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Corporate Social Responsibility and Stakeholders

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CASE:

The Clean Power Company, based in Cincinnati, Ohio, has been in operation for 5 years. The company produces an energy regulating device that automatically regulates the use of power sources in homes and businesses. Recently, they have realized that in order to stay in business, they will have to move their operations out of the country. They have purchased approximately 500 acres next to the Chavon River in the southeastern part the Dominican Republic.

The land is totally undeveloped. However, it is located across the river from the Altos de Chavon complex that has shops, restaurants, and other commercial attractions. This land looks like a tropical paradise with palm trees and access to the sea via the Chavon River.

As part of the sales agreement, the seller, Teltac Corporation, has agreed to put in roads, septic systems, and water lines. However, electrical power and sewer lines will be up to Clean Power. Clean Power Company plans to be self sustaining by using solar power. Teltec has informed them that there should be no problems running sewer lines directly into the river as the Chavon River is clean and large and can absorb the waste.

You are the Director of Corporate Development in charge of spearheading the development of this new site. In addition, you are responsible for transitioning US employees to the new location and hiring local employees. You will need to decide which Cincinnati employees will go to the new Dominican Republic location or if the company should rely solely on local Dominican workers.

Clean Power also plans to build a new school for local children to address overcrowding and the lack of basic necessities, technology, and space for the students. Clean Power desires to be a good corporate partner in this community, which has many dirt roads and undeveloped areas.

Management knows that the initial capital outlay in this initiative will drive the price of the stock down, thereby upsetting the shareholders. However, management believes it will prove a sound investment in the long run.

QUESTIONS:

Question A:
What is Clean Power's corporate social responsibility for each ethical issue you have identified in this case?
? Legal
? Economic
? Ethical
? Philanthropic

Question B:
Stakeholder Management - Address the questions below regarding the following stakeholders: the environment, the employees, the customers, the community and the shareholders:
? What are the above stakeholders' interests for each ethical issue or concern you identified? What are the stakeholders' responsibilities for each ethical issue or concern you identified? What are the possible decisions the corporation could make for each ethical issue or concern, and what are the possible effects on the stakeholders?

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Solution Summary

By addressing the questions, this solution addresses ethical aspects of Corporate Social Responsibility and Stakeholders. References included in APA format.

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RESPONSE:

The information follows this outline:

A. What is Clean Power's corporate social responsibility for each ethical issue you have identified in this case? (legal, economic, ethical, philanthropic).

B.

a. What are the above stakeholders' interests for each ethical issue or concern you identified?
b. What are the stakeholders' responsibilities for each ethical issue or concern you identified?
c. What are the possible decisions the corporation could make for each ethical issue or concern, and what are the possible effects on the stakeholders?

Now let's look at some infromation for you to consider for each section.

Corporate social responsibility (CSR) is a form of corporate self-regulation integrated into a business model through its CSR policy intended to guide behavior and is in this sense, a self-regulating mechanism whereby Clean Power will monitor and ensure its adherence to law, ethical standards, and cultural norms. In other words, Clean Power will embrace responsibility for the impact of its activities on all stakeholders: the environment, consumers, employees, communities, shareholders and all other members of the public sphere. It also has a philanthropic responsibility to do public good, like building schools or giving a certain percentage of money to charities. Corporate Social Responsibility (CSR) is defined "as the way companies integrate social, environmental, and economic concerns into their values and operations in a transparent and accountable manner" (Corporate Social Responsibility, 2009).

A.

The environment as a stakeholder includes the three bottom lines: the people planet and profit (Corporate Social Responsibility, 2009) but puts the first two over and above economic gains. Clean Power has the CSR to protect the environment from harm and put into policy environmental ethical code to direct behavior. One environmental issue of concern for Clean Power is providing electricity to the region, which Clean Power Company plans to be self sustaining by using solar power, which is environmental friendly. The company has also has corporate social responsibility to follow all environmental laws regarding the sewer lines and drainage into the river, over economic gains, to protect the planet and people over economic gain. However, Clean Power Company still has a responsibility to provide profit to the region. To demonstrate CRS to its shareholders at the philanthropic level, therefore, Clean Power has to engage in behavior that addresses the environments interests (William & Aquilera, n.d.).

Employees are Clean Powers most important stakeholders, who expect the company to understand and address the social and community issues that are relevant to them. In this scenario, ethical concerns might be hiring and selection of employees in a fair and open manner, as well as provide appropriate "cultural' training and orientation for expatriates and ...

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