THE LINK BETWEEN QUALITY AND CORPORATE SOCIAL RESPONSIBILITY

Transcription

1 Northern Illinois University College of Business Campus Sites THE LINK BETWEEN QUALITY AND CORPORATE SOCIAL RESPONSIBILITY ASQ Illiana Section Quality Conference February 8, 2013 Terrence R. Bishop, Ph.D. Associate Professor Northern Illinois University Terry Bishop 1

2 The CSR Quality Link Quality = Good Business So, what is good business? Sustainable business practices Satisfy customers Achieve efficiencies Long term perspective Traditional Market Exchange Model Markets Terry Bishop 2

3 Greed, for lack of a better word, is good. Greed is right. Greed works. Greed clarifies, cuts through, and captures, the essence of the evolutionary spirit. Greed, in all of its forms; greed for life, for money, for love, knowledge, has marked the upward surge of mankind and greed, you mark my words, will not only save (the company), but that other malfunctioning corporation called the U.S.A Gordon Gekko, from the movie Wall Street Adam Smith: Father of Greed? Terry Bishop 3

4 That to feel much for others and little for ourselves, that to restrain our selfish and to indulge our benevolent affections, constitutes the perfection of human nature; and can alone produce among mankind the harmony of the sentiments and passions which consists their whole grace and propriety. Adam Smith, from The Theory of Moral Sentiments Enlightened Self-Interest Enlightened self-interest is good unbridled greed is not. Awareness and consideration of others those we exchange with in a market transaction, as well as those that are outside the market transaction (both now and in the future) are important characteristics of effective market exchange. Terry Bishop 4

5 Committee for Economic Development Corporate Social Responsibilities (1971) Emerging Responsibilities Social Values and Priorities Basic Economic Functions (growth, Basic products, Economic job) Functions (growth, products, job) Statement on Corporate Responsibility from the Business Roundtable Economic responsibility is by no means incompatible with other corporate responsibilities in society.a corporation s responsibilities include how the whole business is conducted every day. It must be a thoughtful institution which rises above the bottom line to consider the impact of its actions on all, from shareholders to the society at large. Its business activities must make social sense. (1981) Terry Bishop 5

6 Can Organizations Have Responsibilities? Organizations make products and provide services, they attract and serve customers, they comply with laws, they pay taxes If they can do all of those things, why can t they have responsibilities? Expanded Market Model: Interdependencies Responsible Businesses Responsible Government Effective Markets Responsible Investment Responsible Consumers Terry Bishop 6

7 Examples Supply Chain Partnerships (we ve come a long way from the tradition of seeing buyers and sellers as opponents) Stakeholder Orientation Balanced Scorecards Sources of Social Expectations Extra-market expectations which of these are important? Stakeholders (communities, employees, etc.) Laws & regulations Rules of the game professional and personal norms Media public interests Special interest groups, boycott or boycott-like influences NGO s Terry Bishop 7

8 Social Performance The CSR-Quality Link Illiana ASQ Quality Conference, An SPC Orientation to Social Expectations What is sustainability? The capacity to endure For businesses, it means that they engage in practices that can lead to longevity, survival, continued success Sustainability requires alignment with environmental, social as well as economic domains Must also take into consideration outside market influences Terry Bishop 8

9 CSR and Employees An Essential Link Trust precursor to leadership and employee relationships Basic virtues are required to allow trust to develop (honesty, fairness, transparency, etc.) The Ethics-Performance Linkage Studies have demonstrated links between good ethics and performance Of 95 studies, 50 (53%) found a relationship between CSR and profitability Only 5 (5%) found a negative relationship CSR typically measured as: social performance corporate citizenship treatment of employees Terry Bishop 9

10 The NIU BELIEF Initiative - Background Ethics in the classroom a historical perspective Long-standing questions about education s role in influencing ethics or ethical behavior Hesitation of faculty to delve into ethics AACSB and other calls for coverage of ethics Role of Educational Institutions NIU s approaches to business education Enhance awareness of the importance of values-driven performance Prepare talent for: Value-oriented work within organizational system Leadership roles in organizational management Terry Bishop 10

11 BELIEF Initiative: A 5-Point Program An Ethics Handbook and Decision Card Faculty Support Activities External Corporate Sponsors A BELIEF Director An Assessment System Student LEAD Organization BELIEF Activities Faculty Development Workshops Topics: teaching ethics, preventing academic misconduct, ethics in workplace, etc. BELIEF Day Lead Group Case competition, communication and awareness efforts Web presence: Assessment Terry Bishop 11

12 Social Responsibility and Quality Assumption: Ethics and CSR are fundamental to quality Role of ethics in leadership efficacy Strong values and integrity as drivers of culture and performance These points are reflected in the Baldridge Award criteria Since the late 1980 s the Baldridge criteria have included an expanding CSR component* *See Foote, Gaffney & Evans, Corporate social responsibility: Implications for performance excellence, Total Quality Management, Vol 21 (2010), Linkages: Quality Management & CSR Strategic Planning System Including explicit recognition of CSR Customer Management System Operational Effectiveness Efficiencies Ecological sustainability Workforce Relations Leadership Terry Bishop 12

13 Quality Professionals and CSR What can quality professionals do? Explicit inclusion of CSR in quality models and strategy CSR audits Connect the dots causal relations between CSR and sustainability (e.g., balanced scorecard) Corporate Citizenship Management Framework Overall Governance Community Support Operations Products and Services Values, mission, principles & policies Addressing social challenges Responsible business practices Market strategy Terry Bishop 13

14 Effective CSR Management Organizational CSR tools Strategic planning Integration of values and performance expectations into strategy Ethics and behavior codes Reporting system Subject to evaluation & review Behavioral influences alignment of rewards and outcomes CSR Audits External Categories: CSR and new opportunities Community relations Consumer relations Supplier relations Natural environment Shareholder relations From: Kok, van der Weile, McKenna & Brown, A CSR Audit within a Quality Framework, Journal of Business Ethics, Vol 31 (2001), internal Categories: Physical environment Working conditions Workforce diversity Organizational structure & management style Communications & transparency Industrial relations Education and training Ethics awareness Terry Bishop 14

15 The Quality CSR Linkage Quality CSR Enhances Quality Quality Enhances CSR CSR The Quality Management Environment Corporate Strategy Quality Models Values, Philosophy & Culture Tools & Techniques Source: Corporate Social Responsibility, ASQ 2003 Terry Bishop 15

16 Questions Terry Bishop 16