Social Change Marketing - Approtec Discussion Questions

1.

(i) Internalizing and managing externalities

An externality is a cost or a benefit imposed upon someone by actions taken by others. An example of positive externality can be scientific advance while negative externality can be pollution. Negative externalities can be eliminated through allocation of property rights which negative externalities will be taken into account by both parties. Other options include imposing fines or through mergers where externalities can be internalized.

(ii) Multiple stakeholder orientation

Companies have responsibilities to their shareholders’ interests but are also responsible to their stakeholders such as suppliers and employees, etc. There are ongoing debates to which extent shareholders and stakeholders should be taken into account in a company’s CSR.

(iii) Alignment of CSR and profits

Many stress that social and economical responsibilities of a company should be aligned, which most often causes tradeoffs between profits and social responsibility of a firm.

(iv) Practices and values

CSR requires a set of business practices and strategies that deal with social concerns and issues. However, it is more than practices as some contend that CSR is a set of values that consolidate the practices. It does not just ask companies what they do but also the reason(s) the practice CSR.

(v) More than philanthropy

Most often CSR is being seen as one form of philanthropy. However, currently it is being stated that CSR is something that goes deeper into the core business function of companies, such as operations, human management and production, etc. The emphasis is placed on mainstreaming CSR into daily business instead of being something occasional.

Burt’s Bees would be an example of firms emphasizing CSR. They strive to eliminate waste, reduce energy and water consumption and build LEED certified buildings to internalize negative externalities. They also incorporate CSR into their daily operations by...