Master of Arts in Communication : Corporate Communication Studies

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Course : Corporate Social Responsibility (1508CSR03)

Session Topic : Stakeholder Approach

Course: Corporate Social Responsibility

By Ida M. Bayuni, M.M.

LSPR eLearning Program

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• Part 1 Shareholders & Employees

• Part 2 Customers, Suppliers, Governments & Unions

• Part 3 Competitors et al

Content

Part1: Shareholders & Employees

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Stakeholder Approach: Overview

Stakeholder Approach

1. Identification of stakeholders

2. Understand specific claims

3. Reconciliation of claims,

• assignments of priorities

4. Coordination of claims with other elements

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Stakeholder: Shareholders

Shareholders

Appropriate returns on their investment,

1. Participation in,

a) Distribution of profits,

b) Additional stock offerings,

c) Assets on liquidation,

2. Vote of stock,

3. Inspection of company books,

4. Transfer of stock,

5. Election of board of directors,

6. Additional rights as have been established in the contract with the

corporation

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Stakeholder: Employees

Employees

Seek broadly defined job satisfactions,

1. Economic, social, & psychological satisfaction in the place of

employment,

2. Freedom from arbitrary & capricious behavior on the part of

company officials,

3. Share in fringe benefits,

• Freedom to join union

• Participate in collective bargaining

4. Individual freedom in offering up their services through an

employment contract

5. Adequate working conditions.

Part2: Customers, Suppliers, Governments & Unions

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Stakeholder: Customers & Suppliers

Customers

Want what they pay for,

1. Service provided with the

product,

2. Technical data to use the

product,

3. Suitable warranties,

4. Spare parts to support the

product during use,

5. R&D leading to product

improvement,

6. Facilitation of credit.

Suppliers

Seek dependable buyers,

1. Continuing source of

business,

2. Timely consummation of

trade credit obligations,

3. Professional relationship in

contracting for…

a. Purchasing &

b. Receiving goods &

services.

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Stakeholder: Governments & Unions

Governments

Want adherence to legislation,

1. Taxes

• Income,

• Property, &

• So on

2. Adherence to,

• the letter & intent of public policy

dealing with…

• the requirements of fair & free

competition

3. Discharge of legal obligations of business,

a. …people &

b. …organizations

4. Adherence to antitrust laws.

Unions

Seek benefit for their members,

1. Recognition as the

negotiating agent for

employees;

2. Opportunity to

perpetuate the union as a

participant in the business

organization.

Part3: Competitors et al

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Stakeholder: Competitors & Local Communities

Competitors

Want fair competition,

1. Observation of the norms of

competitive conduct established

by,

a) Society &

b) The industry

2. Business statesmanship on the

part of peers.

Local Communities

Want the company to be a responsible

citizen,

1. Place of productive & healthful

environment in the community,

2. Participation of company officials in

community affairs,

3. Provision of regular employment,

4. Fair play,

• Reasonable portion of purchases...

• …made in the local community,

5. Interest in & support of local

government, support of…

a) Cultural &

b) Charitable projects.

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Stakeholder: General Public

General public

Expects the company’s existence to improve the quality of life,

1. Participation in & contribution to society as a whole,

2. Creative communications between,

• governmental & business units…

• …designed for reciprocal understanding,

3. Assumption of fair proportion of the burden of,

a) Government &

b) Society,

4. Fair price for,

• products & advancement of the state-of-the-art technology that…

• …the product line involves.

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Stakeholder Approach: Level of Social Commitment

No

SocialResponsiveness

HighObligation

Low

Responsibility

Intermediate

1 Reactive Proscriptive Proactive

2 Proscriptive*Does more than required

by law

Anticipates &

prevents problems

3Adheres to legal

requirements

Does more than required

by economic considerations

Searches for society

responsible acts

4Adheres to economic

considerations

Avoids public stands on

issues

Takes public stands

on issue

*Proscriptive means,

• the firm reacts when its action is called,

• (or threatened to be called) to the public’s attention.

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Stakeholder Approach: From CSR to CSV

No CSR CSV

1 Values: doing goodValue: economic & societal

benefits relative to cost

2 Citizenship, philanthropy, sustainabilityJoint company & community value

creation

3Discretionary or in response to

external pressureIntegral to competing

4 Separate from profit maximization Integral to profit maximization

5Agenda is determined by external

reporting & personal preferences

Agenda is company specific &

internally generated

6Impact limited by corporate footprint

& CSR budget

Realigns the entire company

budget

7 Example: Fair trade purchasingExample: transforming procurement

to increase quality & yield.

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Course : Corporate Social Responsibility (1508CSR03)