Working toward Becoming a Socially Responsible Company Part I
Section 1:
� Executive Summary: It is a short section of a larger document that provides an overview of the
critical items covered in the full document. The purpose of the executive summary is to provide the
reader with enough information to get him or her quickly acquainted with the salient information in the
larger report. Review, revise, and summarize research and writings from Weeks 1 to 5 (see bulleted
list below) in 1�2 pages.
Section 2:
� Describe your chosen global, publicly traded organization (Week 1).
� Discuss your strengths, weaknesses, opportunities, and threats (SWOT) analysis. Be sure to
discuss how the selection of your social cause supports strengths and opportunities of your
organization while helping your organization to overcome its weaknesses and threats. (Much, but not
all, of this information was prepared in Week 2.)
� Describe the social cause and/or nonprofit partner and the ethical principles and frameworks used
in making your selection. Include a discussion of the internal and the external impacts you expect to
make with this choice (Week 3).
� Discuss any ethical challenges this social cause or partnering with the chosen nonprofit might
present to your employees (based upon Week 4 materials).
� Discuss why it is important for your organization to actively participate in a CSR program and why it
is important to promote a global citizenship effort (based upon Week 5 materials):
BECOMING A SOCIALLY RESPONSIBLE COMPANY 2
Executive summary
The chosen publicly traded global company is General Motors (GM). This is a Detroit,
Michigan-based multinational that produces and sales a wide range of motor vehicles. The
selected social cause that supports General Motors’ strengths and opportunities while helping
this corporation to overcome its threats and weaknesses is the production of eco-friendly
vehicles. The manufacturing of environment-friendly automobiles supports GM’s strengths
while overcoming its weaknesses and threats as it makes GM to stand as a car maker that
cares for the environment. The ethical challenge is that GM’s employees focus so much on
the production of eco-friendly energy efficient automobiles that they overlook other
important aspects such as safety and quality of the cars. CSR programs and promoting a
global citizenship effort by General Motors would result in workers being better motivated
and their productivity would go up. It will also result in good relationships with the local
authorities which would in turn make conducting business a lot simpler and easier.
BECOMING A SOCIALLY RESPONSIBLE COMPANY 3
Working toward Becoming a Socially Responsible Company Part I
Chosen global company: General Motors
The selected publicly traded, multinational corporation is General Motors (GM). This
is a Detroit, Michigan-based global corporation which is engaged in the production of motor
vehicles. This car maker was established in the year 1908 by the American businessman
William Durant. The firm offers an extensive array of automobile models which include
Chevrolet, Oldsmobile, Buick, Cadillac, as well as GMC Truck and Coach (Roberts, 2016).
Furthermore, General Motors produces a high number of locomotives, gas-turbine, and diesel
engines as well as appliances for domestic use. The company’s customer base is mainly the
section of the population that does not have too much money to spend on cars but are seeking
fuel-efficient automobiles (Crumm, 2010). General Motors’ main areas of operations are the
production and selling of motor vehicles and their spare parts as well as the sale of financial
services. Currently, the company has a workforce of roughly 215,000 employees, and it
serves six continents, and sells over nine million cars annually: in the year 2015 alone, the
company sold 9.8 million vehicles worldwide (General Motors, 2016a).
BECOMING A SOCIALLY RESPONSIBLE COMPANY 4
General Motors does not have an official mission statement. However, the company
states on its website that it is in fact committed to delivering great automobiles and works
toward giving consumers a positive ownership experience. The vision of the company is to be
the global leader in the production of transport products and associated services. The
company also desires to earn the enthusiasm of its customers through continuous
improvement motivated by reliability, cooperation, and invention (General Motors, 2016b).
The values enshrined in the ethics policy of General Motors are as follows: creating lifetime
customers, continuous improvement, prioritizing safety and quality, delivering products that
offer long-term value and making a progressive transformation (General Motors, 2016a). All
in all, General Motors is one of the most prominent companies in the world that produce
automobiles and household appliances. In fact, General Motors is the second largest carmaker
globally just behind the Japanese car manufacturer Toyota (Roberts, 2016). The current high
standing of the company among its competitors is an indication that its products are likely to
continue being used by customers into the future.
