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Presented by
Artem Sinelnikov (Student ID: 32922)
Sahr Koroma (Student ID: 25932)
Isaak Babalola (Student ID: 25315)
Nelson Fernandes (Student ID: 25976)
Lecturers: Corina Chin
Submission Date: 31st March 2014
What is CSR?
According to Howard Bowen, CSR is ''an obligation of businessman to pursue
those policies, to make those decisions, or to follow those lines of action
that are desirable in terms of the objectives and values of our society''
(Bowen, 1953).
However, Milton Friedman in 1962 championed the idea that the only obligation a
business has is to increase its profit.
Business Ethics
According to Paul Taylor, ethics is ''an inquiry into the nature and grounds of morality'' (1975, p.1). He
further defines morality as ''moral judgements, standards and rules of conduct'‘.
David Boddy (2010) also outlines 4 main approaches to what is ethical:
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Moral Principles
Human Rights
Utilitarianism
Individualism
International Code of Ethics, developed in 1994 in Switzerland, is governed by 7 main principles (Kreitner,
2009):
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Responsibility of Business
Economic and Social impact of business
Business behaviour
Respect for rules
Support for multilateral (free) trade
Respect for the environment
Avoidance of unethical practices
Stakeholder Analysis and Mapping
''Stakeholder analysis is the process of identifying the individuals or
groups that are likely to affect or be affected by a proposed action, and
sorting them according to their impact on the action and the impact the
action will have on them’’ (Larson, 2011)
Aims
 To identify most influential stakeholders
Customers
Managers and Directors
The Media
P
 To identify stakeholder orientation
o
 To recognise social, economic and political trends w
e
Application
r
Shareholders
Core Suppliers
Other Suppliers
Employees
Communities
 To help shape potential strategies
 To win over antagonistic stakeholders
Interest
Morrisons
Conflict
Related CSR Policies
1. Regular shareholder meetings
1. Shareholders
2. Creation of 'Let's Go' children's program
Sale of property without consulting shareholders (The
Telegraph, 2014)
2. Community
Noise pollution from main stores
3. Customers
Tackling social exclusion
Supporting charities
3. Promoting healthy lifestyles
Affordable prices
Honest product information
Short-time returns policy
4. Working closely with farmers
4. Suppliers
No supplier logistics support
Encouraging fair conditions at home and abroad
Enhanced construction Health & Safety
5. Employees
5. Morrisons Academy training
Stores overstaffed
Hardship fund
Fair internal promotions
Marks & Spencer
Conflict
Related CSR Policies
1. Shareholders
1. Producing a detailed governance report at the end of each year
Overly enthusiastic yearly report (M&S, 2013) takes focus
away from the company's debt
Ensuring high levels of sustainability to increase profitability
2. Internships
2. Community
Closing unprofitable stores in ROI (BBC, 2003)
Charity and community funding under Plan A
1% of company's profits is donated to charitable projects
3. Customers
3. Collecting customer feedback on Plan A activities
87% rise in profits (M&S, 2013) did not result in savings for
the customers
Reducing the amount of salt and fat in M&S products and introducing
healthier products
4. Suppliers
Protecting customers' personal data
Short notice termination of supplier agreements (BBC,
2000)
4. Suppliers are involved in training and education
Assisting suppliers in providing high standards of animal welfare
5. Employees
Fairtrade
Cutting staff redundancy benefits by 25%
(PersonnelToday, 2008)
5. Generous employee performance rewards
M&S employee retirement club
Tesco
Conflict
1. Shareholders
UK shareholders suffering loss of profit (Financial Times,
2013)
Related CSR Policies
1. Consulting shareholders on all strategic decisions
Annual shareholder meetings
2. Charity work and own food banks
2. Community
Promoting internships
Superstores defacing historic UK landmarks (The
Telegraph, 2013)
Tackling the global obesity crisis
3. Honest nutrition labelling
3. Customers
Long opening hours
Sale of horse meat scandal (BBC, 2013)
Affordable healthy products policy
4. Suppliers
4. Suppliers are involved in the decision making process
Demanding cash from suppliers to cover profit losses (The
Guardian, 2013)
Supporting fair trade
5. Tesco leadership and business management training
5. Employees
24-hour working shifts in parts of S. Korea and Thailand
(BBC, 2014)
Diversity advisory group
ASDA
Conflict
1. Shareholders
No apparent conflicts
Related CSR Policies
1. 3 Interactive shareholder meetings in addition to the regular annual
meetings (ASDA, 2013)
2. Supporting government anti-alcohol campaign in Scotland
2. Community
3. Introduced price information per unit of weight
Sale of cheap alcohol to the public (The Alcohol Academy,
2011)
3. Customers
Using misleading sales tactics (BBC Panorama, 2011)
4. Suppliers
Forcing suppliers to trade at below-market prices (The
Independent, 2010)
5. Employees
Bribing employees out of union membership (Glatuc,
2006)
Launched ASDA price guarantee (Price match)
Long opening hours
Affordable healthy products policy
4. Supplier development program
Supporting small and medium sized farmers
5. Supporting workers' freedom of association
Working closely with Unions
Disaster relief effort with Japanese unions by parent company Wallmart
Comparison
Strong involvement with local
communities
Improved profit reporting
Strong attention on customer satisfaction
Focus on customers
Supporting employees in trouble
Support for suppliers at home and abroad
Failure to consult shareholders on certain
issues
Quick response to shareholder needs
Very strong focus on suppliers following
previous criticism
Improved employee rewards and job
security after recession
Insufficient effort in retaining the UK
customer base
Strong focus on shareholders despite lack of
apparent conflicts
New supplier rules after the horse meat
scandal
Solid effort towards fairer pricing
Positive response to the supplier concerns
Strong response to the union scandal
Poor communication with communities
Weak response to bullying tactics allegations
More focus on training, but issues remain in
S. Korea
Little community effort despite criticism
The Conclusion
The authors have looked at 4 large companies operating in the UK and abroad and the
conflicts they have had with their stakeholders in the past 10 years. Almost every one of
these conflicts led to the development of CSR policies aimed at diffusing the situation
and preventing the conflict from happening again in the future.
It has also been noted that 3 out of 4 companies made strong efforts to keep their key
stakeholders happy by responding swiftly to their ethical concerns. However, they
displayed different degrees of commitment to their less influential stakeholders.
Finally, the authors concluded that Marks & Spencer currently has the most complete
CSR policy, covering the widest range of environmental and social issues around the
world.
References
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References
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2014].
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