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MGT 712 Corporate Governance, Ethics And CSR For Sustainable Development Goals

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Question:

Chose one of the 17 goals Using the United Nations (UN) web based material as your main source of reference, define the structure of governance to support the goal. Apply Mitchell et al’s article “Toward a theory of stakeholder identification and salience: defining the principle of and what really counts” (download from Blackboard’s Learning Materials) to identify and map the stakeholders. Define the relationships within the map as per inclass exercises. Appraise the UN Principles for Responsible Management Education (PRME) core principles to support/achieve the goal. Make 2 recommendations explaining how corporations can achieve the goal you have chosen applying PRME. Use models to support the discussion in your advice (these can be adapted from the lecture slides). Apply the MGT712 Style Guide Checklist (available from Assessment Link in BlackBoard) and that it is to an acceptable University standard of English.

 

Answer:

Introduction

Our world is facing a large number of problems such as poverty, hunger, gender discrimination, health-related issues, inequalities etc. Then, SDG (Sustainable Development Goals) was created by UN, which comprises 17 such type of problems, in order to achieve global sustainable development. Poverty is one of those problems consider in SDG goals. Poverty is the cause of many problems. Even though it has been decreasing from last 10 years, but still it is creating so many challenges and problems for the people all around the world. Poverty is the only cause behind several diseases such as TB, malaria, and malnutrition (Gwatkin, 2010). One of the major reasons behind poverty is a tremendous increase in population from last three decades.

The United Nations is continuously focusing on such a problem and their solutions through good governance. In this report, the role of good governance of UN has been discussed. In this report, it has been discussed that how UN fighting with the various problems of the world with the help of good governance or corporate governance and how PRME principles help in eradicating the poverty. ‘No poverty' is the first and most primary goal of UN, which creates many challenges. Thus, the main focus of this report is also on the eradication of poverty. In the end of this report, there are two recommendations added that suggest how can we eliminate poverty from our society by using PRME principles.

 

Selected goals (Goal no. 1- No Poverty)

Poverty is the major problem all over the world. While global poverty level reduced more than half since 2000, more than 783 million people are living below the international poverty line. The income of these people is less than the US $1.90 per day (Griggs, 2014). Therefore, it is the first sustainable goal of the United Nations as it focuses on ‘No Poverty’. Most of the people living below poverty line belong to Asian and African countries, especially Sub-Sahara Africa and Southern Asia (Bazilian, Nakhooda, and VandeGraaf, 2014). High poverty rates are found in the least developing countries or those countries that are facing the economic crisis. Conflicted affected countries such as Syria, Iraq, and Pakistan are some examples of Asian countries, which are fighting with poverty because of the conflicting and combating situation in the country (Pearce, Barbier, and Markandya, 2013). Poverty is the main cause of several other big problems such as hunger, harmful disease, and crime etc. People who habituate to live in poor conditions and cannot available even the basic resources for the living are suffering from diseases such as TB, malaria, HIV/AIDS, Malnutrition etc. Thus, UN found that it is the first and primary cause of all the problems and then it has decided that the first goal of sustainable development should be the eradication of poverty means ‘No Poverty’.

 

UN Corporate Governance and its Structure

Corporate Governance or sometimes called good governance is the main instrumental factor in poverty eradication. The corporate goal targeted both support and growth of society and the well-being of human beings. It focuses on enabling good political and legal environment in collaboration with capable governments of different countries to provide safety, security, and peace to all people. The United nations first launch Millennium Development Goals and measure its effectiveness and progress with the good governance (Shepherd, et.al, 2015). This is an essential need of UN and also the necessity of all the countries on the globe is to more focus on achieving sustainable goals with the help of good governance. The main agenda behind new sustainable development goals is the eradication of poverty from the world and promote prosperity by improving the well-being of people while protecting the environment by 2030. The development arm of UN, which is also called UNDP, has an important role in supporting countries to make this vision in reality (Adams and Petrella, 2010). The UNDP is responsible for putting societies on its sustainable development pathway, improving the prosperity of people and their wellbeing, and managing risk with enhancing resilience.

United Nations has a large network and it serves as the core strength of UNDP. More than 170 countries and territories are connected with UN. The UNDP program plays a principle coordination role in the UN development program and systems and working with its full potential to fight with poverty and inequality. The another initiative taken by UN in 2007 was PRME (Principle for Responsible Management Education) principles that focus on raining profile of sustainability in schools and colleges around the world. As a voluntary initiative, more than 650 signatories join the PRME principle program of UN (Collins, 2012). The PRME principles work on six principles Purpose, Values, Method, Research, Partnership, and Dialogue. PRME is governed, along with the UN global compact, and by some reputed business schools of the world, and some specialised regional associations such as AACSB, CEEMAN, and ABIS. Apart from this some other organisations such as World Bank, IMF, UNICEF, UNCTAD etc. are working in collaboration with UN against the poverty eradication.  

