Answer the following.
what is the need for social responsibility?
Need for Social responsibility
A business organization is run by the profit motive but profit maximization should not be the sole aim.
Commitment to society is also important. The following points bring out the need for social responsibility of business
- Concept of Trusteeship:
Trusteeship is a socioeconomic philosophy that was propounded by Mahatma Gandhi. It provides a means by which the wealthy people would be the trustees of trusts that looked after the welfare of the people in general. Businessmen are considered to be trustworthy in society.
- Changing expectations of society:
Society's expectations from business firms have undergone a drastic change over the years. In the early days, the business was viewed only as a provider of goods and services.
But today society expects businesses to be responsible citizens and contribute towards social welfare.
Businesses spend a huge amount of resources in brand building and strengthening their image.
A socially responsible company enjoys a good reputation in the society. It results in increased sales, profitability, the attraction of talent, and sustained growth.
- Protection of Environment:
Business organizations should make proper use of the country's natural resources. They should avoid environmental degradation such as contamination of water resources, depletion of the ozone layer, etc. which have been caused by businesses.
- Optimum Utilization of Resources:
Modern businesses have a huge amount of resources at their disposal. With such large resources, businesses are in a better position to protect society's interests. Wastage of resources should be avoided.
- The pressure of the trade Union:
Trade unions are growing fast and play important role in the business environment. Workers expect management to provide fair wages, bonuses, etc. to avoid conflicts between trade unions and management.
- Growth of Consumer Movement:
Development of education and mass media and increasing competition in the market have made the consumers conscious of their rights and powers in determining market forces. So, business enterprises have to follow consumer-oriented policies.
- Government Control:
From the point of view of a business, government regulations are undesirable because they limit freedom. The government has enacted various laws. This has put moral as well as the legal pressure on the business.
- Long term self-interest:
A firm and its image stand to gain maximum profits in the long run when it has its highest goal as 'service to society' when an increasing number of members, of society- including workers, consumers, shareholders, and government officials, feel that business enterprise is not serving their interest, they will tend to withdraw their cooperation to the enterprise concerned so in their own self-interest, a firm fulfills its social responsibility.
- Complexities of Social Problems:
Some of the social problems have been created by business firms themselves such as pollution, unsafe workplaces, discrimination, etc. It is the moral obligation of business to solve such social problems.
The entire globe is the market place nowadays. lt provides more opportunities and challenges to business. International trade barriers have reduced and resulted in the global distribution of goods and services. Countries that have adopted good practices are influencing the world.
- Role of Media:
Media plays important role in public life. Due to the internet, it is easier to reach a common man.
The media is very vibrant and active. It can influence the masses in society. Media can raise voice against business malpractices and exploitation of consumers. Business should not ignore social values.
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- Concept of Social Responsibility