Instructor Resource
Collins, Business Ethics 3e
SAGE Publishing, 2022
Instructor Manual
Chapter 13: Global Corporate Citizenship
CHAPTER 13 LEARNING OBJECTIVES AND END OF CHAPTER QUESTIONS
After reading this chapter, you should be able to
13.1 Describe three primary ethical risks associated with conducting international
business.
End of Chapter Question 1: What are three primary ethical risks associated with
13.2 Frame an organization’s international corporate citizenship based on the
United Nations Global Compact.
13.3 Articulate the competitive advantages of community involvement.
End of Chapter Question 3: What are the competitive advantages of community
involvement?
13.4 Identify three different types of business opportunities to address poverty.
13.5 Administer the community involvement process through philanthropy and
volunteerism.
End of Chapter Question 5: How would you administer a highly effective
13.6 Describe the different phases of issues-driven multi-stakeholder dialogues.
End of Chapter Question 6: What are the different phases of issues-driven multi-
Instructor Resource
Collins, Business Ethics 3e
SAGE Publishing, 2022
CHAPTER 13 OVERVIEW
Organizations are embedded in the communities where they operate. Ethical organizations aspire
to be model community citizens. This chapter discusses the extent to which businesses have
social responsibilities and describes the business case for community involvement. An
CHAPTER 13 LECTURE OUTLINE
Suggested Time: 2 to 3 hours of class time is recommended to present this chapter.
I. Chapter Question 1: Describe three primary ethical risks associated with
conducting international business.
Globalization
II. Chapter Question 2: What is the intent and content of the United Nations
Global Compact?
Integrative Social Contract Theory
III. Chapter Question 3: What are the competitive advantages of community
involvement?
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Collins, Business Ethics 3e
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IV. Chapter Question 4: What are three different types of business opportunities
to address poverty?
Fair Trade
V. Chapter Question 5: How would you administer a highly effective community
involvement process?
Giving Money
VI. Chapter Question 6: What are the different phases of issues-driven multi–
stakeholder dialogue?
Multiple Stakeholder Demands
CHAPTER 13 SUPPORTING MATERIALS
Textbook Inserts
Ethical Dilemma Analysis
• What Would You Do: International Arrangements
Tables and Figures
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• Table 13.1: Largest MNCs
Self-Assessment
• Self-Assessment 13.1: Aristotle Happiness Survey
Thematic Boxes
• Ethics in Action: Timberland’s Service Toolkit
CHAPTER QUESTION 1: DESCRIBE THREE PRIMARY ETHICAL RISKS
ASSOCIATED WITH CONDUCTING INTERNATIONAL BUSINESS.
GLOBALIZATION
• good corporate citizenship extends beyond one nation’s borders and includes suppliers
and customers in other nations
• International business: The exchange of goods, services, or resources across borders.
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Collins, Business Ethics 3e
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GLOBAL BUSINESS CIVILIZING EFFORTS
• People in all nations want to be treated with dignity, which means having your racial,
ethnic, religious, and gender identity accepted; being recognized, understood,
CHAPTER QUESTION 2: WHAT IS THE INTENT AND CONTENT OF THE UNITED
NATIONS GLOBAL COMPACT?
INTEGRATIVE SOCIAL CONTRACT THEORY
• help businesses think through international ethical issues where the norms of two cultures
conflict
• Micro-social contracts are behaviors aligned with local community norms.
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• Principle 3—to be obligatory, a micro-social contract must be compatible with universal
macro-social contracts or norms; and
UNITED NATIONS GLOBAL COMPACT
• The United Nation’s high profile Sustainable Development Goals (SDG) for 2030
consists of 17 global goals with 169 targets.
DISCUSSION ACTIVITY
Have students search the United Nations Sustainable Development Goals website at
UNITED NATIONS GLOBAL COMPACT PRINCIPLES
• The United Nations (UN) has developed guiding principles for conducting business
anywhere in the world.
