(Units Social Responsiity of Entrepreneurs a : __ Chapter 8 Leaning Objectives: Atthe end of this chapter, the student is expected to: 1. identify responsibilities to the business organization he/she belongs to; 2. suggest ways to enhance the employer-employee relationship and encourage just and fair business policies and practices sich as recruitment, promotion, retention, marketing and advertising, intellectual property rights, sources and uses of funds, and the like. Chapter Outline: Responsibilities and Accountabilities of Entrepreneurs A.To the Employees B. To the Government ' C. To the Creditors D. To the Suppliers E. To the Consumers F. To the General Public G. To the Environment Scanned with CamScannerBUSINESS ETHICS AND SOCIAL RESPONSIBILITY = FVisin 2S. Vg 22k insty Jeter he duty of" obligation to satisfactorily perform or vor created By one’s own promise OF circumstances) tees wean penal (oe ala Ce ” 2016). n of an individual or organization oad to disclose the results in a transparent coney or other entrusted property (“What Responsibility refers to 1 complete a task (assigned by someon that one must fulfill, and which definition and meaning, responsibility? “Accountability refers to the obligatior n to account responsibility for them, ty for m ” 2016), for its activities, accept manner. It also inchides the responsibili js accountability? definition and meaning, “Accountability vs. Responsibility difference between responsibility and accountability is that accountable not only ntability cannot. Being The main ig answerable for your responsibility can be shared while accou for something but also ultimately bein; means being responsible arjona Also, accountability is something you hold a person to only after a task is done or fore and/or after a task (Diffen, 2016). not done. Responsibility can be bel overnance, accountability is answerability, blameworthiness, In ethics and gi while responsibility may refer to being in liability, and the expectation of account-giving, being the owner ofa task or event (Diffen, 2016). charge, while responsibility does not necessarily owe Accountability owes an explanation, an explanation (Diffen, 2016). Example eee responsibility to make sure there are supplies in the office room. So Tem beware of ita and Kp bringing in more supplies before they run out. At tispin youcanot iy ‘Tom has been held accountable (answerable) for performing this partici respon forthe ofc supplies, but he only held accountable — owes an or his actions ~ if the supplies ever run out (Diffen, 2016). Example 2 Take the : . case of the notorious 2001 Enron scandal that led to the bankruptcy of the 162 Scanned with CamScannerCHAPTER 8: THe RESPONSIBILITIES AND ACCOUNTABIITIES OF ENTREPRENEURS soon corporation. Members of the executive boa Maviea! actions. CEO Kenneth La prt scope Was due to a consp rd were indicted for their ill for their illegal and Was one of the people indicted, Lay insisted that e 'y waged by short sellers, rog Garment : sellers, rogue executives, an ws media ~ implying that while he could be held accountable as the CEO and ee the organization, Pe Mind not in any way responsible for the fraud in the company even ary found Lay Builly on six counts of conspiracy and fraud, making ecto Fexponsible as well as accountable for the downfall of the company (Diffen, 2016), When companies uphold corporate social responsibility (CSR), they are jecountable £0 various internal and extemal stakeholders. Internal stakcholdees ona jclude the shareholders, employees, and management while external stakeholders are the consumers OT the buying Public, suppliers, creditors, competitors, and the local fommunity oF the society at large (Exforsys, 2015). Accountability and responsibility are two terms commonly considered interchangeable. simply put, the, difference between the two terms is that responsibility involves having authority over one’s actions. Accountability means you are liable or answerable for gne’s actions. In order to be responsible, you must be accountable and vice versa (Kelly, 2014) Paul Gillard & Rachel Radwinsky think that to be accountable is to be held culpable for your actions. “If you are responsible for something, you are also accountable". Sam Harrop says that being accountable means that you have responsibility for the results. A. Responsibilities and Accountabilities to the Employees No enterprise can succeed without , the _ whole-hearted cooperation of the employees. The responsibility of business towards employees is in the form of training, promotion, proper selection, fair wages, safety, health, worker's education, comfortable working conditions, participation management etc. (Chand, 2016). The: employees should be taken into confidence while taking decisions be offered incentives for raising their performance. Mental, physi cultural satisfaction of employees should be taken care of. Ifa busines loo nate welfare of employees then they will also work wholeheartedly for the prosP affecting their interests. The workers should sical, economic, and ks after the 163 Scanned with CamScannerBUSINESS ETHICS AND SOCIAL RESPONSIBILITY business (Chand, 2016). ‘A. business choosing to hire employees inherits a series of responsibiltic, mandated by the government. These responsibilities range widely from paying worken appropriately to making a business as safe as possible, An em ployer electing to shitk thes, responsibilities could incur costly civil liability and lose business licenses and permit, (Lister, 2016). 1, Pay Wages and Taxes Entrepreneurs have the responsibility to pay their employees of their business ay re rrr from working per pay period, includirig overtime, sick leave, and vacation wages Paychecks should always be on time and without delay so the workers can meet individual financial obligations. The government also requires entrepreneurs '0 pay PhilHeatt Social Security, taxes out of employee wages for each employee working their business (Lister, 2016). 2. Create and Maintain a Safe Workplace maintain a safe working The government tequires businesses to create and e eneurs must also make environment for their employees as per standards, Entrepreneurs «sin their business that have a high risk for injury and train their res to minimize the risk of injury. Ensuriig each employee is for their small business's particular industry is also their employees aware of area employees in safety procedu using tools and equipment safe inc responsibility as a business owner. Continual inspection of their facilities and employee knowledge of safety standards is necessary to make certain their workplace remains as safe as possible (Lister, 2016), For example, Mitsubishi Electric promotes initiatives for the sustainment of the occupational safety and health management system, the realization of a healthy company, the enhancement of mental health care, and the creation of comfortable workplace environments (“MITSUBISHI ELECTRIC CSR - Social Responsibility - Responsibility to Employees,” 2016). 