General Motors SWOT analysis
Strengths
Huge Market Share: In as much as the company’s share value recently dropped in
the United States market, General Motors still remains competitive in the global market
(Adela & Monica, 2011). At the moment, GM’s market share value stands at 25% and is
significantly increasing in different markets such as China, South Africa and other emerging
markets (Roberts, 2016). This is a clear depiction of the fact that with the right strategic
plans, the company can actually turn out to be the market leader in the automotive industry
again by surpassing the current market leader, Toyota.
Wide range of Brands: GM has several branches in different parts of the globe and is
considered as a global leader along with its main rival Toyota for the primary purposes of its
BECOMING A SOCIALLY RESPONSIBLE COMPANY 5
wide range of brands. The extensive diversity of its product range has made it easy for the
company to access different types of markets with different types of car products (Adela &
Monica, 2011). Currently, GM’s brands include GMC, Buick, Saturn, Cadillac, Chevrolet,
Daewoo, Saab, Holden, Vauxhaull, Opel, and Hummer. While it offers Hummer, GMC,
Buick, Saturn, Cadillac, and Chevrolet largely for the North American market, General
Motors offers Holden for the Australian market, Opel for the European market, and Vauxhall
for the British market (Crumm, 2010).
Innovation and advanced technology: NASA engineers and GM engineers are
currently working on modalities to launch Robonaut 2 as one of the space shuttles in the
International Space Station (Adela & Monica, 2011). The two entities are collaboratively
putting their efforts together using different technologies in developing this machine and
other humanoid robots through the use of vision systems and advanced sensor. This has
helped to maintain GM’s capacity to use technology in advancing its productivity. The
company also provides energy-efficient technologically advanced automobiles such as the
electric Chevy Volt and the hybrid Chevrolet Cruze Eco. Both of these cars are design to
have negligible environment impact.
Customer Satisfaction and huge financial strength: GM has an outstanding
reputation in the production of quality products as detailed in the American Customer
satisfaction index. The company’s innovative products such as Cadillac and Buick are
currently ranked as the largest products that satisfy the needs of the customers. General
Motors has an immense financial strength thanks to considerable revenues and profits the
company makes each year (Calderón, Ferrero & Redin, 2012). GM’s immense financial
strength has enabled the company to easily expand its presence globally.
Weaknesses
BECOMING A SOCIALLY RESPONSIBLE COMPANY 6
Unproductive Marketing Strategies: GM’s marketing strategies are considered as a
failure since these approaches are restricted within different countries and they do not suit all
the countries the organization conducts its businesses in (Crumm, 2010). This requires the
organization to focus on a global trend and marketing strategy that fits in different markets.
Poor Relationships between the Employees and Management: At GM, there is really
no profound relationship between its management team and employees. This has resulted in
poor communication and conflicts between the staffs and managers (Adela & Monica, 2011).
The company has faced quite a few major loses as a result of these challenges.
Over-reliance of the U.S Market: GM is known for its over-reliance and dependency
on its country of origins market. In as much as the company is taking efforts to expand its
functions in different markets, much of its quality products are not produced in these other
markets (Roberts, 2016). Pension Schemes and Health Allowances: GM’s pension scheme
has resulted in several conflicts between the company and its employees. This is in
consideration of the fact that the company has not been in a position to compensate its
employees’ pensions and health allowances that have piled up over a period of time. This has
consequently tainted the image of the company in the market (Adela & Monica, 2011).
