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Social Responsibility of Business
Definition:
Social Responsibility is the obligation of a business to act in ways that benefit society at large, not just its owners or shareholders.
Key Areas of Responsibility:
- Economic Responsibility – Produce goods and services efficiently.
- Legal Responsibility – Follow laws and regulations.
- Ethical Responsibility – Conduct fair practices beyond legal requirements.
- Discretionary Responsibility – Voluntarily contribute to the welfare of society.
Importance of Social Responsibility:
- Builds public image
- Attracts investors
- Promotes long-term profitability
- Ensures sustainable development
- Creates a better society
Responsibility Towards:
- Owners/Shareholders: Fair return on investment
- Employees: Fair wages, safe working conditions
- Consumers: Quality products, fair prices
- Government: Paying taxes, obeying laws
- Community: Environmental protection, employment generation
Business Ethics
Definition:
Business ethics refers to the moral principles and standards that guide behavior in the world of business.
Characteristics:
- Based on moral values
- Govern conduct of individuals and organization
- Promote fairness, transparency, and integrity
Elements of Business Ethics:
- Trustworthiness
- Respect for Others
- Accountability
- Fairness in Dealings
- Care for Stakeholders
Need for Business Ethics:
- Enhances company reputation
- Boosts customer confidence
- Prevents legal issues
- Encourages employee satisfaction