3, Facilitate Workers’ Compensation Insurance ___ Despite business owners’ best efforts to maintain a safe working environment, accidents will happen. When injuries occur through no fault of their employees, it’s theit responsibility to file a claim with their workers’ compensation insurance provider. This coverage Provides for medical care and wage replacement for their injured employee. Businesses must treat their injured employee with respect and file the claim without attempting to cause a delay in processing or attempt to deter the worker from fin aclaim at all. This is illegal and can cost the business hefty fines and possible jail ne if the (ius oalg refuses to honor their commitment and Tequirements as a business owner Scanned with CamScannerCHAPTER 8: THe (E RESPOI NSIBILITIES AND ACCOUNTABILITIES OF ENTREPRENEURS .énforce Anti-Discrimination Law (EEO) Itis illegal to discrimin: i late against anyone eee one according to their culture. Thi 0h ye aes Seen nk but also age, gender, sexual feisenet abi ‘wy wife stands for ‘Equal Empl nly’, which means that belie ployment Opportunity’, which opines a disadvantaged, dismissed, or not given canine for yet hese cessor It "ployer's responsibility to ensure that all staff is trained d evare of their obligations under anti-discrimination laws, Any problems or i ise wit y P or issues that arise with guests or colleagues from overseas may ire the involvement of i require of embassies, governmen e giplomatic services to help resolve ca 2 Today, many people live in a multicultural society. Examples of the man advantages to this are the wide variety of restaurants serving foods from Sitferent countries and the new foods the migrants bring. It is inevitable that we meet, work, and socialize with people from different cultural groups. To have some understanding of their peliefs, customs and ways of life will make it easier for all of us to work together. For example, as a global corporation, Mitsubishi Electric seeks to hire a diverse workforce with respect for human rights in mind and without regard for gender, age, ationality, or race (‘MITSUBISHI ELECTRIC CSR’ Social Responsibility - Responsibility to Employees,” 2016). Employees don’t have to be cheery, but the environment shouldn't encourage workers to harass each other in any way. It is the entrepreneur's responsibility as a business owner to create a working climate that fosters respect and fair treatment of every employee regardless of age, race, gender, ethnicity, country of origin, disability, or religion. of harassment. Confronting these issues Never ignore employees who come with problems civil lawsuit from allowing a climate of directly can help the entrepreneur avoid a costly harassment in the workplace (Lister, 2016). For example, Atlantic Grupa is a multinational company with companies and representative offices in 11 countries, where special attention is paid to building unique, naturally different, corporate culture that respects diversity and fosters cooperation and synergies between the different segments of production innovations, marketing, and sales. in establishing and maintaining an engaged and motivated workforce to support our company’s mission. Atlantic Grupa set up a process that welcomes new employees in a way that makes, them feel valued as a part of the ofganization as soon as they join (“Responsibility towards employees - Atlantic Grupa 4.4,” 2016) 5. Create and Maintain a Favorable As an entrepreneur and employer, you should try to provide a healthy che Jy person and their opinion is considered. Listen to all yo" 165 Smoother enrollment help: Working Environment Scanned with CamScannerBUSINESS ETHICS AND SOCIAL RESPONSIBILITY Jfare, Remember that they are working for you, worry abou! cir wel il collaborators and worry about their \ better they will do theirjob cs company exists and is profitable and that as better feel, the responsibilities of the entrepreneur,” 2016). them feedback (and that you care how is important that you continue to give y naa h lities of the entrepreneur,” 2016). you do it) and be honest with them. ("5 respons ectric endeavors to develop workplace conditions thay heir careers and meet the duties of raising families Responsibility to Employees,” For example, Mitsubishi allow employees to both excel in tl 2 (MITSUBISHI ELECTRIC CSR - Social Responsibility - 2016). 6. Respect Human Rights ‘The Mitsubishi Electric Group understands that its business operations are interrelated with a wide range of peoples and societies throughout the world, and implements and enforces a code of conduct that fosters respect for human rights (MITSUBISHI ELECTRIC CSR - Social Responsibility - Responsibility to Employees,” 2016). . 7. Support Career Development Mitsubishi Electric provides a human resources development system that supports the careers of employees, a self-development support program, and transfer opportunities for willing employees ("MITSUBISHI ELECTRIC CSR - Social Responsibility ity to Employees,” 2016). - Respons We work hard to create opportunities for employees to develop and grow, also we are aware of the fact that the prospect of career development brings the company more quality individuals with much broader knowledge and skills, therefore, the career concept that we developed and promote is the one that most powerfully unites individual and organizational interests and needs (“Responsibility towards employees - Atlantic Grupa d.d,” 2016) Our interest is ensuring and enabling our employees the opportunity to receive, refresh and expand their knowledge and skills in compliance with the company’s needs and development. Thus, we pay special attention to the permanent education and improvement of our employees, as we develop and implement specialized programs and irsining on all employment levels (“Responsibility towards employees - Atlantic Grupa .d,” 2016) . 