Table of contents:

Task Contents

1 Explain the effects of globalization on national economies.

Discuss the influence of international institutions on

organizations.

Explain the role and responsibility of European Union

membership on the workplace

2 Explain the importance of responsible corporate governance in

organizations.

Analyze the regulatory requirements that shape corporate

governance.

Evaluate the impact of regulatory requirements on corporate

stakeholder’s interests in an organization

3 Discuss the economics of adopting a policy of environmental

awareness in organizations.

Explain the actions that need to be taken by organizations to

maintain the environment.

Describe the measures that exist to improve workplace health

and safety practice

4 Analyse the responsibilities of organizations to improving

workforce welfare.

Compare approaches to the management of diversity in

organizations.

Compare organizational approaches to ensuring positive policies

of workforce diversity

Introduction

The internationalization of markets and business activities, increased use of information and communication technology and the impact and consequences of the activities of organizations on many areas of life have meant that organization’s need to be more aware of the contexts in which they operate. They have to assume great irresponsibility for what they do. Globalization has meant that organizations need to understand the implications of operating in international markets and have had to develop their policies accordingly. Membership of economic and political unions requires accommodating the requirements of transnational laws and regulations within organizational policies and procedures. Corporate governance is concerned with the arrangements for the management of an organisation and the regulation of the relationships between the organization’s different stake holders. Good corporate governance enhances organizational activity and the perception of the organisation as a good corporate citizen. Poor corporate governance can result in negative perceptions and, more seriously, can contribute to the failure of an organisation. Consequently, a major focus of corporate governance centers on the accountability of individuals and organizations to their various stakeholders, including the wider community within which they operate. Organizations have to be concerned with the legal, regulatory, ethical, moral, cultural and environmental dimensions of their activities and the effect these activities have on others. Corporate social responsibility ensures organisations incorporate these requirements in their procedures. By examining corporate responsibility, learners will understand how consideration of the common interest in organizational decision making impacts on the triple bottom-line–people, planet and profit–of organizations

Task 1: Understand the wider implications and effects of global integration on organizations

Global integration: International business environment – PESTLE (political, economic, social, technical, legal, environmental) analysis; market size; economies of scale; multinational corporations; transnational corporations; international institutions

– World Trade Organization (WTO), World Bank, International Monetary Fund(IMF), Organisation for Economic Co-operation and Development (OECD), The Group of Twenty (G-20); global financial stability; capital investment; emerging economies (tiger economies, BRIC economies); corporate values; corporate social responsibility; fair trade; transfer pricing; outsourcing; developing world production; human rights; child labour; intellectual property (copyrights, trademarks, patents);corruption; pariah states; piracy; counterfeiting; hegemony; cultural imperialism; cultural factors

European Union (EU): Role, responsibility, EU legislation; EU directives; EU membership; EU business regulations and their incorporation into national law; EU policies eg. agriculture (CAP), business, competition, growth, employment, education, economics and finance, employment, environment, science and technology, regional, welfare; Scheme Agreement; labour movement; monetary union; subsidiarity;enlargement (the most up-to-date legislation and regulations must be used)

Task 1.1: Explain the effects of globalization on national economies

At the end of 2011, UNECE published the guide "The Impact of Globalization on National Accounts", a joint work by UNECE, Eurostat, and OECD under the chairmanship of Statistics Netherlands.

In recent decades, we have witnessed an unprecedented increase in the cross-border movement of goods, services, income and financial flows, as well as people. The phenomenon of globalization has gained a new momentum, because of political developments and progress in information and communication technology. These developments have had a positive impact on worldwide income and productivity. On the other hand, the recent financial crisis has revealed the major risks associated with the growing interconnectedness of national economies.

Globalization is the process of replacing national economic structures and transactions by international ones, which creates difficulties for the statisticians in terms of allocating the value of production and income to the national economies. For example, knowledge of products or production processes, so-called intellectual properties, can be used simultaneously across the world by multinational or affiliated enterprises, goods can be sent abroad for processing with no

change of ownership, and international trading via the internet can take place without any actual movement of physical goods.

