Scenario: One Sandwich Blitz location is near a public assistance housing complex, which is populated by a large segment of displaced natural disaster survivors, many of whom are of various ethnic groups. While sales are still good, this location has been the target of two armed robberies over the past year. Some employees have voiced their concern over working at this particular location. Local community leaders have urged Dalman and Lei to keep this location open and told them about a local neighborhood improvement initiative designed to make this neighborhood safer and more attractive. Sandwich Blitz has one more year left on a 5-year lease agreement.
Refer to the Pyramid of Global Corporate Social Responsibility and Performance in the textbook; then discuss the concept of corporate social responsibility as it applies to this scenario.
Be sure to discuss the following:
- Based on your reading on Corporate Social Responsibility including economic, legal, ethical, and philanthropic responsibilities, what should Lei and Dalman do in this situation? In your response make sure to refer to textbook material and provide specific examples of each.
Finally, philanthropic respon- sibilities are additional behaviors and activities that society finds desirable and that the values of the business support. Examples include supporting community projects and making charitable contributions. Philanthropic activi- ties can be more than mere altruism; managed properly, “strategic phi- lanthropy” can become not an oxy- moron but a way to build goodwill in a variety of stakeholders and even add to shareholder wealth.102
Robert Giacalone, who teaches business ethics at Temple Univer- sity, believes that a 21st-century education must help students think beyond self-interest and profit- ability. A real education, he says,teaches students to leave a legacy that extends beyond the bottom line—a transcendent education.103 A transcendent education has five higher goals that balance self-interest with responsibility to others:
- Empathy—feeling your decisions as potential victims might feel them, to gain wisdom.
- Generativity—learning how to give as well as take, to others in the present as well as to future generations.
- Mutuality—viewing success not merely as personal gain, but a common victory.
- Civil aspiration—thinking not just in terms of “don’ts” (lie, cheat, steal, kill), but also in terms of positive contributions.
- Intolerance of ineffective humanity—speaking out against unethical actions.
5.2 | Do Businesses Really Have a Social Responsibility?
Two basic and contrasting views describe principles that should guide managerial responsibility. The first, known as the shareholder model, holds that managers act as agents for shareholders and, as such, are obligated to maximize the pres- ent value of the firm. This tenet of capitalism is widely associ- ated with the early writings of Adam Smith in The Wealth of Nations, and more recently with Milton Friedman, the Nobel Prize–winning economist of the University of Chicago. With his now-famous dictum “The social responsibility of business is to increase profits,” Fried- man contended that organi- zations may help improve the quality of life as long as such actions are directed at increas- ing profits.
Some considered Friedman to be “the enemy of business eth- ics,” but his position was ethi- cal: he believed it is unethical for unelected business leaders to decide what is best for soci- ety, and unethical for them to spend shareholders’ money on projects unconnected to key business interests.104 In addi- tion, the context of Friedman’s famous statement includes the qualifier that business should increase its profits while con- forming to society’s laws and ethical customs.
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