There Is One And Only One Social Responsibility Of Business By John Friedman

In the corporate setting, capitalism plays an important role in the sense that it helps ensure that the decisions made by leaders, such as the CEOs, take into consideration the company’s or stockholders’ interest in gaining profit (Peñaloza & Barnhart, 2011). This implies that it compels business leaders to make decisions that minimize loses while increasing the profitability of the firm. In most occasions, this is accomplished through the application of the utilitarian and Kantian approach to decision-making. However, it’s important to note that the central implication of public capitalism is that of helping foster corporate decision-making based on the broader effort to promote the public good (Peñaloza & Barnhart, 2011).

Milton Friedman’s shareholder theory of management says that the purpose of a business is to make money for the owner or the stockholders of the business. Friedman says that there is only one social responsibility for the business: to use its resources in order to increase

During these times of change business may have to change its orgainsation, operation and its nature to deal with the challenges of each stage in the business life cycle. For business to be successful they must constantly develop and change strategies to deal with the growth of the business or the life of the business may be cut short.

First thing let us start with a little overview of what Milton Friedman exposed in his article. It seems that the whole point of his essay revolves around one basic statement which clearly says that the only social responsibility of business is to use its resources and engage in activities designed to increase its profits so long it stays within the rules of the game (Milton Friedman, the social responsibility of business is to increase profit).

What Friedman implies is that shareholders should only be concerned with maximizing profits and not be obligated to be “socially responsible.” In that case, the manager would only have one priority, to maximize profits. However, what if that manager determined that social endeavors is the best option to maximize profits? This would make the corporation socially responsible while still maintaining maximum profits. The argument presented by Friedman in this case is that while the manager is performing as expected by maximizing profits, this type of “social responsibility is frequently a cloak for actions that are justified on other grounds rather than a reason for those actions.”

The ethical issues presented in this case are the different views that each individual has on how the idea of corporate social responsibility (CSR). This dispute is between Mr. Milton Friedman, John Mackey, and T.J. Rodgers; all of which has a different outlook on CSR. The definition of CSR refers to the responsibilities that business has to the society in which it operates and to those actions that a business can be held accountable. Most philosophers have come up with three different types of responsibilities that corporations can be held accountable for. The first and most important of the three is a corporation’s duty to not cause harm. If a corporation can

Subsequently, Denning may have misinterpreted Friedman’s main argument. The actual title of Friedman's article is "The Social Responsibility of Business is to Increase its Profits". Denning hastily substituted the word "sole" for "social" and misinterpreted Friedman’s argument to be that that the sole purpose of the firm is to make money for shareholders. This is not true. The main issue Friedman was tackling was the social responsibility of business; the responsibility that it has to the society. In fact, the word “sole” was not mentioned even once in the

The first source is a quote by Milton Friedman that criticizes the view of corporate officials needing to abide to a “social responsibility”. He claims that, in a free market economy, corporate officials only have one goal, to increase profits for their business. So long as it's done without deception, fraud and engages an open and free competition. It is obvious that Martian Friedman is a supporter of capitalism. Capitalism is an economic and political system in which a country's trade and industry are controlled by private owners for profit, rather than by the state or province. It is a right-wing ideology built on the foundation of individualism. It encourages freedom of action for individuals over government control. The source presents Milton is a supporter of individualism and classical liberalism. He favors an economy focused on making profits for the individual with little to no government intervention. Ideologies that

Milton Friedman argues that persons may choose to undertake social responsibilities to their communities, churches, or nations, and devote their own incomes to causes that they deem morally worthy. But, he adds, if corporate executives attempt to take such social responsibilities or to direct the corporation’s profits to such personal causes, without approval from the shareholders, then:

The purpose of this book is to make us see that nearly all-operating prescriptions for creating large-scale corporate change are nothing but myths and that changes do not happen from one day to another by a miracle, the change from good to great is the result of a successful plan who

Nevertheless, Friedman pointed out that the profits has taken the firms in to the hand of business intellectuals by which Friedman recommend that the financial system by which the organisation run its business is in the restricted responsibility protection which makes the organisations to privatise their profits (Friedman 1970 pp. 177-184). Friedman also suggested that according to him the shareholder theory in terms of socially responsible can only increase the profit. But on the other hand shareholder theory of Edward Freeman completely support the theory of shareholder towards its role to be socially responsible in the society and maximising the profits for the benefits of shareholders within the firms and society as well (Freeman 2008 pp. 162-165).

Milton Friedman wrote in his famous 1970’s article in The New York Times Magazine, that “the one and only social responsibility of business, is to increase profits for shareholders.” Milton Friedman's view on business responsibility accentuates the importance of maximizing firm's value. He pointed that the “there is one and only one social responsibility of business –to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engaged in open and free completion without deception or fraud’’ and by taking on the burden of social cost, the business becomes less efficient (Milton Friedman, 1962).

Milton Friedman was an American economist, statistician and writer, who had a massive impact on the research agenda of the economics profession. His famous words “the only responsibility of business is to increase its profits” (Friedman, Milton. 1970) led to many controversial debates on whether businesses should have ethics or if profit should be their main goal. Corporate social responsibility has many definitions, as its interpretation is quite loose, so I have chosen one that relates the most to this essay, given by the World Business Council for Sustainable Development, in 2000: “Corporate social

Question 1: In the 1960s, Milton Friedman said that the purpose of business was to increase shareholder return and that issues of ethics were not the concern of any business – the law should be complied with, morality should be strived for, but ethical consideration had no place in the business environment.

Friedman argues that the only responsibility a business has to society is to act in its own self-interest to create revenue and remain successful in the economic system (158).Created to make a profit by providing a task or service, a business must “use its resources and engage in activities designed to increase its profits” (Friedman 164). A business could use any tactic to gain a profit as long as they remained “within the rules of the game” (Friedman 164). The rules implied that no deception or fraud could take place while the corporation obtained their profit.