Organization Theory Jozeo Millenaar
Chapter 13 – Managing social responsibility ethically
Risk Society: A risk society is one in which the lioe-threatening disasters that we might be subject to
cannot be controlled within a specifc territoryy Chernobyl or global warming are good examples.
Corporate Social Responsibility: can be defned as the explicit atempt by an organization to signal
that it exceeds minimum legal obligations to stakeholders that are specifed through regulation and
corporate governance, ofen by extending the notion oo stakeholders to be more inclusive.
CSR is seen to be a voluntary commitment on the part oo an organization to sustainable economic
development that will improve the quality oo lioe oo its employees, their oamilies, local communities,
and society at large.
the why question can be used to diferentiate ethical concerns orom instrumental concerns.
Ethically, at one extreme, organizations should be seen to be caring oor a variety oo stakeholders and
the externalities that their operations create, because to do so serves ethical interests in the greater
good. At the other extreme, orom resource dependency and institutional perspectives, organizations
also need legitimation to operate, and concern oor other stakeholders is an efcient means to
acquire legitimation. The second question, the how question, diferentiates between techno-centric
approaches, in which sustainability is seen as a technical problem, and power-sensitive approaches,
in which the pressure oo stakeholder interest makes sustainability a political issue
There are three diferent levels oo analysis implicit in any discussion oo CSRy
- At the insttttonal level there are assumptions about the legitimation oo organizational
actions in so oar as they accord with institutionalized norms and values. At this level, general
societal expectations and the oraming and implementation oo these in practice by
government determine the legitimacy oo a particular organization in its actions.
- At the organizatonal level organizations must take responsibility oor what they do and do
not do because they can be held legally accountable oor their actions and non-actions.
- At the individtal level the principle oo managerial discretion presumes the morality and
ethics oo individual managers in their relationships with stakeholders.
1
,Organization Theory Jozeo Millenaar
Stakeholder management:
Stakeholder (standard defnitono: is any person with an interest in the activity oo an organization
Stakeholder (less encompassing defnitono: those whom the organization afects with their
activities, such as owners, investors, employees, the trade unions that organize the employees,
customers, consumer associations, regulators, suppliers, and citizens living in sufcient proximity to
an organization’s material presence to be afected by it.
Stakeholder theoryy as a way oo managing organizations, develops orameworks within which
relevant stakeholders can be identifed and defned. Ofen these stakeholders are defned more
restrictedly than their identifcation in broad terms would suggest. The more restricted approach
limits stakeholders to those who are relevant. Relevance is defned in terms oo actual investments in
the organization that makes them susceptible to risk orom the organization’s activities.
the question oo who the relevant stakeholders should be becomes one oo time periodsy io businesses
are alert only to interests in the short term they will probably pay most heed to those stakeholders
whose impact is most immediate on their day-to-day operations
Höllerer (2010o has thoroughly examined CSR discourse in Austrian corporate annual reports since
the early 1990s.
- First oocus oo CSR is on the sustainability oo profts, people, and planet ofen reoerred to as
the triple botom line.
- Second oocus is on good corporate governance and enhanced transparency
- Third, situates stakeholder management as a key task oo managing divergent interests.
- Fourth, corporate values such as philanthropy and the support oo societal groups in need
that do not have power or voice in corporate decision-making, are ofen deployed to
demonstrate corporate responsibility oor less privileged members oo society.
the stakeholder approach is always an implicit theory oo power relations in which some interests will
be given a more legitimate status than others. At its best, it will be quite explicit about these
rankings, using some calculus oo poweroulness, legitimacy, and urgency in atending to stakeholder
interests. Some stakeholders will be consistently more on the outside and others will be consistently
more privileged.
Corporate greening:
Corporate Greening: is a process that involves trying to adopt green principles and practices in as
many oacets oo the business as it is possible to do so.
the new corporate environmentalism seeks not only to comply with whatever governmental or
industry regulations may be in place, but also to develop more proactive sustainability approaches.
This places sustainability, or as it is sometimes reoerred to, corporate greening, at the core oo a frm’s
strategic CSR agenda.
Corporate greening involves the espousal oo ‘green’ values, which are becoming increasingly
institutionalized with the realization that sustainable production is equivalent to more efcient
production. Inputs that are not wasted and processes that do not provide outputs which have to be
scrapped are both ecologically and economically rational. Waste is irrational and inefcient.
