For Baking Company, Inc., a privately owned corporation, 2015 was a terrific yea

Question

For Baking Company, Inc., a privately owned corporation, 2015 was a terrific year, by far and away the best year in its history. Its cakes and cookies, which were initially sold locally, are now sold internationally and are flying off the shelves. It seems people especially favor sweets as a relatively inexpensice treat in a tough economy. Baking Company's three owners -- Hugh, Doug, and Kathy, friends from college -- inform the Baking Company's Directors that they want $300,000.00 of th ecorporation's 2015 revenues to be given back to the community in some appropriate way. They ask the Directors for proposals and for rationales for their proposals. In respone, the Directors come up with the following two proposals:

Proposal 1: Spend the entire $300,000.00 to pay the sponsorship fee for being a 2017 sponsor of a popular Walk Away Hunger fundraising event. In exchange for the sponsorship fee, Baking Company's name will be used in all of the event's massive promotional and advertsing materials.

Proposal 2: Make 10 gifts of $30,000.00 each to local, national, and international organizations with proven track records of getting food to those who need it most. Little, if any, publicity will result form this alternative, but the company could be certain that hungry people were being fed with its money.

You are the director tasked with explaining to the owners the ethical implications of each of the above proposals. In your answer, focus on a discussion of the rival views of corporate social responsibility and of the proponents of these views, as well as a discussion of which proposal you would recommend and why.

Be careful that you don't just give your opinion or answer this question solely from a marketing point of view.

Explanation / Answer

The task at hand is to reoommend a prroposal as a director giving comprehensive analysis of the two proposals put forth by the directors. The three owners have clearly stated their wish to give back to the community $3,00,000 of their revenues in an appropriate way.

A) The proposal seeks to spend money on sponsoring a fund raising event. It will garner huge publicity to the company by way of its name featuring on the promotional and advertising material.

The question that needs to be asked here is this really giving back to the society or just a tick matk activity with an underlined intention of garnering publicity to the company. Is it trying to earn somethong back from the sponsorship money spent by the company. There are proponents of CSR ( corporate social responsibilry) which propogate returns from the CSR activity whoch now a days is compulsory bu law. Shoudln't importance be given to making a positive impact on the life of stakeholders of the company, be it its workers, society, ecology etc.

CSR activity should not be looked upon as a business proposal but ahould have a more humane approach.

B) This proposal where $30,000 be gifted to 10 such organisations all over the world with proven track record food delivery to the hungry is morally right.

It is not approaching a CSR task with business in mind but giving importance to the betterment of needy and making the world a better place. It aims for the overall good which in the long run will help the company create such an image and goodwill that it will have a positive impact on its sales and revenues.

So it will be good to recommend the second proposal of funding $30,000 to 10 diffrent organisations because:

a) It is the right thing to do, it is ethical.

b) It will help improve long term revenues and profitability of the company.

c) It will help create a positive image of the company.

d) The owners wish of giving back to the society will be fulfilled.

e) Instead of giving importance to the short tern benefits( which it will get by sponsoring the fund raising wvent) if the company keeps a long term view to its CSR activity it will help company achieve longevity, sustainability and growth.

So proposal two is recommended.

Pls rate the answer to your satisfaction level.

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