Running Head: HEALTHCARE INFORMATICS AND PATIENT CARE 1
2
HEALTHCARE INFORMATICS AND PATIENT CARE
Healthcare Informatics and Patient Care
Healthcare Informatics and Patient Care
Managers
In this paper, we will discuss the benefits of having technology around us and how it can be crucial for the daily operations of healthcare organization. Some of the benefits of having technologies are improvement in patient care, operate efficiently and reduction of cost. To make a healthcare organization successful, every staff member should know their role in improving patient care. One of them is a Director of Admissions, who can utilize technology/system to improve patient care in many ways. The Director of Admissions “admits patients by directing the admissions process; developing, implementing and maintaining revenue-generating strategies; determining and implementing admissions best-practices; promoting the hospital; maintaining a satisfied patient base” (Monster, n.d.).
Patient Care The technology that the Director of Admissions use to make daily workflow seamless is the Electronic Health Record (EHR) and admission/discharge/transfer (ADT) system. An ADT system is “used to input patient registration information which results in the creation of an automated master patient index (MPI) database that allows for storage and retrieval of the information” (Bowie, M. J., 2018). Using these systems can easily improve patient care because the technology can allow for an efficient workflow without errors. The Director of Admissions can manage an HL7 ADT Message system for the staff to let each department know when a patient is admitted, discharged or transferred (Health Standards, 2006). This can be handy to better care of patients by properly communicating with different departments of the hospital. For example, if a patient has arrived for his/her minor same day surgery, upon registration the message can be sent to the surgery department that patient has been admitted and on the way. This can expedite the service and patient experience.Cost and Efficiency
The EHR and ADT systems are safe and can admission process much easier, efficient, and reduce human errors. Reducing error can essentially reduce cost. The Director of Admissions can run daily “admission logs, bed utilization reports, current charges reports, daily census, daily discharge/transfer logs, and patient profile (Green & Bowie, 2016, 8-1a). The Director of Admissions can run daily current charges reports that can help them keep on track with expected account receivable. The Director of Admissions can track down who owes the company money, and he /she can forward the report to organizations account and billing department. This can help organization collect money. Technology makes this process easier and elements costly run around and paper trails.
Decision Making
The reports and data collected from the Director of Admissions can help organization make decisions in di.
Running Head HEALTHCARE INFORMATICS AND PATIENT CARE12HE.docx
1. Running Head: HEALTHCARE INFORMATICS AND PATIENT
CARE 1
2
HEALTHCARE INFORMATICS AND PATIENT CARE
Healthcare Informatics and Patient Care
Healthcare Informatics and Patient Care
Managers
In this paper, we will discuss the benefits of having technology
around us and how it can be crucial for the daily operations of
healthcare organization. Some of the benefits of having
technologies are improvement in patient care, operate
efficiently and reduction of cost. To make a healthcare
organization successful, every staff member should know their
role in improving patient care. One of them is a Director of
Admissions, who can utilize technology/system to improve
patient care in many ways. The Director of Admissions “admits
patients by directing the admissions process; developing,
implementing and maintaining revenue-generating strategies;
determining and implementing admissions best-practices;
promoting the hospital; maintaining a satisfied patient base”
(Monster, n.d.).
Patient Care The technology that the Director of Admissions
2. use to make daily workflow seamless is the Electronic Health
Record (EHR) and admission/discharge/transfer (ADT) system.
An ADT system is “used to input patient registration
information which results in the creation of an automated
master patient index (MPI) database that allows for storage and
retrieval of the information” (Bowie, M. J., 2018). Using these
systems can easily improve patient care because the technology
can allow for an efficient workflow without errors. The
Director of Admissions can manage an HL7 ADT Message
system for the staff to let each department know when a patient
is admitted, discharged or transferred (Health Standards, 2006).
This can be handy to better care of patients by properly
communicating with different departments of the hospital. For
example, if a patient has arrived for his/her minor same day
surgery, upon registration the message can be sent to the
surgery department that patient has been admitted and on the
way. This can expedite the service and patient experience.Cost
and Efficiency
The EHR and ADT systems are safe and can admission
process much easier, efficient, and reduce human errors.
Reducing error can essentially reduce cost. The Director of
Admissions can run daily “admission logs, bed utilization
reports, current charges reports, daily census, daily
discharge/transfer logs, and patient profile (Green & Bowie,
2016, 8-1a). The Director of Admissions can run daily current
charges reports that can help them keep on track with expected
account receivable. The Director of Admissions can track down
who owes the company money, and he /she can forward the
report to organizations account and billing department. This
can help organization collect money. Technology makes this
process easier and elements costly run around and paper trails.
Decision Making
The reports and data collected from the Director of Admissions
can help organization make decisions in different department.
For example, running a daily census report can let certain wards
of the hospital know how busy they are and what kind of
3. staffing level will be needed to properly care for the patients.
The Director of Admissions has to make sure that the collected
data are sent to all the managers and supervisors of the hospital
to help them make decision.
Reference
Bowie, M. J. (2018). Essentials Health Information
Management: Principle & Practices (4th ed.). Place of
publication not identified: Cengage Learning Custom P.Monster
(n.d.). Admissions Director Hospital Job Description. Retrieved
on November 21, 2018 from https://hiring.monster.com/hr/hr-
best-practices/recruiting-hiring-advice/job-
descriptions/admissions-director-hospital-job-description.aspx
Health Standards (2006 October 5). What is an HL7 ADT
Message? Retrieved on November 21, 2018 from
http://healthstandards.com/blog/2006/10/05/what-is-an-adt-
message/
Fair To All People: The SEC and the Regulation of Insider
Trading
· Introduction
· Pre-Securities Act Common Law Enforcement
· The Securities Exchange Act of 1934 - Principles of Full
Disclosure
· Foundations of Fairness: The SEC Develops Theories and
Rules on Corporate Disclosure
· The SEC Takes Command
· Counterattack From the Supreme Court
· Raising the Stakes
· Power of SEC Resilience
· Rule 14e-3 and the Misappropriation Theory
· United States v. O'Hagan
· Old Debate and New Rules: SEC Regulation of Insider
4. Trading in the Global Marketplace
· In Recognition
Power of SEC Resilience
United States v. O'Hagan
It took nearly a decade for the Supreme Court to revisit the
applicability of the misappropriation doctrine they had
deadlocked on in Carpenter. That is not to say that the SEC sat
on the sidelines waiting for a case to arise. In fact, after
the Carpenter deadlock, the SEC actively enforced insider
trading cases, urging lower courts to adopt the misappropriation
theory. But the lower courts divided on the issue, and the Eighth
Circuit overturned the conviction of James O'Hagan for
securities and mail fraud and for violation of Rule 14e-3,
because the court found that O'Hagan owed no duty to Pillsbury,
the company in whose stock he had traded. The Supreme Court
resolved to settle the disputes among the circuit courts
in United States v O'Hagan.(53)
O'Hagan, a Minneapolis legal icon, was charged with violating
Section 10 and Rules 10b-5 and 14e-3 by trading on
misappropriated, non-public information he acquired while at
his law firm. O'Hagan was neither a classic nor a constructive
insider, nor could he be held liable under the disclose or abstain
rule. The SEC and the U.S. Justice Department prosecutors
advocated a broad, expansive reading of Rule 10b-5 to cover
any deceit, meaning that for O'Hagan, his misappropriation of
his employer's information was for his personal benefit, in
connection with the purchase or sale of a security. At oral
argument, Chief Justice Rehnquist quizzed Deputy Solicitor
General Michael Dreeban about the SEC theory.
