T. Samuel Pongen1 BBA – BChrist University

“The social responsibility of business encompasses the economic legal, ethical and discretionary expectations that a society has of organization at a given point in time “

According to Keith Davis “Social Responsibility refers to types of business obligations :(a)the socio economic obligation(b)the social human obligation

OBJECTIVES OF SOCIAL

RESPONSIBILITY

Economic objectives

1.The owners

2.The employees

3.The customers

HUMAN OBJECTIVES

1.Employees

2.Customers

Social Objectives

1. Micro Level (i.e., immediate

environmental objectives )

2.Macro level (i.e., national objectives

)

LEGALA business has a responsibility to operate by the laws of the land, since laws are meant for the good of society

ETHICAL•This includes the behavior of the firm that is expected by society but not in codified by law.

FINANCIAL(Economical)A business enterprise is an economic entity therefore its primary responsibility in making profit.

DISCTRETIONARY (Philanthropic)The voluntary obligation that an enterprise assumes, it is the responsibility of a company to safeguard the capital investment by avoiding speculative activity and undertaking only healthy business ventures which give good returns on investment.

IMPORTANCE OF SOCIAL

RESPONSIBILITIES

• Best interest of business to promote and

improve the communities

• Improves public image of the firm

• Improving stock price

• Solving social problems

• Resource given by the organizations to

solve the social problem

Business Ethics• The word ‘ethics’ is derived from the Greek word ‘ethos’

meaning character, ideals, norms or morals prevailing in society.

• It is concerned with what is right and wrong in human behavior.

• Ethics can be viewed as an entire body of moral values that society attaches to the actions of human beings.

• Ethics concerns itself with relationship between business objectives, practices and techniques and the good of society.

VIEWS OF SOCIAL RESPONSIBILITY OF A BUSINESS

• Communist view

• Capitalistic view

• Pragmatic view

• Trusteeship view

Corporate Governance• Refers to the set of systems,

principles and processes by which a company is governed

• It is based on conducting business with integrity and fairness, making all disclosures and decisions complying with the laws of the land and conducting business in ethical manner

THE GOLDEN PEACOCK AWARD

Benefits of Corporate Governance

1. Creates overall market confidence and long term trust

2. Increases share prices

3. Ensures integrity of financial reports

4. Limits liability by top management

5. Improves strategic thinking

Limitations of Corporate Governance

1. Costs of Monitoring

2. Easily Corruptible

3. Family-Owned Companies

Business and Environmental Protection

• Environment – The totality of man’s surrounding which are in the nature of resources such as land, water, flora, fauna etc.

• Pollution – The introduction of harmful substances into the environment

AIR POLLUTION WATER

POLLUTION

LAND POLLUTION

SOUND POLLUTION

Need for Pollution Control

Reduction of Health Hazard

Reducing Liability

Cost Saving

Improved Public Image

Other Social Benefits

Role of Business in Environmental Stewardship

1. Creating, Maintaining and developing work culture for environmental protection

2. Adopting eco friendly techniques

3. Complying with laws enacted by the government for prevention of pollution

4. Involvement in environmental protection programs

5. Assessment of pollution control

6. Arranging workshops and training materials