Social Irresponsibility in Management

Provided by Cognitive Sciences ePrint Archive

J. Scott Armstrong, “Social Irresponsibility in Management,” Journal of Business Research, 5 (September, 1977),
185-213. Reprinted with permission of Elsevier North-Holland Inc.

Social Irresponsibility in Management

J. Scott Armstrong
The Wharton School, University of Pennsylvania

Abstract

Previously published research suggested that the typical manager may be expected to
harm others in his role as a manager. Further support for this was drawn from the
Panalba role-playing case. None of the 57 control groups in this case were willing to
remove a dangerous drug from the market. In fact, 79% of these groups took active
steps to prevent its removal. This decision was classified as irresponsible by 97% of the
respondents to a questionnaire. Because the role exerts such powerful effects, an
attempt was made to modify subject’s perceptions of their role so that managers would
feel responsible to all of the firm’s interest groups. Some subjects were told that board
members should represent all interest groups; other subjects were placed on boards of
directors where the different groups were represented. Subjects in both groups also
received information on the impact of the decisions upon stockholders, employees, and
customers. The percentage of irresponsible decisions was reduced under these
conditions as only 22% of the 116 groups selected the highly irresponsible decision.

Keywords: obedience to authority, Panalba, role-playing, social accounting, social
responsibility, stakeholder theory

“Social responsibility” is difficult to define. What should a manager do? It is easier to look at the
problem in terms of what he should not do.- i.e., at “social irresponsibility.” A socially irresponsible act
is a decision to accept an alternative that is thought by the decision maker to be inferior to another
alternative when the effects upon all parties are considered. Generally this involves a gain by one
party at the expense of the total system.

To determine whether the above definition agrees with common-sense notions of social
irresponsibility, a convenience sample of 71 subjects (faculty members, managers, and students) was
asked on a self-administered questionnaire to “define a socially irresponsible act in 25 words or less.”
Much variability was found in the responses, and about 12% of the subjects were unable to provide any
response. However, about 33% of the respondents suggested definitions that were similar to the above
definition.

Although this definition is accepted by many, there is still some ambiguity about the meaning of
social irresponsibility. Therefore, a second definition was used; this stated that an act was irresponsible if
a vast majority of unbiased observers would agree that this was so.

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