Business is essentially a social institution and not merely a profit-making activity.
Business is essentially a social institution and not merely a profit-making activity.
It is supported through following points in favour of social responsibility:
(a) Justification for existence and growth
Though profit motive is an important justification for undertaking business activity, it should be looked upon as an outcome of the social objectives fulfilled by the business firm. The prosperity and growth of business are possible only through continuous service to society.
(b) Long-term interest of the firm: The public image of any firm would be improved if the increasing number of members of society like workers, consumers, shareholders, government officials. Feel that business enterprise is serving its best interest. Therefore it is in own interest of a firm fulfills its social responsibility.
(c) Avoidance of government regulation:
It is believed that a business organisation can avoid the problem of undesired government regulations and actions by voluntarily assuming the social responsibility which helps to reduce the need for new laws, which restricts their freedom.
(d) Maintenance of society: When the stakeholders of the business fell that they are cheated, exploited and not getting their dues from the business, may resort to antisocial activities, for which there is no protection by law. They may harm the business itself, therefore, it is desirable that a business enterprise should assume social responsibility.
(e) Availability of resources with business: This argument holds that the business firms have adequate and required financial resources and human resources which can be effectively used for solving social problems like - unemployment, availability of good quality goods.
It is supported through following points in favour of social responsibility:
(a) Justification for existence and growth
Though profit motive is an important justification for undertaking business activity, it should be looked upon as an outcome of the social objectives fulfilled by the business firm. The prosperity and growth of business are possible only through continuous service to society.
(b) Long-term interest of the firm: The public image of any firm would be improved if the increasing number of members of society like workers, consumers, shareholders, government officials. Feel that business enterprise is serving its best interest. Therefore it is in own interest of a firm fulfills its social responsibility.
(c) Avoidance of government regulation:
It is believed that a business organisation can avoid the problem of undesired government regulations and actions by voluntarily assuming the social responsibility which helps to reduce the need for new laws, which restricts their freedom.
(d) Maintenance of society: When the stakeholders of the business fell that they are cheated, exploited and not getting their dues from the business, may resort to antisocial activities, for which there is no protection by law. They may harm the business itself, therefore, it is desirable that a business enterprise should assume social responsibility.
(e) Availability of resources with business: This argument holds that the business firms have adequate and required financial resources and human resources which can be effectively used for solving social problems like - unemployment, availability of good quality goods.