Opportunities
Substitute Energy Approach: although GM has previously faced challenges in
manufacturing energy efficient vehicles, there is an opportunity in the marketplace for this
company to ensure that it develops fuel efficient vehicles for instance through the use of
hybrid technology in order to effectively compete in the market. To achieve this, the
company needs to incorporate the element of Research and Design on hybrid technologies as
well as electric car technologies for its products and innovatively apply the latest green
technologies in the manufacturing process (Roberts, 2016). This is important considering that
BECOMING A SOCIALLY RESPONSIBLE COMPANY 7
more and more consumers are seeking automobiles which are environment friendly with
minimal carbon emissions owing to climate change issues.
Marketing Strategy: in addition, GM should initiate the right marketing strategies in
order to attract its customers. This certainly would require this carmaker to incorporate
advanced technologies and low interest rates on its vehicles (Adela & Monica, 2011). This
approach would be effective in increasing the organizations sales, thus it is essential for the
company to analyze the market and use customer suggestions and feedbacks in effectively
developing strategies that meet the needs of the market.
Threats
Economic slump and financial Crunch: Over the last few years, several
organizations have struggling to sustain their market positions as a result of the 2007/2008
global recession. This has affected the operations of GM as well (Roberts, 2016). In
consideration of the slow progress in the global economy, several changes have been
experienced especially in regards to consumer behaviors. Several consumers have resorted to
low end cars that are fuel efficient, thus affecting the production as well as sale process of
GM since the demand for its products declined to some extent.
Competition: GM has enjoyed the market as a global leader for a considerable
amount of time. However, the advent of other competitors such as Japanese, Korean and
European carmakers has highly affected the functions of this organization in the industry
(Roberts, 2016). Toyota, Volkswagen and Nissan, for example, are currently developing fuel
efficient vehicles at competitive prices and offer their products globally just like GM. In
order for GM to sustain its market position, it is essential for the company to develop
BECOMING A SOCIALLY RESPONSIBLE COMPANY 8
financial programs and offer huge discounts to its customers while also upgrading its brands
in the market (Crumm, 2010).
The selected social cause that supports General Motors’ strengths and opportunities
while helping this corporation to overcome its threats and weaknesses is certainly the
production of eco-friendly vehicles. The manufacturing of environment-friendly automobiles
supports GM’s strengths while overcoming its weaknesses and threats as it makes the
company to stand out from the crowd – comprising other car makers – as a car manufacturer
that actually cares for the environment and seeks to lessen its environmental impacts. This
also supports GM’s strengths by improving its image and repute (Adela & Monica, 2011). In
addition, the social cause of providing environment-friendly cars supports GM’s exploitation
of opportunities available to it in the marketplace while overcoming its weaknesses and
threats as it allows the company to meet the needs of consumers who seek eco-friendly cars,
that is hybrid and electric cars, which have minimal environmental impact (Crumm, 2010). It
also allows General Motors to develop automobiles which meet carbon emission regulations
and laws in America and in other parts of the world which are striving to combat the issue of
climate change.
Social cause and ethical principles
The social cause is the production of energy efficient eco-friendly automobiles –
hybrid cars and electric cars with minimal emission of green house gases (GHGs) which is
good for the environment. In the year 2010, GM largest brand, Chevrolet, invested $40
million in a number of carbon offsetting projects throughout the United States that would
offset eight million metric tonnes of carbon dioxide (CO 2 ) emissions, and it launched the
electric Chevy Volt in 2010 (Godelnik, 2014). Besides the Chevy Volt, GM is also
manufacturing fuel-efficient cars such as the Chevrolet Cruze Eco. In essence, GM has
BECOMING A SOCIALLY RESPONSIBLE COMPANY 9
effectively chosen initiatives which actually maximize environment benefits as well as gains
to the firm.