,Organization Theory Jozeo Millenaar
Jermier and his colleagues (2006) suggest that several oactors characterize a successoul green
learning organization that has become more socially responsibley
- Lifelong learning: ensuring that the organization really is a learning organization, constantly
trying to fnd not only new ways oo doing the same things beter (single-loop learning) but
also new things to do in innovative ways (double-loop learning).
- Developing critcal thinking skillsy helping organization members gain confdence in critical
reflection on existing ways oo doing things and encouraging them to voice their opinions as
to how things might be done beter, developing outure-oriented scenarios that are more
sustainable.
- Btilding citzenship capabilites: encouraging employees to think not just as employees in
terms oo the frm beneft but as concerned citizens desirous oo reducing the overall
ecological oootprint oo not only the organizations they work oor and with, but also the impact
that they make in their daily lives.
- Fostering environmental literacyy encouraging people to learn about specifc environmental
problems and solutions, their causes, consequences, and connectedness.
- Ntrttring ecological wisdomy sharing an eco-centred understanding oo the web oo lioe and
the centrality oo responsible, ethical, and sustainable behaviour to a good lioe.
Three things need to come together to build green learning in organizationsy the creation oo a public
sphere; the development oo communicative rationality; and discursive design.
Newton and Harte’s perspective organizational eco-change will only come about through stronger
state regulation that obliges organizations to be more socially responsible. Regulation may be an
answer but its efcacy cannot be assumed in contexts where the politics oo regulation are highly
contested and in which there is not democratic support across the political spectrum.
Greenwashingy
Cynics might say that it becomes a mater oo shareholder value oor business to appear to be
concerned about CSR issues. A common critique, thereoore, is that CSR is ofen no more than a tool
oo corporate ‘greenwash’ a rhetorical device employed by corporations to legitimize the corporate
oorm and accommodate the social consciences oo its consumers.
it will seek to outdo whatever is constituted as regulatory best practice, seeking to make itselo
greener than it is obliged to be. Just as easily, however, and with oar more orequency one suspects,
organizations promote themselves in the best possible light while not being consistent in their
ecological commitments a process called greenwashing.
Io litle or no efort is otherwise being made towards reducing energy usage and io the reduced costs
are not passed on to customers, you might be oorgiven oor thinking that the green campaign was
more about cutng costs and increasing profts than saving the environment. Such tokenistic
environmentally conscientious acts that serve mostly to increase profts are known as greenwashing.
,
Chapter 13 – Managing social responsibility ethically
Risk Society: A risk society is one in which the lioe-threatening disasters that we might be subject to
cannot be controlled within a specifc territoryy Chernobyl or global warming are good examples.
Corporate Social Responsibility: can be defned as the explicit atempt by an organization to signal
that it exceeds minimum legal obligations to stakeholders that are specifed through regulation and
corporate governance, ofen by extending the notion oo stakeholders to be more inclusive.
CSR is seen to be a voluntary commitment on the part oo an organization to sustainable economic
development that will improve the quality oo lioe oo its employees, their oamilies, local communities,
and society at large.
the why question can be used to diferentiate ethical concerns orom instrumental concerns.
Ethically, at one extreme, organizations should be seen to be caring oor a variety oo stakeholders and
the externalities that their operations create, because to do so serves ethical interests in the greater
good. At the other extreme, orom resource dependency and institutional perspectives, organizations
also need legitimation to operate, and concern oor other stakeholders is an efcient means to
acquire legitimation. The second question, the how question, diferentiates between techno-centric
approaches, in which sustainability is seen as a technical problem, and power-sensitive approaches,
in which the pressure oo stakeholder interest makes sustainability a political issue
There are three diferent levels oo analysis implicit in any discussion oo CSRy
- At the insttttonal level there are assumptions about the legitimation oo organizational
actions in so oar as they accord with institutionalized norms and values. At this level, general
societal expectations and the oraming and implementation oo these in practice by
government determine the legitimacy oo a particular organization in its actions.
- At the organizatonal level organizations must take responsibility oor what they do and do
not do because they can be held legally accountable oor their actions and non-actions.
- At the individtal level the principle oo managerial discretion presumes the morality and
ethics oo individual managers in their relationships with stakeholders.
1
,Organization Theory Jozeo Millenaar
Stakeholder management:
Stakeholder (standard defnitono: is any person with an interest in the activity oo an organization
Stakeholder (less encompassing defnitono: those whom the organization afects with their
activities, such as owners, investors, employees, the trade unions that organize the employees,
customers, consumer associations, regulators, suppliers, and citizens living in sufcient proximity to
an organization’s material presence to be afected by it.
