Ethics and Stakeholder Management – Facebook
Choose a company to answer the below questions.
What is the main purpose of your company and how does it contribute to society?
The main purpose of Facebook can be seen in the mission and vision statements of the company. Both statements claim that Facebook’s main aim is to allow people to build community and bring the world closer together. According to Facebook’s vision statement, people use Facebook to stay connected with friends and family, and discover the latest news and recent developments in the world (Gallo, 2017).
Society is a community of people with common traditions, values, collective activities and interests (Carroll & Brown & Buchholtz, 2018). In my opinion, being the largest social network of the world, more than contributing to the existing society, Facebook created a new society in the digital world for its users. It enables society members to connect with each other and connect to the world. In this age, people come to Facebook to talk to their friends, see what everyone’s doing, read what’s going on in the world, comment, critique, express opinions, buy, sell, do business, and many more.. Facebook acts as a digital, virtual replica of the real world.
Who are your company’s most important stakeholders? Why?
Stakeholders are the parties who have a vested interest in the company including consumers, employees, government, owners, and the external community of the company (Carroll & Brown & Buchholtz, 2018). Since Facebook is one of the biggest companies in the world, all stakeholders are highly important for the company, but the most crucial ones must be the consumers as the most valuable asset of Facebook is its vast user portfolio. Based on its portfolio, Facebook is able to generate income, especially from the ads. The other important stakeholder would be the government and legal authorities as Facebook often gets into trouble with them, and faces high amount of fines.
Which ONE PESTLE (Political, Economic, Social, Technological, Legal and Environmental) sphere is most and least affected by your company?
PESTLE spheres are the components of macroenvironment in which the company resides (Carrol & Brown & Buchholtz, 2018). I used to believe that the PESTLE segment most affected by Facebook is the social segment as Facebook is a platform for its users to get socialised. However, especially after we learn how effective Facebook ads are, and they can even influence the election results in one of the biggest countries in the world, I believe the political sphere can be affected by Facebook as much as social too. And when politics is affected, we know that its impact is bigger than any others.
With respect to the least affected sphere, I would say environmental sphere doesn’t influence or get influenced by Facebook as much as other spheres do. This is because Facebook is a digital platform which doesn’t have any physical product or service so its interaction and impacts for the environment are minimum.
Do you believe that your company is performing well on both dimensions of the social contract? Why or why not?
The social contract is a set of mutual understandings and expectations agreed by business and society that guide the relationship between these two parties. There are two elements in a social contract: (a) laws and regulations that society establishes and business comply with, and (b) shared understandings and expectations reciprocally agreed between the parties (Carroll & Brown & Buchholtz, 2018).
Although Facebook is dependent on the society for its very existence, it has a volatile history on the both sides of the contract. There are some points Facebook lives up to the expectation of the society such as innovation as, in my opinion, it is one of the most innovative companies in the world, and they follow the digital trends very closely and constantly update and upgrade Facebook’s interface and features for a better user experience. However, for instance, when it comes to data privacy, personal data protection, transparency, the company’s past is not clean. There are many cases where Facebook directly or indirectly violated certain US laws and regulations on privacy and security.
Keith from Guardian believes that Facebook needs to be bound with a new social contract that covers all rights, responsibilities and expectations that digital age brings (2018). Only a new social contract can hold Facebook, as well as all other tech giants, accountable against society.
Carroll, A. B., Brown, J. A., Buchholtz, A. K. (2018). Business & Society: Ethics, Sustainability & Stakeholder Management. Boston, US: Cengage Learning.
Gallo, C. (2017). How Mark Zuckerberg Effectively Communicates Facebook’s New 5-Word Mission Statement. Retrieved on May 30, 2020, from https://www.forbes.com/sites/carminegallo/2017/06/25/how-mark-zuckerberg-effectively-communicates-facebooks-new-5-word-mission-statement/#1844063a1377
Keith, K. (2018). We need to build a new social contract for the digital age. Retrieved on May 30, 2020, from https://www.theguardian.com/commentisfree/2018/apr/04/we-need-to-build-a-new-social-contract-for-the-digital-age