Transcript Chapter 20 Power Point

Chapter
20
Global Social Issues
for a New Century
20-1
Business
and
Society
POST, LAWRENCE, WEBER
McGraw-Hill/ Irwin
© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.
Figure 20-1a
Globalization: Pros
• Productivity grows more quickly when countries produce goods and
services in which they have a comparative advantage.
20-2
• Raises per capita GDP and standard of living.
• Global competition creates price competition and minimizes inflation.
• An open economy spurs innovation and improves the flow of new ideas.
• Export jobs often pay better than other jobs.
• Unfettered capital flows give the country access to foreign investment funds;
this helps to keep interest rates low.
Source; Based on arguments in Thomas Friedman, The Lexus and The Olive Tree, New York: Anchor Books, 2000; David
Korten, When Corporations Ruled the World, San Francisco: Berrett-Kohler, 1998; and Business Week, Special issue on
globalization, April 24, 2000.
McGraw-Hill/ Irwin
© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.
Figure 20-1b
Globalization: Cons
20-3
• Jobs in the domestic economy are lost as imports replace
home-made goods and services
• Companies operate in fear of foreign competition and keep
wages as low as possible
• Employers force employees to take wage cuts and require them
to share health care costs
• Employers threaten to close local operations and move jobs out
of the country;
Source; Based on arguments in Thomas Friedman, The Lexus and The Olive Tree, New York: Anchor Books, 2000; David
Korten, When Corporations Ruled the World, San Francisco: Berrett-Kohler, 1998; and Business Week, Special issue on
globalization, April 24, 2000.
McGraw-Hill/ Irwin
© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.
Figure 20-2
Business models and citizenship models:
A comparison
20-4
Business model
Key question:
Elements
Results
How do we make
money?
Citizenship model
How do we become
effective citizens?
• Product
• Market/customer
• Technology
• Manage assets wisely
• Minimize risk to others
• Build stakeholder trust
• Cultivate relationships
• Assist community groups
• Revenues
• Profits
• Goodwill
• Reputation
• Revenues
• Cost control
• Stakeholder trust
• Reputation
Source: J.E. Post, Meeting the Challenge of Global Corporate Citizenship,
Boston College Center for Corporate Community Relations, 2000. p. 35
McGraw-Hill/ Irwin
© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.
Figure 20-3
The “pyramid” of global citizenship activities
Global programs
e.g., IBM global education
20-5
Regional programs
e.g., pharmaceutical firms
fighting AIDS and tropical
diseases
National programs
e.g., community outreach
Source: London Benchmarking Group Model described in J.E. Post, Meeting the Challenge of Global Corporate Citizenship,
Boston College Center for Corporate Community Relations, 2000.
McGraw-Hill/ Irwin
© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.
Figure 20-4
The new wealth: Stakeholder relationships
Financial
capital
assets
Stakeholder
relationships
- Intangible
assets
Natural
resource
assets
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Labor;
human
capital
assets
20-6
Organizational wealth
© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.
Figure 20-5a
The business value chain and
“triple bottom line” impacts
Environmental impacts (negative)
* direct air/water pollution
* resource damage
* use of non-renewable resources
* open system waste streams
* waste streams
Natural
Resources
Manufacture of
Component
Products
20-7
* air & water pollutants
* use of toxics
* excessive packaging
* noise, radiation
Assembly
Operations
Distribution
Activities;
Market
Channels
Marketing,
Promotion,
and Sales
Activities
Environmental impacts (positive)
* offset damage conservation land
* public service messages
* upgraded usage
* reduced packaging (volume)
* improvements
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* emergency risk management
* continuous reduction of toxics
* recycled materials
* less toxic packages
© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.
Figure 20-5b
The business value chain and
“triple bottom line” impacts
Social impacts (negative)
* industry dependence
* transport safety
* advertising messages
* human rights
* competition
Natural
Resources
Manufacture of
Component
Products
20-8
* worker rights
* over-promotion
* company towns
* labor safety
Assembly
Operations
* trade practices
* media images
* local retailers
* service needs
Distribution
Activities;
Market
Channels
Marketing,
Promotion,
and Sales
Activities
Social impacts (positive)
* jobs
* education
* infrastructure
* new knowledge
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* community involvement
* contributions/giving
* volunteerism
* cause-marketing
* less expensive products
* innovation
© The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.