Stakeholder theoryy as a way oo managing organizations, develops orameworks within which
relevant stakeholders can be identifed and defned. Ofen these stakeholders are defned more
restrictedly than their identifcation in broad terms would suggest. The more restricted approach
limits stakeholders to those who are relevant. Relevance is defned in terms oo actual investments in
the organization that makes them susceptible to risk orom the organization’s activities.
the question oo who the relevant stakeholders should be becomes one oo time periodsy io businesses
are alert only to interests in the short term they will probably pay most heed to those stakeholders
whose impact is most immediate on their day-to-day operations
Höllerer (2010o has thoroughly examined CSR discourse in Austrian corporate annual reports since
the early 1990s.
- First oocus oo CSR is on the sustainability oo profts, people, and planet ofen reoerred to as
the triple botom line.
- Second oocus is on good corporate governance and enhanced transparency
- Third, situates stakeholder management as a key task oo managing divergent interests.
- Fourth, corporate values such as philanthropy and the support oo societal groups in need
that do not have power or voice in corporate decision-making, are ofen deployed to
demonstrate corporate responsibility oor less privileged members oo society.
the stakeholder approach is always an implicit theory oo power relations in which some interests will
be given a more legitimate status than others. At its best, it will be quite explicit about these
rankings, using some calculus oo poweroulness, legitimacy, and urgency in atending to stakeholder
interests. Some stakeholders will be consistently more on the outside and others will be consistently
more privileged.
Corporate greening:
Corporate Greening: is a process that involves trying to adopt green principles and practices in as
many oacets oo the business as it is possible to do so.
the new corporate environmentalism seeks not only to comply with whatever governmental or
industry regulations may be in place, but also to develop more proactive sustainability approaches.
This places sustainability, or as it is sometimes reoerred to, corporate greening, at the core oo a frm’s
strategic CSR agenda.
Corporate greening involves the espousal oo ‘green’ values, which are becoming increasingly
institutionalized with the realization that sustainable production is equivalent to more efcient
production. Inputs that are not wasted and processes that do not provide outputs which have to be
scrapped are both ecologically and economically rational. Waste is irrational and inefcient.
,Organization Theory Jozeo Millenaar
Jermier and his colleagues (2006) suggest that several oactors characterize a successoul green
learning organization that has become more socially responsibley
- Lifelong learning: ensuring that the organization really is a learning organization, constantly
trying to fnd not only new ways oo doing the same things beter (single-loop learning) but
also new things to do in innovative ways (double-loop learning).
- Developing critcal thinking skillsy helping organization members gain confdence in critical
reflection on existing ways oo doing things and encouraging them to voice their opinions as
to how things might be done beter, developing outure-oriented scenarios that are more
sustainable.
- Btilding citzenship capabilites: encouraging employees to think not just as employees in
terms oo the frm beneft but as concerned citizens desirous oo reducing the overall
ecological oootprint oo not only the organizations they work oor and with, but also the impact
that they make in their daily lives.
- Fostering environmental literacyy encouraging people to learn about specifc environmental
problems and solutions, their causes, consequences, and connectedness.
- Ntrttring ecological wisdomy sharing an eco-centred understanding oo the web oo lioe and
the centrality oo responsible, ethical, and sustainable behaviour to a good lioe.
Three things need to come together to build green learning in organizationsy the creation oo a public
sphere; the development oo communicative rationality; and discursive design.
Newton and Harte’s perspective organizational eco-change will only come about through stronger
state regulation that obliges organizations to be more socially responsible. Regulation may be an
answer but its efcacy cannot be assumed in contexts where the politics oo regulation are highly
contested and in which there is not democratic support across the political spectrum.
Greenwashingy
Cynics might say that it becomes a mater oo shareholder value oor business to appear to be
concerned about CSR issues. A common critique, thereoore, is that CSR is ofen no more than a tool
oo corporate ‘greenwash’ a rhetorical device employed by corporations to legitimize the corporate
oorm and accommodate the social consciences oo its consumers.
it will seek to outdo whatever is constituted as regulatory best practice, seeking to make itselo
greener than it is obliged to be. Just as easily, however, and with oar more orequency one suspects,
organizations promote themselves in the best possible light while not being consistent in their
ecological commitments a process called greenwashing.
Io litle or no efort is otherwise being made towards reducing energy usage and io the reduced costs
are not passed on to customers, you might be oorgiven oor thinking that the green campaign was
more about cutng costs and increasing profts than saving the environment. Such tokenistic
environmentally conscientious acts that serve mostly to increase profts are known as greenwashing.
,
