Introductory description

The aims of the module are to enable students to understand the wider institutional location of business activity within the polity and the society.

Module aims

Outline syllabus

This is an indicative module outline only to give an indication of the sort of topics that may be covered. Actual sessions held may differ.

Lectures
PART I: FRAMING THE DEBATE
Business in Global Society: The Governance Challenge: We discuss the changing role of business in global society. Based on a review of globalization as a socio-economic phenomenon, we look into how corporations can misuse gaps in global governance and thus create a “race to the bottom” in terms social and environmental standards.
Understanding Corporate Responsibility as Governance: We discuss the concept of “corporate (social) responsibility” (CSR) from the perspective of economic governance. We define the term and briefly look into its history. Next, ask why corporations are interested in this concept. Last but not least, we debate whether firms actually have a responsibility to voluntarily care for those social and environmental issues which are not regulated by law.
Achieving Corporate Responsibility: In this lecture we discuss the emerging institutional infrastructure for governing corporate responsibility. We look into and discuss the various standards/principles/initiatives which have emerged and proliferated in recent years. We also discuss the limits of these initiatives and debate whether firms’ commitment to them is just “window-dressing”.
Firms as Political Actors: We discuss why firms have turned into political actors and reflect on the limits of their influence. We put special emphasis on the role of corporations as “citizens” and critically debate this from a governance perspective.

PART II: MANAGING ISSUES
Business and Human Rights: We look into whether firms face direct human rights obligations and put a particular focus on developing economies and zones of conflict. We discuss the role of multinational firms in respecting human rights.
Labor Rights in Global Supply Chains: We turn towards a governance problem which many firms (e.g. Nike and IKEA) have faced recently: how to monitor labor conditions at their supply factories in emerging and developing economies. We discuss the limits of monitoring of corporate codes of conduct.
Environmental Sustainability: We discuss why firms are often required to take action in areas such as climate change and water scarcity. We outline (a) why these problems are relevant for businesses and how they influence business decisions and (b) what firms can do to integrate environmental concerns into their value and supply chain management.
Anti-Corruption Strategies: This lecture takes a look into the problem of weak governance related to corruption. We discuss why corruption exists and identify main drivers of corruption. We also discuss how firms can set up effective and efficient anti-corruption policies.

PART III: UNDERSTANDING ACTORS
The UN System and Business: We take a look into how the UN manages its relations to business. We emphasize business’ role in the UN Global Compact, which is an UN-driven corporate responsibility initiative. We discuss the Global Compact and debate its limits and opportunities.
Civil Society: We look into how civil society organizations, particularly, NGOs and social movements, interact with businesses. The discussion is based on the idea of associational governance and highlights the need to consider that firms are often significantly influenced by civil society action.
Investors and Financial Markets: We discuss whether investors can pressure corporations to adopt social and environmental principles. We look into the opportunities and constraints of so-called “ethical investment” and discuss the role of financial markets in holding firms accountable.

PART IV: FINAL REFLECTIONS
Scenarios for the Future: We reflect on the key deliverables of this module and also debates linkages to other modules. This lecture is also used to debate very recent challenges and political developments in the area of corporate responsibility (e.g. emerging national legislation).

Seminars/ Group Discussions

1. This seminar follows the lecture Understanding Corporate Responsibility as Governance and debates Milton Friedman’s famous statement “The social responsibility of business is to increase its profits”. We discuss the key criticism of voluntary corporate responsibility based on Friedman’s perspective.
2. This seminar follows the discussion of firms as political actors. We use the case of Pfizer’s influence on the international trade rules to debate how much influence firms should have on political institutions.
3. We discuss the “Shell in Nigeria” case study as an exemplary example of a firms being caught up in human rights violations. This seminar backs up the lecture Business and Human Rights.
4. We consider the case of IKEA to explore the limits of labor auditing in global supply chains. We also discuss how multinational firms can manage their supply chains in ways that labor rights are respected.
5. We look into the case of Siemens to discuss organized corruption in a big firm. We explore the causes of corruption in this particular case and debate alternative scenarios for making business free of corruption.
6. We look into one specific participant of the UN Global Compact (i.e. Novartis) and discuss how this company manages its relations with the UN system.
7. We discuss the case of Nike to reflect on how to best address consumer boycotts organized by NGOs and civil society groups.
8. We look into the case of the Principles for Responsible Investment (PRI) and discuss how investors collectively organize to pressure firms in terms of their corporate responsibilities. We also explore limits to the influence of investors through this case study.

