A Research Proposal on the Role of the Chief Executive Officer Essay Example for Free

A Research Proposal on the Role of the Chief Executive Officer Essay Questions One of the major problems in business is the notion of whether companies should be concerned with other issues than profitability. Adam Smith in 1863 claimed that the process of achieving the overall good for the society is something that will happen inevitably happen because of his idea of the invisible hand of the market. However, more contemporary ideas assert otherwise as they believed that there are a number of conditions that would hinder the invisible hand to work effectively (Mohr and Webb, 2002). The concept of Corporate Social Responsibility (CSR) is deeply rooted on the commitment of organizations to continue their business in an ethical manner. It is in this respect that organizations are said to necessarily contribute to the overall economic development of ones country while at the same time improving the quality of life of not only its employees and its families but also the society where it belonged (Watts and Holme, 1999). One of the central concerns with regard to the necessity of the implementation of CSR by a particular organization is the impact of a particular company’s decisions and actions within the society together with their responsibility in the aforementioned. As such this means that when aligning certain organizational goals or projects, it would be better if organizations will evaluate first their actions and make sure that they are in accordance to the welfare of the greater good (Parsons, 1954). As such, the impact of an organizations decision within the society is very vital in CSR. It should be emphasized as well that an organizations duty should span more than the economic and legal aspects but also assume the good of the majority. Archie Carroll said that an organizations social responsibility is something that includes the interplay of four important factors. These are economic performance, adherence with the law, ethical responsibility, good corporate citizenship, and improving the societys quality of life (Carrol and Buchholtz, 2003). However despite companies claim for CSR implementation, a significant number of evidence tells that every year, there are numerous companies that are charged for violating environmental laws (Kassinis and Panayiotou, 2006, p. 68). Problems The success of a company’s CSR and the its effect on the company’s image has been viewed by a number of studies to be directly correlated on the role of the Chief Executive Officer (CEO) (PR News, 2007). It has been said by Kassinis and Panayiotou (2006) that the role of the CEO is very vital since they are the ones who are primarily responsible for the boards decision-management functions and the even the extent of corporate wrongdoing. The interpretation of the CEO in terms of various environmental issues that could have affect their firms and its choice of environmental strategies have also a significant implication on the overall image and performance of a particular company. Studies such as those conducted by PR News Wire in 2008 claimed that to belong to Fortune’s Worlds Most Admired Companies, the CEOs role together with his or her capacity to create a strategy or hire specific experts who can effectively handle CSR concerns, such as hiring a competitive Chief Communications Officer (CCO,) is very vital. Companies which belong to Fortunes annual awards are often evaluated based on their reputation. According to PR News in 2007, it is often the case that CEOs are the ones who are held accountable in terms of the failure to protect the company image in whenever a crisis arises. The study of PR News revealed that in out of 950 global business executives in 11 countries, 68% of the results attributed unethical behavior to the CEO, and 60% cited environmental violations and product recalls to the CEO as well. The influence of the perceptions of various stakeholders, regulators, communities and employees has been viewed by Kassinis and Panayiotou (2006) as critical to the welfare of the firm as they are centrally involved in enforcing the laws and other policies that companies must adhere to. Figure 1: Relationship Between CSR and Stakeholders Source: Tokoro (2007) The figure above shows the direct relationship of stakeholders to CSR in terms of the restrictions that they impose, the resource deals that they pass and the overall value creation of the organization. Gap in Research Even if the claim on the role of CEOs in terms of dealing with issues of CSR and company reputation, other studies suggests that CSR strategies and policies are instead delegated to the shareholders (Kassinis and Panayiotou, 2006, p. 67). It is often the case that the demands of the shareholders are oftentimes in conflict with the interest of customers, suppliers, governments, unions, competitors, local communities, and the general public (Sims, 2003, p. 40). The table below shows an overview of perceptions of Table 1: Stakeholders View of Corporate Responsibility Stakeholders Nature of Stakeholder Claim Shareholders Participation in distribution of profits, additional stock offerings, assets on liquidation; vote of stock; inspection of company books; transfer of stock; election of board of directors; and such additional rights as have been established in the contract with the corporation. Employees Economic, social, and psychological