"What bothers me about this case," queried Rehnquist, "is what
is the connection between the ‘deceptive device' and the
‘purchase or sale' of the security" since O'Hagan didn't deceive
anyone who sold him the Pillsbury stock."
The misappropriation theory, replied Dreeban, "had a broader
aim to pick up the cunning devices that people might use." The
issue in O'Hagan, he remarked, was "a unique kind of fraud,
5. unique to the securities markets" in which a person could profit
from misappropriated information only by trading or tipping
someone else off.
But John D. French, O'Hagan's lawyer, dismissed the SEC
attempt to expand the misappropriation theory. "If Congress
wants to get the misappropriation theory into law, it has to write
it into law." Otherwise, he added, remembering the troika of
Justice Powell-inspired cases from the 1980s, "you cannot
disconnect the misappropriation from the purchase and
sale."(54)
On June 25, 1997, in an opinion written by Justice Ruth Bader
Ginsburg, the Supreme Court upheld the misappropriation
theory as a valid basis on which to impose insider trading
liability. While the Supreme Court acknowledged that
misappropriators had no independent duty to disclose to persons
with whom they traded, the legal obligation under the Securities
Acts was founded on the theory that "a fiduciary's undisclosed,
self-serving use of a principle's information to purchase and sell
securities, in breach of a duty of loyalty and confidentiality,
defrauds the principal of the exclusive use of that information."
So defined, the misappropriation theory thus satisfied the 10(b)
requirement of a "deceptive device or contrivance" used "in
connection with a securities transaction." SEC Chairman Arthur
Levitt Jr. commented that the decision reaffirmed "the SEC's
efforts to make the stock market fair to all people, whether
you're a Wall Street veteran or a Main Street newcomer." The
misappropriation theory was well-tuned to the animating
principle of federal securities law: to insure honest securities
markets and thereby promote investor confidence.
The success of the SEC was the result of a long and persistent
strategy that avoided congressional definitions that it felt would
make actual enforcement more difficult, while advocating for
common law interpretations that promoted a somewhat nebulous
definition of insider trading based on principles of equal access
to market information. Opting for a common law interpretation
while developing administrative rules of enforcement allowed
6. the SEC to react to market abuses, but not overreact in a way
that might damage its enforcement flexibility or the stability of
the markets. The ideological and legal persistence of the SEC
won the day in 1997, but insider trading issues remain an
ongoing debate.
<< PREVIOUSNEXT >>
Footnotes:
(53) 484 US 19 (1997)
(54) Linda Greenhouse, "S.E.C. Argues Insider-Trade Theory
Before High Court," The New York Times, April 17, 1997, D1.
Related Museum Resources
Papers
FEBRUARY 27, 1997
Brief for the United States, United States of America v. James
Herman O'Hagan
IMAGEPDF (Courtesy of the Library of Congress)
FEBRUARY 28, 1997
Brief of Amici Curiae North American Securities
Administrators Association, Inc. and Law Professors in Support
of Petitioner, United States of America v. James Herman
O'Hagan
IMAGEPDF (Courtesy of the Library of Congress)
MARCH 27, 1997
Brief of Amici Curiae Law Professors and Counsel in Support
of Respondent, United States of America v. James Herman
O'Hagan
IMAGEPDF (Courtesy of the Library of Congress)
MARCH 28, 1997
Brief for Respondent James Herman O'Hagan on Writ of
Certiorari to the U.S. Court of Appeals, United States of
American v. James Herman O'Hagan (begins at Questions
Presented)
IMAGEPDF (Courtesy of the Library of Congress)
APRIL 27, 1997
8. resale or redistribution.
Section 9.1Financial and CSR Reports
Pretest Questions
1. Firms can legally report company earnings numbers in just
one way. T/F
2. Offering CSR or sustainability reports remains optional in all
industries. T/F
3. Publicity is the major leverage point for externally
motivating corporations to
report CSR. T/F
Answers can be found at the end of the chapter.
Introduction
Customers and other stakeholders (even employees) cannot
usually become aware of socially
responsible behaviors without some effort on the organization’s
part. Thus, accurate and
timely reporting of CSR efforts can engage stakeholders and
provide concrete evidence of
sustainability attempts and successes. However, not all firms
report the same way, and con-
sumers are not always able to protect themselves from false or
misleading reports. Also, some
firm managers still choose to only report financial returns and
don’t discuss the social or
environmental aspects of or contributions to those returns.
This chapter addresses types of financial and CSR reporting. It
discusses reasons why compa-
9. nies make the effort to report and describe standards and
general practices that, if adhered to,
can help such reports be maximally useful to customers and
other stakeholders.
9.1 Financial and CSR Reports
Today the most common type of corporate reports are financial
reports. Interestingly, com-
panies can legally present investors with two types of financial
reports: (a) those that strictly
adhere to generally accepted accounting principles (GAAP) and
(b) those that include
some simplifications or leave out some facts from the main
body of the report. The first type
is well known to accountants; such reports follow a
standardized format that make them easy
to compare to reports from other companies that use the same
standards. Thus, the GAAP
format enables the financial situation of two or more companies
to be compared. In contrast,
non-GAAP reports feature adjusted figures known as pro forma
or non-GAAP numbers. Com-
pany leaders have significant freedom in reporting such
adjusted numbers, in part because
there are no rules about what they can strip from the reporting.
This allows executives to
paint a simplified or idealized picture of the corporate situation
(Morgenson, 2015). Even
within the same industry, companies can differ on what they
include or exclude from the
nonstandard report. For example, one company may exclude
facts about how employees are
compensated, while another company in the same industry may
include such numbers. When
these differences occur, it makes it challenging for investors or
other stakeholders to compare
11. value dropped by almost $60
billion, largely as a result of investor reactions to the discovery
of the variance between the
two versions of the report (Morgenson, 2015).