The UN system Chief Executives Board for Collaboration (CEB) is the highest level of the UN system and it is headed by UN Secretary-General. The CEB comprises with 31 executive heads, which are the heads of various UN functions and program such as funds and program management, the specialized agencies, and other related organisations such as WTO, IAEA, and IMF etc. (Sumner and Tiwari, 2010). The UN-CEB carries outs its role through two high-level committees:

  1. High-level Committee on Programmes (HLCP)
  2. High-level Committee on Management (HLCM)

The CEB membership includes 15 specialized agencies, 3 related organisations, and 12 funds and program created by the UN General assembly. IOM is the newest member of CEB.

Stakeholders Map and Relationship

The stakeholder map analysis is helpful to find out the importance and behaviour of various stakeholders in a project. The Mitchell’s model, which is also called ‘Salience model’ and it is helpful in understanding the behaviour and the priority level of a particular stakeholder. The Salience model is working on three major aspects of a stakeholder that are Power, Legitimacy, and Urgency model. This model identifies eight stakeholder groups, which specifies the nature of stakeholders and their behaviour in a particular situation. There are many stakeholders involved in SDG programs of UN such as various Governments, major groups, intergovernmental organizations, and others stakeholders (Lu, et.al, 2015). These stakeholders help directly and indirectly both to achieve the first goal of the SDGs. Apart from these stakeholders, some other stakeholders of UN poverty programs are as follows:  

  • Farmers
  • Children and youth
  • Scientific and Technological Community
  • Local Authorities
  • Governments of least and underdeveloped countries
  • Both national and international NGO’s
  • Indigenous Peoples
  • Farmers

Some other stakeholders such as migrants’ families, older age person, local communities etc. are also playing a significant role in poverty eradication. The role of these stakeholders is so important in any program of the United Nations, especially they decide the way of the success of various UN programs and its long-term goals (Mitchell, et.al, 2011). These groups and stakeholders show a high level of engagement with intergovernmental processes at United Nations. 

Green

Latent Stakeholders: Low salience, single attribute. UN may not control and cannot do anything about these stakeholders, and may not even recognise them as stakeholders.

Amber

Expectant Stakeholders: Two Attributes, moderate salience. They have active involvement in the goals achievement. UN can always expect something from them because they highly involved with in the project.

Red

Definite Stakeholders: High salience and all the three attributes. The main focus of UN on these Stakeholders because of their high priority level.

Source: (Wagner, Alves, and Raposo, 2011)

Description of each stakeholder and the relationship with the goal 

  1. Dormant Stakeholders: The dormant stakeholders have low urgency and low legitimacy, but they have high power to influence any decision-making. Normally these stakeholders are found to be prosperous and well approachable. These stakeholders are known for their power practices. If we consider UN member countries, then the USA and Russia are the two powerful countries. These countries have too much power in UN and they can easily influence any decision of the UN related to the poverty eradication goals (Thijssens, Bollen, and Hassink, 2015). Therefore, in this group, we can consider various governments and inter-governmental groups in the world.
  2. Discretionary Stakeholders: These stakeholders have high legitimacy, but low power and urgency. In this type of stakeholders, we can consider various worldwide NGOs, which are genuine stakeholders of the poverty eradication program, but they do not have power or urgency to control the poverty level. However, everyone knows the role of these NGO’s in nation building and making a good environment for people.
  3. Demanding Stakeholders: These type of stakeholders living with high urgency, but they have low urgency and low power. People living in the least developing countries such as Southern Asia and Sub-Sahara Africa are the good examples of such stakeholders. The poor countries of these continents are suffering from poverty. The first goal of SDGs is directly linked with such type of countries. The UN focusing on such countries, which are suffering from poor living conditions and even though they cannot afford water to drink because of their poverty. Somewhat we can consider poor farmers at the same level.
  4. Dominant stakeholders: These stakeholders have high legitimacy and high power but low urgency. Some developing countries such as China and India in Asian countries are the big economies and highly populated country. But the major problem in these countries that these countries are facing very low poverty level and low per capita income (Khan, 2012). Even though the high numbers of people are living below the international poverty line in these countries.
  5. Dangerous stakeholders:In this type of stakeholder’s group, stakeholders have high power and high urgency, but low legitimacy. In this categories, those countries are considered which has no legitimacy neither they have the power to use resources to eradicate poverty from their community.  
  6. Dependent stakeholders: These stakeholders have very low power but they have high legitimacy with high urgency. In this group those poor countries can be considered which has very low budget economy and they are not able to fight with poverty, but they have high power and also high urgency to avail such facilities which helps them to come out from economic crisis, thus they can get a victory over poverty (Merino and Valor, 2011).
  7. Definite Stakeholders: These stakeholders required the most attention and they have all the three attributes. In these categories, those countries and stakeholders can be considered which has high power, high level of urgency, and a high level of urgency as well.
  8. Non-Potential Stakeholders: These stakeholders are nothing to do and they did for considered. Even though these types of stakeholders are connected with the SDG mission plan, but the role of such stakeholders is zero in eradication poverty from the world.
 

