DEPARTMENT OF M.B.

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good or evil .ETHICS is a set of standards or a code or value system worked out from human reason & experience by which free human actions are determined as ultimately right or wrong .

Social responsibility & Ethics has been an elephant in the room for centuries . Social responsibility has to do with the social conscious of an entity or corporation. . It also deals with the citizenship & public sprit of the company. It is common standard of justice.

Social moral and ethical aspects of business decisions are as important as economic aspects to judge the success of a business firm. Economic criteria alone cannot justify the existence of business organizations .Social responsibility is an important features of every business in modern times. “Social responsibility is an organization's obligation to benefit society in ways that transcend the primary business objective of maximizing profit” .

The nature of Social responsibility can be understand as follows : 1-Focus on business firms : Both business & non-business organizations should be responsible towards society. . 2-It deals with moral issues : Companies have specific policies and programmers to look after interests of their employees and other stakeholders. 4-It is a continuing activity : Social responsibility is not catering to the interests of society once or twice. 3-It is a pervasive activity : Social responsibility is not just the obligation of top level managers.

. In addition to abiding by legal framework of the country:. 4-Creation of public expectations : At the highest level of hierarchy. 2-Catering to public expections : Social responsibility goes beyond merely obeying the law. 3-Anticipation of public expectations : At a still higher level.There are four levels of hierarchy : 1-Obeyance of the law – Managers feel they are discharging Social responsibility by merely obeying the law. business firms not only fulfill what society expects from them but also anticipate needs of the society. managers not only cater to public demands but also set standards of Social responsibility and want the society to be benefited by those standards.

public viewed business enterprises as institutions which mainly looked after the interests of their owners. 2-Trusteeship management : During later years. the concept of Social responsibility got widened from mere satisfaction of owners’ interests of other stakeholders also. . 3-Quality of life management : A still wider perspective of Social responsibility developed in 1960s. Business enterprises were supposed to change the quality of society.creditors etc. like employees.consumers.Regard corporate Social responsibility has gone through three phases : 1-Profit maximization : Historically.

2-Stakeholder philosophy : It is an extension of traditional philosophy. there are three phases of philosophical perspectives of Social responsibility. 3-Affirmative philosophy : Similar to the 3rd place of historical perspective . 1-Traditional philosophy : It defines Social responsibility as producing goods services for society at low cost.Similar to historical perspective. .the affirmative philosophy aims at broadest spectrum of Social responsibility.

firms perform legal. ethical and social obligation only if they are asked to do so. 2-Social obligation : Socially obliged firms discharge Social responsibility to the extent that avoids government interference. 4-Social contribution : Socially responsive firms which favor the concept of Social responsibility follow the social contribution approach where they seek opportunities to perform activities that contribute to social goals.Four approaches to Social responsibility are discussed below : 1-Social obstruction : Firms which follow this approach to Social responsibility do the least possible to solve social problems. 3-Social response : A step further ahead of social obligation. .

product or service. or geographic location. 2-Stakeholder involvement : Companies must be ready to engage in dialogues with stakeholders. quality of its reports and management systems and processes. .Companies must adhere to the following principles : 1-Supply chain responsibilities : A company’s social responsibilities should cover all those with whom companies come in contact.Transparency and reporting : Companies must be transparent and open with respect to their policies and social conduct. that is internally monitor its CSR policies. 4-Independent verification : Companies must verify. 3. irrespective of the relationship.

It asserts that companies should look after the interests of all those who are affected by their policies and operations. .The following theories link the field of business and society and discuss issues related corporate social responsiveness and public policy : 1-Feminist theory : This theory of CSR is also known as ethics of care . 2-Stakeholders theory :This theory describes company’s relationship with society.t rejects the concept of moral reasoning as moral decision-making separates moral problems from social problems and distinguishes b/w moral decision-makers and individuals who from part of the society.

it reflects expectations of society from business houses. Its main aim is economic growth or drive for profits. 4-Ethics and Nature : It describes the origin of ethical dimensions of business.3-Social contract theory : This theory focuses on changing contracts between business and society. The business values constitute three clusters of values– economizing values. 5-Pragmatism : This theory of business ethics incorporates various trends found in contemporary business ethics.It provides a philosophical ground for understanding what is moral’ and why’ and how we chose among various principles in an ongoing process of dealing with change and novelty.ecologising and power aggrandising. .

correspond to the social environment in which it operates. influenced by them. It influences various elements in society and is. philosophy. A business enterprise must. The social system is influenced by the way business carries its activities. therefore. in turn. Business is an economic institution that operates in social system. .The business of a company its priorities direction of development. policies all are guided by its objectives.

The following arguments are offered in favor of corporate social responsibility : 1-Long run survival of business concerns : Firms that assumes social responsibilities may suffer losses in the short-run nut fulfilling social obligations is certainly beneficial for long-run survival of the firms. .Profitable for the business concerns : Assuming social responsibility necessary and helpful for long-run survival of business firms. 2.

. 5-Helps in avoiding government regulation : Business organizations that do not assume social responsibility may be required to do so by the government.3-Moral and social commitment : Business organizations operate in the social environment and therefore should be morally committed to the interest of the society. 6-Resources : Business organizations have enormous resources which can be partly used for soling social problems. 4-Improvement in public image : A business firm that looks after interests of the society develop goodwill and public image.

whose interest should hold priority over others questions are open to subjective considerations. what amount of resources should be committed to social values. . 1-Business is an economic activity : IT is argued by the opponents of social responsibility that basic function of a business enterprise be engaged in it. 2-Quantification of social benefits : What measures social responsibility and to what extent should a business enterprise be engaged in it what amount of resources should be committed to social values.The concepts of corporate social responsibility has been criticized on the following ground.

. 6. this would violate the very purpose of existence of an organizations.3-Cost-benefit analysis : Any social-benefits programmed where initial costs exceed the benefits may not be taken up by business enterprises even in the short-run. 5-Transfer of social costs : Costs related to social programmers are adjusted by business concerns. 4-Lack of skull and competence : Professionally qualified managers may not have the aptitude required to solve the social problems.Sub-optimal utilization of resources : If scares business resources are utilized for social goals.

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