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DISCUSSION ACTIVITY
Have students review the United Nations Global Compact Principles and answer the following
questions: Should businesses be working for the effective abolition of child labor or is not
employing child laborers sufficient action? If you knew that a competitor operating in another
nation paid a bribe, would you inform federal authorities? Why or why not?
BRIBERY AND FOREIGN CORRUPT PRACTICES ACT
• Transparency International promotes transparency in helping develop “a world in
which government, politics, business, civil society, and the daily lives of people are
free of corruption.”
• The global average was 43, with more than two-thirds of the countries below the
scale midpoint.
DISCUSSION ACTIVITY
Transparency International measures the level of corruption in 176 nations and territories, with 0
for highly corrupt, and 100 for very clean. Have students visit their website at
www.transparency.org/news/feature/corruption_perceptions_index_2016
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Denmark and New Zealand (90) had the highest scores and Somalia (10) the lowest score. The
United States is ranked 18th (74).
Ask students why they think the United States ranked only 18th. In small groups, discuss
whether they agree with this assessment, and why or why not.
• American businesses are obligated to obey both U.S. laws and host nation laws, and
their behaviors in other countries fall under the Foreign Corrupt Practices Act
(FCPA).
SWEATSHOPS AND CHILD LABOR
• Sweatshops in developing nations epitomize the difficulty of imposing a universal
standard on all organizations in all nations.
• A sweatshop is a business facility that employs workers at low wages, for long hours,
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o According to cultural relativism, it is ethical to adopt standards based on the
norms of the host community—when in Rome do as the Romans do.
o Sweatshops are also defended based on utilitarianism, the greatest good for the
• From a deontological (human rights) and virtue ethics (practicing virtues)
perspective, these working conditions are unacceptable.
o An unfair double standard is being invoked—if it is wrong to employ Americans
under these unhealthy and abusive working conditions, then it is also wrong to
in the United States.
DISCUSSION ACTIVITY
Have students independently answer the following questions: Are sweatshops or paying a
reduced wage to workers in offshoring situations ethical? Why or why not?
Put students on teams with classmates who agree with them and have them prioritize their
reasons. Then facilitate a discussion or debate between the two opposing perspectives.
• There are various ways to ensure a supplier or company’s subsidiary is sweatshop-
free.
o Fair Labor Association (FLA)—conducts independent and unannounced audits
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NON-WESTERN EXAMPLES OF CSR
• Pakistan: National Foods, a food products company, helped launch the Aagahi Adult
Literacy Program to increase female literacy and basic education irrespective of caste
or background.iii
CHAPTER QUESTION 3: WHAT ARE THE COMPETIVE ADVANTAGES OF
COMMUNITY INVOLVEMENT?
• A very strong business case supports being a model corporate citizen.
REPUTATION BENEFITS
• Table 13.3, Company Benefits From Community Outreach, helps show how a
company’s reputation as a good citizen favorably impacts employee, customer,
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o Benefits to community relations
▪ Recognition as a responsible neighbor of choice
▪ Community goodwill and support
o Benefits to investor relations
• The Socially Responsible Investment (SRI) financial market is huge.
• SRI funds screen companies for (1) financial performance—meets financial goals,
solid return on investment, and (2) social performance—generates social benefits
through good employer-employee relations, strong environmental practices, safe
DISCUSSION ACTIVITY
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The MSCI KLD 400 Social Index does not include companies or industries that produce unsafe
products, violate human rights, or are considered to be socially irresponsible. Below is a list of
socially irresponsible criteria used to eliminate companies from the SRI fund. For each socially
irresponsible criterion, ask students: Do you believe it should be used to eliminate companies
from the fund? Why or why not?
1. Alcohol
2. Tobacco
3. Firearms
NETWORKING BENEFITS
• Community involvement provides many opportunities for networking with other
businesses and community leaders.
