Week four MGMT 5050- Week 4
Stakeholders: Business and Society
Trade Marks
“Prior to the invasion of Australia, First Nations communities had established a
chain of trade routes all over the continent. The exchange of goods and
services was also practised between neighbouring language groups as well as
other language groups across the continent.
Trading was vital to First Nation Peoples as it improved their quality of life.
Trading objects such as food, seeds, stones, ochres, tools, weapons was not
only a method of sharing resources but was a form of social control and lore. It
was a way of honouring each other's rights, boundaries, and cultural
differences.
Many tribes developed good relationships as they respected shared stories of
their journeys and narratives of the Dreamtime. Trade was not only linked with
materialistic objects but included songs, dances and art, stories, rituals and
ceremonies which connected First Nations Peoples to Land, Sea and Sky.”
Award winning Designer Maker Debra Beale
In 2019 UNSW Business School commissioned Debra
Beale who created this exclusive design Trade Marks
Acknowledgement of country
General feedback on memos
Business decision making is complex as we
saw last week
This week we explore CSR, Stakeholders and ESG.
More than the economic and legal requirements
Corporate Responsibility requires more.
We need to understand what we are in the business of
Risk, values who are we as a company
Corporate Social Responsibility & Corporate Citizenship
What is the relationship between organisations and society?
What is a citizen?
Both rights AND responsibilities
The role and functions of organisations in society
Economic and production tasks
Land maintenance and food
production, manufacture and
distribution of goods and
services, all tasks associated with
creation and maintenance of
wealth
Distributors Mines Manufactures
Farms Retailers
Maintenance tasks
Exist to hold society ‘together’,
maintain its stability, and
ensure its continuation.
Activities that are involved in
transmitting and shaping
knowledge and culture
Education Health and
welfare Religion
services
Adaptive tasks
The means by which society
responds to change.
Universities The Arts
Research organisation
Managerial or political tasks
The institutions and systems to
identify and implement policy
for the group and related
agencies to arbitrate and assess
conflicting demands or
expectations
Political parties Government
The law Military
The role and functions of organisations in society
Adaptive tasks
The means by which society
responds to change.
Economic and production
tasks Land maintenance and
food
production, manufacture and
distribution of goods and
services, all tasks associated with
creation and maintenance of
wealth
Manufacture
s
Distributors Mines
Farms Retailers
Universitie
s
Research
organisation
The
Arts
Educatio
n Religio
n
Political
parties The law
Maintenance tasks
Exist to hold society ‘together’,
maintain its stability, and
ensure its continuation.
Activities that are involved in
transmitting and shaping
knowledge and culture
Health and
welfare
services
Managerial or political tasks
The institutions and systems
to
identify and implement policy for
the group and related agencies
to arbitrate and assess
conflicting demands or
expectations
Government
Military
Carroll
1991
Corporate Social
Responsibility
CSR : It is important to ...
Economic Legal Ethical Philanthropic
be committed to
being as profitable
as possible
perform in a manner
consistent with
expectations of
government and law
perform in a manner
consistent with
expectations of
societal mores and
ethical norms
perform in a manner
consistent with the
philanthropic and
charitable
expectations of
society
maintain a strong
competitive position
be a law-abiding
corporate citizen
recognize and
respect new or
evolving ethical/
moral norms
adopted by society
to assist the fine and
performing arts
maintain a high level
of operating
efficiency
provide goods and
services that at least
meet minimal legal
requirements
prevent ethical
norms from being
compromised in
order to achieve
corporate goals
participate in
voluntary and
charitable and
educational activities
within their local
communities
a successful firm be
defined as one that
is consistently
profitable
a successful firm be
defined as one that
fulfils its legal
obligations
good corporate
citizenship be
defined as doing
what is expected
morally or ethically
assist voluntarily
those projects that
enhance a
community's "quality
of life."
Global power
Of course, the biggest caveat to consider with
these comparisons is the difference between
market cap and GDP numbers.
A company’s market cap is a proxy of its net
worth in the eyes of public markets and changes
constantly, while GDP measures the economic
output of a country in a given year.
But companies directly and indirectly affect the
economies of countries around the world. With
international reach, wealth accumulation, and
impact, it’s important to consider just how much
wealth and power these companies have.
The World’s Tech Giants, Compared to the Size of Economies
The Visual Capitalist - July 7, 2021
The World’s Tech Giants, Compared to the Size of Economies
The Visual Capitalist - July 7, 2021
The World’s Tech Giants, Compared to the Size of Economies
The Visual Capitalist - July 7, 2021
The World’s Tech Giants, Compared to the Size of Economies
The Visual Capitalist - July 7, 2021
Who is richer than whom?
Corporate influence in the development of policy
Corporations do influence: e.g Mike Cannon Brookes
of Atlassian is outspoken in the need for
businesses to step up.