Globalization has both economic and social implications and needs to be carefully reflected in countries' national accounts to ensure the relevance and international comparability of the statistical figures, such as gross domestic products (GDP), national income and exports and imports. The Guide explains how globalization affects the national accounts and provides practical guidance to national statistical offices on how to produce the national accounts statistics taking the impact of globalization into account. It draws extensively on national experience in the form of country case studies.

The chapters of the Guide are organized in 3 thematic sections. The first section describes measurement issues related to multinational enterprises, such as allocation of output and value added to national economies and the treatment of foreign direct investments. The second section discusses trade of goods and services, global manufacturing processes and international transactions of intellectual property products. The third section discusses how to reflect international labour movements, remittances, second homes abroad and e-commerce in the national accounts. The guide also includes an addendum on the impact of the financial crisis.

Task 1.2: Discuss the influence of international institutions on organizations

One of the most important debates in international relations research concerns the role of international institutions in facilitating cooperation among states. Institutionalists (e.g. Keohane, 1984) emphasize the importance of institutions and regimes in mitigating the effects of anarchy on the prospects for cooperation among states. They argue that institutions facilitate cooperation by decreasing transaction costs and increasing the flow of information among member states. Realists (e.g. Grieco, 1988; Mearsheimer, 1994/95) respond that while such approaches examine the problem of cheating adequately, they ignore relative gains concerns and thus cannot provide a compelling explanation for security relations. In fact, Mearsheimer (1994/95:15) asserts that liberal institutionalism “largely ignores security issues and concentrates instead on economic, and to a lesser extent, environmental issues.” He accuses such scholars of shying away from arenas in which relative gains considerations matter most.

Keohane and Martin (1995:43-44) disagree with Mearsheimer. Because institutionalist theories focus on the role of institutions in providing information, they should be applicable to security issues, as well as economic and environmental issues. If the institutionalist perspective is correct,

then institutions should promote cooperation, even in situations where states have quite divergent preferences.

The growth in the number and influence of international institutions over the past century has been staggering. According to the Union of International Associations, in 1909 there existed 37 intergovernmental organizations (IGOs) of all types, as well as 176 nongovernmental organizations (NGOs). In contrast, today there exist over 6400 IGOs, including 251 “conventional international organizations” and 2028 “multilateral treaties and intergovernmental agreements,” as well as nearly 44,000 NGOs.3 Such a trend is consistent with theoretical arguments developed by neoliberal institutionalist scholars. Institutionalists (e.g. Keohane, 1984) demonstrate the importance of institutions and regimes in facilitating cooperation among rational egoist states.

Institutions (or regimes more broadly) make cooperation more likely in a variety of ways. First, international institutions establish patterns of legal liability. Institutions serve as quasi-agreements and “like contracts, help to organize relationships in mutually beneficial ways…Contracts, conventions, and quasi-agreements provide information and generate patterns of transaction costs: costs of reneging on commitments are increased, and the costs of operating within these frameworks are reduced (Keohane, 1984:89).” This relates to the second way in which institutions facilitate cooperation, by reducing transaction costs, thus making it easier for states to negotiate agreements. Multiple issues are often linked, making side-payments possible in negotiation. Third, international institutions increase the flow of information among member states. “Regimes may also include international organizations whose secretariats act not only as mediators but as providers of unbiased information that is made available, more or less equally to all members. By reducing asymmetries of information through a process of upgrading the general level of available information, international regimes reduce uncertainty. (Keohane, 1984:94).” In this sense, cooperation is facilitated because international institutions regimes reduce uncertainty.

Task 1.3: Explain the role and responsibility of European Union membership on the workplace

The European Union of Supported Employment has developed a Code of Ethics that outlines principles and ethical commitments that demonstrate the competence and responsibilities required of professionals delivering supported employment. These principles should provide guidance to those working in this area and could also be used as guidelines for self-assessment and as a quality improvement tool. This Code of Ethics demonstrates the values underpinning supported employment, upon which professionals develop their everyday practice. The Code is intended to provide both general principles and guidelines to cover professional situations and activities when delivering supported employment services.