What are government and exchange regulators doing about this
issue? In 2003, when pro
forma or non-GAAP earnings first became popular, the SEC
instituted Regulation G to help
investors. Regulation G requires companies that use adjusted
non-GAAP figures in regulatory
filings to present comparable numbers calculated using GAAP.
However, the regulation does
not cover news releases, a major source of information for
investors.
According to many, this kind of market deception reflects the
need for transparency and stan-
dardization in reporting, not just for accounting measures
(which are only one part of the
triple bottom line), but also for CSR (Howell, 2015b).
Transparency means being open, hon-
est, and direct about a company’s past, present, and future.
Standardization means using a
common system that allows people to make fair comparisons
between similar corporations.
Transparency and standardization are a foundational element of
sustainability because they
allow companies to fairly measure and compare shareholder
value, return on investment in
finance, and environmental impact and social contributions to
CSR. CSR reports are a rela-
tively new phenomenon, and making sure they are useful
requires understanding the history
of reports, the standards related to reporting, and cases of
reporting use and abuse. Doing so
13. The Exxon Valdez became a symbol of how the drive for
profit can conflict with environmental and social respon-
sibility, with devastating results. The short-term media
and social response was significant, and public outrage
and concern continued for years.
Some of the disaster’s long-term implications relate to
corporate transparency. The spill instigated new pres-
sures for firms to report how they were (or were not)
protecting workers and the environment. Groups of
activists began to push for accountability through vol-
untary corporate reporting. One of the leading orga-
nizations responsible for demanding more corporate
transparency was the Coalition for Environmentally
Responsible Economies (Ceres), which was formed in
response to the spill.
The Coalition for Environmentally
Responsible Economies
Ceres was formed by a small group of investors who
believed that if firms like Exxon had to publicly admit
they were overworking people (a social CSR issue),
were failing to invest in safe equipment (another social
CSR issue), or lacked the policies to protect the environment in
the event of an emergency,
they might find reason to fix such irresponsible and
unsustainable behaviors. Essentially, the
founders of Ceres believed that transparency could herald
change.
Over the organization’s 25-year history, its mission has
expanded. It has introduced report-
ing tools to help organizations weave environmental and social
challenges into company and
14. investor decision making. It has inspired a reevaluation of
companies’ roles and responsi-
bilities as stewards of the global environment when it published
the Valdez Principles, later
named the Ceres principles. These consist of 10 points of
environmental conduct that Ceres
encourages companies to publicly endorse (Lubber, 2014):
1. Protection of the biosphere: How well does the corporation
protect the general bio-
sphere, including by reducing greenhouse gases?
2. Sustainable use of natural resources: Does the corporation
strive to use renewable
resources and reduce the consumption of nonrenewable ones?
3. Reduction and disposal of wastes: Does the corporation
practice lean manufacturing
and seek to reduce or eliminate waste?
4. Energy conservation: Does the corporation conserve energy?
5. Risk reduction: Does the corporation have safety and
accident-reduction programs
in place?
6. Safe products and services: Does the corporation create
products and packaging that
are safe for consumers? Are consumers safe when they use the
product?
7. Environmental restoration: Does the corporation take steps to
renew and restore
the environment when damage is done?
John Gaps III/AP Images
16. The creation of the principles and the requirement for
supporters to publicly declare support
ushered in renewed pressure to make public data on where
companies stand in regard to CSR
and sustainability. Ceres spearheaded a movement to get firms
to publicly report and state
sustainability and CSR goals, progress, and setbacks.
Recent research suggests that 93% of the top global companies
publish CSR or sustainability
reports (KPMG, 2013). The statistic indicates how far
sustainability and CSR reporting have
come, but the journey was not easy. As Bob Massie, Ceres’s
executive director from 1996 to
2002, stated in 2014:
The whole idea of having an environmental ethic, or measuring
your perfor-
mance above and beyond your legal requirements, was
considered completely
insane. Sustainability was considered to be a shockingly
difficult thing that no
company would ever take on as a goal. (Ceres, 2014)
As Ceres pushed reporting, it also spearheaded a worldwide
effort to standardize and system-
atize disclosure on environmental, social, and human rights
performance. In the late 1990s
Ceres launched a separate entity known as the Global Reporting
Initiative (GRI), the aim
of which was to create a standardized and transparent
accountability process that ensures
compliant companies follow the Ceres principles (GRI, 2015).
The Global Reporting Initiative
The GRI is the most widely adopted framework for
18. decided to spin off the reporting
efforts from the rest of the organization. Thus, GRI became a
separate and independent non-
profit institution in 2001. The organization moved to
Amsterdam and became part of the
United Nations under its environmental program (the UNEP).
That same year, in 2002, the
second generation of guidelines (G2) was unveiled at the World
Summit on Sustainable Devel-
opment in Johannesburg, South Africa. The summit was the
most important international
convention related to climate change, and being part of it was
another sign of the organiza-
tion’s value and prestige.
Over the next 4 years, demand for CSR reporting guidance grew
dramatically, and the third
generation of the guidelines (G3) was launched with the help of
more than 3,000 experts
from multiple sectors, including packaged goods, shipping,
agribusiness, and more (GRI,
2015). However, it was not until 2007 that GRI created a
product for mass consumption and
utility—Pathways I. This publication provides a step-by-step
procedure for report makers. To
create a regional presence and learn how different regions
responded to the document, GRI
set up regional offices around the world, beginning with Brazil.
Today it has offices in many
countries.
To encourage the use and enforcement of the current guidelines
(G4), GRI launched a
60- question multiple-choice exam that enables individuals to
be accredited to use the G4
guidelines. The exam is available in more than 70 countries;
19. successful participants receive
a certificate and get their name published on the GRI website
for 3 years. While this kind of
recognition may seem narrow, it has significant weight with
environmentally and socially
conscious investors who have come to expect transparent
reporting and this kind of standard
measurement. Also, certified people can go into business for
themselves (or be selected by
employers) to help others create better CSR and sustainability
reports—this provides a way
for CSR and sustainability skills to be turned into financial
benefits. The more people who are
accredited to the GRI standards, the more the GRI brand grows
and the more the reporting
movement gains momentum and standardization. GRI’s vision is
for organizations to con-
sider sustainability throughout their decision-making processes
(GRI, 2015). Such a goal puts
them in partnership with corporate leaders and individuals who
are interested in increasing
CSR and sustainability.
The emergence of Ceres and GRI illustrate how a small group of
individuals can form a collec-
tive and ultimately drive major change. The ability of
individuals to report, support report-
ing efforts, and engage with standardized guidelines has moved
from nonexistent in 1992 to
being the purview of a few experts to being readily accessible
by almost all interested parties.
