Society and Business

Society and Business

Society and Business

Outline

Introduction

Forms of Financial Participation

Which type of large Firms should Have worker Financial Participation?

Effects on Productivity

Annotated Bibliography

Carroll, A. B. (1999). Corporate social responsibility: Evolution of a definitional construct, Business & Society, 38, 268-295.

In this article, the author traces the evolution of the CSR construct beginning in the 1950s, which marks the modern era of CSR. Definitions expanded during the 1960s and proliferated during the 1970s. In the 1980s, there were fewer new definitions, more empirical research, and alternative themes began to mature. These alternative themes included corporate social performance (CSP), stakeholder theory, and business ethics theory. In the 1990s, CSR continues to serve as a core construct but yields to or is transformed into alternative thematic frameworks.

Graves, S. B., & Waddock, S. A. (1994). Institutional owners and corporate social performance. Academy of Management Journal, 37, 1034-1046.

This is based on a study of more than 100 large Australian companies, demonstrates that business commitment, scope, focus and diversity of corporate community investment activities in large Australian continue to increase and deepen.

Prakash, A., & Potoski, M. (2006). The voluntary environmentalists: Green Clubs, ISO 14001, and voluntary environmental regulations. Cambridge, UK: Cambridge University Press.

This excellent and well-researched study provides a valuable resource for scholars and practitioners in determining how to adjust our regulatory and other strategies to the demands of a new and more challenging era of environmental problem-solving. When do firms choose to follow voluntary environmental standards? Why do they apparently seek less freedom to pollute? Using the theory of green clubs and evidence from ISO 14001, Prakash and Potoski help resolve these policy mysteries. The Voluntary Environmentalists should interest readers concerned with finding innovative ways to improve environmental performance.Introduction

Profit sharing and employee share ownership are widespread in the European Union. In the four largest countries, at least 17 million employees, or 19% of private sector employment, are covered by such schemes. Financial participation is of interest for public policy because it may have positive effects on productivity and employment and could further other public policy objectives like wealth redistribution and economic democracy. Issues for the design of policy include choosing the most effective form of intervention (e.g. tax concessions or information and education) and which types of financial participation schemes to promote (Prakash 2006). Only certain types of schemes may have effects of interest for public policy such as increasing productivity or demand for labour. The form of the scheme may also bear on other public policy concerns including risk bearing by employees and the extent of employee participation in governance.

Forms of Financial Participation

Financial participation includes profit-sharing, under which a portion of profit is paid to employees in addition to their wage, and employee share ownership, under which employees own shares in the company in which they work. Both forms are often combined in the same enterprise. Like other forms of employee participation, financial participation is characterised by a sharing of property rights with employees. It gives employees a residual right to the firm's ...