PRME Principles

The Principles for Responsible Management Education (PRME) is one of the major initiations of United Nations, which was formed by the UN in 2007 to provide knowledge and importance of sustainability in various Business Schools in all over the world (Barbier, 2014). The main objective of the PRME principles is to spread awareness among students via various top Business schools and prepare them to achieve the Sustainability goals set in SDGs. The PRME principles include six principles on which it works as follow:

Purpose

The purpose of the PRME principles is that to develop capabilities of students to maintain sustainability in future and prepare the encourage them to work for society and sustainable global economy (Burchell, Kennedy, and Murray, 2015). These are the main purpose of PRME principle and if we consider it regarding eradication of poverty then it can help to understand the problems of people and motivate them why they should work for the poor people and how it can help to build a strong economy.

Values

The various courses and programs are incorporated with the academic and curricular activities of the Business schools and prospectuses the values of global social responsibility as described in global initiatives such as the UN Global Compact (Kandachar, and Halme, 2017).

Method

The third PRME principle focuses on providing proper way and methodologies to eradicate poverty from our societies. For this purpose, the PRME principle focuses on providing various materials, frameworks, process, and environments that help our future leaders to understand the issues and challenges related to poverty and how they can handle these challenges in future in order to achieve the sustainable development goals (Sachs, 2012).

Research

This is the fourth principle of PRME that focuses on practical approach of the research that advances the knowledge and understanding of the students in order to understand the causes of poverty and its effect on the society at large. It also helps in to understand the role, impact, and dynamics of corporations in the creation of sustainable development and environmental and economic values.

Partnership

The fifth principle of PRME focuses on interaction and partnership with different business corporations and their managers. This principle focuses on the collaborative effort to eradicate poverty from the society and jointly afford to meet these challenges, which arises due to poverty.

Dialogue

The six principle of PRIME focuses on debate, dialogue, and interactions among various students, school faculties, corporates, media, consumers, government, people, civil society, and other interest groups and stakeholders on those issues and problems, which arises because of poverty (Waddock, et.al, 2010). The other objective of this PRME principle is to focus on issues related to sustainability and global social responsibilities.

Recommendations

Poverty is one of the major problems of the world and it causes several other problems such as hunger and harmful diseases. The health of a human being directly influenced because of their poor conditions. To eradicate poverty from the world we need a strong planning and strategy. Awareness about the problem is one of the essential things before fighting with the problem. Thus, PRME principles of the UN focus on spreading awareness among people about the causes of poverty and its related issues. If people know the root of the problem they can easily solve the issue. Here are the two crucial recommendations, which have been discussed below that are helpful in removing poverty problem from the world.

  1. Decrease Population: Population is one of the major causes of poverty. Most of the countries cannot able to handle the poverty, because they have limited resources but the population is increasing day-by-day and with a quick speed. The PRME principle of ‘Dialogue' can be helpful tool here to spread awareness among people to control the population. Actually, population control is one of the major challenges for the whole world. We have limited resources and the large number of people (Kolk and VanTulder, 2010). Thus, UN by using Dialogue principle of PRME spread awareness and talk with them that how and why they can control the population and how it is directly related to poverty.
  2. Innovation and Technology: Technology plays an important role in poverty erudition. If we develop high-quality equipment for production and provide food and other resources to those countries, which are facing crisis and poverty, people will not die because of hunger. Therefore, we should use the fourth principle of PRME to do research on the problem and find out the solutions to the problems and challenges that arise because of poverty.  
 

Conclusion

Good governance is the key to sustainable development all over the world. Poverty is the Global challenge that is facing by a large number of Asian and African countries. One of the major reasons behind poverty is a rapid growth in the global population. If we want to remove poverty, we must focus on two things; firstly, we should control our population and second we should focus on sustainable development through good governance. Thus, it is essential for UN to focus on those 17 SDG’s goals for sustainable development, and for UN should implement all the principles of the PRME on both school and college level. PRME principle can help to create future leaders who may find out some unique and innovative way to fight with poverty and reduces its effect on our world.

