Microsoft Company - Corporate Governance & Social Responsibility Analysis - Essay Example

? Microsoft Company: Corporate Governance & Social Responsibility Analysis Microsoft Company: Corporate Governance & Social Responsibility Analysis The board constitution of Microsoft This paper will seek to use the information from the PowerPoint file about Microsoft, in addition to other course materials on corporate governance to address matters like reflection of the company’s vision and code of ethics among others. Microsoft has Board of Directors, which comprises of four committees namely; compensation committee, audit committee, regulatory and public policy committee, and government and nominating committee (Marsan, 2012). At Microsoft, the Board can remove any existing committee and/or add a new one anytime this action deems necessary. The Board has an independence policy that gives guidelines on certain issues. For instance, it states that the decisions made by a director of each committee are independent (Mullerat & Brennan, 2011). It also indicates that directors must act independently in order to avoid conflict of interests that may in turn impair judgment or deter the directors from executing their tasks effectively. What do vision and mission statements say about Microsoft? The Microsoft’s mission, vision, and value statement shows that this company is passionate about customers, technology, and partners. It says that Microsoft respects and opens to other companies and can dedicate its time and resources to make them better (Carlson, 2010). Particularly, the statements show Microsoft’s willingness to face big challenges and see itself through them. Additionally, the mission statements show value for commitment towards individual excellence and personal improvement and it shows the company’s accountability in results, quality, and commitment to shareholders, customers, employees, and partners (Rendtorff, 2009). This means that the company’s statements of vision, value, and mission Microsoft values the aspect of helping others, treating its customers, stakeholders, partners and employees with the utmost respect and accountability, and self-competence is of great importance (Werther & Chandler, 2011). Microsoft’s code of conduct as well as other official documents such as the company’s financial statement suggests that this company values management of its business by complying with laws and any other regulatory requirement. In addition, the code of ethics indicates that Microsoft values formation and maintenance of respect and trust of its customers, shareholders, partners, and consumers (Rushton, 2011). It is also within its cultural principles to put into consideration the facet of being responsible stewards in protection, management, and use of Microsoft assets. Microsoft, according to its standards, values promotion of diverse, productive, and cooperative working environment for all. Its code of conduct also declares its responsibility and care in the global community. Since Microsoft values transparency between and among its employees, stakeholders, partners, and consumers, it files annual reports, financial reports, and earnings releases (Aras & Crowther, 2010). Through these reports, the company is able to table the much that it has earned or lost, its performance, and specifically discuss its future business prospects. Scandals threatening Microsoft brand A former senior director, Simon Negus, at Microsoft in the UK landed this company into a grueling wary of sexual harassment, which stood at the base of threatening Microsoft’s brand. Simon, in addition to other senior directors was accused of making inapt sexual advancements on their female co-workers after excessive partying (Savitz & Weber, 2006). As of now, there is a lawsuit against Simon. Generally, when an employee directly involved with a company becomes a victim of a scandal, he or she poses serious challenges on the company’s brand given the idea that employees are ambassadors of a company. In addition, according to a telegraph sent on November 11, 2011, female executives engaged in casual “catfights” simply because of being extra “bubby” (Zu, 2008). Since the telegraph revealed that employees used to serve unlimited vodka on ice sculptures while they partied in throbbing masses, the company’s brand stood faced jeopardy. Apart from sexual harassment, Microsoft faced yet another scandal that stood in position of destroying the company’s brand. Specifically, Microsoft distributes some of its electronic accessories such as web cams and mouse through KYE suppliers (Monks & Minow, 2004). In 2010, KYE a Microsoft supplier, was accused of being involved in child labor, overworking employees (16.5 hours in a single day), paying under standardized wages per an hour ($0.65), and forbidding workers from leaving the factory. Without a doubt, these scandals affected Microsoft’s brand directly and stood at a better chance of destroying it (Van & Verweire, 2004). It is against the laws of the International Organization of Labor (ILO) to employ children under the age of eighteen as its stipulations refer to this as child labor. Before facing these scandals, Microsoft had undergone traumatizing experience after determining that 10,000 Hotmail users posted their personal data on www.pastebin.com in 2009. Reports and other information about Microsoft’s activities that is available to the public As of now, it is seeable that Microsoft is a transparent company that respects