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1. The answer is NO, since social responsibility is not about the visibility of social involvement but to maximize positive impact on society. 2. The answer is YES, stakeholders provide resources that are more or less critical to a firm’s long-term success. 3. The answer is NO, the primary stakeholders are only customers. 4. The answer is NO, there are more influences on ethical behavior than the opportunity to engage in unethical decisions such as the culture, mission, and vision of the company. 5. The answer is YES, the stakeholder perspective is useful in managing social responsibility and business ethics.

Terms definitions * Stakeholder: investors, customers, shareholders, employees, suppliers, government agencies and communities that have a stake or claim in sine aspect of a company’s products, operations, markets, industry, and outcomes. * Primary stakeholders: those who continued association is absolutely necessary for a firm’s survival such as the customers. * Secondary stakeholders: those who don’t engage in transactions with the company and are not essential to its survival. For example media, trade associations, and interest groups. * Stakeholder interaction model: conceptualization of the relationship between businesses and stakeholders. * Stakeholders orientation: the degree to which a firm understands and addresses stakeholders demands. It involves activities and processes within a system of social institutions that facilitate and maintain value through exchange relationships with multiple stakeholders. * Corporate citizenship: the extent to which businesses strategically meet the economic, legal, ethical, and philanthropic responsibilities placed on them by various stakeholders. It has four dimensions: strong sustained economic performance, rigorous compliance, ethical actions beyond what the law requires, and voluntary contributions that advance the reputation and stakeholder commitment of the organization. * Reputation: corporate reputation, image, and brands of an organization. It is one of the organization’s greatest intangible assets with a tangible value. The value of a positive reputation is difficult to quantify but it is important. A bad reputation can affect the company for years. * Corporate governance: involves the development of formal systems of accountability, oversight, and control. It is the fourth major issue of corporate social responsibility. Strong corporate governance removes the opportunity for employees to make unethical decisions. * Shareholder model of corporate governance: its goal is to maximize wealth for investors and owners. It has been criticized since it focus on investors and owners and there are other factors and other ways of investing in a business. * Stakeholder model of corporate governance: it is an approach that adopts a broader view of the purpose of businesses. It involves maximizing the wealth of investors but also employees, suppliers, government regulators, communities, and interest groups. * Interlocking directorate: the concept of board members being linked to more than one company. * Executive compensation: the issue boards and directors face when deciding how executives are compensated for their leadership, organizational service, and performance. Sometimes this topic becomes more important than ensuring the integrity of the company’s financial reporting systems.

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