8. Train and Educate Employees Promoting knowledge is important in changing the business environment. Acquisition of new knowledge and skills through the professional and personal development of employees is a prerequisite and a guarantee of business success. We are aware of this fact and that is why we have been encouraging and enabling our employees ‘o attend business schools, specializations, professional conferences, and congresses. Scanned with CamScanner. ~ = RESPONS ig, + lures 7 AND, ACCOUNTABILTIES OF Ew IEPRENEURS The educational ‘, content 7 _quses alized BY OUF exper (rt PPOREAMS yy p fe stallored” for our © prepare and offe ss “tailored” to y Our employees ver Cand offer include seminars and mee sea” 216 + MES OUF news ell as outside a Responct institutions through mployees - Atlantic towards ,.anase Performance “What gets measured oo, ) alking about performance Bes fe key *© UF philosophy fployees t0 have cle an o; rene xPression you will often hey e e me: of rewardin, oe arly defined cee heh and th ‘ar when e meaning behind this statement is ‘ging performance. We want : : all our anagers 08 the basis of busines Aon whlch they defined themselves with their ro and people ( Responsibility towe ewe tee main performance areas-proft, ‘ards employees - Atlantic Grupa 4," 2016) The performance Management posed abjective-setting and permet PY8s We utilize scaled US and itis. a dialogue. sees expeeatere ae ‘ fee Cvaluation system which ensures that the form: xP\ all of us are d ivi reget idenied and acea on are clear and that the individual development 4s,” 2016) “Responsibility towards employees - Atlantic Grupa 40. Give Rewards and Benefits . We reward our employees fairly and attractively, in line with the prevailing conditions on the local market. We gather data from the labor market on a regular basis, ensuring that our reward structures remain competitive. Our reward system is well structured and transparent in its application. It: * — Allocates appropriate pedple to appropriate job positions © Set requirements and standards, outcomes and measures * Provides effective orientation, education, and training * Provides ongoing coaching and feedback © Designs a foundation for effective systems that rewards people for their contributions : mmotional/career development opportunities for employees ides pro i Be : Responsibility towards employees - Atlantic Grupa dd,” 2016) iliti ernment B. Responsibilities and Accountabilities to the Go' . ibilit of a busine: according to economist Milton Friedman, : s om ‘ ' r owl ney an The primary fa ue have pul up a ae succeed. Yet busin jem re’ spective governments i several ple to the respective government aking th sponsible to the in an effort to help it in which they operate, areas (Wolke, 2016) ee 167 Scanned with CamScannerBIL a co the government tries , ‘community and improve i, F respect the Business has, operation to the government, discharges HS responsibilities th, ent sincerely and effectively, the tcan function more efficiently. Thi, e whole community ang of the business, The 5 depend upon the ° communi The development of munity; hence pusiness has got to be the commun government (BMS Tein, that oe interest © e interest ne busines: he development of charging its obliga business depends upon th very particular about dis 2016) Observe Laws, Rules, and Regulations required to follow the rules and regulations laid by ‘The business organization is the government in a proper manner (BMS Team, 2016): ‘A number of legislative time t proper regulation and control | smen shoul requirements, execute government cont of executives available for government, laws for the business (Chand, 2016) For example, the Aluminum Company ° jsoues states, “no one may ask arly employee tO bre values, policies, and procedures.” ALCOA’S commitmen by the company’s approach to corporate governance; “we expect all cther Alcoans to conduct business in compliance with our Business Conduct Policies.” (Oster, 2016) ‘The laws reflect the wishes of the community, they show what the community wants the member to do and what the community wants the member to avoid. The laws control the behavior of the individuals with each other and with the community (ans Team, 2016) o time by the government for 4 comply with all lege honestly and in time, make services nd send proposals to enact new .s are formed from f business. Busines: rracts, pay taxes suggest measures a America’s approach to compliance ‘ak the law, or go against company t to compliance is underpinned directors, officers, and 2. Pay Taxes Businesses must.pay taxes a1 and fees to th ee P x e government in ing, oat hop nt ee can include taxes on revenues, tariff ea ee an necessary to register the b ae rata a , particularly taxes, is considered a crime (Wolf ee olfe, 2016) The business organiza tions must such as sales tax, income tax, aus y = Fecaue it would be dificalt fr th duty, VAT, etc Noncpayeonna Soe eet ent of taxes is an offens® 0 UO undertake development pr0gr2e — lertake development progr Scanned with CamScanner(CHAPTER 8: THE RESPONSIBILITIES AND ACCOUNTABILITIES OF ENTREPRENEURS fd ‘Team, 2016). A number of taxes are imposed on business for collecting revenue. Businessmen yould pay Various taxes in time and help the government in collecting funds. They should potsesort eo taxevasions rather declare their incomes honestly and correctly (Chand, 2016). But series of raids conducted on business houses clearly show that businessmen rave failed to discharge their responsibility towards government (Chand, 2016). ‘The expenditure of a modern government is heavy and is fast increasing. The main source ofsincome for the government is the different type of taxes imposed by it. The pusiness pays taxes on goods produced by them, taxes on goods imported by them, taxes qnown income and taxes on the incomes of the employees. The bulk of the tax revenue is collected from the business. If a business pays the taxes honestly and on time the smment can fulfill its responsibilities efficiently. If taxes are evaded by one group, the .parden of taxation increases on some other group. Non-payment of a tax is a political ifense and also a social dishonesty (BMS Team, 2016). 3, Follow Environmental Regulations Many companies, particularly those in the industrial and manufacturing sectors, face heavy regulations regarding the number and variety of pollutants that they are allowed to emit. Some companies, feeling a “social responsibility” toward the common good, may seek to limit their pollution more than the law requires (Wolfe, 2016). 