There are conflicting expectations of the nature of a company’s responsibilities to society. However, those companies that undertake what may be termed ‘Corporate Social Responsibility’ must decide; what are the actual social responsibilities of these companies? I will present a possible paradigm. Also, I will look at the benefit to the business that employs proper management as compared the business with poor management. This research paper describes my view of corporate social responsibility and compares the social responsibilities of Delta Air Lines and Spirit
Because corporations are established to profit and shareholders invest money with expectations of a greater return, managers cannot be given a directive to be “socially responsible” without providing specific criteria of checks and balances to which needs to adhere. Therefore, it is imperative to the success of a corporation for managers to not act solely but rather to act within the policies of the shareholders.
Every business has a social responsibility toward society. That means to maximize positive affects and minimize negative affects on the society. Social responsibilities includes economic-to produce goods and services, that society needs at the price, that satisfy both-business and consumers, legal
Many believe that business entities should have an ethical duty to be socially responsible, to work towards increasing its positive effects on society while decreasing its negative effects. Many organizations look for opportunities to be socially responsible while also creating shareholder wealth.
There is no dispute that CSR is accepted as a potential means to help today companies with customers concerning ethical and environmental issues to get competitive advantage, but there is not any prove that always ethical values leads to financial profits. Different
In Friedman’s article, The Social Responsibility of Business is to Increase Its Profit, he gives two arguments for what, if any, social responsibilities a business has and why they have it. In his arguments, he presents a businessman in charge of running the business on behalf of the owner. The first point he raises in dictating what responsibilities the businessman should fulfill involves defining the businessman’s purpose. He was hired as an agent of the shareholders, the owners of the business, etc. to make the business profitable. Barring some eleemosynary functions, as Friedman states, such as hospitals and schools, the general purpose of a business is to make money, therefore, the responsibilities of an agent of the business would be to increase said profits. To do otherwise would be to fulfill a purpose other than the one he was hired for and betray the owners.
John Friedman begins his text with mentioning the misquotation of Milton Friedman’s famous sentences, “There is one and only one social responsibility of business to increase its profits." John Friedman says, “In fact they are misquoting and simplifying just one part of Mr Friedman's more than four decades' old statement. The complete statement is rather broader and brings in a few elements of what is today considered to be integral parts of corporate responsibility -- ethics and integrity.” In the complete statement, Milton Friedman says, “There is one and only one social responsibility of business -- to use it resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to
My analysis is that is in order to solve these social problems, the environment will need to be cleaner. Our organization would benefit by contributing to assist in correcting these issues. The company can use ethical decision making to secure the organization environmental responsibility. Decisions that would allow for government agencies to get involved with the organization. For instance if a company is proactive and follows the United States Environmental Protection Agency guidelines for emissions on dangerous pollutants and even goes an extra step to get involved in the community and address those concerns that the public might have; they would be less likely to have the EPA investigate them for environmental concerns.(Corporate social responsibility, 2009).
Continually in today’s working environment businesses and corporations stay finding new ways and methods to align their business goals and values with the profitability of those who they serve or work for (stockholders, other agents). The goal of companies in the business sector is still maximizing profit, but questions now arise at to what extent is that the only goal of the company. Furthermore, we see now more than any time period in history, companies taking on more of a social responsibility than before, which effects their decision making and business plan. The argument therefore remains, is increasing profits the only social responsibility of business?
In so doing, corporations does not go empty handed; the reward is profits for its owners and management. The society benefits more in terms of growth and satisfaction in different respects. Company goals nowadays incorporate morals or some statements that linger on ethical behavior and morality, hence companies have a social responsibility as defined by their very own mission statements and objectives. This further attests to the notion that there is a social contract to deliver what society deems necessary to achieve developmental growth.
Is the deception of consumers worth making a profit? The Ford Pinto, popular car of the 1970s, made a profit off of a vehicle that endangered the lives of hundreds of people. In his essay “Pinto Madness” Mark Dowie, author and Pulitzer Prize nominee, exposed the unethical decisions made by Ford Motor Company. When it came to their customer’s safety and profit for the company, Ford made a decision that led to consequences their customers had to pay the price for. Should the business be held accountable for these actions? In his essay “The Social Responsibility of Business Is to Increase Its Profit” Milton Friedman, powerful economist, discusses what a business should prioritize in the economic system. Friedman declares what a business is responsible for and the guidelines they must follow. Due to Friedman’s view, he would not have condoned the actions and decisions that the executives at Ford Motor Company took.
Some business leaders are taking good moral decisions and the reason behind that idea is that the core part of their business strategy is to create mutual benefit for both wider society and business as well. The growing desire of top management is to find out ways to create mutual benefit for both the organizations and the stake holders but the public still believes that companies are greedy entities which make decisions only in their self-interest, even at the cost of greater public welfare. It is the utmost obligation of the companies to discern the social issues while making the decisions (Yashiro, Yoshida and Suzuki, no date; Godwin, 2006; Schwab, 1996; Godwin, 2008; Werhane, 1998; Werhane, 2002; Heath, 2008; Mehalik and Gorman, 2006).
A business is not one that lives in isolation; it can be an integral part in a community’s success or demise and has social responsibilities to; the community, stakeholders, and anyone who may be affected by a company’s actions. Corporate social responsibility is a term that is never used lightly and is a key role in the development of a successful and morally healthy business. “The objectives of a corporation are to outperform its competitors, presumably through preferred competitive strategies” (Joseph Heath 123). There are three main models by; Freeman, Friedman and Heath discussing corporate social responsibilities and all have distinct differences between their moral obligations, and the way they perceive business should be ran in a
One argument is that firms face trade-offs between their social responsibility and financial gain. Those who believe this propose that the incur costs firms have to pay for their socially responsible actions put them at an economic disadvantage compared to others. These additional costs include actions such as charitable contributions, promoting community development plans, etc. Another view is that the explicit cost of a corporate’s social responsible duties are minimal and that they ultimately benefit in doing so with an increase in employee morale and
It is evident that the activities of every business are concern for all its stakeholders and for the business itself and this initiates continuing business activities to inculcate the code of ethics and social responsibility in its organization. Social responsibility for the corporate become an integral part of their various operations be it in human resource, in management or in wealth creation process which increases the competitiveness in the market of the business and enhances wealth creation value for the society as whole. But there is nothing same for the different organization that are different approaches, different values and priorities of the business. The business goal is to encourage the positive approach of