What have companies done with this ability, and what are the
consumer and competitive
pressures to conform? As stated earlier, data suggests that each
year, more companies report
and that these reports are becoming more accessible, detailed,
21. During the 1970s and 1980s, CSR messages (if they existed at
all) were based on public rela-
tions goals more than truth or adherence to standards. One
important breakthrough came in
1972, when a consulting firm named Abt & Associates added an
unexpected environmental
report to its typical annual financial statements. This pioneering
effort focused strictly on
sharing data on air and water pollution by the company and its
affiliates. Abt & Associates’
financial auditor certified the financial data. But since he was
only trained to evaluate finan-
cial reports, he disclaimed any responsibility for the
environmental data, since no standards
existed for such audits. In response, John Tepper Marlin (1973)
wrote an article for the Jour-
nal of Accountancy suggesting ways accountants could measure
pollution; the article included
a model environmental report, which was subsequently adopted
by a few accounting and
auditing firms around the nation (Marlin & Marlin, 2003). Still,
neither the practice of report-
ing nor the practice of having auditors measure environmental
pollution gained much trac-
tion until the 1980s.
Phase 2
In the second phase of CSR reporting, Mar-
lin continued to innovate and improve on
his original ideas. He found an interested
innovation partner in gourmet ice cream
purveyor Ben & Jerry’s. In a groundbreak-
ing deviation from standard practice, Ben
& Jerry’s commissioned a social auditor to
work with its staff on a report covering the
previous year’s activities. This was unusual
23. first stakeholder report was
divided into categories that represented different audiences,
including communities (out-
reach, philanthropic giving, environmental awareness, global
awareness), employees, cus-
tomers, suppliers, and investors (Marlin & Marlin, 2003). This
was notable because it marked
the first time that Ben & Jerry’s considered suppliers to be a
stakeholder. The report was also
a landmark because it was commissioned by Marlin.
This report, as well as others from similarly progressive
companies such as the Body Shop
and Shell Canada, helped introduce a new model of corporate
reporting—a precursor to the
GRI standards. After the first social audit, Ben & Jerry’s
continued to issue social reports,
using different social auditors to refine the concept and practice
of CSR reporting. While these
audits still lacked a set of generally accepted standards by
which to measure CSR, they were
transparent and offered a road map for improvement (and
inspired others).
It is important to note that it was not just awareness and
goodwill that led to the rise in CSR
reporting during the 1980s. Legal issues were also at play in the
United States. The open
records and meeting laws passed in the 1970s as a result of the
Watergate scandal increased
the volume of environmental pollution emissions data that
entered the public record. In 1987
“right to know” legislation was extended by Congress to
establish the Toxic Release Inventory
and the Pollution Prevention Act of 1990, which created a
database that is used by investors
25. jeopardize the environment
and the possibility of achieving report certification. Auditors
are generally solution oriented
and tend to give the corporation time to address any violations
before the problems affect
certification. Reporting in general, and the role of auditors in
that process, has matured into
an industry where auditors receive standardized training and
follow specific CSR standards
before certifying a company and its reports.
Several agencies and organizations stand out as early leaders in
the final phase of CSR
reporting. Among them is Social Accountability International,
which was founded in 1997
(Marlin & Marlin, 2003). Other auditing pioneers include the
FSC, the International Foun-
dation for Organic Agriculture, and the Fairtrade group.
Together, these groups formed a
larger organization called the International Social and
Environmental Accreditation and
Labelling, which sets reporting standards internationally and
provides uniform training to
thousands of social auditors. This group uses GRI standards as
well as others that change
by industry.
Such agencies help companies assess, measure, and certify CSR
and environmental compli-
ance. The very existence of such a wide number and variety of
certifying organizations indi-
cates how CSR and sustainability reporting has become an
established feature of modern
organizational life. Such reports provide customers, employees,
competitors, governments,
and other stakeholders the ability to evaluate whether firms are
27. f09_01
Step 1:
Identify
Step 2:
Prioritize
Step 3:
Validate
Step 4:
Review
CSR Report
Principles
Materiality
Stakeholder
Inclusiveness
Sustainability
Context
Completeness
Source: Adapted from “How to Define What Is Material,” by G4
Online, 2013 (https://g4.globalreporting.org/how-you-should-
report/how-
to-define-what-is-material/Pages/default.aspx
To begin, a publisher would focus on the steps of the process—
identification, prioritization,
29. Section 9.2CSR Reports and Audits
suppliers were stakeholders. This type of awakening is possible
in every industry as leaders
fine-tune the definition of stakeholder inclusiveness. The
principle of sustainability context
ensures that reports include how an organization’s performance
influences sustainability
in a wider context (locally to globally). Finally, completeness
ensures the report’s topics are
adequately covered to provide stakeholders with sufficient
information about the organiza-
tion’s economic, environmental, and social performance. The
report should also detail its own
process and methodologies used, as well as mention any trade-
offs or assumptions involved
in creating the report. Once the report is ready, many companies
ask a third-party agency to
verify and validate it.
CSR Report Auditors
Earlier in this chapter, we discussed the way GAAP guidelines
inform the …
6 The Corporation as Steward
Hxdyl/iStock/Thinkstock
Learning Objectives
After reading this chapter, you should be able to:
31. ways. Buildings use wood and
metal from forests and mines; companies require electricity
(from coal, wind, solar, nuclear,
or other sources of energy); and computers use components
from mines and fabrication
plants. Firm employees who drive to work use energy and likely
create pollution in the pro-
cess. Manufacturing companies use natural and human-made
inputs to create new products
for sale.
This chapter examines the relationship between the natural
environment and the corpora-
tion. It addresses the environmental issues introduced in
Chapter 5 and explores the true
social, environmental, and financial cost of certain corporate
activities. Part of addressing
how companies relate to the environment includes discussing
how they comply with legal
regulations, best practices prescribed by nongovernmental
agencies, and international orga-
nizations (such as the United Nations). This chapter describes
analytical tools that allow peo-
ple to identify risks, rewards, and impacts related to creating,
using, and disposing products
and services. These tools also provide data for companies that
want to create less damag-
ing or more restorative products. The discussion then turns to
communitarianism, the green
movement, and the formation of environmental regulatory
agencies in the United States and
European Union. It closes with a short discussion of how
strategic concerns about risk man-
agement and human welfare issues related to water rights and
water supplies may dominate
corporate conversations going forward.
33. between protecting and restoring the environment (which can
have costs that reduce ROI in
the short term) and using the environment with less care in
order to improve ROI for owners
in the near term.