The ethical principles and frameworks that were used to make this selection include
the following: (i) care for the environment – care ethics is extensively applied to various
moral issues as well as ethical fields, such as bioethics and caring for the environment and
animals. General Motors demonstrates care for the environment by developing automobiles
which are energy efficient that have negligible impact on the environment in comparison to
the conventional cars made by other car makers (Bredeson & Goree, 2014). (ii) Law abiding
– ethical company executives are generally law abiding as they conform to the regulations,
rules and laws that pertain to their business activities (Mishra & Modi, 2016). At GM, the
company’s top executives have demonstrated this ethical principal by complying with
appropriate European Union and American environmental regulations and laws which are
aimed at reducing the impact of automobiles on the environment. The law in the European
Union for instance requires that every new car registered in this region does not release more
than an average of 130 grams of carbon dioxide for every kilometre by the year 2015,
meaning fuel consumption of roughly 4.9 litres for each 100 kilometres of diesel or 5.6 litres
for every 100 kilometres of petrol (European Commission, 2016). In the United States, the
Obama Administration established regulations aimed at increasing fuel economy for light-
duty trucks and cars to the equivalent of 54.5 mpg by the 2025 Model Year (The White
House, 2016). GM’s innovative technologies could be helpful in cutting emissions of CO 2
and enhance fuel and energy efficiency.
(iii) Reputation and commitment to excellence – top executives who are ethical
usually endeavour to protect and build the good reputation of the organization as well as the
employees’ morale by not engaging in any activities which may undermine respect. Such
leaders also pursue excellence in carrying out their responsibilities. These executives are
BECOMING A SOCIALLY RESPONSIBLE COMPANY 10
well-informed and geared up, and always seek to increase their proficiency in every area of
responsibility (Hsieh, 2015). By pursuing the social cause, leaders at General Motors seek to
protect the GM’s good reputation as a car manufacturer that actually cares for the
environment by developing energy efficient automobiles that have minimal environmental
impact.
There are a number of external and internal impacts that would be made by the
choice. The internal impacts include increased employee satisfaction and retention, improved
employee job performance since employees would be more motivated to work in a socially
responsible firm, and reduced costs. The external impacts include increased customer
satisfaction and retention, easier access to investors and funders, the firm would be more
competitive in its industry, and improved relations with the authorities in America and other
global markets in which GM carries out its business operations (Zlatanović, 2015).
Ethical challenges the social cause presents to employees
The main ethical challenge is that GM’s employees focus so much on the production
of energy efficient automobiles that they overlook other important aspects such as safety and
quality of the cars. Consequently, the company manufactured a lot of faulty cars with quality
and safety issues. The genesis of this controversy resulted when this giant car manufacturer
failed in recalling its faulty cars at the required time: the employees had known very well of
the existence of a problem for quite some time. The problem that GM encountered is linked
to its vehicles detent plunger, a spring within the ignition switch that provides enough torque
to vehicles and holds the key in the switch to avoid turning off the car’s engine (Calderón,
Ferrero & Redin, 2012). As a result of this, several clients experienced technical problems
since the ignition keys fell off the switch, thus shutting down the engine and disabling other
safety functionalities that are powered by the engine of a car.
BECOMING A SOCIALLY RESPONSIBLE COMPANY 11
According to Kant’s maxims theory, it was improbable for the company’s executives
to unknowingly drive faulty cars. In addition, it would not be justified that GM’s employees
would be in a position to risk their lives driving these faulty vehicles, which proves the fact
that they had an idea about the dangers of these vehicles and neglected to correct these
aspects. According to Calderón, Ferrero and Redin (2012), it is questionable whether the
company’s employees were comfortable not knowing that a multitude of the products they
use on a daily basis were actually faulty and could potentially cause a major accident that
may be deadly to the users.
Through their inaction, the company left the faulty ignition systems to go through the
production process resulting in the generation of millions of faulty vehicles. In this case, it is
important that the employees had the capacity to detect the problem and prevent the fatalities
that resulted from GM faulty vehicles causing accidents (Calderón, Ferrero & Redin, 2012).
The reported results of these technical errors owing to GM’s faulty cars include 13 deaths and
35 car crashes – GM linked these accidents to the failure to use airbags. Furthermore, GM
recorded a loss of close to 30 million cars, which greatly affected its operations.
