Business has various social responsibilities towards different interest groups.
Identify the relevant interest group in the following cases:
(i) Entrepreneur should act according to well accepted values of the society.
(ii) Business should provide fair return on their capital investment.
(iii) Business should avoid any type of pollution.
(iv) Business enterprise must pay taxes regularly and honestly.
(v) Business should supply good quantity goods at reasonable prices.
(vi) There should be proper and safe working conditions.
Answers
Answer:
A business enterprise should do business and earn money in ways that fulfill the expectations of the society. Every individual living in society has certain obligations towards society. He has to respect social values and norms of behaviour. A business enterprise is permitted by society to carry on industrial or commercial activities and thereby earn profits. But it is obligatory on part of the business enterprise not to do anything, that is undesirable from society’s point of view. Manufacture and sale of adulterated goods, making deceptive advertisements, not paying taxes which are due, polluting the environment and exploiting workers are some examples of socially undesirable practices which may increase the profit of enterprises but which have adverse effect on society at large. On the other hand, supplying good quality goods, creating healthy working conditions, honestly paying taxes prevention/installing pollution
Answer:
The relevant interest groups in the above cases are:
(i) Society - Entrepreneur should act according to well accepted values of the society.
(ii) Investors - Business should provide a fair return on their capital investment.
(iii) Environment - Business should avoid any type of pollution.
(iv) Government - Business enterprise must pay taxes regularly and honestly.
(v) Customers - Business should supply good quality goods at reasonable prices.
(vi) Employees - There should be proper and safe working conditions.
Explanation:
Businesses have various social responsibilities towards different interest groups. These groups have different interests, needs and expectations from the business, and it is important for the business to address these responsibilities to maintain its long-term sustainability and growth. For instance, by providing a fair return on investment, a business can attract more capital and expand its operations. Similarly, by avoiding pollution and providing safe working conditions, a business can enhance its reputation and attract more customers. Hence, it is important for businesses to understand and address the social responsibilities towards the different interest groups.
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