the value of information. As such, it has other reports and information, which is available to the public and explains its activities. It provides a shareholder letter that unveils details pertaining to, but not limited to, accrued profits, bonuses, and losses among other substantial financial information (Lee, 2010). Furthermore, it avails to the public investor relations information. This information gives contact data whereby investors seeking further information or clarification on the company’s dealings. The public also has access to Microsoft’s Securities and Exchange Commission (SEC) filings, which include the 10-Q, a report that shows the company’s performance submitted quarterly disclosing the financial information of the company (Stachowiak, 2010). Other reports available to the public include reports of unscheduled changes certifying the SEC (8-K) and another comprehensive report (10-K) giving a detailed company history, equity, Earnings Per Share (EPS), and organizational structure as well as holdings among others (Davies, 2011). Governance outside US and dealing with subcontractors outside US Microsoft has company officials who oversee the activities of all its contracted companies and report to the main firm in the US. The company official is not an employee of any subcontractor and acts to discharge responsibilities as handed down by Microsoft Corporation (Abraham, 2012). Definitely, laws governing subcontractors of Microsoft are applicable to all subcontractors within or without the US boundaries. If any subcontractor violates any of the stipulated rules and regulations governing them, it stands to face the relevant charges with reference to Microsoft subcontractors’ laws. Moreover, every partner is accountable for any violation detected hence Microsoft is an organization that does not tolerate unscrupulous behavior and/or lewd behavior (Bangs & Henricks, 2005). For instance, when Simon Negus and other executives behaved inappropriately, they lost their job positions at Microsoft and subsequently faced charges against them. Suppliers found violating company rules by overworking and underpaying employees lost their supplier’s contract and thereafter lawsuit (Habisch, 2005). CSR activities involved and conclusion Microsoft has a corporate social responsibility wherein it takes part in serving the community by improving access to education, giving to society, and creating business and jobs for the locals. It has working responsibility in which it seeks to implement environmental sustainability policies, ensuring online privacy and safety, and adapting responsible sourcing (Mooij, 2010). With regard to the strategies and society framework put across by Porter and Kramer, society and business depend on each other. As a result, it is needful for corporations to analyze opportunities in support of social responsibility by employing the frameworks, which offer guidance to the corporation’s core business strategies. The Microsoft Cooperate Citizenship strategy helps support communities by lending its IT support and resources through sustainability, skill building, and humanitarian and disaster relief (Napier, 2006). Besides these efforts serving as community benefits, they also lock these societies into using products of Microsoft. In conclusion, Kramer and Porter recommend corporations to treat social opportunity as a way of benefiting the society and strengthening the corporations’ grasp in a competitive milieu (Mullerat, 2010). This paper has analyzed Microsoft social responsibility and corporate governance. References Abraham, C. (2012). Strategic planning: A practical guide for competitive success. London: Emerald Group Publ. Aras, G. & Crowther, D. (2010). A handbook of corporate governance and social responsibility. Farnham, Surrey, England: Ashgate. Bangs, H., & Henricks, M. (2005). Business plans made easy. Irvine, Calif.: Entrepreneur Press. Carlson, N. (2010). Microsoft supplier uses child workers and pays them $0.65 Per Hour. Business Insider. Retrieved from http://www.businessinsider.com/microsoft-slammed-over-child-labor-accusations-2010-4?op=1 on October 13, 2012. Davies, A. (2011). The globalisation of corporate governance: The challenge of clashing cultures. Farnham: Gower. Habisch, A. (2005). Corporate social responsibility across Europe. Berlin [u.a.: Springer. Lee, J. (2010). Biomedical engineering entrepreneurship. Singapore: World Scientific. Marsan, C. (2012). 15 worst InternNetwork World. 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The Telegraph. Retrieved from http://www.telegraph.co.uk/technology/microsoft/8901043/Scandal-hit-Microsoft-admits-blow-to-morale.html on October 6, 2012. Savitz, A. & Weber, K. (2006). The Triple Bottom Line: How Today's Best-Run Companies Are Achieving Economic, Social, and Environmental Success and How You Can Too. San Francisco, CA: John Wiley & Sons, Inc. Stachowiak, J. (2010). The multiple sclerosis manifesto: Action to take, principles to live by. New York: Demos Health. Van, L. & Verweire, K. (2004). Integrated performance management: A guide to strategic implementation. London: SAGE Publ. Werther, B. & Chandler, D. (2011). Strategic corporate social responsibility: Stakeholders in a global environment. Los Angeles: SAGE. Zu, L. (2008). Corporate Social Responsibility, Corporate Restructuring and Firm's Performance: Empirical Evidence from Chinese Enterprises. Berlin: Springer Berlin. Read More

 

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