4, Abide by Labor Laws Businesses that hire employees must abide by a slew of laws relating to how they treat their eriuployees. These include laws related to how much an employee can be paid, how many hours he may work, and the criteria under which he can be hired and fired (Wolfe, 2016). 5, Avoid Restrictive Trade Practices Companies are forbidden from engaging in certain kinds of restrictive trade practices that limit competition. For example, most companies may not develop monopolies within a particular sector or provide substantial bartiers for new companies tocompete with them, Restrictive trade practices of this kind can often reduce the quality of products available to consumers and drive up prices (Wolfe, 2016). 6, Disclose Financial Statements Companies must disclose a number of financial statements to the government in the form of tax returns, and, ifthe company makes ownership of shares of stock commonly available, to the public as well. This financial transparency helps to ensure that the company is not violating any laws, such as withholding taxes, and to aid the public in deciding whether to invest in the company (Wolfe, 2016). 169 Scanned with CamScannerSIBILITY. susness ETHICS AND SOCIAL RESPON fen from bribing public officials, ws, id ; also forbi tially in the interest of the County Businesses in most nations are ‘ jobs impart would subvert their ability to carry out th citizens (Wolfe, 2016). f favor from go heed ver ‘The commercial organization should not a type meng officials by bribing ot influencing them (BMS Team 201°) 8. Assist in Implementing Socio-Economic Policies business sector tohelp;, , the ‘The government expects co-operation and help Or tonomic development (h implementing programs and policies relating to social an‘ Ms Team, 2016). 9. Help Earn Foreign Exchange . 4 business organization that it will earn frei, et, The government requires this foeig, ducts (BMS Team, 2016). The government also expects from currency by exporting goods in the foreign mar currency for importing valuable and important pro 10: Advise the Government fe timely advice to the government in ‘The business organization has to provid tustrial policy, Import & Export policy, respect of framing important policies such as Indi Licensing policy, etc. (BMS Team, 2016). of technical economic financial or political Often the government requires input: ss has contacts in different sections importance for framing appropriate policies. The busines: of the community. They can be used for collecting the required information and providing it to the government. Any action based upon accurate inputs has greater chances of achieving a higher success. For example, before imposing a tax on a commodity the government likes to know the elasticity of demand for that commodity (BMS Team, 2016) committees. The business leaders have practical experience of a particular type of business ‘A.committee appointed for doing something in respect of that business is highly benefited if some prominent person from that field is appointed as the chairman of that committee ‘or commission (BMS Team, 2016). 11. Complete Promptly Government Contracts The government has to take up several works such as the construction of roads bridges, flyovers, airports ete, Sometimes these works are undertaken by ee departments buta more common method of undertaking that work i tog, the gover give contracts to business. It is the responsibil Work is to invite tenders time and maintain a high level of quality of the a Scanned with CamScannerp.contribute to Government Treasu overnment Treasury The commercial org spergencies and Mattral e ganization must -alamities like floods, 43, contribute to Political stabitity contribute the funds “nm nds to the gor vernment durin earthquakes, ete, (BMS Team, 2016), The commercial org i soy The sable eee Eizations should work towards th ta conte THe sible Government often brings m fi and pene ky ofthe ot gs Team, 2019, 'g8 More return and peace in a democratic ¢ Responsibilities andl Accountabilites to the Creditors 4, Give Correct Information Shareholders who are the owners of the business should be provided with correct information about the company to enable them to decide about: further investments (Chand, 2016). : 2. Provide Fair Return on Investment (RO!) The company should provide a fair return on the investment made by shareholders, If shareholders do not get the proper dividend then they will hesitate to invest additional funds. Shareholders should be kept fully informed about the working of the company for healthy growth of the business, The Companies Act 1956 also requires the company to give full disclosure in the published statements (Chand, 2016). 3. Strengthen Share Prices ‘The company should strengttien the share prices by its growth, innovation, and diversification, At the same time, shareholders should also offer wholehearted support anc co-operation to the company to protect their own interests (Chand, 2016). owners as well as managing business profitably, loyed, consolidating the financial position as to enable the owners to withstand any Business is accountable towards ensuring fair and regular return on capital emp! ofbusiness, guaranteeing capital appreciation so business contingencies (Chand, 2016). 4, Honor Fiduciary Duties (McKinney, 2010) _ unanticipated questions and Difficult economic times frequently generate include if and its creditors. One unanticipated question may challenges for a corporation ; rporation’s creditors. or when fiduciary duties should be extended to a a7 Scanned with CamScannercee gree fiduciary duties , i ® extend £0 2 COFPOTatigy, og and . . + officers MC qutie ; While it is well-recogniz ether those duc ie uties tO creditors When Fon, whel jducl , sharehokders and he corpora the law extends fiduciary gion cannot Pay its deby, Soares tess cetan. Comer yy mea vent--comimonly corporation becomes insol as they become due. he Suppliers D. Responsibiliti “esponsible for providing (Exforsys, 2015) eds in the production, In strict business st or delivering the raw materi Suppliers indirectly affect marki price, and production of goods. Goo' products and fair market p} and quantity. Considering the stiff mar doing t ructure, th jals and resources eting and 4 quality rw ice, Availability of SUP ats such as product quality, ‘materials als ‘mean quality-made fina} duction workload plies determiries Pro et competition across jheir best to minimize con sales as a way of industries, companies are ood costs but not pushing too much gaining profit. This can be addressed by keeping 8' hey can help bring relationships