A fiduciary refers to a person who holds a legal relationship of
trust with one or more par-
ties (such as shareholders). Typically, a corporate fiduciary
prudently takes care of money or
other assets. Corporate leaders by default become fiduciaries, or
people with a special duty to
owners/shareholders to protect and keep assets safe but also
efficiently and effectively use
assets. By law, a corporate leader cannot profit at the expense
of corporate shareholders; he
or she can also be fired for not managing funds to maximize
profits. In other words, leaders
are morally and legally bound to seek profit on behalf of owners
(Inc., n.d.). Thus, fiducia-
ries are stewards, or caretakers, of the financial side of
business. However, seeking profit for
shareholders is not the only aspect of the complex notion of
stewardship.
Peter Block is a thought leader in the world of business who
spent the past 40 years advocat-
ing for an expanded notion of corporate stewardship; one that
goes beyond fiduciary con-
cerns. Rather than just representing the interests of
shareholders, Block (2013) advocates
that corporations should adopt a stewardship model of
management whereby they treat
people and natural resources as assets to be cared for, nurtured,
preserved, and respected.
Stewardship commonly refers to the responsible care and
34. management of an asset over time
that allows for sustainability and growth. Some argue that
stewards are caretakers who bal-
ance all interests in the hopes of sustaining the life and value of
an asset (Inc., n.d.). For Block,
stewardship is a mind-set that changes the fundamental way
corporate managers and leaders
behave. Block suggests that not only are managers and leaders
stewards of what happens
within the corporation, they are also stewards of the
corporation’s social and environmental
impacts.
Block (2013) says that corporate leaders are responsible for
ethical communication and for
providing a quality good or service. He challenges corporate
leaders to tend to environmen-
tal issues while simultaneously being fiduciaries of the financial
bottom line. Block makes a
compelling argument that most corporations act in immediate
self-interest and do not have
the capacity to balance long-term environmental needs with
demands for short-term profit.
Stewardship involves listening and weighing multiple interests,
including long-term financial,
social, and environmental interests, in addition to short-term
financial ones.
Religious, social, and environmental movements have long
advocated the notion of steward-
ship over resources, which suggests that human and natural
resources have intrinsic and
long-term value and thus should be viewed with a long-term
mind-set. But Block’s version of
environmental stewardship suggests going one step further—to
restore environments. Such
36. discussed, such as shareholder investments, expectations, and
profits. But these interests can
best be sustained within a livable community, one that is
capable of providing well-trained
and empowered employees who are able to lead healthy and
productive lives. This means that
good stewards attempt to practice inclusion by involving all
stakeholders in communication,
and they practice, submit to, and attempt to exemplify
appropriate governance.
In order to embody this view, good stewards consider and work
across boundaries of juris-
diction, sector, and discipline to connect these four spheres and
create opportunity for the
region.
It should be noted that people who are not necessarily corporate
leaders are also considered
stewards. For example, educators and students exercise
important stewardship over society,
the environment, and future generations when they study the
world’s various interconnec-
tions. Society also entrusts politicians and civil servants to be
stewards of regions, resources,
and people’s well-being. Citizens can remove these privileges
(by vote or impeachment) if
government leaders do not practice stewardship. Owners can
also remove corporate stew-
ards (managers) if they are not acting in the corporation’s best
interests.
In some way, we all have stewardship roles. To be sure,
corporate leaders have macro stew-
ardship responsibilities, but employees at all levels are
accountable for many of the same
38. property is disallowed or carefully con-
trolled—this makes it harder to be an effec-
tive steward because owners usually have
more power than other stakeholders. In
Communist states, such as the former Soviet
Union and contemporary North Korea, the
concept of ownership is totalitarian, and
the state owns most businesses and other
factors of production. In contrast, the United States and
European democracies conceive of
ownership as a state in which assets can be held privately or by
different government entities,
including on national, state, and local levels. For example,
governments may own transporta-
tion systems, such as Amtrak in the United States or British
Rail in the United Kingdom. Many
of the older European airlines, such as Air France, KLM, and
Swissair, began as government-
owned businesses. They have since been privatized or are
semiprivate, which means they are
jointly owned by government entities and private companies.
Partial ownership creates stewardship and legal challenges; it is
difficult to determine who
is responsible for performance when both shareholders and
elected governments own part
of a corporation. This state of affairs is further complicated
when an owner needs to be held
responsible by a court of law. When legal entities hold someone
responsible for environmen-
tal damage, for example, it is difficult to prosecute or defend
owners when the owner is the
same government that manages the regulatory agency.
Extending Ownership and Responsibility
When a corporate stakeholder sees a poorly calculated decision
40. Section 6.2The Cost of Failed Stewardship
a thought leader in the world of business and an expert on
complexity theory and leadership,
believes that stewardship resides in everyone, regardless of the
social and leadership envi-
ronment in which they live.
This stance illustrates how some people, such as Wheatley,
consider individual workers and
actors to be quite powerful. Such a mind-set suggests that one
need not wait to have a leader-
ship position or be deeply experienced and highly credible to
guide an organization to sus-
tainability. Everyone has the capacity to be a good steward and
advance the interests of the
organization and the greater good.
How can stewards at all levels of an organization take
appropriate stances on critical con-
cerns? By respecting, encouraging, and considering multiple
voices.
Extending the ideas of Havel and Wheatley, Max De Pree, the
longtime leader of the Her-
man Miller corporation (manufacturers of office furniture),
publicly fostered the idea of an
inclusive corporation, or one in which all voices are heard and
given credence. He wanted
to create a caring organization that was also financially
successful. Because of that belief, he
opposed business ideas that only benefited senior management.
He suggested that good lead-
ers and stewards are open to communication. But most of all, he
41. was known for talking and
listening to anyone and considering and enacting ideas from all
levels of the company (De
Pree, 1987). Unlike Wheatley and Block, who are consultants
and idea leaders, De Pree was a
manager and corporate actor. His ideas focused less on what a
steward is and more on what
he or she does.
6.2 The Cost of Failed Stewardship
Up to this point, stewardship has been described as both a mind-
set and a set of behaviors
that can be distributed or enacted from inside or outside an
organization. Equally important
to cover are stewardship failures; indeed, examining failures
creates another way to motivate
action. Most instances of failed corporate stewardship go far
beyond harming financial stake-
holders. Such failures impact the social community, the
environment, employees, the legal
system, and the banking system (Clarke, 2004). For example,
the potential failure of the U.S.
auto industry in the 2008 recession triggered Congress to offer
massive financial aid to top
manufacturing companies. The subsequent financial “bailout”
was justified for a variety of
reasons, including to preserve jobs and national security.
