Chapter 4.2
Social Responsibility
Objectives
Define social responsibility
Describe the social responsibilities of
business
What is social responsibility?
The duty of a business to do what is best
for society.
Examples?
What is social responsibility? (ctd)
Example:
Los Angeles Times
1 million readers
Recycled paper
Responsibility to Customers
Customers = first responsibility of the
business
Businesses should offer a good, safe, product
or service at a reasonable price.
Responsibility to Customers (ctd)
Food and Drug Administration (FDA)
Government regulating agency
Protects consumers from dangerous or
falsely advertised products.
Responsibility to Customers (ctd)
Fair Competition
Healthy for the marketplace; however, not all
companies play fairly.
Responsibility to Employees
Two laws that are changing the workplace:
Equal Pay Act of 1964
men and women must be paid the same wages for
the same work
The American with Disabilities Act
bans discrimination against people with mental or
physical disability.
Responsibility to Society
Environmental Protection Agency (EPA)
1970
enforces rules that protect the environment and
control pollution
Companies are using biodegradable materials
in their products
buying recycled paper, and are following pollution
standards.
Responsibility to Creditors & Owners
1990s
Unethical and unlawful accounting errors
Sarbanes-Oxley Act
mandates truthful reporting and makes the CEO
more accountable
Ch. 4.2 Reinforcement Questions
1. How is producing a good or service a way
of being socially responsible?
2. What is the mission of the Food and Drug
Administration?
3. What is one of the biggest social issues
that businesses face today?
Activity!
Scenario
Tony and Scott are talking in the hallway
of Company A. Scott says in a hushed
voice, “Can you believe this? I’ve been
told it’s mandatory to do 25 hours
overtime every week. I missed Back-toSchool night last week. Tony says, “I
know what you mean, lately I only get to
see my family on the weekend!” Is
Company A acting ethically?
Activity! Continued
1. Discuss with the people around you.
2. You will be divided into four groups, two
pro and two con.
3. Be prepared to debate the statement,
“Company A’s actions are ethical.”