MNE Topic 6

Question 1

stakeholder

Answer 1

any group or individual who can affect or is affected by achievement of firms objectives

Question 2

shareholder value perspective

Answer 2

• profit over responsibility
• serve SHs (org obj)
• success = share price
• stakeholder mngmnet = means
• individual social responsibility
• society served -> pursue economic efficiency

Question 3

stakeholder value perspective

Answer 3

• responsibility over profit
• serve all stakeholders
• success = stakeholders satisfied
• stakeholder management = means and end
• individual and org social responsibility
• society served -> pursue economic symbiosis

Question 4

CSR

Answer 4

consideration & response
social benefits & traditional economic gains
issue beyond narrow
req - economic, technical, legal

Question 5

main ethical domains

Answer 5

1. corruption
2. environment
3. human rights and labour issues

Question 6

modern slavery

Answer 6

supermarket slave trail

Question 7

5 challenges in implementing CSR policies in MNCs

Answer 7

1. differing ethical standards
2. laws-> lack of/enforcing
3. increased costs
4. boundaries of MNC’s responsibilities
5. complexity globalised supply chain

Question 8

child labour examples

Answer 8

• multinationals dont disclose info on ethical/HRM approaches

1. BodyShop - state support ban on forced child/prison labour
2. Elf Acquitaine -> state reject child labour use
3. JCPenney -> claim not knowingly allow importation into US of merchandise manufactured with illegal child labour

• vague aspects = avoid other dilemmas that explicit child labour codes raise

Question 9

civil learning tool - CSR organisational learning

Answer 9

• org pass through 5 stages = more socially responsible -> org learning process

1. Defensive
2. Compliance
3. Managerial
4. Strategic
5. Civil

Question 10

defensive

Answer 10

deny practice/outcomes or responsibilities

• defend against rep attacks in ST
• affect sales, recruit, productivity, brand

Question 11

compliance

Answer 11

adopt policy based compliance approach as cost of doing business

• mitigate erosion of economic value in medium term
• ongoing rep and litigation risk

Question 12

managerial

Answer 12

embedded societal issue in core management process

• mitigate erosion of economic value in medium term
  -achieve LT gains by integrating responsible business practice in daily ops

Question 13

strategic

Answer 13

integrate societal issue into core business strategy

-enhance economic value in LT
- gain FMA aligning strategy and process innovations with societal issue

Question 14

civil

Answer 14

broad industry participation in corp responsibility = gains via collective action

• enhance LT economic value by overcoming first moving disadvantage

Question 15

civil learning tool - societal issue maturity

Answer 15

societal maturity of issues - Zadek 2004 = societal awareness of issues

Question 16

4 stages of issue maturity

Answer 16

1. latent
2. emerging
3. consolidating
4. institutionalised

Question 17

Latent

Answer 17

• activists and NGO aware
• weak scientific/hard evidence
• ignored or dismissed by business community

Question 18

Emerging

Answer 18

• political and media awareness
• energy research body, weak data
• leading business experiment with approaches to deal with it

Question 19

Consolidating

Answer 19

-emerging body of business practices surrounding
-sector and issue based voluntary initiative are established
- litigation and increased view of legislation need
- voluntary standards developed = collective action

Question 20

institutionalised

Answer 20

• legislation/business norms established
  -embedded practices = normal part of business excellence model

Question 21

civil learning tool

Answer 21

Question 22

CSR approaches

Answer 22

1. Global
2. Local
3. Transnational

-benefits-costs trade offs

Question 23

Global CSR approach

Answer 23

• global integration/standardisation
• HQ perspective/demands for consistency prevail over local concerns

Question 24

Local CSR approach

Answer 24

• local responsiveness/flexibility
• local concerns take precedence over demands for global consistency

Question 25

Transnational CSR approach

Answer 25

- global integration & local responsiveness - attempt to reconcile tensions between global and local concerns found more effective in coordinating CSR activities worldwide (global template with variations & adaptations)

Question 26

3 ways of corporate governance as influence on CSR approach

Answer 26

1. stakeholder vs shareholder 2. strategic vs financial control 3. financial vs triple bottom line managerial incentives

Question 27

triple bottom line

Answer 27

1. profit 2. people 3. planet

Question 28

corporate governance types

Answer 28

corp governance characteristics = play important role in adopting particular approach 1. corporate governance emphasis 2. board monitoring focus 3. managerial incentives

Question 29

8 corporate governance changes enable a transnational CSR approach

Answer 29

1. shift financial -> strategic control 2. incentives on triple bottom line 3. board diversity - stkholder represented 4. risk management (economic & social factors) 5. accountability to wider body of stkholders 6. non-hierarchical communications (HQ & subs) 7. board functional structure = stkholder relations committee 8. investor engage with board on CSR

Question 30

4 Contingency factors influencing CSR implementation in MNCs and supply chains

Answer 30

1. Knowledge enhancing mechanisms 2. Knowledge controlling mechanisms 3. Firm specific assets 4. Corporate history

Question 31

knowledge enhancing mechanisms

Answer 31

internally: CSR training, experience sharing amongst employees externally: create common reference frame between MNC & suppliers (training, visits, dialogue)

Question 32

knowledge controlling mechanisms

Answer 32

- incorp codes of conduct in perf measurement systems -groups, change agents = monitor implementation of CSR policies

Question 33

firm specific assets

Answer 33

- company size - financial resources - reputation - design of global supply chain

Question 34

corporate history

Answer 34

- tradition of company working with environmental & social issues - history of relationships with suppliers