However, the same bailout cost tax-
payers; cost the firms in reputational capital; and cost citizens
and investors stress, in terms
of uncertainty and fear.
What are the additional costs when stewardship fails? These can
be seen in the blunder by
Atlas Minerals, a now closed industrial site near the entrance of
the Arches National Park in
43. Powell, and the Grand Canyon.
What was once thought of as an acceptable risk and normal by-
product of manufacturing was
finally seen as an environmental disaster. With such discoveries
and related changes, Atlas
Minerals entered Chapter 11 bankruptcy, and in so doing
dodged liability for undertaking
a massive cleanup that cost many times more than the company
was worth. Since then, the
DOE has taken over the site (Grand County Utah, 2016) and is
now tasked with cleaning up
all such sites that contributed to pollution related to the creation
of nuclear weapons (Yahoo!
Finance, 2016).
After the DOE assumed ownership of the land, it set up a trust
to fund the site’s cleanup.
As of 2016, only 50% of the tailings had been removed.
Trainloads of radioactive tailings
are continuously removed from the site—about 5,000 tons each
week. The tailings are taken
approximately 40 miles away to a location considered less
environmentally sensitive because
it is not at the edge of the Colorado River (Yahoo! Finance,
2016). The project will cost taxpay-
ers many times the amount that Atlas Minerals made in profit
during its years in production.
In fairness, corporate leaders who in the 1950s endorsed the
plan to build a uranium mill and
store tailings near the Colorado River did so with the approval
of, and even encouragement
from, government agencies. They operated using the best
science of the time, although there
were environmental engineers, local workers, and others who
could see the folly of putting
a radioactive tailings pile so close to the Colorado River.
44. However, their concerns were dis-
missed, ignored, or discounted.
For the sake of short-term cost savings and expediency, and due
to a narrow definition of
impact, a river was polluted, the life expectancy of nearby
humans and animals was reduced,
and the cost of conducting a massive cleanup was passed on to
taxpayers. In contrast, cor-
porate leaders of today and the future, especially those who take
a stewardship mind-set,
research the impacts of location, sourcing, and product
ingredients on current and future
generations before making decisions.
If we agree with Havel, Wheatley, and De Pree, then most (but
not all) of the blame goes to
those who own the corporation. The bad planning, failed
science, poor execution, and bank-
ruptcy are not just the failure of corporate leaders, but also of
regulatory agencies, govern-
ment, and even local citizens and employees. We all share in the
blame for poor stewardship if
we are connected to a community. But as problems get larger
and involve more stakeholders,
it becomes increasingly difficult to reach agreement and take
collective action.
In addition, it may seem difficult to foresee the impacts of
large-scale corporate activities
on future generations. However, several tools can help assess
the environmental impact of
a product, process, plant, or any other activity in which an
organization may engage. One is
the life cycle assessment (LCA), which provides a way to
measure a corporation’s environ-
46. sions, and the social implications of business operations. In
contrast, the cost of not doing an
LCA can also be extensive, as seen in the Atlas Minerals case;
it can result in firms mistreating
stakeholders, wasting resources, incurring internal expenses, or
receiving bad publicity. Run-
ning an LCA would help managers identify and address weak
spots and risky areas.
When managers do not assess impacts, they may fail to see risks
as well as opportunities to
evolve products to mitigate environmental and social impacts.
For example, after performing
an LCA, Levi Strauss & Company implemented changes to
mitigate the environmental impact
of its jeans.
CSR and Sustainability in Action: Levi Strauss & Company
An LCA done by Levi Strauss & Company in 2016 showed that
approximately 1,003
gallons of water are used to make a single pair of jeans.
Producing the material accounts
for 680 gallons, and the washing and cleaning of machines and
manufacturing facilities
account for the rest. Almost 70 pounds of carbon dioxide are
produced to create each
pair of jeans, mostly during fabric production. The LCA, which
follows the product from
birth to end of use, also found that Americans wash jeans, on
average, after wearing
them 2 times. Europeans wear them 2.5 times, while Chinese
wear them 4 times before
washing. The LCA suggested that if consumers wear their jeans
10 times before washing
them, they could reduce the environmental impact of jeans by
48. that refers to the time from initial manufacture or “birth” of a
product or service to its dis-
posal or “death.” The cradle period for a car, for example,
involves the extraction of metals,
chemicals, and minerals for car parts and electronic
components, and the extraction of petro-
leum for plastics and the gasoline or electricity that will power
the car. Performing an LCA
for a car also means considering its end-of-life destination,
which for many cars is either a
junkyard, a landfill, or a recycling facility, where some or all of
the parts are extracted and
reused. As another example, consider the cradle-to-grave LCA
of a newspaper. Harvesting and
grounding trees into pulp is an energy-intensive process. Paper
is produced from the pulp;
the paper is shipped to suppliers and then sent on to printing
facilities that print ink on it. The
same facilities fold and prepare the paper to ship to vendors.
The paper is then delivered to
homes and offices in cars and trucks that produce pollution and
are powered by fossil fuels. At
this point, the paper has left the cradle stage and is now moving
through the life stage, where
it is consumed (read). It is then disposed of and heads toward
the grave stage. Newspapers
(those that still exist in this digital age) can be burned, used as
wrapping or protective cover,
be recycled, or thrown away to decompose in landfills. The
impacts of each grave can also be
analyzed. If papers are recycled, one possible outcome is to
create cellulose insulation, which
can be installed in homes and offices. It is also possible to
calculate the fossil fuel savings
from the insulation, along with the effects of most other steps in
the life cycle. Conversely, if
49. the papers are burned, then the release of carbon can also be
measured and assigned to the
product LCA measurement tally.
When recycling costs and benefits enter the picture, some
people suggest that the LCA
becomes a cradle-to-cradle analysis. Cradle-to-cradle was
discussed in Chapter 5.3; the term
was coined by design advocate Bill McDonough, who suggested
that when the output of one
cycle can be the input for another cycle, then materials need
never enter landfill or junkyard
“graves.” When the process of making and using a newspaper
ends with landfill expenses and
impacts, then the analysis is a cradle-to-grave analysis. If,
however, the analysis includes data
on recycling and finding alternative uses for the product, then it
begins to resemble a cradle-
to-cradle analysis (McDonough & Braungart, 1998).
Note that there is an entire industry of firms and practitioners
interested in conducting LCAs.
