Introduction (12/12/23)

• Purpose of a business

  • make surplus for shareholders
  • sell goods and services to make profit
• Shareholder = benefit finacially when a business does well
• Stakeholders = anyone who is interested/ affected by anything regarding the business
• Social Contract Theory = employees and stakeholders are given a voice to how the business operates
• Milton Friedman, NYT 1970 ''the social responsibility of business is to increase it's profits''
• Examples of Corporate Social Responsibility

  • materials form sustainable source despite costs
  • refusing sponsorship from companies involved in fossil fuels
  • passing higher wages than rivals or making staff shareholders
  • refusing to test on animals
  • investing in local youth
• Investors are able to buy shares in a business and are paid dividends when it succeeds. This demonstrates that businesses have a duty to shareholders.
• Milton Friedman believed a business did not have corporate social responsibility.