Name:

Strand,Grade&Section:
Teacher:
Subject:

CONCEPT NOTES #3

Social Responsibility of Entrepreneurs

(Responsibilities and Accountabilities to the Consumers)

1. Attend to Complaints – When major issues occur, employ a system for making quick and
accurate decisions on steps and measures to take, while placing top priority on not
inconveniencing the customers.

2. Service Even After Sales – After sales service is essential and ensures long term growth and
profits for the organization. Efficient and effective after sale service helps to establish a good
relation between the customers and the company.

3. Respect Customers’ Time – Do not decide the time and venue as per your availability and
comfort.

4. Treat Customer’s Well – Build a strong relationship with your customers for them not only
to remain your local clients but also bring more people along with them. Avoid making fake
promises and commitments which you yourself know are difficult to fulfill.

5 Ensure Regular Supply – Commercial organization should not create an artificial shortage of
goods.

6 Research and Develop to Increase Satisfaction – Through surveys of customers who have
purchased your products, investigate customer satisfaction and enhance after-purchase support
and information services.

7 Avoid Monopolistic Competition – Commercial organization should avoid monopolistic

competition in the interest of consumer.

Social Responsibility of Entrepreneurs

(Responsibilities and Accountabilities to the General Public)

1. Be Fiscally Responsible – A company needs to enact and enforce guidelines of its own that
agree with the law but also apply specifically to the company, to avoid misuse of company
funds.
 2. Consider Public Input – Companies should reach out to its customers and benefit from the
insight of what customers are looking for in product improvements. It is the responsibility of
the company to remain accountable to its customers.

3. Take Care of the Community – The company has a responsibility to give back to the
community that supports with its tax breaks and a labor force. Businesses has to take up
several moral responsibilities towards the society.

Social Responsibility of Entrepreneurs

(Responsibilities and Accountabilities to the Environment)

1. Comply with Environmental Legislation

2. Dispose Waste Properly – Ensure that any waste you produce as a result of business
operations is stored safely and securely, treated appropriately and collected for disposal or
recycling by an organization authorized to do such.

3. Recycle – Businesses are required to separate the following forms of commercia; waste for
recycling paper, card, plastic, metals and glass.

4. Conserve and Protect Biodiversity – All types of business operating near protected areas
should be aware of their responsibilities for conservation and protecting biodiversity.

5. Prevent and Remedy damages to the Environment

6. Report an Incident

7. Use Scarce Natural Resources Sparingly

Name:
Strand,Grade&Section:
Teacher:
Subject:

CONCEPT NOTES #4

Social Responsibility of Entrepreneurs

(Major Ethical Issues in Entrepreneurship)

Ethical Issue is a problem or situation that requires a person or organization to choose between
alternatives that must be evaluated as right (ethical) or wrong (unethical).
Ethical dilemma arises in a situation concerning right or wrong when values are in conflict.

Basic Fairness - Ethical decision-making process should center on protecting employee and customer
rights, making sure all business operations are fair and just, protecting the common good and making
sure individual values and beliefs of workers are protected.
Partners
Gross Negligence

A. Personnel and Customer Relations

Mistreating Employees
Discrimination and Harassment in the Workplace

1. Family-Run Business
2. Employee Behavior
3. Employee Working Condition

B. Distribution Dilemmas – Pricing refers to the way in which prices are set for consumers
(inputs, distribution, and overhead). Placement involves the strategic positioning of products
within retail stores. Promotion involves short-term price discounts or giveaways.

1. Pricing Strategy Ethics

2. Product Placement Ethics
3. Ethics and Promotions

C. Fraud – Can be in the form of financial misconduct or misinterpretation. (price-fixing, illegal

agreement between industry competitors, tax evasion, tax fraud, “cooking the books”, etc.)

Unfair Competition – A situation in which competitors compete on unequal terms because favorable
or disadvantageous conditions are applied to some competitors but not to others.

Antitrust Law or Competition Law – Occurs when one competitor attempts to force others out of the
market or prevent others from entering the market.

