ACCT3031 Chap.9 Stakeholders, CSR, Sustainability and Ethics
Stakeholders, CSR, Sustainability and Ethics
The final chapter widens governance to the people and systems a company affects.
It traces definitions of corporate social responsibility from Bowen and Carroll to Friedman, contrasts overlapping and nested models of sustainability, shows how to test SDG and CSR claims for evidence, names the forms of greenwashing, uses Shell in the Niger Delta and multinational tax planning as cases, and introduces the normative ethical approaches boards use to justify decisions.
It closes the unit by asking how stakeholders can tell a responsible corporation from one that is simply good at reporting responsibility.
What this chapter covers
- 01
Definitions of CSR
- 02
Sustainability and the two models
- 03
SDG alignment and contribution
- 04
Policy, activity and outcome
- 05
Greenwashing and legitimacy theory
- 06
Shell in the Niger Delta
- 07
Tax avoidance and evasion
- 08
Normative ethics
Worked example · free
Classify three arguments about a plant closure by ethical approach
- +1The first judges the action by its results, so it is a consequential approach.
- +1The second holds the duty regardless of outcome, so it is a non-consequential approach.
- +1The third focuses on whether the action and the way it is carried out are justifiable, so it reflects a virtue approach.
Key terms
- Corporate social responsibility
- The responsibilities a corporation is expected to accept towards society and stakeholders beyond financial returns to shareholders.
- Sustainable development
- Development that meets today's needs without undermining the capacity of future generations to provide for theirs.
- SDG washing
- Superficial use of the Sustainable Development Goals to imply sustainability without meaningful action.
- Legitimacy theory
- A theory that corporations depend on continuing social acceptance and act to close gaps between conduct and expectations.
- Treaty shopping
- Routing income through a jurisdiction to gain favourable treatment under a double taxation agreement.
- Normative ethics
- The branch of ethics concerned with what people or organisations should do.
Stakeholders, CSR, Sustainability and Ethics FAQ
What is the difference between CSR and sustainability?
Sustainability asks whether environmental, social and economic systems can be maintained over time, as in the Brundtland definition. CSR asks what responsibilities a corporation has for its impacts on society and stakeholders. The two increasingly overlap, but sustainability is the wider idea, and the nested model shows the economy depending on society and the environment.
How can you tell whether a sustainability claim is greenwashing?
Ask five questions: what is claimed, what evidence supports it, what boundary it covers, what is missing and whether it can be challenged. Watch for vague claims, ratios that hide totals, changed boundaries, distant targets without milestones and symbolic governance. The test is whether the claim matches the underlying practice, as ASIC's penalty cases show.
Why does ethics matter if a decision is legal?
A decision can be lawful yet still raise questions of fairness, honesty or responsibility to those affected. Ethical reasoning gives the board a structured way to weigh consequences, duties and character and to justify its choice to stakeholders. The module stresses that ethics offers reasoning rather than automatic answers.
What is the difference between tax avoidance and tax evasion?
Tax evasion is unlawful, while avoidance and planning can comply with the law technically yet reduce tax substantially. The OECD's work on base erosion and profit shifting shows how multinationals use transfer pricing, deductions in high-tax countries, mismatches and treaty shopping, which turns tax into a question of responsibility to the societies a company relies on.
Why are the SDGs not a reporting checklist?
The Sustainable Development Goals were adopted by UN member states in 2015 as a global agenda, not as a corporate reporting template. Mapping activities to Goals shows alignment only. Contribution needs evidence of what the company did, what changed, how significant the change was and how it was measured, alongside any adverse impacts.
Assessment move
Build a short table of CSR definitions and their primary duty, then practise the five-question test on a real sustainability report. For ethics, learn the three normative approaches with one board example each, and practise a paragraph that states which approach supports your recommendation and how another would challenge it.
Use the Shell case to practise starting from the impact rather than the report, and compare the company's account with what affected communities experienced.
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