satisfaction in the place of employment. Freedom from arbitrary and capricious behavior on the part of company officials. Share in fringe benefits, freedom to join union and participate in collective bargaining, individual freedom in offering up their services through an employment contract. Adequate working conditions. Customers Service provided with the product; technical data to use the product; suitable warranties; spare parts to support the product during use; RD leading to product improvement; facilitation of credit. Creditors Legal proportion of interest payments due and return of principal from the investment. Security of pledged assets; relative priority in event of liquidation. Management and owner prerogatives if certain conditions exist with the company (such as default of interest payments). Suppliers Continuing source of business; timely consummation of trade credit obligations; professional relationship in contracting for, purchasing, and receiving goods and services. Unions Recognition as the negotiating agent for employees. Opportunity to perpetuate the union as a participant in the business organization. Competitors Observation of the norms of competitive conduct established by society and the industry. Business statesmanship on the part of peers. Governments Taxes (income, property, and so on); adherence to the letter and intent of public policy dealing with the requirements of fair and free competition; discharge of legal obligations of businesspeople (and business organizations); adherence to antitrust laws. Local communities Place of productive and healthful environment in the community. Participation of company officials in community affairs, provision of regular employment, fair play, reasonable portion of purchases made in the local community, interest in and support of local government, support of cultural and charitable projects. The general public Participation in and contribution to society as a whole; creative communications between governmental and business units designed for reciprocal understanding; assumption of fair proportion of the burden of government and society. Fair price for products and advancement of the state-of-the-art technology that the product line involves. Source: Sims, 2003, p. 41 For instance, consumers expect that the company should be able to carry out their business in a responsible manner; on the other hand, stakeholders expect that their investments would be returned. In other instances, customers are looking forward a return on what they paid for, while suppliers look for dependable buyers. The government wanted companies to follow legislations, while unions seek benefits for their members. The competitors, expected companies to do their business in a fair manner and local communities wanted the aforementioned to be responsible citizens. Finally, the general public expects organizations to improve the over all quality of human life, while shareholders might view this proposition as utopian (Sims, 2003). The figure below shows the dynamics of stakeholder interactions. Figure 2: Value Creation Through Dialogue with Stakeholders Source: Tokoro (2007) As such, it is in this respect that it could be said that CEOs and a particular company’s responsiveness to the demands of CSR and eventually creating a strong image is something could not be the sole determining factor for a successful CSR. Instead, the question of whether CEOs are only implementing the demands of the company’s stakeholders, or the CEOs only attending to consumer, suppliers, government, community and general public demand should also be taken into close consideration. Deficiency As most researches often attribute the success or failure of a CSR strategy to the CEO, the role and influence of other stakeholders in the organization are not often viewed as significant variables worthy of consideration. Only most recent researches are significantly attributing stakeholder roles in terms of its relationship to CSR. Albeit, based from the researcher’s survey of various secondary data, there are hardly any robust literatures stating the influence of stakeholders to the CEO and eventually the latter’s decision on how to implement its CSR program. Purpose The study is vital in order to not only contribute to the existing studies on the role of CEOs and a successful CSR program; but also to further strengthen the claim on the relationship of CSR and a favorable company image. More importantly, subtle factors that might have influenced CEO decisions, strategies and policies such as those coming from company stakeholders will be taken into close consideration and in addition, will be taken as important variables for the research. Although studies on the direct relationship of company stakeholders and CSR and presented by various researches, the role of the stakeholders in terms of influencing the CEO in its CSR decisions are seldom taken into consideration. As such it is with this respect that the research seeks to significantly contribute to the scholarly studies devoted in order to analyze such dynamics. Research Questions Main Question For the purpose of this research, the study wanted to know: What is the role of the CEO in terms of promoting the Corporate Social Responsibility (CSR) programs of their organization and its relation to building a favorable image? Subquestions Specifically, the research wanted to know: 1. What is the relationship between a successful CSR program and the role of the CEO? 2. What is the relationship between a successful CSR program and a favorable brand image? 