The term 'stakeholder

  1. Who are the stakeholders in this case? How should Google prioritize the relative obligation that the company has toward those stakeholders and communicate this to them
  2. Before telling who should be regarded as 'Stakeholders' in this case study, it would like to clarify the meaning of the term 'Stakeholder' so as that we can get the most precise idea as possible. The term 'Stakeholder' has been given various meanings. Freeman et al (2007) stated that the term 'Stakeholder' refers to a group of people who have benefits or losses from a business, or a person or a group of people who share benefits from a business in the form of dividends or any other type of assets. Stakeholders can be divided into two main groups. The first group is the Primary Stakeholder or the Internal Stakeholder. This group includes business owners, clients and customers, employees, and deliverers. As for CEO's, they can be regarded as stakeholders, actors and representatives of a company. The second group is the Secondary Stakeholders or the External Stakeholders. This group includes press, consumers/service receivers, courts, governments, rivals or competitors, lobbyists, the public and the society (Strickland 2003).

    Realizing who stakeholders are, it will discuss the stakeholders in this case study, as well as the reason why they are considered as such. As in this case study, it has categorized the stakeholders into three groups, i.e., 1) Google, 2) Chinese Government and 3) Consumers/ Service Receivers.

    It can be seen that all the three groups can be regarded as stakeholders because they have stakes from Google's doing its business in China. All the three groups are related to one another their benefits are directly and indirectly linked to those of others. In other words, if Google were not controlled by Chinese government, consumers/service receivers would be fully benefited from the utilization of the search engine because they could freely search for any information that they want to obtain. If the Chinese government did not control such uses, consumers/service receivers might use the search engine to get information that the government believes to be inappropriate, or does not want them to know. In the mean time, if Google violated the controlling measure issued by the government, it could be hindered from providing its services. On the contrary, when the government issues controlling measures, such as regulations and restrictions, and Google complies with such controlling measures, consumers'/ service receivers' access to some information will be restricted to the extend where they believe that Google's services are inefficient, which can cause negative effects on Google.

    In this paragraph, it will discuss how Google should prioritize the relative obligation that the company has toward the other two groups of stakeholders and communicate this to them. To have its business in China succeed, Google must have the stakeholder management that fit every group. Hill and Jones (2008) has suggested that the term 'Stakeholder Management' or 'SM' means the ethical organization management that allows all stakeholders to obtain their fair benefits in accordance to their rights which have been pre-determined by laws, customs or agreements. In the same time, the 'Win-Win Strategy' is the decision making whereby all stakeholders get their fair and righteous benefits.

    Google is a huge and widely-known company that provides the search engine. The main duty of Google is to search for whatever users want to obtain as much as possible within the least time as possible. The term 'whatever' used here can refer to data, web-sites or photos. This duty is the strength of Google Company. The very first thing that Google should do is to retain this strength by providing an efficient search engine so as to satisfy Chinese consumers/ service receivers while strictly complying with, and not violating, regulations and restrictions or other controlling measures ,such as the Censorship Laws and the Great Firewall, issued by Chinese government. Simultaneously, Google should have clear and straight-forward communication to Chinese government and consumers/ service receivers. To obtain all the aforementioned things, Google must show all the results from the search keyword that can be included in the 'Blacklist' determined by Chinese government so as to let consumers/ service receivers understand that the search engine provided by Google is efficient but they cannot obtain the thing they have searched for because Google complies with the Censorship Laws of China which hinder consumers/ service receivers from entering some web-sites shown as the results from the search keyword. In addition, Google should clearing show Chinese government that it has strictly complied with the Censorship laws.

    Furthermore, Google should move its service base to China so as to boost up the efficiency of its search engine services, to solve the blockage problem caused by Chinese government via the Great Firewall, and to show that Google needs to respond to Chinese consumers as much as possible. In the opinion of Chinese government, Google has shown its sincerity, accountability and controllability within the frames of Chinese laws, regulations and culture.

    It is apparent that Google has prioritized the relative obligation and communicate to all related stakeholders via the stakeholder management that fit every group of stakeholders. As a result, Google can retain its strength whilst Chinese government has succeeded in controlling information accesses via Censorship Laws and the Great Firewall, and consumers can enjoy the fully efficient search engine that helps them to search for everything although some accesses might have been blocked.

