ABE Human Resources Management Chapter 2

Ethics and Corporate Social Responsibility in HRM

1/20/2013

What is ethics?
Ethics (also known as moral philosophy) is a branch of philosophy that addresses questions about morality that is, concepts such as good vs. bad, noble vs. ignoble, right vs. wrong, and matters of justice, love, peace and virtue. WHO must behave ethically? Everyone.

1/20/2013

Ethics and Corporate Social Responsibility in HRM

Organisations Accountability
Shareholders: To return on their financial investment. Employees: To ensure the employment contract is followed. Suppliers: Ensuring relationships are maintain to attain goals. Customers: To ensure the end product is being enjoyed. Society: Protect the environment. Local communities
1/20/2013 Ethics and Corporate Social Responsibility in HRM 3

1/20/2013

Ethics and Corporate Social Responsibility in HRM

Stakeholder Groups.
Stakeholder a person or group of people who affect or be affected by the organisation. Internal Stakeholders: to ensure the internal operations of the business are practice. Connected Stakeholders: No do manage the daily activities, but have an impact on the running. External Stakeholders: To ensure the law is followed and generally is not connected to the operations.
1/20/2013 Ethics and Corporate Social Responsibility in HRM 5

Stakeholder Theory
The act of balancing the responsibility to various stakeholders at any point in time. The practice is to view all parties and their level of contribution to the business. A common conflict in this theory is to determine which party should receive more rewards than the other.
1/20/2013 Ethics and Corporate Social Responsibility in HRM 6

Externality
Economics studies two forms of externalities. An externality is something that, while it does not monetarily affect the producer of a good, does influence the standard of living of society as a whole. A positive externality is something that benefits society, but in such a way that the producer cannot fully profit from the gains made. A negative externality is something that costs the producer nothing, but is costly to society in general. Examples of positive externalities are environmental clean-up and research. A cleaner environment certainly benefits society, but does not increase profits for the company responsible for it. Likewise, research and new technological developments create gains on which the company responsible for them cannot fully capitalize. Negative externalities, unfortunately, are much more common. Pollution is a very common negative externality. A company that pollutes loses no money in doing so, but society must pay heavily to take care of the problem pollution caused.
1/20/2013 Ethics and Corporate Social Responsibility in HRM 7

Ethics Applied to Management

Decisions organisations make to actions that are held to be rights are: - Deontology: Act to respect the fundamental right of human beings. - Utilitarianism: Serve the greatest good of the greatest numbers. - Teleology: End justifies the means. - Egoism: Moral behaviour to be considered in terms of personal self interest.
1/20/2013 Ethics and Corporate Social Responsibility in HRM 8

Developing Business Ethics.

- Ethical Decision Model: Recognise the issue get the facts evaluate actions make decision act and reflect on the outcome. - EVR congruence: E-V-R shows how the environment is a source of opportunities and threats - external key success factors; and that resources constitute strengths and weaknesses, strategic competencies which either match, or fail to match, environmental needs.
1/20/2013 Ethics and Corporate Social Responsibility in HRM 9

Corporate Social responsibility

Social responsibility is an ethical or ideological theory that an entity whether it is a government, or individual has a big responsibility to society at large. This responsibility can be "negative", meaning there is exemption from blame or liability, or it can be "positive," meaning there is a responsibility to act beneficently (proactive stance).

Corporate social responsibility (CSR), also known as corporate responsibility, is a form of corporate self-regulation integrated into a business model. CSR policy would function as a built-in, self-regulating mechanism whereby business would monitor and ensure its support to law, ethical standards, and international norms.
Relevance to HRM Retirement and redundancy assisting employees to change from work to nonwork. Outplacement

1/20/2013

Ethics and Corporate Social Responsibility in HRM

10

Home Work

June 2009 Question 1 Question 2

1/20/2013 Ethics and Corporate Social Responsibility in HRM 11