• Managers can join the Rotary, Chamber of Commerce, Better Business Bureau, and
other business associations including Businesses for Social Responsibility, the Lions
DISCUSSION ACTIVITY
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Have students independently explore the Internet to find and determine three business
networking opportunities that exist in the local community. have them share the list of
networking organizations in small groups and with the entire class.
CHAPTER QUESTION 4: WHAT ARE THREE DIFFERENT TYPES OF BUSINESS
OPPORTUNITIES TO ADDRESS POVERTY?
FAIR TRADE
• Businesses wanting to improve their ethical and social performance can also establish
procurement preferences for “fair–trade” certified suppliers.
o Products certified as fair-trade meet agreed upon conditions for fair pricing,
humane worker treatment, and environmental sustainability.
• What qualifies a product to be certified as fair trade? Different certifiers and
industries use different standards. In the fair-trade coffee industry, certification is
based on six general guidelines for producer and buyer activities:
1. Price floor: Buyers guarantee a reasonable minimum price for the product (e.g.,
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4. Stability and access to credit: Buyers provide one- or multiple-year contracts that
allow a steady flow of income and offer crop financing credits.
• The fair-trade movement has been criticized for a variety of reasons. The most
common criticisms of fair-trade coffee are:
o Not accomplishing its goals
SOCIAL ENTREPRENEURSHIP
• Social entrepreneurship—entrepreneurs with a social mission—is another way that
business people can contribute their skills.
• Social entrepreneurship refers to using business principles to directly meet basic
BOTTOM OF THE PYRAMID
• that there’s a fortune to be made by international businesses and social entrepreneurs
providing services to the poor in underdeveloped regions at the bottom of the economic
pyramid
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CHAPTER QUESTION 5: HOW WOULD YOU ADMINISTER A HIGHLY EFFECTIVE
COMMUNITY INVOLVEMENT PROCESS?
PHILANTHROPY AND VOLUNTEERISM
• Companies exhibit good citizenship through philanthropy and volunteerism.
• Philanthropy is the donation of money or property to assist a nonprofit organization
GIVING MONEY
• In 2018, corporate donations were at all-time high of $20 billion
• Initial efforts to coordinate business giving in a community began in 1887 when a
priest, two ministers, and a rabbi joined forces to address social welfare problems in
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o The financier Warren Buffett pledged to donate $37.4 billion, 85 percent of his
fortune, to the Gates Foundation.
o Buffet annually donates at least $1 billion in Berkshire Hathaway Inc. stock,
which must be spent within 1 year.
o Gates encouraged other wealthy businesspeople to take “The Giving Pledge”
GIVING PRODUCTS
• Many community organizations can benefit from receiving company products.
• Low-income community centers, for instance, welcome school supplies from retail
GIVING SKILLS
• In 2015, 62.6 million Americans volunteered a total of 7.8 billion hours of service.
• Companies can tap into an employee’s desire to help others by supporting volunteer
activities and offering sabbaticals.
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• Invoke the three “Cs”—compatibility, commitment, and communication—when
forming long-term volunteer partnerships, such as delivering food weekly for “Meals–
on-Wheels” or serving food monthly at a homeless shelter.
DISCUSSION ACTIVITY
Direct students to the local United Way website. Ask them to review all of the volunteer
opportunities and choose one they would be most interested in doing if time permitted.
Then meet in small groups, share the volunteer opportunity, and explain why each opportunity
was chosen.
GIVING JOB OPPORTUNITIES
• Businesses can give back to the community by providing jobs to people in need.
• Some companies also create special job positions for people with disabilities, the
elderly, and returning war veterans.
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DISCUSSION ACTIVITY
Have students describe how the college, business school, or their employer donates money,
products or services, or employee skills to nonprofit organizations, or provides job opportunities
for hard-to-employ segments of the population. What are the organization’s giving strengths and
weaknesses? How can the organization transform a weakness into a strength? Discuss the
answers in small groups.
STRATEGIC PHILANTHROPY
• Also set aside some community giving resources for strategic partnerships with
nonprofits aligned with the company’s mission.