Introduction
In the stakeholder/responsibility matrix (Carroll & Buchholtz 1999, p. 84), there are employees, owners, customers, communities, public at large, social activist groups and others in the stakeholder group. Carroll & Buchholtz (1999, p. 84) have stated the four types of responsibilities as Philanthropic, Economic, Ethical and Legal.
Carroll & Buchholtz (1999, p. 37-38) describe a socially responsible firm would need to make a profit [Economic], obey the law [Legal], be ethical [Ethical] and be a good corporate citizen [Philanthropic]. Based on the figure 2-2 (Carroll & Buchholtz 1999, p. 36), it shows that economic, legal are required, whereas the ethical and philanthropic are expected and desired respectively.
Different groups of stakeholders will expect different things in these four responsibilities. This report will be touching on employees, who are the primary stakeholders whose association is necessary and very important for a firm to survive in the economy as they are the ones who influence the firm’s business day-to-day (Ferrell, Fraedrich & Ferrell 2005, p. 26-27).
Economic Responsibilities
Economic responsibilities have the largest impact on the employees. If the business is not doing well due to poor decisions or economic downturns, employees will be deeply affected as they will be laid off by the firm. Not only will the employees lose their jobs, they will lose the retirement pensions which are usually heavily invested in the firm’s stocks. This might result in losing lots of money. During this period of time, most employees will be too stressed up facing the firm’s demand to cut down expenses, therefore affecting ‘product quality, customer service, em ...