 

References

Adams, C. and Petrella, L. (2010) Collaboration, connections and change: the UN global compact, the global reporting initiative, principles for responsible management education, and the globally responsible leadership initiative. Sustainability Accounting, Management and Policy Journal, 1(2), pp. 292-296.

Barbier, E.B. (2014) The concept of sustainable economic development. Environmental conservation, 14(2), pp. 101-110.

Bazilian, M., Nakhooda, S. and VandeGraaf, T. (2014) Energy governance and poverty. Energy Research & Social Science, 1(5), pp. 217-225.

Burchell, J., Kennedy, S. and Murray, A. (2015) Responsible management education in UK business schools: Critically examining the role of the United Nations Principles for Responsible Management Education as a driver for change. Management Learning, 46(4), pp. 479-497.

Collins, P.D., (2012) Governance and the eradication of poverty: an introduction to the special issue. Public Administration and Development, 32(4-5), pp. 337-344.

Griggs, D., Smith, M.S., Rockström, J., Öhman, M.C., Gaffney, O., Glaser, G., Kanie, N., Noble, I., Steffen, W. and Shyamsundar, P. (2014) An integrated framework for sustainable development goals. Ecology and Society, 19(4), pp. 44-55.

Gwatkin, D.R. (2010) Health inequalities and the health of the poor: What do we know? What can we do?. Bulletin of the world health organization, 78 (16), pp. 3-18.

Kandachar, P. and Halme, M. (2017) Farewell to pyramids: how can business and technology help to eradicate poverty?. In Sustainability Challenges and Solutions at the Base of the Pyramid, 18(22), pp. 13-40.

Khan, M.T., Khan, N.A., Ahmed, S. and Ali, M. (2012) Corporate social responsibility (CSR)–definition, concepts and scope. Universal Journal of Management and Social Sciences, 2(7), pp. 41-52.

Kolk, A. and VanTulder, R., (2010) International business, corporate social responsibility and sustainable development. International business review, 19(2), pp. 119-125.

Lu, Y., Nakicenovic, N., Visbeck, M. and Stevance, A.S. (2015) Five priorities for the UN sustainable development goals. Nature, 520(7548), pp. 432-433.

Merino, A. and Valor, C. (2011) The potential of corporate social responsibility to eradicate poverty: an ongoing debate. Development in Practice, 21(2), pp. 157-167.

Mitchell, R., Agle, B., and Wood, J.D. (1997) Toward a Theory of Stakeholder Identification and Salience: Defining the Principle of Who and What Really Counts [online]. Available from: https://www.researchgate.net/publication/280801272_Toward_a_Theory_of_Stakeholder_Identification_and_Salience_Defining_the_Principle_of_Who_and_What_Really_Counts [Accessed: 02/10/2018]. Doi: DOI: 10.5465/AMR.1997.9711022105

Mitchell, R.K., Agle, B.R., Chrisman, J.J. and Spence, L.J. (2011) Toward a theory of stakeholder salience in family firms. Business Ethics Quarterly, 21(2), pp. 235-255.

Pearce, D., Barbier, E. and Markandya, A. (2013) Sustainable development: economics and environment in the Third World. 4th ed. London, UK: Routledge.

Sachs, J.D. (2012) From millennium development goals to sustainable development goals. The Lancet, 379(9832), pp. 2206-2211.

Shepherd, K., Hubbard, D., Fenton, N., Claxton, K., Luedeling, E. and de Leeuw, J. (2015) Policy: Development goals should enable decision-making. Nature News, 523(7559), p. 152.

Sumner, A. and Tiwari, M. (2010) Global Poverty Reduction to 2015 and Beyond: What has been the Impact of the MDGs and what are the Options for a Post?2015 Global Framework?. IDS Working Papers, 2010(348), pp. 01-31.

Thijssens, T., Bollen, L. and Hassink, H. (2015) Secondary stakeholder influence on CSR disclosure: An application of stakeholder salience theory. Journal of Business Ethics, 132(4), pp. 873-891.

Waddock, S., Rasche, A., Werhane, P.H. and Unruh, G. (2010) The principles for responsible management education. Towards assessing business ethics education, 18(22), pp. 13-28.

Wagner, M.E., Alves, H. and Raposo, M. (2011) Stakeholder theory: issues to resolve. Management decision, 49(2), pp. 226-252.

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