Trademark Infringement – Occurs when the marker of a product uses a name, logo, or other
identifying characteristics to deceive consumers into thinking that they are buying the product of the
competitor.
Misappropriation of Trade Secrets – Occurs when one competitor uses espionage, bribery, or outright
theft to obtain economically advantageous information in the possession of another.

Trade Libel – Spreading of false information about the quality or characteristics of a competitor’s
product.

Tortious Interference – Occurs when one competitor convinces a party having a relationship with
another competitor to breach a contract with.

Anti-Competitive Practices – Prevent or reduce competition in a market.

Dumping - Company sells a product at a loss. Though the company loses money for each sale, the
company hopes to force other competitors out of the market, after which, the company would be free to
raise prices for greater profit.

Exclusive Dealing – A retailer or wholesaler is obliged by contract to only purchase from the
contracted supplier.

Price Fixing – Companies collude to set prices, effectively dismantling the free market

Refusal to Deal – Two companies agree not to use a certain vendor.

Dividing Territories – An agreement by two companies to stay out of each other’s way and reduce
competition in the agreed-upon territories.

Limit Pricing – Price is set by a monopolist at a level intended to discourage entry into a market.
Tying – Products that aren’t naturally related must be purchased together.

Resale Price Maintenance – Resellers are not allowed to set prices independently.

Religious / Minority Group Doctrine – Businesses must apply tribute to a significant – normally
religious – part of the community in order to engage in trade with that community.

Absorption of a Competitor or Competing Technology – Powerful form effectively co-ops or

swallows its competitor rather than see it either compete directly or be absorbed by another firm.

Subsidies from Government – Subsidies which allow a firm to function without being profitable,
giving them an advantage over competition or effectively barring competition.

Regulations – Some regulations place costly restrictions on firms that less wealthy firms cannot afford
to implement.
Protectionism, tariffs, and Quotas – Protectionism, tariffs, and quotas which give firms insulation
from competitive forces.

Patent Misuse and Copyright Misuse – Patent and copyright misuse, such as fraudulently obtaining a
patent, copyright, or other forms of intellectual property; or using such legal devices to gain an
advantage in an unrelated market.

Digital Rights Management – Prevents owners from selling used media, as would normally be allowed
by the first sale doctrine.

Enhancing the Addictiveness

Social Responsibility of Entrepreneurs

(Models and Frameworks of Social Responsibility in the Practice of Sound
Business)

Models of Socially Responsible Businesses

Ben & Jerry’s – Founders Ben Cohen and jerry Greenfield have infused the company with the notions
of giving back in every way possible, as well as “linked prosperity” between the company, its
employees, and the community. They started the Ben & Jerry’s Foundation where they set an
extraordinary rate of giving to charitable organizations, donating a full 7.5% of pretax profits. In their
own words, they ‘strive to show a deep respect for human beings inside and outside our company and
for the communities in which they live.”

Burt’s Bees – The focus of Burt’s Bees has always been on well-being and “the greater good.” As part
of the Natural Products Association, the company helped develop the Natural Standard for Personal
Care Products, which created guidelines for what can be deemed natural. Burt’s Bees follow the
highest possible standards for packaging sustainability, furthering its dedication to the cause.
Starbucks Coffee – The company has focused on acting responsibly and ethically. One of their main
focus is the sustainable production of green coffee. It created C.A.F.E. practices, a set of guidelines to
achieve product quality, economic accountability, social responsibility, and environmental leadership.
The company supports products such as Ethos Water, which brings clean water to more than 1 billion
people who do not have access.

TOMS – Blake Mycoskie started Toms shoes on the premise that for every pair of shoes sold, one pair
would be donated into a child in need. Toms shoes recognized that consumers want to feel good about
what they buy, and thus directly tied the purchase with the donation.

General Electric – To stay true to GE’s mission, Ecomagination offerings include products that
significantly and measurably improve customers’ operating performance or value proposition and
environmental performance. Ecomagination helped GE build its business by increasing awareness of
how the company is using renewable energy and reducing carbon emissions.