U2-1 Social Costs & Benefits

Ethical and Environmental objectives
1. Is profit the main measure of business success?
  1. Should a wider view be taken of what should be achieved?
2. More managers are setting E&E objectives as well as growth and profit
  Annotations:
  - - Beliefs other than the aim of making money, or understand the importance of corporate image - Managers are considering the impact on society
Changing objectives
1. Laws on environmental protection are stronger
  1. Breaching would mean heavy fines and bad publicity
2. Growing and widespread public support for action against dumping waste and climate change
  1. Gain good publicity and customer loyalty
3. Consumers putting pressure on firms to be more ethical
Can reduce short-term profits
1. Paying wages above minimum is expensive
2. Not paying money bribes/ gifts to win contracts - lost sales
  1. Significant in countries where it is accepted
3. Not forcing suppliers to reduce prices further to make them go out of business might mean paying more than others
Increase long-term profits
1. Other ethical firms will want to do business with you
2. Workers more motivated if higher paid and well treated
3. Government more likely to give contracts to ethical firms
  1. Set a good example
4. Consumers may avoid unethical firms
  1. Can boycott firms to show them
5. Suppliers will develop a good relationship
  1. Offer best terms possible

Resource summary

	Created by jadepalmer98 over 10 years ago