  3. Use theories or theories model of CSR as the basis of the following questions

A. What role and responsibility does a technology company such Google have toward society in general?

Roughly speaking, it can be concluded that the main objectives of a business are to pursue profits, to generate the highest benefits as possible for the business, and to satisfy all stakeholders. Therefore, many companies have forgotten their obligations and responsibilities for the society or the public. In the present time, any business that only pursues profits cannot obtain a sustainable growth because many business factors have changed from those in the past. If a business just aims only at profits, it will have negative images and will not get acceptance from other people. As a result, Corporate Social Responsibility or CSR has attracted more business people's and normal people's attentions. Kotler and Lee (2005) has stated that Corporate Social Responsibility (CSR) is to do a business with ethic and good governance, and care to the society and environment, so as to generate a sustainable business development; to make the society or communities become pleasant places to live in; and to do good deeds for all surrounding communities, either nearby or afar. CSR can lead to a great many benefits. It believes that CSR mainly creates good reputations for a company that has had some distributions to the society, and makes employee proud of their company.

CSR can be performed in various manners, which can be categorized into six groups of activities, i.e., 1) Cause-relate Marketing, 2) Cause Promotion, 3) Corporate Social Marketing, 4) Corporate Philanthropy, 5) Community Volunteering and 6) Socially Responsible Business Practices (Kotler and Lee 2005).

As in this case study, Mr. Kai-Fu Lee, new head of operations for Google in China, has mentioned that the work philosophies of Google are "youth + freedom + equality + bottom-up innovation + user focus + don't be evil = The Miracle of Google". Having analyzed the work philosophies of Google by comparing them with CSR activities, the author could realize that the philosophies of "User Focus" and "Don't be Evil" can be included in the group of 'Cause Promotion' because it is apparent that Google has moved its server to China so as to respond to Chinese users' needs in a better way. In addition, Google has tried to enable Chinese users to obtain as much information as possible from their uses of search engine. At the mean time, Google has also been concerned about the 'Socially Responsible Business Practices' by performing 'Self Censorship' so as to block accesses to information that can be harmful to the Chinese society, and by developing the disclaimer that agrees to the search engine controlling measures issued by Chinese government. Performing the 'Cause Promotion' and the 'Socially Responsible Business Practices' activities, Google uses the Corporate-driven CSR whereby the company uses the resources that it has for carrying out its CSR activities.

It can be seen that Google is a technological company, the main task of which is to provide data and information that users search for. Thus, the data and information that Google provides is an important aspect because users can obtain any information including information which may be inappropriate for the society or even illegal. This is why Google must and should be able to determine what information should be obtained and what information should not be shown to the public or the society.

Should the home company culture, ethics and risk management approach impacts how the company operates in China?

Making an entry to China, Google will certainly encounter a new business culture, as well as ethics and morals, and a new risk management approach, which are definitely different from those of its headquarters in USA. In addition, Google will have to encounter the risk from investment since China has laws and regulations that are different from those of many other countries.

Concerning the way of living, Chinese way of living is much different from American one. One of the most precise examples is the use of internet. Most of the American's lives have been made convenient by internet. They have hi-speed internet at home, so they can do almost everything, such as communicating with other people via e-mails, ordering food, having financial interactions, buying things and searching for information and photos, without leaving their houses. The American has freedom to use internet because American laws are less strict than those of other countries. On the contrary, the Chinese have not been accustomed to such a way of live because they have scarcely used internet. The Chinese have always used telephone services and used internet only at an internet-shop or at a cafeteria that provides internet access. The Chinese have always used internet out of their houses, i.e., at an internet caf that serves food and drink, where they can use internet with their friends; therefore, in most cases, they have used internet for playing online discussion boards.

The first aspect of differences, or culture, can affect Google's business in China because people from the two countries use internet differently from each other. In China, there is a web-site named 'Baidu' which is a Chinese web-site that provides search engine services as Google does. The thing that differentiates 'Baidu' from Google is that Baidu shows the results from a search keyword together with the links to the discussion boards concerning the search keyword. This agrees to Chinese people's uses of internet because they prefer to have group chatters and use internet at internet shops. This culture affects Google because it forces Google to adjust its search engine service to fit the internet use of Chinese people.

