Stakeholders, Categories & Responsibilities of Organizations
Activity 3-Stakeholders, Categories & Responsibilities of Organizations 1. Describe the basic features that distinguish the four basic forms of business ownership: sole proprietorships, general partnerships, C corporations, and limited liability companies. Ownership of C corporation is represented by shares of the stock, or shareholders, it is the most common type of the business, where ownership to the shareholders offers a limited liability to all its owners.
Limited liability companies are those companies who have the form of the partnership, in which all the partners have the right to participate in management and have the limited liability for company debts. A general partnership is a partnership (with 2 partners more often), where they enter into a voluntary partnership agreement. Basically there are such things as a financial contribution each partner will make, special responsibilities, the share of the profit/loss. The agreement can be oral, but the best way is to have everything on paper, in a written form.
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And, finally, the sole proprietorship, are the businesses, that are owned and usually managed by an individual. To say in other words it s the extension of the owner. That means that if there is a profit in the company, it is defined as an owner’s profit, and if something goes wrong all the responsibility goes to the owner as well 2. Describe the relationship between a corporation’s common stockholders, its board of directors, and its chief executive officer (CEO). The CEO is responsible for day to day operations and identifies and manages corporate risk. the board of directors oversees the management ( where CEO is related to), they also have particular functions, such as audit, compensation, corporate governance. The main responsibility of the board of directors is to decide in the interest of shareholders. Shareholders are people who voluntarily invest by buying stock. That is the reason why they can be defined as owners. Their right is to elect the board of directors, approve mergers and accuisitions. 3. Video Case: Starbucks Coffee: Shared Planet and C. A. F. E.
Practices (access this video on the CourseMate website click on Video for Chapter 4. ) Using information from the case and the video, answer the following critical thinking questions: a)What is the Starbucks Shared Planet program, and what caused Starbucks to initiate this program? b)What is sustainability and how do the C. A. F. E. Practices guidelines help promote sustainability in the coffee industry? c)Why is sustainability important to businesses? 4. What is the difference between corporate philanthropy and corporate responsibility to the community?
Which do you think is better? Why? The difference between the corporate philanthropy and the corporate responsibility to the community s the following: the corporate philanthropy includes all donations to the non-profit groups ( including money and physical products); employees time donations- some organizations pay their companies for working for the non-profits. The corporate responsibility is related to the corporate philanthropy but is focused on the actions for business itself, rather than donations of money, products and time.
In my opinion, both corporate responsibility and corporate philanthropy are good for the society, but from the ethical point of view, corporate responsibility is better because not everyone is interested in donations and non profits are not a large economy sector. Though Cisco Systems have developed a program for different branches of society- military and disabled. This can help them to develop and to feel better, not a thrown away part of the society. 5.
A growing number of businesses—including videogame developers, cigarette companies, soft drink producers, liquor marketers, and fast food chains—are feeling the heat from government, the press, and society at large for encouraging harmful consumer habits. But in our free market economy, people are free to choose the products they consume (within legal boundaries, of course). Where does personal responsibility end and corporate responsibility begin? How does your response change across specific industries? What role (if any) do you believe the government should play?
Develop a rationale for each of your answers. In early 1960’s, President Kennedy has defined the concept of consumerism- social movement with the focus on four (4) basic human rights. Right to be safe, right to be informed, right to choose, right to be heard. According to these basic rules, the organizations try to provide responsibility to the customers, and in the time of the globalization and the increasing amount of competitors the services should be done in the best way, otherwise the customers can be lost.
In my opinion, both, the customer and the organization which provides goods is responsible for the product. I have discussed the responsibility of the organization but the personal responsibility begins from the moment of choosing. Actually, we live in the free trade world and even though there is an external pressure, such as mass media to our pinions, we have our own heads. Of course, organization is responsible for what is written, but we have to think as well. It is written that alcohol is bad for liver and is not sent to the children under 18 (21).
But still it is done and here comes the problem of the lady in the shop and the problem of parents ho did not tell their baby all the consequences. The same relates to every product. I mean if it is written that for example a shampoo may cause the allergy and a customer does not read it is his problem. In my opinion, the government should take care only about the products such as medicine, alcohol, cigarettes, fastfood ( at least someone will explain the McDonald’s is NOT healthy and fresh0 their responsibility is to write all these things as SMOKING KILLS.
I mean, they can not do anything else. You cant forbid anything as far as its legal. 6. Define green marketing and describe some of its challenges. Green marketing- is developing and promoting environmentally sound products and practices to gain the competitive edge (p. 57) . many companies (and their amount increases), began using this concept, but there are also different challenges, such as the majority of people do not support the whole idea of the green marketing because they do not want to sacrifice price, performance or materials to buy these products.
The movement is pretty new and all organics are the way more expensive than normal products, in the crisis time people will save money rather than to buy something which does not differ from the competitors product that visibly much but the price. 7. Explain how globalization impacts social responsibility. We live in the world of the globalization. It affects every single part of our life. According to the activity 3 topic I will discuss the impact of the globalization to the social responsibility. Firstly, the social responsibility has become more complicated at every level for workers.
At this time we can see several global challenges. Firstly, the corruption and bribery. Of course it existed many years ago, but nowadays it has become so transparent. Seriously, if we look at the statistics provided by Transparency International, we can see that there is no country without corruption. But there is no smoke without fire- organizations use the law and they suggest bribes. It is illegal, but the present is not a bribe. In other words, we can see that people who want to get the profit even not in a fair way will get it.
The second global challenge is the living wage for reasonable hours in the safe working environment. But the living wage is a term which is different for every country and to every single person. So the most responsible companies have the codes of conduct, created because of th constant change process in the term of globalization. This is the best way to work with enforcement, monitoring and finding he solutions for everyone in the organization. 8. View the video: SUBWAY: #1 FRANCHISOR on the class website. •Why do you think SUBWAY is the number one franchise in the U. S? How many stores are in Prague?
In the Czech Republic? Are you surprised that the number one franchise in the U. S. isn’t McDonald’s? •What are the primary benefits of buying a franchise rather than starting a business completely from scratch? Biggest disadvantages? •What types of franchise business opportunities are available? •What is the relationship between a franchisor and franchisee? 9. View the video: Business Partnership Pitfalls. Identify and describe two advantages and disadvantages of partnerships as a form of business organization. Why should every owner have a written partnership agreement?
What is unlimited liability? In the modern world many businesses are run by more than one person, that means that there are partnerships. And of course there are advantages and disadvantages. Two main advantages are: 1. It is easier to run business with a partner, share responsibility, 2 a partnership with a right strategy can ,make a business more successful and long living. Two main disadvantages are: 1- a possibility that a business will be successful are app. One third. 2. When the business partner is chosen in a wrong way there can be misunderstanding and a wrong division of labour.
This is a point why every single partnership should have a written partnership agreement where it is clearly written the percentage of the income, what should everyone do in the organization; in order not to have arguments and clearly written ways to exit the business. The unlimited liability is a sort of investment where both the investor and a partner can have a loss of unlimited amount of money. 10. Define the core stakeholder groups of most businesses. List one core responsibility of business to each stakeholder group. There are four (4) core stakeholder groups for the most businesses- Employees, Customers, Community, Investors
Their core responsibilities are: Employees- to make sure that employees are treated in a fair way, respected, to pay for their work ,to help workers balance emerging work-life priorities. Customers- provide quality goods at a fair price, to follow the four rules of being informed, save, the rigt to choose and to be heard. Investors- create the profit stream. Manage the investments according t the legal standards Community- minimize the environmental impact on the company, support the non-profit groups which improve the community.