3. What is the role of the following in terms of influencing the CSR strategies of a particular organization: a. Shareholders b. Consumers c. Suppliers d. General Public 4. How did company shareholders, consumers, suppliers and the general public influence the strategy of the CEO in terms of implementing its CSR program? Methodology Research Tradition For the purpose of this research, the study will be employing both quantitative and qualitative research methods. Â  It is often the case that quantitative research employs the method that is based on testing of theories. It uses measurement of numbers, and statistical analysis to perform its studies. The idea behind quantitative research is often to ascertain that a generalized theory or the prediction of a theory will be confirmed by the use of numbers. The aforementioned normally starts with a research question or a hypothesis in addition to other theories that are needed to be tested. The approach of quantitative research includes the use of formal and generally recognized instruments (O’brien 1998). In addition to this, the quantitative tradition of research focuses on conducting experiments with an underlying expectation that a consensus would be arrived at. This method usually aims to arrive at a predictable generalization, and a causal explanation. Quantitative research can create a controlled environment in order to attain inductive analysis. The goal of this research tradition is to establish a consensus by reducing data to numerical indications, hence finally identifying if certain generalizations are valid or invalid (O’brien 1998). In this research method it is very relevant that the researcher must maintain its independence from the research object; and consequently, the research outcome is expected to be not value affected (O’brien 1998). The quantitative methodology also tests cause and effect by using deductive logic. When done correctly a quantitative research should be able to predict, and explain the theory in question (O’brien 1998). On the other hand, the Qualitative research focuses primarily on words rather than numbers. The main research instrument for such a type of tradition is the process of involvement of the researcher to the people whom he or she studies (Dyamon and Holloway, 2002). In relation with this, the viewpoints of the participants are also taken into much account. The Qualitative research tradition focuses on small-scale studies wherein deep explorations are being conducted in order to provide a detailed and holistic description and explanation of a specific subject matter. Rather than focusing on a single or two isolated variables, the aforementioned takes into account interconnected activities, experiences, beliefs and values of people, hence adopting a multiple dimension for study. This tradition of research is also flexible in a sense that certain factors are being explored due to not necessarily adhering to a strict method of data gathering. It also captures certain processes wherein changes in sequence of events, behaviors and transformation among cultures are closely taken into consideration. More importantly, a qualitative research is normally carried out in venues that are within a respondents natural environment such as schools, offices, homes, etc. This allowed participants to be more at ease and be able to express their ideas freely (Dyamon and Holloway, 2002). Data Gathering The data gathering will consist of secondary and primary data collections. Ghauri, Gronhaug and Kristianslund (1995) emphasized the importance of secondary data collection most especially through desk or library research. Secondary data collection normally includes data that were collected by another researcher or writer. It is often the case that they are lifted from books of recent publications, journals, magazines, newspapers and even trusted websites such as those of private organizations, non-government organizations, government organizations and the likes. The review of related literature will provide a scholarly perspective on the subject matter and at the same time made the researcher aware of both previous and contemporary research on the subject matter. For the purpose of this research, the author will be using scholarly journals and articles, books and magazines specifically focusing on the oil and gas industry; and freight industry in the Middle East, most specifically Turkey. The scholarly literatures will be primarily taken from EBSCO Host, JSTOR and Questia Media America, an exclusive on-line library. For the primary data collection for quantitative data, the study will be conducting surveys among consumers, suppliers and general public using questions of ordinal measurement using Likert scales for General Electric. Surveys include the process of using questionnaires with the aim of making an estimation of the perceptions of the subjects of the study. Surveys are considered advantageous because it could be used to study a huge number of subjects (Ghauri, Gronhaug and Kristianslund, 1995). On the other hand, interviews will be conducted among selected GE shareholders regarding their perception on the role of the CEO and implementation of the company’s CSR. Data Gathering Methods and their Justification For the purpose of this research, the researcher will be