with suppliers since Town the.cost by offering reasonable prices for the scources, However, in the same way that companies uphold ethical business transactions and negotiations we h them, suppliers must also practice sustainable and responsible acts. Itis important to know that in business, companies, Jationship based on mutual respect. In dealing with sup, and suppliers must maintain pliers, there are certain a good rel key points that firms must take note of. 1. Practice Fair Pricing and Licensing Companies must seek fairness and truthfulness i i ee ruthfulness in all dealings with suppliers 2. Avoid Coercion and Litigation Companies should make certai certain that any busi ines i be free from ny form of coercion and unnecessary litig i" (ansaction with suppers ms sary litigation, 3. Maintain Stability Firms must promote lor ng-term stability in thei ie ; ii : pay back the good value, quality, and vallabili aa Felationship with the suppliers gained, ; 4, Maintain Confidentiality 172 Scanned with CamScannerDealing with supptiers ang them part of the py tof AMY NeW informa; 7 runs sharing information with them and 8 Processes. They must keep their clients tion on ne 'W technology and ly practiced, ty a company lannin, and purchasers latest raw materials, ‘ANS NO Unnecessary disclosure of sb dentiality must be anfidentiality . formation shared by the is_me a i and its activiti oe One of the best ways to ¢ cal with supplier smnonts according to the PP Py 5,PaY on Time s to be responsible for m, *ms and conditions of the trade. cernment aking time agreed te aking, timely g,select Suppliers with a oeneraeeeeeeeeeeE A business th. at aims aims at succeeding must have a good discernment in selecting Companies share common requirements from their suppliers but there companies that would establish their own Prerequisites and conditions before purcha: goods from them. Suppliers must always be in compliance with the national or regional laws and maintain proper observance of social norms. Moreover, suppliers must be fair in its dealings with creditors and organizations. They must also maintain the approved quality and delivery standards expected from them: are sing As suppliers, they have to maintain ‘a stable supply and ‘availability of raw materials as well as eco-friendly goods. E. Responsibilities and Accountabilities to the Consumers a me vonsumers A. business cannot" work without the consumer. The survival and growth of a business depend on consumer satisfaction, service, and Support. The commercial organization Should win the confidence of the fistomers. This is possible by fl itive attitude towards / asiomes an ptpling following social responsibilities towards them, (Haider, 2010). Scanned with CamScanner.ioluT rns AnD SOCIAL RESPONS eee a “A Ensure Quality of Products and sete aN lity (Haider, 2010). roy goods. TI tof qua ss its business strategic , The company should produce quality z its quality. There is always room for improveme! : i , ba: ; : Richard Branson, the CEO of Virgin Group, fa companies do 100 and oc" client, and always trying best to satisfy aes ol the entrepreneur,” 2016), ave achieved succe: e years ("5 responsibilities — achieved success over the years ("5 resp fest quality in Your produ, le. A good entrepreneur is hot or sll false expecta ‘ Your responsibility isto offer customers the hi Services provide the best care al never le to get # Sle Oe and gives a good price / benefit. Never use marketing (5 responsibilities of the entrepreneur,” 2016). Quality goods should be produced and supplied. Deen oe shox make goods easily available to avoid artificial scarcities ee a er foes ser shou I Prompt. Buying capacity and consumer preferences shoul tain while deciding the manufacturing policies (Chand, 2016). 2, Ensure Consumer's Health and Safety The business must ensure that the product supplied will not ee affect thy life and health of the customers. Unsafe product must not be marketed by the company (Haider, 2010; Chand, 2016). A key consumer issue is the quality and safety of products. Customers neeq clear instructions for safe product use, including assembly and maintenance. To avoid custome harm and danger, anticipate potential risks of your product and services in the design stage and throughout the product life cycle, from R & D, to manufacturing, storage and distribution, use and disposal, reuse and recycling, Whether or not legal safety regulations exist, products should be safe for their intended use and if misused in a way that canbe foreseen (“SME Sustainability Roadmap - Corporate Social Responsibility,” 2016) 3. Provide Easy-to-Use Products Through universal design, manufacture Fasy-to-use and practical products (“MITSUBISHI ELECTRIC CSR - Social Responsibility 7 Responsibility to Customers,’ 2016). 4. Provide Free Training ‘The commercial organization shou Id arrange to trai it ot ‘ d free of fora fee, It must be in the case of computers, ete (Haider oe preemies 5. Be Fair with Prices ‘The customers should not be che: ; fool the customer at all the time, Thus, fan ene high prices. Its not posse customer (Haider, 2010), Price converts a customer into permanet 174 —— Scanned with CamScannerCHAPTER 0: THERES ESPONS, *LUTIES AD ACCOUNTABILITIES OF EUTREPRENEURS keting 6,80 ponest in Advertising and Mai ‘The customers want ee Svan toa the facts, features, advantages, side-effects, ete, of the ne nveys this information. Thus, the company must see that vertisement is not being mi ea 8 misleading a pen Faformation (Haider, 2010), ig and it must be done by providing the true and " qo avoid being n isled by g i Pee van 'y wrong claims about products through improper se » the consumer should be provided full information about the acts including their adverse: effects, rs ee ceca effects, risks, and care to be taken while using the Consumers all over the world are, by and large, dis: id because the ' : t by ‘ge, dissatisfied mance of businessman is far from satisfactory. Consumer is not the king in our Fiantty but a vehicle used by businessmen f i : taaximization (Chand, 2016) for driving towards the goal of profit hee of which the concept of ‘consumerism’ has come up to protect the rights of consumers. Even the government is interfering in a big way to protect the interests of consumers (Chand, 2016). 