The document discusses different levels for understanding the relationship between business, government, and society. It presents figures showing the broad conceptual level down to the practical applied management level, which focuses on a specific corporation and its primary and secondary stakeholders. It also discusses how business and society can be viewed as an interdependent system, and that management thinking has been influenced by general systems theory regarding interactions between systems and their environments.

1. The Corporation and
Chapter Its Stakeholders
1
1-1
Business
and
Society
POST, LAWRENCE, WEBER
McGraw-Hill/ Irwin © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.

2. Figure 1-1a
A range of levels for understanding the
1-2
business-government-society relationship
Broad conceptual level
Economy/ Politics/
Business Government
Society/Culture
McGraw-Hill/ Irwin © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.

3. Figure 1-1b
A range of levels for understanding the
1-3
business-government-society relationship
Intermediate level
Industry Governments:
in general; national, state,
industry local, foreign
sectors Stakeholders
McGraw-Hill/ Irwin © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.

4. Figure 1-1c
A range of levels for understanding the
1-4
business-government-society relationship
Practical, applied management level
Specific
Corporation
government
X Primary and agencies and
secondary actors
stakeholders
McGraw-Hill/ Irwin © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.

5. Business-Government-Society: An Interdependent
System
 A Systems Perspective – Management thinking
has been greatly influenced by general systems theory. 1-5
According to this theory, all living organisms (systems)
interact with, and are affected by, other forces in their
host environments.
 The Stakeholder Concept – Stakeholders are all
the people and groups affected by, or that can
affect, an organization’s decisions, policies, and
operations.
 The Three-Legged Stool –
employees, customers, and shareholders (Watson Sr.
Chairman of IBM in 1950). In 1990 Watson Jr.
emphasized the large number and variety of other
stakeholders – communities, arts
organizations, colleges and universities, foreign
governments, and many more.
McGraw-Hill/ Irwin © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.

6. Figure 1-2
Relations between a business firm and its
primary stakeholders
1-6
Employees
(Unions) Stockholders
Wholesalers Distribute Sell
(Retailers) products labor
Invest
Business capital
Buy firm Creditors
products Lend
(Managers) money
Customers Sell
materials
Suppliers
McGraw-Hill/ Irwin © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.

7. Figure 1-3
Relations between a business firm and
some of its other (secondary) stakeholders
1-7
Local Federal,
The Communities State
General Positive, and Local
Public negative Jobs, Governments
opinion environment
Regulation,
Advice, Business taxes
Business research Firm Foreign
Support
Image, Friendly, Governments
Groups
publicity (Managers) hostile
Social Social
Media demands Activist
Groups
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8. Home Work
1-8
 Writean essay (500 words) on
“Free Advices” and its impact on society.
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9. Figure 1-4
Forces that shape the business and society
relationship
Economic competition:
1-9
strategic and social challenges
Global Economic Change
Ethical expectations and
Business and public values
its
Stakeholders Changing role of government
and public policy
Ecological and natural resource
concerns
Technology and new knowledge
McGraw-Hill/ Irwin © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.

10. Exhibit 1-A
Global Internet usage, 2000-2005
Top Nations in Internet Use at Year-end, 2000 1-10
Users (millions) Percentage of total
1. United States 135.7 36.20%
2. Japan 26.9 7.80
3. Germany 19.1 5.10
4. UK 17.9 4.77
5. China 15.8 4.20
6. Canada 15.2 4.05
7. South Korea 14.8 3.95
8. Italy 11.6 3.08
9. Brazil 10.6 2.84
10. France 9.0 2.39
11. Australia 8.1 2.16
12. Russia 6.6 1.77
13. Taiwan 6.5 1.73
14. Netherlands 5.4 1.45
15. Spain 5.2 1.39
Source: http://www.c-i-a.com
McGraw-Hill/ Irwin © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.

11. Exhibit 1-A (continued)
Global Internet usage, 2000-2005
1-11
• 374.9 million worldwide Internet users per year.
• Top 15 countries accounted for 80% of users.
• The United States leads with over 35% of users.
• By 2005, 600 million Internet users are expected.
McGraw-Hill/ Irwin © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.