what I believe the positions of Milton Friedman and John Boatright would be based upon the assigned reading of their views regarding corporate social responsibility. As I just mentioned, I believe that to a certain extent, Project Share is at once altruistic and good business, but this view relies upon a perception of the business value of social outreach and community image that is difficult to accurately quantify. It also bears comparison to other industries and other business models. Project Share is undoubtedly helpful to the many customers who receive its benefits, and the assigned article states that “NYSEG’s bad-debt level is 20 percent lower than that of the average U.S. utility company.” It also points out that the costs of managing Project Share gre... ... middle of paper ... ...l responsibility as a source of employee satisfaction. Research in Organizational Behavior. Retreived May 16, 2014, from https://www.uic.edu/labs/skitka/public_html/CorpSR.pdf McElhaney K. (2009, Spring) A Strategic Approach to Corporate Social Responsibility. Executive Forum. Retreived May 16, 2014, from http://responsiblebusiness.haas.berkeley.edu/documents/Strategic%20CSR%20(Leader%20to%20Leader,%20McElhaney).pdf Schnietz K., Epstein, M. (2004) Does Corporate Social Responsibility Pay Off? Graziadio Business Review. Retreived May 18, 2014, from http://gbr.pepperdine.edu/2010/08/does-corporate-social-responsibility-pay-off/ Johnson, B. (2013, Jun 23) Big U.S. Advertisers Boost 2012 Spending By Slim 2.8% With a Lift From Tech. AdvertisingAge. Retreived May 18, 2014, from http://adage.com/article/news/big-u-s-advertisers-boost-2012-spending-slim-2-8/242761/
Orlitzky, M, Schmidt, F & Rynes, S 2003, ‘Corporate social and financial performance: A meta analysis’, Organization Studies, vol. 24, no. 3, pp 403-11.
To understand this issue from both sides, it is also important to gain a perspective from the corporate finance world. Understanding that the goal of a corporation is to maximize the profits of its shareholders, H.B. Fuller really did not have a social obligation. If, howe...
Perhaps Friedman’s most prevalent justification for dismissing social responsibility from business arises from his view on ethical spending. He believed that it was unethical for businessmen to spend other people’s (shareholders) money on other people (i.e. the community), and that transactions of such a nature should be left to government and corporate social responsibility programs. This line of thinking reinforced what is known today as the shareholder primacy model, whereby the primary moral duty of any corporation is to serve the shareholder’s interests, subject to some moral minimum (Smith, 2003). Friedman held that it was the shareholders money being spent, not the corporation 's, as corporations were merely fictional entities. Numerous
Hohnen, P. (2007). Corporate Social Responsibility An Implementation Guide for Business. Winnipeg: International Institute for Sustainable Development. Retrieved January 22, 2014, from http://www.iisd.org/pdf/2007/csr_guide.pdf
To supply the wants and needs of a consumer, society entrusts wealth-producing resources to the business enterprise.” (Santayana, George. Is The Tyranny Of Shareholder Value Finally Ending? So before we go into greater detail on the different perspectives related to social responsibility, one might question the meaning of social responsibility. It is generally agreed that social responsibility is defined as the business obligation to make decisions that benefit society.... ...
SC Johnson is in a very familiar arena for companies who have decided that the best approach to community support is through social contract. For me, I expect for large corporations to take part in social, political and environmental issues. Not only that, but there is an expectation for corporations to reinvest and to help struggling people to meet their basic needs. Corporations such as SC Johnson can show their concerns with struggling communities and appreciate the kickbacks while showing that it recognizes the value in giving back to these struggling communities.
While going through my academic program, I have learned the importance of organizations having to integrate strategic planning in accordance with ethics and social responsibility practices; it is necessary for an organization’s survival. As such, an organization needs to implement its mission, strategy, and vision while considering the stakeholders and general public. My academic program has brought me to this realization and provided me with a means to effectively associate the implications of an organization’s ethics and social responsibility from a strategic perspective. When integrated effectively, establishing these components within the organization’s strategic plan has the capacity to largely benefit the organization's daily operations, which in turn, affect overall profit.
Waldman, D., Kenett, R. S. and Zilberg, T. 2010. Corporate Social Responsibility: What it really is, Why it’s so important, and How it should be managed. School of Global Management and Leadership, Arizona State University.
Different facets of organizational behavior were addressed in the three articles reviewed for this project. Pay Satisfaction, Job Satisfaction, and Turnover Intent by Parbudyal Singh and Natasha Loncar examines the relationship between employee position and salary satisfaction and job turnover. The 4 Rs of Motivation by Michael Maccoby suggests a formula from which leaders should pull to motivate subordinates, and Relations Between Leader-Subordinate Personality Similarity and Job Attitudes by Lior Oren, Aharon Tziner, Gil Sharoni, Iafit Amor, and Pini Alon examines the effect the relationship between leaders and subordinates has upon job satisfaction.
The article “The Social Responsibility of Business is to Increase its Profits” is written by a famous economist Milton Friedman. Friedman in this article implies that shareholders are the main drivers of the corporations and he believes that it is to them corporations must be socially responsible to. The goal of any corporation is to maximize profits and return the portion of these profits to shareholders for investing in the corporation. The shareholders can themselves decide which social causes to take part in rather than assigning a corporate executive to decide on their behalf. Friedman argues that a corporation must have no social responsibility to society because its only concern is the increase profits for itself and its shareholders.
The first discussion question posed was, “How does Dr. Friedman characterize discussions on the “social responsibilities of business”? Why (Jennings, 2009, p. 79)? Friedman (1970) characterized the discussions on social responsibilities as one hundred percent unadulterated socialism. Friedman (1970) characterized these discussions in that manner because he felt that a corporate executive should focus solely on making profits and not on social aspects. He mentioned how people who conduct and express themselves in this fashion are positively reinforcing and supporting the actions of individuals that have been weakening the foundational blocks of free society. Friedman (1970) posed a question which was the crux of his 1970 article “The Social Responsibility of Business is to Increase its Profits” where he investigated the true contextual meaning of what responsibilities mean to businesses. Friedman describes how businesses cann...
When the problem became serious two main views formed: the “narrow” view and the “broader” view, based on different ideas. The “narrow” view is based on the proposition that corporations have no social responsibility and they have only one main purpose, to make a profit (Friedman, 1970). So corporations should remain socially independent and all conflicts must be solved through the individual responsibility concept. On the contrary the “broader” view states that corporations have social obligations as all existing participants of market, persons and entities are tied together and are mutually dependent. So corporations cannot ignore some serious events or problems, which take place, and must help society, as profit is not their single purpose.
Hildebrand,D, Sen,S and Bhattacharya,C.B.(2011) European Journal of Marketing. Corporate social responsibility: a corporate marketing perspective. 45(9/10).1353-1364.
European Commission: 2001, Green Paper Promoting aEuropean Framework for Corporate Social Responsibility C OM(2001) 366 (Commission of the European Communities, Brussels). Retrieved from http://eurlex.europa.eu/LexUriServ/site/en/com/2001/com2001_0366en01.pdf
It seems obvious that large corporations have a tendency to ignore the negative effects of their actions in favor of profit. This example, although sensationalized, still says to me that with power comes responsibility. It affirmed my belief that a corporation’s goal cannot be just to provide profit to shareholders, but there must also be an element of social responsibility.