Why Stakeholders, Ethics and Corporate Social Responsibility matter?

Why should managers care about stakeholders, ethics, and social responsibility? If managers
ignore the claims that stakeholders place on an organization, those stakeholders will withdraw
their support, and the performance of the organization will falter. In other words, it is in
managers' self-interest to take stakeholder claims into account.
There are several reasons why managers should adhere to high ethical standards. First, by doing
so they can enhance their own personal reputations, which will be valuable for them in the long
run. Second, considering the ethical aspects of business decisions is a good way of making sure
that the rights of different stakeholder groups are respected. And third, behaving ethically is
simply the right and moral thing to do. Ethical behavior should be valued for its own sake.
People who behave in an ethical manner have greater self-respect, and that goes a long way
toward ensuring psychological security.
Finally, managers should consider issues of social responsibility when they make business
decisions because all economic decisions also have social consequences that impact
stakeholders. Making socially responsible investments is thus another way of recognizing
stakeholder claims and improving stakeholder relations, which benefit the firm. Moreover, as
with ethical behavior, managers should take social factors into account when making business
decisions because this is the right thing to do. Large corporations in particular have gained a
great deal from the societies in which they do business, and it is incumbent upon them to repay
those societies with social investments that improve human well-being.