Learning outcomes

By the end of the module, students should be able to:

• Demonstrate comprehensive understanding of the responsibilities of companies in the local and global context
• Demonstrate comprehensive understanding of the significance of the non-market environment for business decisions
• Critically analyse the quality of evidence, linking themes and multi-disciplinary approaches together, to gain perspective on their normal disciplinary approaches.

Indicative reading list

There is no single textbook for this module. Instead a variety of readings from journals and also book chapters are used. Exemplary readings include:

• Scherer, A. G., Rasche, A., Palazzo, G., & Spicer, A. (2016). Managing for Political Corporate Social Responsibility:

New Challenges and Directions for PCSR 2.0. Journal of Management Studies, 53(3), 273–298.3

• Scherer, A./G. Palazzo (2008): Globalization and Corporate Social Responsibility, in: A. Crane et al. (eds.) The Oxford Handbook of Corporate Social Responsibility. Oxford: Oxford University Press, pp. 413-430.
• Scholte, A.A. (2005).Globalization: A Critical Introduction, 2nd edition, Palgrave Macmillan (Chapter 2).
• Porter, M.E. and M. Kramer (2006). Strategy and Society: The link between competitive advantage and corporate social responsibility. Harvard Business Review, 84(12): 78-92.
• Karnani, A. (2010) The Case Against Corporate Social Responsibility, The Wall Street Journal, 23rd August 2010.
• Friedman, M. 1970. “The social responsibility of business is to increase its profits.” New York Times Magazine, September 13: 32-33, 122, 124, 126.
• Fotaki, M., Islam, G., and Antoni, A. (2019). Business Ethics and Care in Organizations. Routledge
• Rasche, A. (2010). The limits of corporate responsibility standards. Business Ethics: A European Review, 19(3): 280-291.
• Locke, R. and M. Romis (2007). Improving work conditions in a global supply chain. MIT Sloan Management Review, 48(2): 54-62.
• Gilbert, D. U./Rasche, A. (2007): Discourse Ethics and Social Accountability – The Ethics of SA 8000, in: Business Ethics Quarterly, Vol. 17, No.2, pp. 187-216.

Kotlikoff, L. Schlesinger, L. Lynch, L. Johnson, S. Financial Advice for eh Challenges Facing Obama (11 November 2012)
Longinos, M. Competitiveness as a Strategic Outcome of Corporate Social Responsibility (Nov/Dec 2012). Corporate Social Responsibility and Environmental Management. Wiley Periodicals
Bevir, M. Governance: a very short introduction (2012). OUP
Barsade, S. O’Neill, O. Manage your Emotional Culture (2016) Harvard Business Review Vol. 94 Issue 1.
Appadurai, A. Banking on words: the failure of language in the age of derivative finance (2016) University of Chicago Press
Larcker, D. Tayan, B. Corporate Governance Matters: a closer look at organisational choices and their consequences (2016). Pearson Education

Research element

Critically analyse the quality of evidence, linking themes and multi-disciplinary approaches together, to gain perspective on their normal disciplinary approaches.

Interdisciplinary

The module draws from moral theory, business ethics, political economy, and social movements.

International

The module considers various issues of global relevance and uses examples, and case studies from around the world (India, Africa, China, USA, and Europe). These cover topics such as:
Development legacies from the 20th century
Global financial crisis
Environmental challenges and threats
Child labour and extractivist industries

Subject specific skills

Assess evidence and succinctly summarise conclusions
Locate business activity within its social and political contexts
Interpret and evaluate statistical data presented in graphical form.

Transferable skills

Written communciation