SOCIAL RESPONSIBILITY

• Social Responsibility of Business


  The impact of a corporation's activities on society. This embodies the performance of its economic function and other actions taken to contribute to the quality of life. These activities may extend beyond meeting the letter of law due to the pressures of competition or the requirements of contracts.
• Social responsibility


  An ethical focus for individuals and companies whereby they seek to take action and be accountable for practices that benefit society. Social responsibility has become increasingly important to investors and consumers who seek investments that not only are profitable but also contribute to the welfare of society and the environment.
• Corporate Social Responsibility


  Operating in a manner which meets or excels the ethical, legal, commercial and public expectations that a society has from the business
• Socially Responsible Corporations

  • Starbucks Corp. (SBUX)
  • Ben & Jerry's Homemade Holdings Inc.
  • Salesforce.com Inc. (CRM)
  • Target Corp. (TGT)
• Starbucks Corp. (SBUX)

  • Committed to social responsibility from the start, including sustainability and community welfare. It purchases Fair Trade Certified ingredients to manufacture products and actively supports sustainable farming in the regions where ingredients are sourced
• Ben & Jerry's Homemade Holdings Inc.

  • Has integrated social responsibility into the core of its operations. Like Starbucks, the company purchases Fair Trade Certified ingredients.
• Salesforce.com Inc. (CRM)

  • Developed what it calls the 1-1-1 model. The company dedicates 1% of its equity, 1% of its product, and 1% of its employees' time back to the community.
• Target Corp. (TGT)

  • Also well known for its social responsibility programs, has donated money to communities in which the stores operate, including education grants.
• Reasons for Significance of Social Responsibility

  • Long-Term Interest
  • Indebted to Society
  • Social Power
  • Public Image
  • Social Awareness
  • To Avoid Government Intervention
  • Law and Order
  • Moral Justification
  • Socio-Cultural Norms
  • Trusteeship
• Long-Term Interest


  It is in the long-term interest of the business to discharge its social obligations by serving different interest groups such as employees, consumers, government and citizens. Wise business persons know that unless they serve the society by fulfilling its needs, they will not be able to climb the success ladder.
• Indebted to Society


  A business uses the resources of the society for its functioning. Hence, it becomes obligatory for it to pay back its dues by serving the society. Businessmen should tend to the needs of the society and use its resources for community welfare.
• Social Power


  Business persons are endowed with a lot of social power. They have the potential to change the destiny of the population by collectively deciding for the country on crucial issues such as rate of economic progress, distribution of income among different income groups etc. Ideally. business persons should take up social responsibilities in proportion to their social power.
• Public Image


  A business devoted towards fulfilling its social responsibilities is regarded highly by the society. Good rapport with employees, suppliers, customers and government helps in building a favourable public image of the business enterprise. Moreover, a socially responsible organization is considered trustworthy by the shareholders and investors.
• Social Awareness


  These days, employees and customers are more informed about their rights. While consumers expect the seller to abide by the fair trade practices, workers want fair wages and other employee benefits. If the expectations of these interest groups are not met, they may resort to either anti-social activities or seek help from trade unions and consumer courts. This will lead to industrial turmoil and unrest within the society which is harmful for proper functioning of the business.
• To Avoid Government Intervention


  If a business organization fails to acknowledge and perform its social duties, it is bound to lose its freedom and flexibility in the long-run. The Consumer Protection Act and other legislations passed by the government safeguard the interest of the customers against business persons indulging in black-marketing, adulteration, hoarding and many other illegal trade practices.
• Law and Order


  A peaceful society is congenial to the expansion of business. Unable to withstand exploitation by the business enterprises, the weaker sections can rebel and take the law and order in their hands. As a result, the survival of the business can be threatened
• Moral Justification


  A business possesses resources such as finance and talent pool to help bail out troubled masses out of social issues like poverty, dowry. unemployment and illiteracy by organizing special campaigns and programs. Additionally. business houses can assist the government in solving many other issues like lack of foreign exchange etc. Moreover, business organizations increase pollution by releasing untreated sewage into the environment. Thus, it is a moral obligation of the business to render its services in tackling these issues.
• Socio-Cultural Norms


  India has a rich legacy of business values passed down by the legendary and morally upright business owners like Ratan Tata. Azim Premji, etc. Only those business persons who sincerely abide by the canon of business will get the privilege of being honored by the citizens and the government. Hence, the business should aim to promote equal opportunity and maintain healthy inter-personal relations with all the stakeholders such as customers, employees to carve a niche for itself as a honest enterprise.
• Trusteeship


  The great socio-political leader Mahatma Gandhi propounded the philosophy that owners of wealth and property should hold and use the wealth for the welfare of the society. Therefore, company owners should operate the business not only for their own benefit, but also for the prosperity of the society. According to Keith Davis, since business has the resources to resolve the mounting social problems, it should try and assume the social responsibilities.
• Corporate Social Responsibility (CSR): Concept


  Every business must conduct its operations so as to produce an overall positive impact on society. Corporate social responsibility (CSR) requires every business to behave ethically and improve the quality of life of society. Every business must decide voluntarily to contribute to a better society and a cleaner environment. CSR is a concept that strikes a happy balance between economic, social, ethical and societal concerns of a business. It forces every business to conduct the show in the best interests of society.
• The Essential Elements of CSR

  • CSR is a moral obligation to conduct operations ethically
  • It strikes a happy balance between economic, ethical and social issues
  • It demands every business to conduct the show in the best interests of society at large
  • Businesses must make profits, but that cannot be at the cost of customers
  • It is a voluntary effort undertaken by every business that goes beyond what has been dictated by law
  • It is, in short, a company's sense of responsibility towards the community and environment in which it operates. Now a-days, the term is extended to include philanthropy (love of humanity) and volunteering (actions undertaken without seeking any gain).
• The term corporate social responsibility refers to the concept of business being accountable to how it manages the impact of its processes on stakeholders on a voluntary basis. Since business have to draw on the community in which they operate for all resources, they also have obligations to their multiple stakeholders.