((((((social Responsibility
Mr. krishnaraj jadav
Social Responsibility
Social Responsibility of business refers to what
the business does, over and above statutory
requirement, for the benefit of the society.
Corporate Social Responsibility (CSR) refers to
the moral responsibility of the business to the
society by the virtue of being a part of the society.
CSR
CSR is about how
companies manage the
business processes to
produce an overall
positive impact on
society.
Traditional Vs. Modern view of
Social Responsibility
Social obligation--social responsiveness--social responsibility.
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Traditional view of Social Responsibility
The prime purpose of the business was profit
maximization- Milton Friedman “ the business of
business is business.”
Friedman argues that the profit earned by business
belongs exclusively to the shareholders of the business
and these profit cannot be diverted to any other social
purpose.- social obligation
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Cont…
He argued that when management decide to spend the
organization’s resources for ‘social good’, they add to
the costs if doing business, which have to be passed on
to the consumers through higher prices or absorbed by
stockholders through smaller dividend.
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Modern view of Social Responsibility
‘Moral behavior pays…..at least in the long run.’
According to this view business is a social and
economic institution which can not live in isolation.
The establishment and development of business
depends upon the contribution made by the society.
This socioeconomic view says that managers'’ social
responsibility go beyond making profit to include
protecting g and improving society’s welfare .
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Cont…
Social responsiveness means that a company engages
in social actions in response to some popular social
need.
Social responsibility means a business’s intention,
beyond its legal and economic obligation, to for the right
things and act in ways that are good for society.
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Social Orientation Of Business
The extent of social orientation of companies vary very
widely and change over time.
Social responsibility models:
Model describes evolution and extent of social
orientation of companies. Following are the corporate
obligations.
Economic
Legal
Ethical
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discretionary
Factors affecting social orientation:
Promoters and top management
Board of directors
Stakeholders and internal power relationship
Societal factors
Industry and trade associations
Government and laws
Political influence
Competitors
Resources
Ethical influence
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Major arguments for and against social
responsibility
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For social responsibility
Public expectations
Long-run profits
Ethical obligation
Public image
Better environment
Harmonious and healthy relations with the society
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Cont…
Discouragement of further governmental regulation
Balance of responsibility and power
Stockholders interests
Possession of resources
Superiority of prevention over cure
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Against social responsibility
Violation of profit maximization
Dilution of purpose
Costs
Too much power
Social actions can not be measured
Lack of skills
Lack of accountability
Increase in the prices of the products or services.
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Stakeholders and its management
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Responsibility toward customers/consumer
It has been widely recognized that customer satisfaction
shall be the key to satisfying the organizational goal.
To understand needs and wants of the customers.
To improve the efficiency of functioning of business so
as to ….
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

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Increase productivity
Reduce prices
Improve quality and services
Smoothen the distribution system
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Cont…
To undertake R & D, to improve quality and introduce
innovative product.
To supply goods at reasonable price.
To provide required after sale services.
To ensure product has no adverse effects on
consumers.
To avoid misleading customers by improper
advertisement.
To provide sufficient information about product
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Responsibility toward employees
The successful organization depends to a very large
extent on the morale of the employees.
The payment of fair wages
The provision of best possible working conditions
The establishment of fair work standards and norms
The provision of labour welfare facility.
Arrangement for proper training and education of the
worker.
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Cont…
Reasonable and proper chance for promotion
Proper recognition, appreciation and encouragement of
skills.
The installation of efficient grievance handling system.
An opportunity for participation in a management
decision.
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Responsibility toward shareholders
A fair and responsible return on the capital invested by
them
A part in profit or bonus payment scheme
Political and economical security for investment through
stable govt. law
Knowledge about the working of a n enterprise.
Fair amount of dividend or retained earnings.
Voting rights
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Responsibility toward inter-Business
The social responsibility of business include a healthy
cooperative business relationship between diff. businesses.
Prevention of unfair and unethical competition and unfair
interference in the rival’s business.
Not to spread false rumors about rival’s product.
Not to show unethical advertisement.
Not to create artificial scarcity.
Businessman should adopt better designs, good advertisements,
quick and safe delivery with after sale services, reasonable
prices.
Responsibility toward the state (Government)
It will be a law abiding citizen.
It will pay its dues and taxes other state fully and honestly.
It will not purchase political support by unfair means;
It will sell his goods, commodities and services without
adulteration at fair and reasonable prices, and
It will maintain fair trade practices and refrain from
activities like restraint of trade
Responsibilities Towards the Community
Major areas where business can and does contribute
towards community welfare
Taking appropriate steps to prevent environmental
pollution and preserve ecological balance.
Rehabilitation of population disabled by the business.
Assisting in over all development of locality.
Taking steps to conserve scarce resources
Improving the efficiency of business operation.
Contributing to R&D
Development of backward areas
In the field of Industry
Industry/business can help rural areas by introducing ‘selfhelp’ and ‘earn-while-you-learn’ programmers.
Carpentry, pottery, spinning, weaving, agro-based
industry, farming, dairy farming, poultry and pig rearing,
storage, etc., so that increasing employment could be
provided in rural areas.
Identification of areas needing improvement, facilities,
skill requirements and financial assistance may be
surveyed by business experts.
In the field of Agriculture
To provide full-time
employment to the vast
unemployed rural labour force.
Providing facilities for
irrigation, water supply and
actual supply of fertilizers,
seeds, pesticides, expertise, and
finances.
.
Housing Facilities
Business can, play its role in
changing house-building,
extending loans and financial
aid facilities, providing material
and manpower support
Transportation
Development of cheap
public transport and
distribution systems
through improved journey
planning and traffic
regulation, increased
operational efficiency and
utilization of road
capacity.
Health and Education
Business organizations also hold a responsibility towards improvement
of the quality of life the people in the community.
Providing water sources for drinking and bathing, improving sewage
disposal system, cleaning dirty areas of the solid waste, reducing
pollution, improving sanitary facilities.
Reduce preventable and water-borne diseases.
They can also distribute free medicines, nutritious food to schoolgoing children and pregnant mothers, the aged and the sick.
Holding of open camps for operation of minor ailments, eye diseases,
family planning
Industrial Aid to Education in Urban Areas
1.
2.
3.
4.
5.
5 forms of educational aid
Cash contribution to educational institutions;
Scholarship and loans to undergraduate students;
Contribution of material and equipments to educational
institutions;
Teaching aids for students and teachers;
Contribution of company manpower;
Social Audit on Factual Assessment
‘social audit’ means a comprehensive evaluation of the
way a company discharges all its responsibilities to
shareholders, customers, employees, community and the
government.
Towards Input Suppliers
Providing technical know-how and assistance
Providing fair price
Assuring continuous purchase of inputs
Helping them in expansion and development
Towards Bankers and Financial Institutions
Providing correct data and information for project
appraisal
Prompt payment of interest
Clearance of the principal amount on or before due date
Towards Market Intermediaries
Providing products quiet in advance
Providing freedom to have price margins
Taking back poor quality products
Training the personnel
Providing freedom in promotional programmes
Green management
MRF tyres
HUL
Jet airways
Amway
Nokia