General Principles:

Professional Competence:

Supported Employment professionals should maintain the highest levels of competence in their work, and should recognise the need to update their knowledge in the key areas of Supported Employment. They should be responsible for their own continuing professional development and consult with other professionals to exchange information, share good practice and develop professional and technical expertise.

Integrity:

Supported Employment professionals must be honest, fair and respectful of others in their professional activities. Supported Employment professionals should conduct their activities in ways that inspire trust and confidence.

Opportunity and Equality:

Supported Employment professionals must respect the rights, dignity and worth of all stakeholders. They must not discriminate in any way on the grounds of gender, age, religion, race, ethnicity, political opinion, disability, sexual orientation, health condition, dependents or social status.

They should be sensitive and responsive to cultural and individual differences and needs and provide equality of opportunity and of outcomes for all individuals.

Social Responsibility:

Supported Employment professionals should be aware of the impact they have on people’s lifestyle and on the communities in which they live and work, they should accept the responsibility to contribute to social inclusion through employment.

Confidentiality:

Supported Employment professionals have an obligation to ensure that confidential/sensitive information is protected. Agreement must be sought and gained from the individual regarding matters relating to disclosure and a professional relationship with individuals must be maintained at all times.

Empowerment and Self-advocacy:

Supported Employment professionals have an obligation to actively promote the maximum participation, decision-making and autonomy of individuals within the supported employment process.

Task 2: Understand the importance of responsible corporate governance in organizations

A corollary to the focus on corporate behaviour and the behaviour of senior corporate employees is the attention increaseingly being paid to the qualification of these senior people to carry out their responsibilities. There has never been any formal qualification required to run an organisation, and none to be a director - although in recent years organisations like the UK Institute of Directors has introduced qualifications such as the Chartered Director to address the issue. In practice, of course, most large and well run organisations will look for suitable professional qualifications in their senior staff, and there is an increasing number of organisations offering non-executive director training and selection services.

Task 2.1: Explain the importance of responsible corporate governance in organizationsCorporate Governance refers to the processes, structures and information used for directing and overseeing the management of an institution. A good corporate governance framework establishes the mechanisms for achieving accountability between the Board, senior management and shareholders, while protecting the interests of relevant stakeholders. It also sets out the structure through which the division of power in the organisation is determined.

The role and importance of banks in the financial system and the way banks are funded underscores the need for a framework for corporate governance for licensed banks. The legislative framework for banks recognises this crucial role and the risk of malfeasance by inter alia:

Restricting access to the industry Defining grounds for revoking a license, including where the conduct of business is

detrimental to the public interest or the interest of depositors Defining types of individuals who cannot serve as directors or officers of a licensee Imposing large exposure restrictions on lending and investment and Requiring regular reporting to the Bank, annual audits by independent auditors and public

disclosure of financial performance.

Task 2.2: Analyze the regulatory requirements that shape corporate governanceAn effective corporate governance framework requires an effective legal, regulatory and institutional foundation, which all market participants can rely upon when they enter into their multitude of contractual relations. This legal, regulatory and institutional foundation typically comprises elements of legislation, regulation, self-regulatory arrangements, voluntary

commitments and business practices that are the result of a country’s specific economic circumstances, history and traditions. The desirable mixbetween legislation, regulation, self-regulation, voluntary standards, etc. will therefore vary from country to country. As new experiences accrue and business circumstances change, the content and structure of this framework might need to be adjusted. In this process, it is essential to assess the quality of the domestic framework in light of international developments and requirements.

The regulatory and legal environment within which corporations operate is of key importance to overall economic outcomes. Policy makers have a responsibility to put in place a framework that is flexible enough to meet the needs of corporations operating in widely different circumstances, facilitating their development of new opportunities to create value and to determine the most efficient deployment of resources. To achieve this goal, it is important that policy makers remain focused on the ultimate economic outcomes from interventions. When considering different policy options, it is also useful to undertake an analysis of the impact on key variables that affect the functioning of markets, such as incentive structures, the efficiency of self-regulatory systems and dealing with systemic conflicts of interest.

