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Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 1
ChapterThirteen
Civil Society Stakeholders
Prepared by Mark Schwartz, York University
Canadian Business and Society: Canadian Business and Society: Ethics & ResponsibilitiesEthics & Responsibilities
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 2
Chapter Outline
Civil Society: Definition Non-Governmental Organizations (NGOs) The Case for NGOs NGO Tactics Strategies for Relationships with NGOs Partnership Relationships with NGOs The Media Stakeholder Policy Development, Educational, and Religious
Institutions
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 3
Civil Society: Definition
Civil society is composed of the voluntary, community, and social organizations or institutions that contribute to the functioning of society but are not related to or supported by government.
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 4
Civil Society Civil society is usually regarded to be a counterbalance to the state
(and more recently also to business) guarding against the abuse of power and ensuring that the people’s best interests are served.
State Sector
Market Sector
Civil Society Sector
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 5
Non-Governmental Organizations (NGOs): Definition Any group that holds shared values or
attitudes about an issue confronting society and advocates for changes relating to the issue.
Usually, but not always, non-profit.
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 6
NGO Societal Issues Most Relevant to Business Animal rights Technology Economic Social
development
Workers’/human rights
Environment Religious
activism
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 7
Civil Society
1995 UN report suggested that nearly 29,000 international NGOs exist
Different in terms of the issues they focus on Scope of their operations Different forms and structures Varied mixture of activities
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 8
CSOs
TypeCommunity groupCampaign group
Research organizationBusiness association
Religious groupTrade union
Technical body
StructureInformalFormal
Co-operativeProfessional
EntrepreneurialNetworkFocus
Natural environmentSocial issuesDevelopment
Poverty alleviationHuman rights
Animal welfare
ScopeIndividual
Grass-rootsLocal
RegionalNational
TransnationalGlobal
ActivitiesAcademic research
Market researchProtests and DemosBoycott co-ordination
Policy researchInformation provision
Campaigning
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 9
The Case for NGOs
Identifying opportunities and risks Influence on public opinion Innovation possibilities Reputation and trust by the public Expertise on specific issues Employee engagement
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 10
NGO Tactics
Pressure on governments to change policies
Damaging publicity Disrupt annual meetings Develop shareholder social
policy resolutions Damaging physical property Picket managers’ homes Sponsor demonstrations or
picket corporate locations
Organize boycotts Launch letter-writing
campaigns Initiate legal proceedings Develop anti-business
websites Support anti-business
documentaries Provide support for
alternative sources of goods and services (e.g., fair-trade products)
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 11
Strategies for Relationships with NGOs Proactively engage NGO Do not underestimate NGO’s influence Reversing a decision from a project shouldn’t
be viewed as a defeat Sometimes selective concessions are
sufficient Sometimes better to deal with “realist” NGO,
not radical ones A preemptive strategy may be feasible
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 12
Partnership Relationships with NGOs Four key ingredients to a successful
partnership: Corporate and NGO leaders must show
leadership The corporation must be open to change Must be a commitment to being committed Partners must have a shared goal
Source: Canadian Business for Social Responsibility, 2005
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 13
Drivers towards business – CSO partnershipsDrivers for business engagement with CSOs Drivers for CSO engagement with business
Consumer expectations Growing interest in markets
NGO credibility with public Disenchantment with government as provider of solutions
Need for an external challenge Need for more resources
Cross-fertilization of thinking Cross-fertilization of thinking
Greater efficiency in resource allocation Credibility of business with government
Desire to head off negative public confrontation and protect image
Access to supply chains
Desire to engage stakeholders Greater leverage
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 14
Civil Society Organizations as Stakeholders
The stake held by CSOs is quite different from that held by other stakeholder groups
CSOs very rarely contribute any resources directly to corporations
The stake held by CSOs is largely one of representing the interests of individual stakeholders (including non-human stakeholders)
The stake of CSOs is indirect and representative
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 15
Civil Society Organizations as Stakeholders
Two types Sectional Groups – include trade unions, professional associations,
student bodies etc. Promotional Groups – promoting specific causes or issues
Section groups Promotional groups
Membership Closed Open
Represent Specific section of society Issues or causes
Aims Self-interest Social goals
Traditional Status Insider Outsider
Main approach Consultation Argument
Pressure exerted through Threat of withdrawl Mass media publicity
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 16
Civil Society Organizations as Stakeholders
Sectional groups have been said to enjoy insider status whilst promotional groups have largely been outsiders
Promotional groups have tended to have less easy access to governmental or corporate policy-making
Since they do not represent a readily identifiable constituency, it is not obvious whom exactly they are speaking for
Promotional groups have tended to need to mobilize mass public opinion before they are heard or involved in any kind of decision making
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 17
CSO Tactics
Indirect action – research and communication (issue around provision of misleading information)
Violent direct action – is often illegal but it often generates the most publicity
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CSO Accountability
CSO accountability being questioned is not surprising when one considers that they have often been the parties most vociferously questioning the accountability of corporations
Questions about CSO accountability have largely mirrored the same questions that have been raised in relation to corporations
Accountability of CSOs to their supposed beneficiaries that tends to raise the most debate.
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 19
Globalization and civil society organizations Three main areas where globalization is
reshaping the relations between corporations and CSOs:
Engagement with overseas CSOs
Global issues and causes
Globalization of CSOs
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 20
The Media Stakeholder
Dealing with the media is part of managers’ responsibilities
Legitimacy of business is dependent upon public’s knowledge of events and issues
Information spread through newspapers, periodicals, radio, television, and social media (i.e., online technologies)
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 21
The Interaction Between Business and the MediaBusiness complaints: Reporters not
sufficiently knowledgeable
Only interested in “bad” news
Inherent bias Do not respect “off-the-
record” comments
Media complaints: Businesspeople
dishonest Use excuse that they
are only accountable to shareholders
Overreact to reporting process
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 22
Ownership and the Media
Business enterprises now own and operate major media outlets.
Issues: Newspaper monopolies Interlocking ownership between print and broadcasting
media Licensing process favours some corporations over others Newspaper chains more focused on profits than
professional journalism
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 23
Changes in Media Attitudes Toward Business Now increased coverage of business and
CSR in the media Now more favourable approach to business
coverage Business more prepared to work with the
media The media as a stakeholder influences
business, but business can also influence the media
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 24
Policy Development Institutions (Think Tanks) An organization that researches and analyzes
various important social, economic, and political issues confronting society
Funded by government, corporations, trade unions, wealthy individuals, universities
Examples: C.D. Howe Institute, Conference Board of Canada, Fraser Institute
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 25
Religious Institutions
Influence of religion on business: The impact on managerial decision making The existence of businesses supplying religious
goods and services Spirituality in the workplace Corporate response to religious activism
Chapter 13 Copyright © 2008 McGraw-Hill Ryerson Ltd. 26
Educational Institutions
Business now involved in the educational system from kindergarten to university
Two distinct approaches: Mutually beneficial partnership; or Educational institutions should be unencumbered
from corporate influence
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Civil Regulation
Civil society can be a source of regulation of corporations
Increasingly important role in forming codes of practice and even other more formal elements of rule setting and regulation
Civil society can act as a conduit through which individual citizens can exert some kind of leverage on, or gain a form of participation in corporate decision making and action