7.Be Honest in Dealings Never lie to your customers. It is foolish to cook false stories. You will be caught. Intoday's world, where‘information is just a click away, everyone does his/her thorough research before purchasing something, Unnecessarily you will lose your respect infront of them. If you can’t deliver something, please mention it clearly. They might not invest in that particular product but believe me, would definitely come back to you in neat future jastbecause you were honest, and guided them correctly. Ieis pointless to badmouth your competitors ("Social Responsibilities of Organization Towards Customers,” 2016). Disindises dexling witt exsrorier's mbeiey nied tolbe-extes ciseful with Se Make sure their money is invested in a right way and also multiples ata rate promised to them, Do not run away with their money. tis one of the worst things you cP do to your customers. It is your responsibilty to take care of their hard earned money. Suggest them the sight schemes and right plans as per their need. Do not just think of your own selfish is way, you will definitely meet your targets once or twice but targets and incentives? Thi trust me not for a very long time. The moment, the customer knows that you have cheated enhimy/her; your game is over. He would neither come fo yt again nor recommend your brand to his friends or acquaintances (“Social Responsibilities of Organization Towards Customers,” 2016). 8. Attend to Complaints The consumer complaints must be attended immediately (Haider, 2010). stem for making quick and accurate on not inconveniencing When major issues occur, employ a decisions on steps and measures lo take, while placing top priority 175 Scanned with CamScanner a 2RESPONSIBILITY ‘aysiness ETHICS AND social RES gocial Responsibility - Responsibitiy io R= the customers (“MITSUBISHI ELECTRIC CSI Customers,” 2016). ae service for maintenance of go 9, Service Even After Sales iter sale service helPs 00 estab,» wide after S tive a} pany (Fa ted to pro The company is expec r Efficient and effec during the period of warranty. jider, 2010). good relation between the customers and the com doa a Aen 4 to forget their customers ONC ganization. Ma service is essential and ensures Tong teem growth and Pe jou wish to sori ne sure you are in touch with your customers afer Re deal Ee prod rte cut throat competition. Do not ignore their calls once you an toreplaceitor : the customer isnot eatsfied with your product itis YOUrFesPO%" Pee re Prove secolation, Customer feedbacks are important and help you un in A eae isfaction level of your esteemed customers and how you can make yous produc! beter coer of time ("Social Responsibilities of Organization Towards Customers,” 2016). Organizations ten 10, Respect Customers’ Time Respect your customer's time. Do not decide the fime and venue as per your availability and comfort. If the customer wants to meet you at 6 in the evening, make sure ly nor too late. Do not keep your customers you are there on time, Neither arrive too eat c ‘waiting, Do not forget that there are several options available in the market. Your loss is comeone else's gain (“Social Responsibilities of Organization Towards Customers,” 2016 11, Treat Customers well ‘Treat your customers as kings and do not think of them only when you havea pressure to meet your targets within the stipulated time frame. There are organizations that do not bother to touch base with their customers the whole month but are active only when they fall short of their targets and they have an appraisal in the coming month Understand that a customer buys your products or services only when he/she trusts your brand and most importantly believes in you. Understand the needs and requirements of your clients. Find out as to why they need a particular product and — ir product would benefit them, You need to build a strong relationship with ner a them not only to remain your loyal clients but also bring more people clen Se Ete responsibility ofthe organization to give cortect suggestions ond foc with them. Itis th Avoid making fake promises and commitments whieh eee eee fulfill. What is the need of selling a mobile phone with you yourself know are difficult the customer has specifically asked yéu for a Thdndoel h just one-day battery backup Whe? Responsibilities of Organization Towards Customers” 20g least3 days’ backup? ("Soc 12. Ensure Regular Supply Scanned with CamScannerThe ones Tequire that the bu: sont for the purpose of iny ei vide 2010). 8 organization must conduct research and roving the Proving the quality and reducing the cost of production hrough surveys of cust Throws lomers wh ¢ omer satisfaction and enhance ae ae . a ‘purcha i i on pISH ELECTRIC Cg ey Pinchase soppot and information services se M ELECTRIC Csr Responsibility - Responsibility to Customers,” th avoid Monopolistic Competition The commercial organiz, ation sh i i spat consumers Haider 2010, should avoid monopolistic competition in the f. Responsibilities and Accountabilities to the General public : a SSsSSSSSSSSSSSFsFSFFSes To maintain a positive public image and attract new clients, a company must understand its corporate responsibilities to the public. Ultimately, any business that encounters the public has responsibilities (Root Ill, 2016). 1,Be Fiscally Responsible One of the actions that prompted failure of companies such as Enron and Adelphia ccurred when executives gave themselves loans using company funds, according to RR Donnelley. While it can be disappointing to consumers that companies need legislation to be fiscally responsible, it would be naive to allow company executives to keep raiding, corporate bank accounts for their own needs. When a company is caught up in a scandal caused by executive greed, it can be fiscally fatal for that company. That is why a company reeds to enact and enforce guidelines of its own that agree with the law but also apply specifically to the company, to avoid misuse of company funds. There is a bond of trust between a consumer and a company that is broken when fiscal fraud occurs. This goes for public or private companies (Root If, 2016). 2.Consider Public Input ‘A company should be able to operate under its own rules and ideals, but @ company should also take into account the input of its customers to remain competitive, cording to the World Bank Institute's report titled “Public Policy for Corporate Social Responsibility.” wnefit from the insight of what any that creates an advisory sndations on how to keep in ‘A company should reach out to its customers and ber Bors aie looking for in product improvements. ‘A comp: 1 audience gathers recomme! of a cross-section of its targe' 177 Scanned with CamScanneryeiulTY iesponst ‘pusiNess ETHICS AND social Rl pany’s public image. iti, e the com 0 improve ps ao : touch with the customer base and how to imps antable to its customers; otherwise the main a . responsibility of the company (0° mai et (ROO 11, 2016). 