In each of the Regional Corporate Governance Roundtables, the need for effective enforcement and implementation has emerged as a key priority. This reflects a view that a sound legal framework for corporate governance, while important, is not sufficient for ensuring the effective functioning of the capital markets. Laws and regulation but also most private arrangements designed to protect the rights of shareholders and ensure equitable treatment of different shareholders and stakeholders derive their strength from the broader implementation and enforcement environment. If existing institutions are weak, implementing and enforcing private agreements as well as laws and regulation becomes more difficult. A corporate governance framework must therefore include both a set of policies and a regulatory/institutional framework to ensure its implementation.

Task 2.3: Evaluate the impact of regulatory requirements on corporate stakeholder’s interests in an organizationA “stakeholder” is any person or organization that is actively involved in a project, or whose interests may be affected positively or negatively by execution of a project. Stakeholders can be internal to the organization or external. In many projects the public at large will become a stakeholder to be considered during the project. The challenge for the project manager when the public is a stakeholder will be to act while considering public needs. Often there is no direct representative of the public to be consulted during project planning and execution.

A project manager must be sure to identify and list all potential stakeholders for a project. Potential stakeholders include but are not limited to:

Competitors National communities

Employees Professional associations

Government Prospective customers

Government regulatory agencies Prospective employees

Industry trade groups Public at large (Global community)

Investors Shareholders

Labor unions Suppliers

The project manager must document relevant information for all identified stakeholders. This information may include the stakeholder’s interests, involvement, expectations, importance, influence, and impact on the project’s execution as well as any specific communications requirements. It is important to note that although some identified stakeholders may not actually require any communications, those stakeholders should be identified.

Task 3: Understand the effects of environmental legislation, directives and guidance on organizations

Task 3.1: Discuss the economics of adopting a policy of environmental awareness in organizationsCompanies began to cooperate to minimize negative effects of pollution and require environmental responsibility. Agreements and international cooperative action have been able to police and prosecute offenders of reasonable standards of emissions.

It is possible to merge economic interests with environmental interests, but the economic thinking dominates and guides the majority of governments is that everything must submit to it and that the ecology is external to the economy. Humans are only part of the nature of business, so the economy should be seen as part of ecology.

Environmental issues should be considered one of the most important challenges that face the business world in this first decade of the millennium. Companies should take forward this issue of fundamental importance, acting promptly and a proactive stance instead of abandoning a reactive posture.

Companies that do not understand this new relationship of forces which destiny is to disappear, because the more the citizen behave as a consumer of ideas and political attitudes, higher pressure occurs on the crucial issue. This awareness was the perception that it is necessary to increase the profit, but now with the vision of welfare, without harming the environment, educating the consumer in some way to improve the environmental situation. The insanity that affronts our natural wealth is unthinkable, the economic vision of nature, the concentration of income and the domain of scientific knowledge. For that we need more awareness that it is necessary to break with the lack of human sensitivity, lead to understanding and finding that human dignity is in all living conditions in society and the reason to turn over everything in consumables for obtaining profit .

Task 3.2: Explain the actions that need to be taken by organizations to maintain the environmentWhether you're addressing a company's proposal to build on your local nature reserve or responding to a serious pollution incident that has poisoned your local fishery, you may be sure that someone, somewhere, will have "expert knowledge" about your problem or at least will have had a similar experience. If you can make contact with that person or persons, you can learn from their experience. Check with others in your area who are concerned with the same issues and ask their help to find out what resources are available. A lot of time can be saved by not redoing things that have been done before.

An important part of being an effective networker for the cause of environmental preservation is to maintain a constant awareness of what is needed and how these needs can be met. When you begin to meet people and develop your network, you will become aware that some of the people you meet have needs that can easily be met through the resources of others you have met before. By bringing these people together, you not only assist others in meeting their needs, but you also contribute to a common cause-the environment. At the same time you increase the number of people who can assist your organization when it is in need.

