PGreen_MGT5019 #3June 19, 2014
Assessing Corporate Social Responsibility
Views of Social Responsibility
Friedman felt as though businesses doesn’t have responsibilities just people. He stated that a corporation is an artificial person with artificial responsibilities and that business cannot have responsibilities (M. Jennings, 2012). He basically believed that having a social responsibility to business means to not do something that is not in the best interest of the employers (M. Jennings, 2012). Freeman on the other hand, talked about how stakeholders and his idea of how business really works (www.shareholdermap.com). Freeman believed that for business to thrive it has to create value for customers, suppliers, employees, communities and financiers, shareholders, banks and others with the money (www.shareholdermap.com). He talked about how you can’t look at any of their stake or stakeholders in isolation He talked about how the job of a manager or entrepreneur is to work in the best interest of customers, suppliers, communities, employees and financiers and that they all must go in the same direction (www.shareholdermap.com). In his theory he wanted readers to think about how important each one of these groups are to a business in order for it to be successful (www.shareholdermap.com). Friedman and Freeman views are the same in the sense that they both talk about how employees must keep the best interest of their employers and business as a whole. Their views are mostly based on the fact that they believe social responsibility is more based on an individual. Entine and Jennings on the other hand talked about how business and business ethics are more difficult than the breeziness of corporate responsibility (M. Jennings, 2012). They talked about how it was more to understanding the corporate soul than by just corporate social responsibility (M. Jennings, 2012). They talked about how corporate responsibility is not just based on an individual. The question Entine and Jennings stated that no company is ethically perfect (M. Jennings, 2012). They feel as though no company or no individual is without sin or exempt from mistakes (M. Jennings, 2012). Consequently, the obsession to anoint icons of CSR only interferes with the soul of a company (M. Jennings, 2012). They feel that looking beyond political issues is a way to determine the soul of a company (M. Jennings, 2012). They concluded by saying that CSR has come to promote narrow and contradictory social agendas as opposed to measures of integrity (M. Jennings, 2012).
Eight questions vs Traditional Measures Of Social Responsibility
According to the article Two Views of Social Responsibility, Social responsibility says that to the manager who has the additional attitude, social responsibility is someone else’s job (Castle, J www.streetdirectory.com) The article also goes on to say that stockholders invest in a corporation to earn a profit their investment, not because the firm is socially responsible and the firm is legally obligated to act in the best interest of its stockholders (Castle, J www.streetdirectory.com). In traditional CSR managers believe they are socially responsible for customers, employees, suppliers, and the general public (Castle, J www.streetdirectory.com). The are article then goes on to say that there are two traditional viewpoints on social responsibility, one is that a business must be more than a profit seeker to support their position and to not ignore social issues (Castle, J www.streetdirectory.com). The second viewpoint is that a business should do what it does best and that is earn a profit and produce and manufacture goods that the people want and not worry about the social issues (Castle, J www.streetdirectory.com). The traditional measure of CSR looked at it as a business should focus on making profits not solving society issues (Castle, J www.streetdirectory.com). When you look at Entine and Jennings eight questions you will see that the questions are based on a company as a whole not an individual but the questions do keep the people’s best interest in mind which determines, that Entine and Jennings believe that a company is not only socially responsible to stakeholders but also to the people (M. Jennings, 2012). The questions that Entine and Jennings asks basically are questions to determine if the company is ethical. The traditional measures of CSR looks at making a profit for a business while Entine and Jennings questions asks about the ethical side of the business. Entine and Jennings questions on the soul of a company is questions I think all companies should based their business on. Not only will those eight questions help a company to remain ethical, but I also feel that those questions will help a company profit also in an ethical way.
Fannie Mae, Fannie Mae
Based on the model, I do feel that Fannie Mae started out as a honest company. Fannie Mae was a institution that increased availability for housing for low income individuals which I think was a great thing and a honest reason to start a company (M. Jennings, 2012). Fannie Mae mission was to:
• Expand access to homeownership for first-time home buyers and help raise the minority home-
ownership rate with the ultimate goal of closing the homeownership gap entirely; (M. Jennings, 2012)
• Make homeownership and rental housing a success for families at risk of losing their homes; (M. Jennings, 2012)
• Expand the supply of affordable housing where it is needed most, which includes initiatives for
workforce housing and supportive housing for the chronically homeless; and (M. Jennings, 2012).
• Transform targeted communities, including urban, rural, and Native American, by channeling all
the company’s tools and resources and aligning efforts with partners in these areas (M. Jennings, 2012).
I think in the beginning Fannie Mae held up to their mission of making sure that minorities and individuals with low incomes could afford housing until individuals in Fannie Mae’s company started to get greedy. When the greed came into play that’s when Fannie Mae started to lose its honesty and ethics. The issues with accounting was basically all happening because the CFO’s and other officers at the time were not focused on the mission but focused on getting more money. They hid a lot of things from the books, and they even had other departments at Fannie Mae hiding things also. When people in a corporation loses focus on what’s important and start to focus more on profit, that’s when the honesty leaves a corporation in my opinion. Even though Fannie Mae got a whole team of new people in the company I think that a lot of people still could not look past the underhanded things the company did. Not even government officials. I feel as though if a lot of those people in the company would have listened to the employees that came forward when they saw that certained things were not right, Fannie Mae’s downfall could have possibly been avoided.