Apart from culture, differences in ethics and morals are also precise in this case study. The American has a higher degree of freedom to obtain and analyze data and information by themselves more than the Chinese do. As for the American, any issue that becomes a public issue will attract more attentions from people such as the case of Tiger Woods' affairs with many women other than his legally wedded wife, which can be regarded to be immoral and unethical things that the American had never known before (Elliot 2009). On the contrary, Chinese government uses Censor Laws and the Great Firewall to block people's accesses to some tidings such as those concerning the events at the 'Tiananmen Square' or those concerning 'Falun Gong' cult, which Chinese government does not want its people to know or learn about.

Cultural, ethical and moral differences can cause effects on Google's business in China. In addition, Chinese government's controlling measures, i.e., Censorship Laws and the Great Firewall, have forced Google to be more concerned about ethics and morals in providing information accesses because this is a sensitive matter. Any mistake concerning the data and information provision may lead to the closure of Google's business in China, which is a great loss.

Investing in China, Google has to encounter a great number of risks by dint of the different risk management approach which is caused from the different laws, regulations and schemes of calculations for account capitals of the two countries. These factors have forced Google to use the risk management approach other than that used in America. As in America, for instance, the risk management approach that Google applies may emphasize on the retention and management for the images of the company, as well as the development of new technologies, which can lead to the price of shares and shareholders' satisfaction (Ruggie and Kytle 2005). At the same time, doing business in China, Google has to apply a risk management approach that emphasizes on the compliance with Chinese government' s laws and regulations, as well as the capabilities of satisfying Chinese users to the farthest extend within such highly strict laws and regulations

To what extent do you agree with those criticizing Google as acquiescing to China's censorship of the Google Company's website?

It agrees with Google's agreeing to comply with Chinese government's controlling measures because it is the only way that enables Chinese users to use Google's search engine more easily and quickly. Ulm (2008, p.3) suggests that 'corporations must ensure compliance with national laws and avoid human rights violations through due diligence by considering the "country context" where they operate, the human rights impact of their activities and their contribution to potential abuse through their business relationships'. Had Google not complied with such measures, its search engine would still have shown all results from search keywords but users would not have been able to get to some websites; in addition, the search engine would have worked very slowly due to the hindrance by Chinese government's 'The Great Firewall'. Since Google complies with Chinese government's measures, it can do its business in China. This is good for Google itself because Google can achieve a lot more consumers because China has a great number of populations. In addition, Google has also developed its disclaimer so as to tell its users that they cannot reach some websites because of the blockage from Chinese government whilst its rivals, namely, Microsoft and Yahoo, have not. As a results Microsoft's and Yahoo's users in China will only learn that some websites that they want to reach are blocked. Therefore, it strongly believe that Google has done a smart thing, agreeing to comply with Chinese government's censorship because it has been generating a great many positive returns to Google and its consumers/ service receivers in China.

References

  • Elliot, D., 2009. A Lesson on Ethics, Courtesy of Tiger Woods. Art Science Research Laboratory's Media Ethics Project, [online]. 6 December. Available at: http://www.stinkyjournalism.org/editordetail.php?id=553 [Accessed 20 March 2010].
  • Freeman, R.E., Harrison, S.J. and Wicks, C.A., 2007. Managing for Stakeholders "Survival , Reputation, and Success. A Caravan book, United State of America.
  • Hill, W.L.C. and Jones R.G., 2008. Strategic Management Theory: An Integrated Approach, Ninth edition, South-Western, United State of America.
  • Kotler, P. and Lee, N., 2005. Corporate Social Responsibility: Doing the Most Good for Your Company and Your Cause, John Wiley and Sons, Inc., Canada.
  • Ruggie, G.H. and Kytle, B., 2005. Corporate Responsibility as Risk Management: A Model for Multinationals. [online] Harvard University. Available at: http://www.hks.harvard.edu/m-rcbg/CSRI/publications/workingpaper_10_kytle_ruggie.pdf [Accessed 21 March 2010].
  • Strickland, T., 2003. Strategic management: concept and cases, International edition, McGraw Hill, Sydney.
  • Ulm L.J., 2008. Protect, Respect and Remedy: Ruggie's Latest Report to the UN on Human Rights and Business. CSR Journal, [online]. May 2008, p. 3. Available at: http://www.abanet.org/intlaw/committees/CSR_Journal-5.23.08.pdf [Accessed 20 March 2010].

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