read the case below and answer:

Among the six competing proposals, choose the proposal(s) you want to recommend.

Write the rationale for your decision. In doing so, consider the positive/negative impacts on at least one stakeholder (e.g., shareholders, employees, customers, suppliers, local communities, governments, and global communities). Also, think about at least one component of CSR (i.e., economic, legal, ethical, and philanthropic responsibilities).

Appendix A: The Organic Delights Exercise

You are the manager of a fictional restaurant and caterer that prepares, distributes, and markets prepackaged organic foods. All of the foods are free of pesticides, hormones, and antibiotics and are prepared without artificial ingredients, preservatives, trans-fats, or high- fructose corn syrup. The company is most well-known for its breads, cheeses, and desserts, which represent the majority of sales and profits for the prepackaged food line. The restaurant and catering facility are located in a suburban community in the Midwest, and the catering facility can host weddings and banquets that serve up to 300 people. Manufacturing operations for the prepackaged foods are located in the same town as the restaurant.

The company is a for-profit corporation that is committed to earning a good return for its shareholders and to using its business as a force for good and for benefiting all of its stakeholders. The company believes in corporate social responsibility (CSR), and its mission statement pledges to delight our customers with delicious and healthy food while making a positive contribution to society. The corporations charter calls for the company to spend 5% of its projected annual net income to promote CSR by making donations to worthwhile causes or investing in the business to run it in ways that benefit its customers, employees, and community. Prior to the start of each fiscal year, the senior management team meets to review the companys financial forecast and approve donations and investments that support the companys commitment to CSR.

You are a senior manager of the company and are looking forward to the next management meeting. The company is doing very well, earning $300,000 in the last fiscal year. Projections for the next fiscal year are for profits of $350,000. Prior to the meeting, you have been sent a list of six proposals to support the companys CSR. Before the meeting, you must fill

out the CSR ballot, indicating which proposal(s) you will support. At the meeting, you will confer with your fellow managers to debate the proposals and to make a final decision on which will be implemented. Outlined below are the six proposals. Please review them and complete the attached CSR ballot prior to the meeting.

The United Way We propose to donate $2,500 to the local United Way. Supporting our community through giving should become the cornerstone of our business. We also will encourage our employees to donate their time, talent, and resources to local charities. We expect that employees will donate many hours voluntarily.

Paid Maternity Leave We care about our employees and their families, and we take pride in the fact that we pay above minimum wage and have a basic hospital insurance plan. We now propose to offer 12 weeks of paid maternity leave to our employees. We estimate that, next year, the negative profit impact will be $15,000. We recognize that there are no laws that require us to offer paid maternity leave (and no other food preparation companies or restaurants in our area offer this), but we believe that this is the right thing to do.

Recycling We have tested a new way to recycle our kitchen waste, and we propose investing in a new approach that will reduce the garbage that goes into landfills by 26%. The cost of this proposal is $2,500. We believe that preserving the environment is a moral imperative and that it is consistent with our company mission. The recycling proposal also may help our image, but we are not factoring that into our financial projections.

Traffic Control Local citizens have expressed concern that, when we have large wedding celebrations at our catering facility, traffic can be congested and dangerous to pedestrians. We are proposing to hire off-duty police officers to direct the traffic. We can pass on some, but not all, of the costs of the off-duty police officers to our catering customers. To implement this proposal will reduce profits by $2,500, but it will make our community safer.

Fair Trade Sugar We propose to begin using exclusively fair trade sugar. Specifically, we propose to source our sugar from sugar farms that do not use child labor and that pay at least the local minimum wage to the workers who harvest the sugar. Our costs for food preparation will increase, and because we already charge premium prices, we do not believe that we can raise our prices further. The impact of using fair trade sugar will be to reduce next years profits by $10,000. We believe that using fair trade sugar is the right thing to do. This approach also will help to attract more socially conscious customers to our business. A market research test that we conducted indicates that fair trade sugar will enhance our corporate reputation and product image. In particular, our customer base will grow, and we will recapture lost profits in 30 months time.

Glycemic Index Food Labeling We propose to augment the labeling of all of our food products to include the glycemic index. The glycemic index is a measure of how carbohydrate-containing food raises blood sugar. Low glycemic index diets decrease the risk of cardiovascular disease, diabetes, and stroke. This information will help our customers to manage their diets and

their health. Glycemic index labeling is not required by law, and we would be the first company of our kind to include it. We did not conduct consumer research to determine how this labeling would affect consumer attitudes, our brand image, or consumption of our products but acknowledge that this proposal has the potential to reduce the sales of our high glycemic index foods, including breads and desserts. Accordingly, we are budgeting the cost of this initiative at $17,500 due to reduced sales. This is a small price to pay to help improve the health of our customers.

Stakeholder theory

Firms have responsibilities to a variety of stakeholders that include not only the firms shareholders but also other parties including employees, customers, suppliers, local communities, and governments.