In accordance with the utilitarian theory, the choices of the company must have been
made in light of the consequences that would result (Bredeson & Goree, 2014). On the other
hand, deontological theories assert that every rational company needs to act in accordance
with reason and duty. However, GM’s senior management ignored these consequences and
chose to continue producing faulty cars, which affected millions of its consumers in the
United States (Calderón, Ferrero & Redin, 2012). In this case, it is important to note that the
actions of General Motors’ top executives contradicted the Utilitarian and Deontological
ideologies on ethical actions, which actually makes it difficult to justify their actions in light
of ethical responsibility towards their customers. Such an unethical conduct should not be
tolerated in future: cars produced with faults should be recalled as soon as the faults are
BECOMING A SOCIALLY RESPONSIBLE COMPANY 12
discovered by the car maker and necessary corrective measures undertaken to protect the
lives and properties of consumers and other road users.
Importance for General Motors to actively participate in a CSR program
There are a number of reasons as to why it is important for General Motors
Corporation to participate actively in a Corporate Social Responsibility program and why the
company should promote a global citizenship effort. Firstly, this will make GM’s employees
to be satisfied with the company. Workers generally want to feel proud of the company they
are working for. A worker who has a positive attitude toward the organization has a less
likelihood of looking for employment in a different company. In essence, corporate social
responsibility would help General Motors to retail employees (Zlatanović, 2015). Workers
would be motivated to stay at the company for a longer period, which would in turn reduce
the disruption and costs of hiring and retraining. Furthermore, General Motors would be able
to get more of job applications since a lot of people would like to work for GM. More choice
will mean a better workforce. All in all, General Motors would be able to not just attract, but
also retain and maintain happy staff members and even be recognized as an Employer of
Choice (Hsieh, 2015).
Secondly, participating actively in a CSR program will result in satisfied clients.
Researchers have reported that a strong record of corporate social responsibility will improve
the attitude of customers toward the organization: Cassimon, Engelen and Liedekerke (2016)
reported that 89% of customers said that they would purchase from an organization that
engages in and supports activities that are aimed improving the society. If customers like the
firm, then they are likely to purchase more products. In addition, they would be less willing
to shift to a different brand. Thirdly, active participation in a CSR program and promoting a
global citizenship effort results in positive public relations (PR). Corporate social
responsibility programs provide the opportunity of sharing positive stories via conventional
BECOMING A SOCIALLY RESPONSIBLE COMPANY 13
media as well as through online media (Chernev & Blair, 2015). General Motors will not
have to waste substantial amount of money any more on costly advertising campaigns. This is
because the company would simply generate free publicity through its CSR programs and
benefit from word of mouth marketing. Fourthly, it will result in cost reductions. General
Motors would be able to lower costs by: less investment in conventional advertising,
executing energy savings programs, more efficient hiring and retention of employees, and
managing possible liabilities and risks in a more effective manner (Hsieh, 2015). The
company would be able to save on operating and energy costs.
Other benefits of CSR programs and promoting a global citizenship effort to General
Motors include the fact that workers would be better motivated and their productivity would
go up. It will result in good relationships with the local authorities which would in turn make
conducting business a lot simpler and easier. Corporate social responsibilities will help in
ensuring that the company complies with the regulatory requirements (Hsieh, 2015). In
addition, understanding the wider impact of the business could in fact present opportunities
for developing new services and products. CSR activities, for instance involvement with local
communities, are perfect opportunities for generating positive press coverage. Equally
important, corporate social responsibilities could make the company more competitive in the
automotive industry and decreases the risk of abrupt harm to its reputation as well as sales.
General Motors would also be able to find it easier to access funding given that investors
would be much more willing to support a company that has a good reputation (Cassimon,
Engelen & Liedekerke, 2016). Lastly, active participation in a CSR program and promoting a
global citizenship effort will help to distinguish this car manufacturer from the competition
and would increase customer retention.
BECOMING A SOCIALLY RESPONSIBLE COMPANY 14
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BECOMING A SOCIALLY RESPONSIBLE COMPANY 15
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