User:Satarupa/Temp/Social Responsibility of
Managers.doc
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Social Responsibility of Managers
Objective
Objective of this lesson is
1. Explain the concept of social responsibility of business
2. Identifying theoretical framework of SRs of managers
3. Recognize the responsibility of business towards different interest groups.
Contents
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1 Concept of Social Responsibility
2 Features of Social Responsibility
3 Importance of SR in business
4 Reasons behind adopting SR by Managers
Concept of Social Responsibility
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Social responsibility is a doctrine that claims that an entity whether it is state,
government, corporation, organization or individual has a responsibility to society.
This responsibility can be negative, in that it is responsibility to refrain from acting or it
can be positive i.e. responsibility to act.
Social responsibility is voluntary; it is about going above & beyond what is called for by
the law (legal responsibility).
Social responsibility adopts the idea of being proactive instead of reactive towards a
problem.
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Social responsibility means eliminating corruption, irresponsible or unethical behavior
that might bring harm to the community, it’s people or the environment concerned.
Definition
In the words of Andrews, “ By social responsibility, we mean the intelligent & objective
concern for the welfare of society that restrains individuals & corporate behavior from
ultimately destructive activities, no matter how immediately profitable, & lends in the direction
of positive contributions to human betterment, variously as the latter may be defined.”
Features of Social Responsibility
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SR contains three types of behaviour – Positive, Neutral & Negative.
Every person in the society has the social obligation to fulfill SR.
It involves fulfilling obligations towards various parties (Directly or indirectly related to
business) concerned with the functioning of business.
The standards fixed for fulfilling obligations are decided as per the social norms.
Social responsibility requires identification of various interest groups which may affect the
functioning of the business. Normally various groups associated with business are:
Shareholders : The first responsibility of management is towards it’s shareholders. Management
is expected to use it’s resources effectively & to protect the interest of shareholders.
Workers : Management should treat workers as other cart of the wheel. It should adopt a
progressive labour policy. Also it should pay fair & reasonable wages.
Customers : Management should not mislead the customers by false, misleading & exaggerated
advertisements.
Creditors/Suppliers : There should be healthy & co-operative inter business relationship.
Management should provide accurate & relevant information to creditors & suppliers.
Government : Management should be law abiding. It should pay all the taxes correctly & on
time. It should not corrupt public servants.
Society : It should set up socially desirable standards of living & avoid wasteful expenditures. It
should play a proper role in civic affairs.
Importance of SR in business
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Public Image - The activities of business towards the welfare of the society earn goodwill
and reputation for the business. The earnings of business also depend upon the public
image of its activities. People prefer to buy products of a company that engages itself in
various social welfare programmes.
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Government Regulation - To avoid government regulations businessmen should
discharge their duties voluntarily. For example, if any business firm pollutes the
environment it will naturally come under strict government regulation, which may
ultimately force the firm to close down its business. Instead, the business firm should
engage itself in maintaining a pollution free environment.
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Survival and Growth -Every business is a part of the society. So for its survival and
growth, support from the society is very much essential. Business utilizes the available
resources like power, water, land, roads, etc. of the society. So it should be the
responsibility of every business to spend a part of its profit for the welfare of the society.
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Employee satisfaction - Besides getting good salary and working in a healthy
atmosphere, employees also expect other facilities like proper accommodation,
transportation, education and training. The employers should try to fulfill all the
expectation of the employees because employee satisfaction is directly related to
productivity and it is also required for the long-term prosperity of the organization. For
example, if business spends money on training of the employees, it will have more
efficient people to work and thus, earn more profit.
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Consumer Awareness - Now-a-days consumers have become very conscious about their
rights. They protest against the supply of inferior and harmful products by forming
groups. This has made it obligatory for the business to protect the interest of the
consumers by providing quality products at the most competitive price.
Reasons behind adopting SR by Managers
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Compelling force: Business managers fulfill their social responsibility because of the fear
of public interference in business through government.
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Persuasive force: Businessmen have been persuaded to consider their social obligations
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Favourable force: The new age manager are well educated & fully acquainted with the
expectations of the society. They give the required weightage to social & human values.
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Changes in business environment: The change in environment which have compelled the
business to assume social responsibilities include:
1.
2.
3.
4.
5.
Rise of consumerism.
Growth of labour movement
Increase in level of literacy
Improved communication & transport
Legal provision against exploitation of workers & consumers.
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Need for favourable public image: Modern business is aware of the need of good public
opinion of their business to stand apart in the competition.
|
Work in progress, expect frequent changes. Help and feedback is
welcome. See discussion page.
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Social Responsibilities of Managers
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This page was last modified on 17 September 2010, at 10:52.
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