0 exis omers and cease company will lose its cust 3, Take Care of the Community ~ A company exists because of the customers it serves and the community in which it is located. The community provides most of the employees for the company, and the community provides all the public services the company enjoys, stich as electricity and firefighting protection. In some cases, companies are given breaks on their utilities and taxes in order to entice them to establish a local responsibility to giverback to the community that supPo! Rate os fore, When there is a community event, the company should contribute volunteer, money, or something that would support the event. ‘The company should use local suppliers as much as it can to help support local businesses (Root III, 2016). of business towards community and society includes spending 1 facilities. Every industrial undertaking ‘ha way that ecological balance is community. The company has tion within the sts it with tax breaks and a labor The responsi a part of profits towards civic and educational should take steps to dispose of Industrial wastes in suc maintained and environmental polhition is prevented (Chand, 2016). Rehabilitating the population displaced by business units should also be part of responsibility of business. Business houses should set up units at those places where sufficient space is available for housing colonies of workers. The promotion of small scale industries will help not only nation but will also help in building up a better society (Chand, 2016). - In addition to the legal and political responsibilities, the business has to take up several moral responsibilities towards the society. Thus, the business has to provide training facilities for the unemployed persons so that they can get absorbed in some occupation or can set up self-employment units, Several business houses established educational institutions, hospitals, libraries, recreation halls, pl ete RT or alls, playgrounds ete. for the : y Ipful in winning them sympathy from the community. It is like a investment made by the business (BMS Team, 2016). caus G. Responsibilities and Accountabilities to the Environment Global warming ard climate change are not “w, in tiine to lessen their impact. Asan entra 1ot “words” but realities that we are still trepreneur, in additic . dition to starting a business to helP eee 178 oo Scanned with CamScannerCHAPTER 8: THE Resp FONSIBILITIES AND ACCOUNTABUITIES oF ENTREPRE! lution oF encourapi . oe Pe ntality in your een “¥eling; you alsa have the i sr mentality {9 YOUr company. y . Opportunity to adopt a (5 responsibiliti ies of the entrepreneur,” 2016) Agood way to go when devel ae sy country ana how Tea help sop focused ON Social or environ bility loping your business ide ‘a is to think: What ve them ina sust a oe ainable way? Now, if your company ental goals, then it should i include some shares o in your model. It ieee ‘an be from d m i om eae dar irom donating, money to chari a va y ities to vo Planting trees or recycle waste ("5 respon ot ilities of the entrepreneur,” i) Going beyond environmental compliance can jag business ‘benefits. Many businesses have realized acting iN a socially and enviro sible way is more than just a leg, four bottom line and the long-term success of your rsiness (“Environmental responsibilities for posnesses | Business Gateway,” 2016) mentally al duty. It affects 1.comply with Environmental Legislation Thereis a range of environmental rules your business may have to follow: 1. Comply with legislation regarding emissions into the air. 2. Store waste safely and securely, make sure it is treated appropriately, ensure it is collected by an authorized organization (such as your local authority or a licensed private waste contractor) and complete a waste transfer note or consignment note when waste is handed over. 3, Manage your business waste for recycling by separating paper, card, plastic, metals, and glass prior to collection. Most food businesses also need to separate food waste for recycling. 4. Ensure you do not cause a statutory nuisance which could affect someone's health | or annoy your neighbors. This covers things like producing noise, smoke, fumes, gasses, dust, odor, light pollution, or accumulating rubbish. company before you allow trade effluent such as 5: Get permission from your water c i (s ling or cleaning water to enter the sewerage waste chemicals, detergents, cool system. plianée scheme if you handle more than 50 tons of 6 Join roved com : Jein an app 11 provide evidence that you're recovering and recycling packaging. You must the a set amount of packaging waste. with restrictions on the s hazardous waste your business produces is correctly ther disposed of or recovered at an approptiately ion orage and use of hazardous Make sure that you comply substances. Ensure that any P _ Classified and described, and ise’ 179 Scanned with CamScannerauthorized facility. . s to prevent t Notify the relevant enforcing authority and take steps to p' ent the dam, imminent threat to the environmen, ’8it your business activities pose an imminent threa ou must tee Hye business activities cause actual environmental damage, y fake Teme action to repair the damage. 5 ide rai There are also specific environmental rules covering a w ‘ta ae bu from construction and electronics to textiles and chemicals manufacture. (“Envir Fesponsibilities for businesses | Business Gateway,” 2016). snes, ONmMen| Hazardous substances covered by environmental legislation Specific environmental rules cover potentially dangerous substances, Every business needs to think about the risks to people or the environment posed by. chemical oF substances classified as hazardous to health under the Chemicals (Hazard and Packaging for Supply) Regulations (CHIP). Hazardous substances are tightly regulated. They include: Information animal by-products © chemicals © oil * ozone-depleting substances (ODS) * - pesticides and biocides * radioactive materials * hazardous substances in electrical an d electronic equipment * solvents - You must consider thé environmental risks for store, use, produce, or dispose of at work. You must ensu and comply with legislation when storing goods and ma every hazardous substance you re you control any potential risks terials. If you manufacture, use, import, or tecover from waste. materials any chemicals, you may have to comply with the Registration, Evaluation, and Authorization of Chemicals (REACH) Regulations. Businesses manufacturing, recovering, chemicals over 1 ton Per year must ensure those chemicals have been. fal responsibilities for businesses | Bu: or importing any siness Gateway” 7 If you manufacture electrical and electronic equipment you must comply with the Restriction of the Use of Certain Hazardous Substances in Blectrical and Electroié Equipment Regulations 2008 (RoHS). Under RoHS, manufacturers are prevented from Placing products on the market with more than “certain amount of hazardous substan such as lead, mercury, and cadmium (“Environmental | res] iit siness Business Gateway? 