Running efficient business is the responsibility of business towards this group. Answer in a word / phrase / term.
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“If you are in the luckiest of 1% of humanity, you owe it to the rest of humanity to think about the other 99%,” said Warren Buffett. Mr. Buffett understood that the purpose of any business is not only to make a profit but also to be responsible for its actions and decisions. Social responsibility is the duty of businesses towards society. Businessmen must review their impact of decisions and actions on the different sections of society.
Social Responsibility
According to Peter F Druker, “Social responsibility requires managers to consider whether their actions are likely to promote the public good, to advance the basic belief of society, to contribute to its stability strength and harmony.” Social responsibility refers to the voluntary efforts on the part of the business to contribute to the social well being. The moral idea behind this is that the businesses use resources of the society so they must give something back to the society.
The Need for Social Responsibility
Self-interest: It is in the self-interest of the business to have a social responsibility as it opens opportunities for understanding the problems and issues of society.
A better environment for Business: In today’s cynical age, social responsibility keeps the businesses honest and the markets stable.
Public image: When a business takes initiative to solve the problems of the society, it puts the business in the goodwill of the people.
Social power: A leader is a helper. Helping the society is a form of social responsibility. Executing social work helps the business attain social power within the society.
Arguments Supporting Social Responsibility
The justification for existence and growth: The primary goal of business is to make profits as only profits can help the business sustain and expand. Profits should only be made as a return of service to the society by producing goods and services.
The long-term-term interest in the firm: A firm is to gain maximum profits in the long run if it has it’s the highest goal as service to society. As humans are social beings, when they notice that a particular corporation is not serving its the best interest socially, they do not support the organization further.
Avoidance of government regulations: Government is the highest authority in the nation. When a government feels that the business is not socially responsible or is creating problems like pollution, the government limits its freedom.
Arguments Against Social Responsibility
Violation of maximization of the profit motive: This statement argues that business exists only for maximizing profits and businesses fulfil their social responsibility best by maximizing profits by increasing efficiency and reducing costs. They need not take up any additional obligations.
Side effects on Consumers: Customers suffer because of the solving social problems and taking social care require huge financial investment. As the money within the business is used in social help, the business increase the cost of their products and services.
Lack of Social skills: It is often stated that businessmen don’t fully under the social problems and thus can’t solve them efficiently
Social Responsibility
According to Peter F Druker, “Social responsibility requires managers to consider whether their actions are likely to promote the public good, to advance the basic belief of society, to contribute to its stability strength and harmony.” Social responsibility refers to the voluntary efforts on the part of the business to contribute to the social well being. The moral idea behind this is that the businesses use resources of the society so they must give something back to the society.
The Need for Social Responsibility
Self-interest: It is in the self-interest of the business to have a social responsibility as it opens opportunities for understanding the problems and issues of society.
A better environment for Business: In today’s cynical age, social responsibility keeps the businesses honest and the markets stable.
Public image: When a business takes initiative to solve the problems of the society, it puts the business in the goodwill of the people.
Social power: A leader is a helper. Helping the society is a form of social responsibility. Executing social work helps the business attain social power within the society.
Arguments Supporting Social Responsibility
The justification for existence and growth: The primary goal of business is to make profits as only profits can help the business sustain and expand. Profits should only be made as a return of service to the society by producing goods and services.
The long-term-term interest in the firm: A firm is to gain maximum profits in the long run if it has it’s the highest goal as service to society. As humans are social beings, when they notice that a particular corporation is not serving its the best interest socially, they do not support the organization further.
Avoidance of government regulations: Government is the highest authority in the nation. When a government feels that the business is not socially responsible or is creating problems like pollution, the government limits its freedom.
Arguments Against Social Responsibility
Violation of maximization of the profit motive: This statement argues that business exists only for maximizing profits and businesses fulfil their social responsibility best by maximizing profits by increasing efficiency and reducing costs. They need not take up any additional obligations.
Side effects on Consumers: Customers suffer because of the solving social problems and taking social care require huge financial investment. As the money within the business is used in social help, the business increase the cost of their products and services.
Lack of Social skills: It is often stated that businessmen don’t fully under the social problems and thus can’t solve them efficiently
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Running efficient business is the responsibility of business towards investors.
* Investors invest money in an organisation in a hope to get back a good sum of amount as profit.
* Hence it is the responsibility of the business organisation to look after the security of the investment.
* They should ensure efficiency and productivity such that it yields a greater return on the sum invested.
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