Question

How Does Being Good Pay Off? Organizations are under increasing pressure to do the right thing and serve the public good, and there are a multitude of ways that organizations can be ethical and socially responsible. Although organizations should always consider ways to do this, these decisions often come at a financial cost and thus create dilemmas for organizational decision makers. This activity is important because it highlights the ways that being socially responsible is beneficial for organizations. The goal of this exercise is to challenge your knowledge of research findings on how being ethical and socially responsible pays off for organizations. Listed in the diagram are statements showing how ethical and socially responsible behavior by a company affects various stakeholders. Read the statements and then drag each term to the element of ethical or socially responsible behavior that it best represents Interpersonal Relationships Employees Profits Stock Price Revenue Customers Consumers want to Socially responsible spend more money companies generate An ethical scandal can cause a with companies that significantly higher 5- year returns on are socially company's valuation invested capital responsible to plummet Workers may be happier and less likely to leave when their company is socially responsible Companies with Investors are effective ethics and increasingly seeking compliance cultures socially responsible find their employees companies to put are less likely to their money into retaliate against one another

Answer 1

Answer:

How Does Being Good Pay Off?

Effects of ethical and socially responsible behavior by a company on various stakeholders:

1. Consumers want to spend more money with companies that are socially responsible.

Customers

2. Socially responsible  companies generate significantly higher 5- year returns on invested capital.

Profits

3. An ethical scandal can cause company's valuation to plummet.

Stock Price

4. Workers may be happier and less likely to leave when their company is socially responsible.

Employees

5. Investors are increasingly seeking socially responsible companies to put their money into.

Revenue

6. Companies with effective ethics and compliance cultures find their employees  are less likely to  retaliate against one another.

Interpersonal Relationships

Explanation:

a) Stakeholders Effects:

Interpersonal Relationships

Employees

Profits

Stock Price

Revenue

Customers

b) Organizations are not only under pressure to do right, but many have discovered that it pays more in both revenue and profits to do right.  The society has given organizations the opportunity to move in the right direction, and they should never lose it because the consequences of neglecting this onerous duty are too dear to contemplate.