206) POnsibilities for bu: If you work with equipment containin ing a ; 8 ODS o fluori - including conditioning and refrigeration equipment . there are requir td Basses ind eet Ne requirements that you must ™ NN Oe piyien ss Scanned with CamScannerCHAPTER 8: THE Re: =SPONS TESPONSIBIUITIES AND ACCOUNTABILITIES OF ENITREPRENEURS jardin! ne ontainment «containment including B Prevention and repair of le i snd record heping 18 Prevention and repair of leaks, checking for leakages «recovery for the pur very Pose of recycling, re 5 feng and conte ea esting reclamation or destruction Regulated work includes th s the disposal, maintenance, servi i ae ‘al, maintenance, servicing and dismantling of aerators, freezers, air-conditioning 7 sg tioning equipment and heat pumps and the © ae + missioning of fire protection e ‘se 8 Protection equipment and extinguishers. _ oispose Waste Properly ropriate Appropriate steps should be taken to prevent environmental pollution and to serve ecological balance. The industrial waste should be disposed of carefully or if ible can be recycled to mit = e pollution. The toxic wastes, excessive noise, chemical sesicides, automobile exhaust etc, ned to be checked from time to time (Chand, 2016). You must ensure that any waste you produce as a result of your business rations is stored safely and securely, treated appropriately and collected for disposal ax cycling by an organization authorized to do so such as your local authority or a jcensed private waste contractor (Chand, 2016). 3,Recycle Businesses are required to separate the following forms of commercial waste for recycling: paper, card, plastic, metals, and glass. If your business processes prepare or distribute food and produce over 50kg, of food waste per week, you are required to separate food waste. It is illegal to dispose of food waste directly or indirectly into a public drain or sewer (“Environmental responsibilities for businesses | Business Gateway,” 2016) 4, Conserve and Protect Biodiversity (‘Environmental responsibilities for businesses | Business Gateway,” 2016) Biodiversity refers to all species of plants and animals, including any genetic variations within those species, and the complex ecosystems they live in. “The world is losing biodiversity at an ever-increasing rate as a result of human ativiy, All types of business operating near protected areas should be aware of their responsibilities for conservation and protecting biodiversity. This doesnt just apply t© Jnd-based industries such as forestry or farming, but to all offic and other business activities based on or near these areas (“Environmental responsibilities for businesses | Business Gateway,” 2016) s, factories Protected areas include: _ © Local nature reserves - places with wildlife or geological features that are of special interest locally. een “Scanned with CamScannerBUSINESS ETHICS AND SOCIAL RESPONSIBILITY _ lar natural beauty in need og ic areas ~ areas of particul National sce conservation. ; . 1e countryside that have been given protection fo, National parks - tracts of th and enhancement of thi .s- important areas o ic interest - good exai ir special qualitie: ff wildlife habitat. the conservation mples of the natural heritage o¢ National nature reserve: Sites of special scienti wildlife habitats, geological features, and landforms. ; tion - strictly protected sites for habitat types ang most in need of conservation at a European Special areas of conserva species that are considered to be level a Special protection areas - strictly protected sites classified for rare ang vulnerable birds. Wetlands UNESCO biospheres - areas of terrestrial and coastal/marine ecosystems Which are internationally recognized under UNESCO's Man and the Biosphere program. 5, Prevent and remedy damages to environment Every year there are thousands of cases of damage to the environment covering: © damage to species and habitats «damage to water risks to human health from contamination of land If you are responsible ‘operator’ of the activity that causes or threatens the damage—you must take immediate action to prevent or remedy this (“Environmental responsibilities for businesses | Business Gateway,” 2016) 6. Report an incident You should report incidents such as: damage or danger to the natural environment pollution to water or land poaching or illegal fishing fish in distress or dead fish watercourse blocked by a vehicle or fallen tree causing risk of flooding iMegal dumping of special (hazardous) waste or large amounts of industrial e incidents at waste sites illegal abstraction from watercourses unusual drops in river flow collapsed or badly damaged river or canal banks You should pe repoi : odors, noise, waste or : ee such as gas leaks, burst water mains, or domesti¢ Pest nuisances to your local authority or utility company. Business should protect the environment which i 7 ich has acquired great importance all over the world has acquired great importance all over the worl 182 Scanned with CamScannerdischarge th ibili ness can Be the responsibil g thee onsiiitis for businesses | Busines: certain the Tees should be used very carefully as these are depleting at a © Sources can also be found out to save natural resources like Wood and pulp can be found, the use of coal can be reduced "By (Chand, 2016) Start by Tecycling paper, making the most of sheets. Separate garbage dumps and avoid using dis stems such as LED |i, addition, invite them to Perform activities such as planting trees, entrepreneur,” 2016). Scarce natural resou fast rate. The alternatiy, vee forests alternative pyalternative source of ene; digital way and reusing the recording, isposable plates, especially Styrofoam. T-pooling. In . ("5 responsibilities of the Scanned with CamScanner