Task 3.3: Describe the measures that exist to improve workplace health and safety practiceAll employers are required under the Occupational Health and Safety Act 1983 to accept a duty of care for the health and safety of all people in the workplace. Implementing duty of care requires everyone in the workplace to be aware of potential hazards and take steps to prevent workplace accidents, injuries and illnesses.

A six point approach:

A lack of corporate commitment to health and safety will result in OHS remaining a marginalized and insufficiently funded workplace activity. A six point approach has been devised to help you implement effective occupational health and safety systems. This plan can help prevent accidents, incidents, injuries, and work-related ill health. The six points are:

1. Develop an OHS policy and related programs.

2. Set up a consultation mechanism with employees.

3. Establish a training strategy.

4. Establish a hazard identification and workplace assessment process.

5. Develop and implement risk control.

6. Promote, maintain and improve these strategies.

These points are not necessarily in order because all workplaces are different. Some of you may want to repeat some of the steps at different stages. It is important however, that all six steps are included in your occupational health and safety strategy.

Task 4: Understand the socio-cultural, ethical and moral issues that affect organizations in the current environment

Task 4.1: Analyse the responsibilities of organizations to improving workforce welfareSOCIAL RESPONSIBILITY:

The term social responsibility means different things to different people. Generally, corporate social responsibility is the obligation to take action that protects and improves the welfare of society as whole as well as organizational interests. According to the concept of corporate social responsibility, a manager must strive to achieve both organizational and societal goals. Organizations characterized by attitudes and behaviors consistent with the social responsiveness approach generally are more socially responsive than organizations characterized by attitudes and behaviors consistent with either the social responsibility approach or the social obligation approach. Also, organizations characterized by the social responsibility approach generally achieve higher levels of social responsiveness than organizations characterized by the social obligation approach. As one moves from the social obligation approach to the social responsiveness approach, management becomes more proactive. Proactive managers will do what is prudent from a business viewpoint to reduce liabilities whether an action is required by law or not.

Task 4.2: Compare approaches to the management of diversity in organizations1. LEARNING: Many managers are often unprepared to deal with diversity; because of their inexperience they do not know how to respond. To better prepare themselves, managers must work hard to learn and experience as much as they can about developing appropriate behavior. They can learn more by communicating one-on-one with the young and old employees, women, minorities, and those with disablement in order to determine how best to understand and interact with them. In this way managers can learn more about a diverse group’s characteristics and how the workers want to be treated. Managers should also develop personal style that works well with each worker of a diverse group. Managers can also ask their workers to tell him truthfully that how they want him to treat them and so he can adjust his behavior towards each worker.

2. EMPATHY: Empathy means to put yourself in other person’s place and see things from his point of view. Empathy is closely related with learning. It is important in the study of diversity because members of diverse group think and feel that only they can truly understand the challenges and problems they are facing. Empathy is an important way to deal with many problems because it helps the manager to understand the point of view of the employee. When dealing with the minorities and those with physical disables a manager should take special care

and know their feelings. The manager should care about the employee but he should make sure that the employee should not feel that he is receiving a special treatment.

Task 4.3: Compare organizational approaches to ensuring positive policies of workforce diversity:THE INTERNAL CONTEXT OF DIVERSITY POLICY DEVELOPMENT—ORGANIZATION CULTURE

Organizational culture is usually defined in terms of shared symbols, languages, practices and deeply embedded beliefs and values (Newman, 1995). This implies a high degree of homogeneity within the organization, which may not constitute an accurate picture, or alternatively, the organization may be seeking to become more diverse and for this reason cultural homogeneity may be perceived as undesirable. In any case, it would be naive to suggest that diversity and cultural homogeneity could coexist without coming into conflict. suggest that the valuing of diversity will not occur naturally. Organizations, including individual organizational members, will need to be persuaded of the (ethical or economic) merits of valuing diversity. Following from that, specific and measurable policy initiatives will need to be developed if change is to occur.

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