As these needs have increased, so has the need to standardize
and develop processes that
enable comparisons and ensure accuracy. There are widely
accepted standards in place that
are managed by the International Organization for
Standardization (ISO). Specifically, stan-
dards such as ISO 14040 and 14044 explain how to conduct
LCAs. Both sets of standards
recommend that the process include four distinct phases (as
illustrated in Figure 6.1). These
phases, or steps, are interdependent, which adds to the
complexity of the analysis. Further
complicating matters is the back-and-forth nature of this
process, where, for example, changes
52. “vested” in the
corporation. T/F
2. Research shows that employees of companies with employee
stock ownership plans are
more committed to their company. T/F
3. Suppliers are solely motivated by profit margin in deciding to
whom they will sell. T/F
4. An investor cannot be an employee. T/F
5. A B corporation is a simple tax designation for a type of
corporate structure. T/F
Answers can be found at the end of the chapter.
Introduction
Chapters 1 and 2 introduced the idea of stakeholders and
stakeholder analysis and showed
how corporate social responsibility can originate from or spread
through social networks.
This chapter examines stakeholders who are internal to the
corporation. Specifically, it
focuses on three different kinds of stakeholders: employees,
suppliers, and owners/market
stockholders. To reflect the complex nature of business, the
chapter also addresses how the
lines blur between different types of stakeholders who are
financially or emotionally con-
nected to the modern corporation. For example, some employees
are also owners, and some
owners are also suppliers. These arrangements can create
complex governing problems for
the corporation. Such complexity increases when owners and
employees have certain legal
rights. To illustrate how CSR includes—and sometimes begins
with—taking care of internal
54. Section 3.1Vesting and Corporate Ownership
are publicly traded—meaning that small pieces of company
ownership in the form of stock
can be exchanged in return for cash. In such cases the many and
varied individuals and insti-
tutions that own shares in the company actually own the
company together.
Before the rise in new employee incentives related to stock
ownership, there were only two
kinds of stakeholders vested in corporations: financial investors
and owners. Now, in the age
of globalization and with an increase in firms where managers
reward employees with a mix-
ture of wages plus the promise of staged future ownership with
stock options, there are at
least three categories of people vested in corporations:
employees, owners/investors, and
suppliers (see Figure 3.1).
Figure 3.1: Three types of corporate ownership
f03_01
SuppliersEmployees
Investors
Such ownership distinctions matter in a book on sustainability
and CSR for several reasons.
First, by definition, people vested in a firm tend to care more
deeply about how it behaves.
56. Suppliers represent another type of entity that can become
vested in a company. A supplier
is another company or corporation that provides the company
with the appropriate parts,
inventory, and/or service inputs required for the company to
create its products and services.
It may sound surprising to suggest that a supplier would be
vested in a client, but this is cer-
tainly the case if you follow the financial logic. The supplier
vests in the future of a client’s
company in anticipation of ongoing financial reward in the form
of continued sales, increased
sales, or sales referrals. Suppliers (or the parent companies that
own and manage supplier
companies) can purchase a formal stake in the future of the
companies they serve by buying
large amounts of stock or by forming legally binding
partnerships. Thus, suppliers have a
range of options in terms of their degree of vested interest; but
by definition, any supplier to
a firm has a vested interest in it.
Vested Owners or Investors
Another way individuals develop a vested interest in a company
relates to investing money
as owners, part owners, or nonequity investors (investors with
no ownership rights but with
other rights as negotiated at the time of investment). Investors
provide a business or project
with funding or other resources, and in return they expect a
financial benefit. An owner of
a company invests in the company for a variety of reasons, but
the most common relates to
securing rights to future financial benefits in the form of
increased stock price. Investors and
owners provide capital, absorb risk, and over time expect a
58. resale or redistribution.
Section 3.2Employees
3.2 Employees
In the 21st century, corporate managers view workers
differently than they typically did
in the past. Also, employees increasingly have different types of
commitments to firms. For
example, in technology firms and many new nontechnical
startups, employees are seen as
family, essential members of a work community. Employees
often feel the same way about the
firm (AFL-CIO, 2015). Modern companies show more
commitment to employees than they
did in previous decades, in part because there are fewer choices
for substitutes—at least in
sectors that employ skilled workers. Many technological
problems require specific technical
expertise that is rare or unavailable in the broader market.
Consider the skills of computer programmers, coders, and
systems engineers—these skills
are specialized and not evenly distributed among the job-
seeking population. Other indus-
tries face similar situations: Medical personnel have technical
training and are currently in
high demand by employers. Over time, specific industries create
specialists and subspecial-
ists, and employees and employers in these industries develop
new interdependencies—one
worker can no longer be easily substituted for another.
Employees in such situations also per-
sist in working for the company’s success, because the
59. employee’s financial future depends on
it—especially when his or her specialization is so specific that
the employee cannot find other
work without significant retraining. The employer needs the
relationship to persist because
firms cannot easily or inexpensively find a replacement in the
labor market. For example,
many software companies and medical service firms continually
adjust to market needs by
training current employees on anticipated future needs and
providing employees with incen-
tives to stay at the company.
Types of Employees
Most firms categorize employees in ways that relate to federal
employment regulations. In
most firms there are four basic categories of employees: full-
time, part-time, independent
contractors, and informal employees.
Full-Time Employees
Full-time employees work either hourly or on a salary. Hourly
employees in the United States
are typically required by law to spend 30 to 40 hours a week
performing their work duties.
Salaried full-time employees differ from hourly full-time
employees in that they have a con-
tractually defined responsibility. They must manage that
responsibility and complete asso-
ciated tasks in exchange for a monthly paycheck no matter how
many hours they work—
sometimes they might be able to complete requirements in under
30 to 40 hours a week,
and at other times they may work more than this amount. Unlike
hourly employees, salaried
employees generally do not track work time in any formal way
61. when contacted for a specific skill or project. He or she works
for a specific amount of time
and for a specified salary or hourly wage; there is typically no
expectation that the employ-
ment arrangement will extend past the life of the project or
specified time.
Note that when someone builds a house or other structure with a
specific builder, the builder
then contracts (or subcontracts) with skilled people (or many
different ones) to complete
the various specialized tasks related to building the structure
within a specified time frame
and quality level. In most cases, no builder can possibly
perform all required tasks with equal
skill, speed, and precision as what can be accomplished by
various specialists hired for the
tasks. The same logic applies to building a corporation or other
organization, and the rea-
sons a corporation might seek contract employees are the same:
Some people have a specific
skill set for doing a certain job, and they should be paid to
perform that job but not remain
associated with the company once the job is complete. A
contract employee is not consid-
ered an employee in current U.S. legal terms, but in modern
(nonconstruction) firms, contract
employees may provide accounting, payroll, janitorial,
marketing, consulting, or other spe-
cialized services. An independent contractor might also be
someone who works seasonally.