Climate change is a big issue COP 26 and 27 theme
Uniting the World to Tackle Climate Change.
COP28 - COP stands for Conference of the Parties
and will be attended by countries that signed the
United Nations Framework Convention on Climate
Change (UNFCCC) - a treaty agreed in 1994. The
2023 meeting will be the 28th meeting - COP28.
Corporations beyond green and blue washing
Ikea advertising shift
Credit Swisse
Consider why these companies are doing this
the Business Roundtable’s statement of Volunteering, awareness days, and employee
purpose in 2019, in which 181 CEOs committed perks all fall under the CSR banner, as do
to lead their companies for the benefit of recycling policies and dedicated efforts to
employees, suppliers, customers, communities, reduce carbon emissions.
and shareholders alike.
View is Sustainability intrinsically good – in operation this
means …
But is it enough? Move over CSR its time for ESGs
Because we need to consider
environment as well
Environmental, Social, and
Governance (ESG)
ESG the latest evolution of the
intentions behind CSR, which
provides a framework for
greater transparency, greater
efforts, and greater good. https://www.pwc.com/gr/en/advisory/risk-assurance/sustainability-
climate-change/eu-sustainable-finance-and-the-increasing-
importance-of-ESG-factors-in-accessing-finance.html
Background:
CSR aims to make a business accountable,
ESG criteria make its efforts measurable
ESG provides numbers: how companies treat
their staff, manage supply chains, respond
to climate change, increase diversity and
inclusion, and build community links.
For many businesses, CSR has never
graduated beyond being an add-on to their
main purpose and overall direction, a
footnote in the annual report. At worst, it
has become a marketing tool, allowing an
organisation to say what it is doing well
without having to back up its claims or talk
about areas where it may be failing.
ESG policies, are criteria led and require that
being embedded in the core of a business’s
strategy. The power of ESG lies in its
integration into a business. Momentum is being
driven by asset managers, consumers, and
employees demanding transparent, purpose-
led business practices that align with their own
priorities.
ESG is replacing CSR
In 2019, Global Reporting Initiative revealed
that 93% of the world’s largest companies by
revenue already report on their ESG
performance..
ESGs to operationalize SDGS
These 10 areas might help to drill down
Things to think about
Who are stakeholders? What are their stakes?
In order to do sustainability have to recognize the
stakeholders
Stakeholders
• Stakeholders are those
who can affect or be
affected by an
organisation’s decisions,
policies or practices.
• May be past, present or
future-oriented e.g.
future generations as
environmental
stakeholders
Stakeholder view of business
• Alternative to the narrow (shareholder/ stockholder) views of firms,
which assumes that self-interested behaviour by individuals &
corporations will lead to general wellbeing (& prosperity) of society
(i.e. money buys you happiness)
• A ‘stakeholder view’ is associated with broader view of corporate
social responsibility
Stakeholders
Investors/ Owners
Suppliers Customers
Employees
(Resources)
COMPANY
Government/
Regulatory agencies
Special interest
groups
CommunitiesTrade associations
Competitors
‘Traditional’ media Social media
Basic premise of stakeholder theory
1. To perform well managers need to pay attention to a wide array of
stakeholders
2. Managers have obligations to stakeholders which include, but
extend beyond, shareholders
Stakeholders and their expectations
Stakeholder Expectation
Primary Secondary
Owners/shareholders Financial return Added value
Employees Pay Work satisfaction,
training
Customers Goods and services Quality
Creditors Credit worthiness Security
Suppliers Payment Long term relationships
Community Safety & security Contribution to
community
Government Compliance Improved
competitiveness
Stakeholder Management:
1. Who are our stakeholders?
2. What are their stakes?
3. What opportunities and challenges are presented by our
stakeholders?
4. What corporate social responsibility do we owe our stakeholders?
5. What strategies/ actions or decisions should we take to best deal
with these responsibilities?
Stakeholders and power
We return to power in week 8 but need to be aware of power
imbalance
Why stakeholder approach?
Stakeholder mapping
You will do more in your tutorials
Applying stakeholder theory to the case
Looking at Jukan Gorge who are the stakeholders and what are their
stakes?
Why were Indigenous stakes overlooked?
This is not a problem in Australia alone – Canada also has had issues
in this area.
Each of us has a responsibility to consider stakeholders.
Good corporate citizenship…
• Integrating social, ethical, environmental, economic and
philanthropic values in the core decision making processes of a
business.
• Consult, ask, explore for today and tomorrow as well as
considering the past.
A word of warning - Cancel culture
Cancel culture refers to the popular practice of withdrawing support
for (canceling) public figures and companies after they have done
or said something. By expressing disapproval and exerting social
pressure the ‘movement’ hopes to bring about change.
Should all companies be ready to be cancelled?
There is backlash to cancel culture, it remains largely unchecked and
professionally you need to be aware of what you align yourself
with.