using self-administered questionnaires. Self-administered questionnaires often times offer a higher response rate and are also relatively cost effective (Ghauri, Gronhaug and Kristianslund, 1995). Foremost of its advantage rests on the notion that the process of data gathering could be more personal and also the researcher will be able to clarify certain notions that could be unclear in the survey form. However, one distinct disadvantage of such a method is the difficulty of administrating the survey to multiple respondents all at the same time. In addition, the self-administered data gathering could be very time consuming as well. The research will also be conducting an interview in order to collect the qualitative data necessary for the research. Interviews are very relevant most specially in getting data that could be a rich source of information that surveys could not provide (Ghauri, Gronhaug and Kristianslund, 1995). For the purpose of interviewing, various stakeholders from General Electric Corporation will be asked with regard to their perceptions of how GE should be employing its CSR, and their perceptions on the role of the CEO in terms of effectively implementing its CSR and the company’s image. Questionnaire Design The questionnaire design for the survey will be made in a detailed, precise and logical construction of close-ended questions. In addition with this, the questions will also be made in accordance with the research question and the objectives of the research (Oppenheim, 1992). The questions will be formulated using an ordinal scale and will be close-ended in nature. Such is relevant so that respondents would only have to encircle or check the designated number of their corresponding responses (Oppenhein, 1992). In addition to this, close-ended questions are very easy to answer and could enable the researcher create a summated value that could be use for data analysis. The questions that will be used in the interview will be tailored in such a manner that would directly answer concerns that are in accordance of the objectives of the study. The questions for the shareholders will be specifically created in a manner where there will be an open flow of information and exchange of ideas. The details on how consumers, suppliers and general public wanted the company to act together with its policies and possible ethical practices will be included in the survey. In this respect, questions will be formulated with a closed-ended nature. Sampling For the purpose of this research, the researcher will conduct a survey based on simple random sampling (SRS) which will include randomly choosing participants coming from consumers, suppliers and general public. On the other hand, the research will be employing purposive sampling methods in terms of choosing the stakeholders of General Electric who can participate in the study. Target Population According to Ghauri, Gronhaug and Kristianslund (1995) research should cater to a target population that has all the necessary information for the research such as sampling elements, sampling units, and area of coverage. For the purpose of this study, the author is trying to identify the role of consumers, suppliers and the general public. As such, the study will be asking 120 respondents to participate in the survey of which will primarily come from consumers and suppliers of General Electric as well as the general public who are concerned with General Electric and its operations. Reliability and Validity The studys reliability and validity go hand in hand as patterns of measurement are both dependent on the aforementioned (Zikmund, 1994). Reliability primarily focuses on the internal consistency and the repeatability of the variables within the research. On the other hand, validity centers on the correctness and appropriateness of the question that one intends to measure (Ghauri, Gronhaug and Kristianslund, 1995). According to Chisnall (1997), validity is generally considered and established through the relationship of the instrument to the content, criterion or construct that it attempts to measure. A lack of validity can lead to incorrect conclusion. In order to make sure that the instrument that will be used are reliable and valid, the researcher will assure that such is patterned based on the objectives of the study, the secondary data and also on the feedback that was given based on the pilot study that will be conducted. Analysis of Data Data information gathered from the surveys and interviews and secondary data from the other studies found will be used for the analysis that would answer the research question. Charts and comparisons of data will be used as analysis tools. Statistics used will be based on the survey results from the questionnaire made by the researcher. Statistical Products and Service Solutions (SPSS) will also be used to determine the stand of the respondents regarding a particular question formulated in the survey (Griego and Morgan, 2000, p. 2). References Carroll A. and Buchholtz A.K., (2003). Business and Society: Ethics and Stakeholder Management, 5th ed. Mason, O.: South-Western. Chisnall P. M., (1997). Marketing Research, 5ed., Berkshire: McGraw-Hill. Woodruff H. (1995), Services Marketing. London: Pitman Publishing Daymon C. and Holloway I., (2002). Qualitative Research Methods in Public Relations and Marketing Communications. London: Routledge. 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