Informal Employees
The fourth and final kind of employee is the informal
consenting employee. This person might
be a friend, spouse, intern, or volunteer. Regardless of the
63. ment. It can generally be assumed
that the full-time employee has a
deeper engagement with the corpo-
ration and that a part-time, infor-
mal, or contract worker has less of a
commitment to the corporation’s
future. Full-time employees tend to
stay longer, be paid more, and have
financial and promotion futures
more directly tied to the future of
the corporation.
Figure 3.2 shows the range of rela-
tionships that corporations have
with the types of employee stake-
holders vested in the corporation.
As the figure indicates, many dif-
ferent options exist. An employee
might be a partial owner. A contract
employee might also be a supplier.
A part-time employee might have a
spouse or partner who is employed
full-time at the same place. It is
important people understand the wide number of options that
now exist in the modern work
environment. Anyone interested in CSR and sustainability,
particularly regarding employees
and employee rights, needs to keep a close eye on the many
different ways firms define the
concept of “employee” and “owner.”
Motivating Employees
Corporate managers understand the importance of motivating
their highest quality workers
to have a long-term commitment to the firm. The costs to attain
new talent vary by job and
65. resale or redistribution.
Section 3.2Employees
Employee Stock Ownership Plan
In 1956 the owners of Peninsula Newspapers wanted to exit
from ownership of the company;
at the same time, the employees wanted to become owners
themselves to be more tightly
coupled to the organization. Political economist Louis Kelso
enabled the employees to pur-
chase the company by creating a legal category known as an
employee stock ownership
plan (ESOP). As the idea of the ESOP emerged, it required
authorization through legislation
and tax code changes. In the United States an ESOP is a
qualified pension plan (another way
of saying it offers a type of retirement benefit). Because of this
designation, employees do not
need to pay taxes or any contribution to the firm until they
“cash in” on their vested amount
when they leave the company. When employees cash in, they
can also roll over any ownership
shares into an individual retirement account if they qualify
(Doucouliagos, 1995). In refer-
ence to stock options, vesting is the amount of time employees
must wait to exercise or fully
own their stock options (which is known as being fully vested).
Stock options usually come
with terms that provide more ownership or more stock the
longer an employee stays with a
firm. Usually, the terms include milestones related to time. For
example, if an employee stays
5 years, he or she can be 25% vested in the amount of stock in
66. question; in 7 years he or she
can be 50% vested in the amount of stock in question; and so on
(the exact time and percent-
ages vary by company and industry).
Over time, employees with vested interest in their company can
become fully vested as part
owners. Initially, employees’ small compensation in stock won’t
give them much say in the
company’s operations. However, over time, employees with
options could amass consider-
able influence in its future and governance.
The philosophy behind an ESOP includes at least three parts:
broaden ownership of capital,
create financial security and incentives, and urge better
employee productivity. The California-
based National Center for Employee Ownership (2016) claims
that 13 million employees in
the United States work in places where they are encouraged to
participate in ESOPs. In some
cases, employees own and manage these companies, and there
are no external investors. In
other cases, employees own a smaller portion of the corporate
stock shares, and external
nonemployee investors have greater control. ESOPs are common
in the service industry but
can be found in many other industries too. Several high-profile
companies that have ESOPs
include United Airlines and W. L. Gore and Associates (Gimein,
Lavelle, Barrett, & Foust, 2006;
Paton, 1989).
Why do companies go through so much trouble to create a plan
that allows employees to
become owners? Scholars have studied this idea extensively,
68. Another criticism of ESOPs is that they are excessively
ideological, whereas the marketplace
is more practical. For example, companies that are forced to
downsize because of changes
in the marketplace often lay off workers—such decisions make
financial sense and help the
organization survive for the remaining employees and
customers. However, if through an
ESOP an employee participates in the company’s management,
then he or she is put in a posi-
tion to protect employee jobs, making it less likely the company
will take the cost-cutting/
job-cutting steps that are sometimes needed to survive.
Managing ESOP companies can thus
occasionally become problematic (Stumpff & Stein, 2009;
McDonnell, 2000).
Other Stock-Related Options
In the United States there are other ways that companies can
reap the advantages of ESOPs
without completely changing the company’s legal structure. One
way is to offer stock to
employees under very specific conditions. While these are
mostly found in highly competi-
tive sectors, it is also true that progressively minded companies
such as Starbucks use stock
options to benefit employees. In such companies workers do not
have management control
associated with the highest levels and type of stock ownership
(there are various levels), but
they do have a long-term financial tie to the company created by
the option to purchase stock
at a fixed price.
Other companies allow employees to directly purchase shares in
the company on their own.
70. Section 3.2Employees
motivate and retain employees by offering flexible hours, work-
from-home telecommuting
options, and unlimited no-questions-asked time off and sick
leave.
Many employees work for the promise of future income and
bonuses, but many people select
employers based on nonfinancial criteria too. Employers of
choice tend to be places where
the culture supports learning, work–life balance, health and
wellness, flexibility, growth, a
supportive work environment, safety, and a sense of purpose or
meaning (Dill, 2015). Thus,
a firm’s employment policies and the general way it treats its
workers (its human resource
policies and practices) influence employee engagement and
become a point of consider-
ation when candidates apply for jobs and when firm managers
build or rebuild policies and
practices.
Employee Rights
Thus far, we have discussed employees and some options
provided to those employees fortu-
nate enough to quality for certain benefits. This section
examines the rights and protections
that government regulations and social standards provide for all
employees. While employee
rights vary, there is general agreement on the basic rights of
workers, despite the fact that
enforcing these rights differs by region and industry. The most
basic rights include safety,
71. freedom of participation, collective bargaining, free speech,
protection from honesty tests,
and protection and privacy of information.
The Right to Safety
The first right covers basic workplace safety while
acknowledging that different industries
have different safety concerns. Certainly, almost all work has a
reasonable risk associated
with it. For example, flying in an airplane is generally safe, but
there are occasions when acci-
dents occur. Likewise, truck drivers, taxi drivers, emergency
services workers, factory work-
ers, farmers, and many others absorb a certain amount of risk
when they enter the workplace.
All workers should ask themselves what level of risk they are
willing to absorb, and every
manager and owner should determine whether they are
providing the safest possible work
environment. All safety issues are associated with a cost–
benefit analysis, and it is under-
stood that perfect safety can rarely be achieved. There are
always limited resources within
which companies operate that affect the amount they can spend
on safety procedures. But
worker safety is and should always be an overriding question
and pursuit in any workplace.
Workers, labor unions, managers, leaders, owners, and investors
should ask if all reasonable
risk is being illuminated and properly managed. An important
law that protects worker safety
is the Occupational Safety and Health Act of 1970, which
regulates the safety and health con-
ditions of the majority of industries. This act and its associated
department, the Occupational
Safety and Health Administration (OSHA), protect workers