Ethics and Social Responsibilities of Business Essay

The emergence of solicitude as a distinct and diagnosable activity in the elbow roomrn era has had an classic move on the bon ton with which it developed (Massie 1995). Till the early days of the twentieth century, organizations were preponderantly concerned with their celebrateive profit-maximizing activities. However, this singular intention of profit maximation of seam farms was protested by the societal activists during the later half of the 20th century.They pointed come in that, since the organizations drive their moving in from the participation, the contriveer must possess whatsoever obligations towards the interests and eudaemonia of the later. The concept of note ethics and corporate responsibility gained immense richness after the publication of Bowens fond Responsibilities of stemmaman in the stratum 1953. Bowen opines that product line corporations should affirm certain responsibilities towards the society in which it operates. Often line of merchan dise ethics and its neighborly responsibilities argon regarded as their science of conduct (McNamara). morality is the study of morality and standards of conducts (Fred and Richard, 480). The term ethics is, in generally, used to hang to the rules and principles that define right and wrong conduct. The study of ethics is of immense richness in international prudence because ethical demeanour in a particular country may be mattered as an unethical utilise in different countries. Ethical demeanour of ancestry has become an important aspect in todays corporate environment.Even in the United States, trading s usher outdals, profanes etc. have gained gigantic media exposures and have arouse public concern regarding ethical practices in international business management. integrated business ethics is primarily concerned with h peerlesssty, truth and justice and should consider several aspects like the expectations of society, fair competition, public relations, consumer aut onomy, neighborly responsibilities, adherence to the rules in the operating country, and so on. An organization should be always accountable in creating an environment that fosters ethical decision-making. corporal kind responsibility is seriously considering the impact of the comp whatsoevers actions on society. In the views of Andrews, social responsibility doer the intelligent and objective concern for the welfare of society that restrains individuals and corporate behavior from ultimately destructive activities, no matter how immediately profitable and signifies the cocksure contri thation to human betterment. favorable responsibility contends that the business organizations are responsible to all the interest groups with which it interacts. All the interests groups such as employees, customers, suppliers, government and society should be given importance equal to that of the shareholders of the respective companies.Thus, ethical and social responsibilities signifies that the management should pay attention to the welfare of the workers, consumers needs and safety, the interests and rights of creditors, governments rules, regulations and policies, and the obligations of the organization towards society as a whole. Thus, in otherwise words, Corporate social responsibility indicates the managements commitment towards upholding the interests of direct stakeholders and to dribble in an economically and environmentally responsible manner (Davis and Robert, 1975).Ethical and affectionate indebtedness of Corporate OrganizationsCorporate organizations which are concerned about business ethics and corporate social responsibility need to identify various(a) interest groups which may crop the functioning of a firm and which, in turn, may be affected by the firms decisions. In fact, business enterprises are primarily responsible for the well being of sextuplet major interest groups which are discussed hereunder one by oneprotect Shareholders InterestsThe most important responsibility of business organizations is to protect the interests of its shareholders. The shareholders depict the core resource the capital that enables an organization to operate and grow. They expect the management to use the capital judiciously and operate the business in an cost-efficient way that would ensure a well-grounded return on their investment, some(prenominal) through dividends and through affix in stock value. Shareholders should be provided with commensurate and timely information about the functioning of the organization.protect Employees InterestsEmployees are the biggest assets of the organizations. In the early days, managers regarded employees just now as one of the factors of production and denied them the right to buzz off an equal distribution of income. But, with the passage of time, the situation has changed in a considerable way.Now, it is absolutely mandatory for the management to protect its employees interests. Government la ws and regulations have direct define the responsibilities of the employer ensuring equal work rights for men and women, offering timely pensions and other retirement benefits, and providing and maintaining a secure and healthy working environment. To protect the interests of employees, management mustTreat the employees as the basic pillars of the organization.Develop administrative processes that stir cooperation between employers and employees.Foster a harmonious work atmosphere by adopting a progressive labor policy. This includes allowing the participation of workers in management, creating a sense impression of involvement, and improving the working conditions and living standards of workers.Provide fair wages (not merely the one determined by the market forces of demand and supply) and other fiscal benefits to workers to keep them motivated.Fair selection, training and promotion based on theatrical role and merit without any discrimination on the grounds of sex, race, religion, physical demeanor and so on.Protecting Customers InterestsIn the recent times, great attention is delivered to the customers. In the age of cut-throat competition, business firms have rightly begun to realize the importance of maintaining a healthy relationship with the consumers. The growth and development of consumerism has compelled the organizations to become more conscious(predicate) of their duties and responsibilities towards the customers. The most successful businesses put the customer first, instead of the investors (Mackey). Business firms should effectuate their obligations to their customers byCharging reasonable prices for their products.Ensuring the provision of standardized and quality goods and services.Ensuring the easy approachability of goods and services, so that customers do not have to spend too untold time and energy in procuring them.Abstaining from unethical practices like hoarding, profiteering or creating bionic scarcity, misleading advert isement and so on.Refraining from deceiving customers by making false or misleading claims.Protecting Creditors and Suppliers InterestsAll the inputs productions are provided by the creditors and suppliers in the form of raw materials and capital. Hence, the management must take proper care in fulfilling its obligations towards the former. This batch be done byCreating a long-term and healthy business relationship with them.Making prompt payments to creditors and suppliers.Providing them with accurate, relevant and needed information.Protecting Societys InterestOrganizations function within a social system and draw their resources from this system. Therefore, they have certain obligations towards society. The management of business organizations can fulfill their obligations toward society by preserving and enhancing the well-being of the members of society. Management can do so in the following waysUsing its technical expertise to solve local problems.Setting socially desirable s tandards of living and avoiding supernumerary and wasteful expenditure.Playing an important role in civic affairs. destiny the society in events of national calamity, famine, war, and so on.Providing basic amenities, healthcare and precept facilities, thus creating better living conditions.Establishing development programmers for the benefit of economically weaker sections ofthe society.Protecting Governments InterestsIn any country, the Government provides the basic requirements for the survival and growth of business organizations. Most of the rules and policies which the government imposes are mainly in the favor of the businesses. Hence, the business, in turn, must have certain obligations to the businessBe law-abiding respect the rules, procedures and policies of the governmentPay all taxes and other dues fully, timely and honestly.Not bribe government employees and officials to obtain favors for the company.Not try to use political influence in its favor for own interests.A dvantages and Disadvantages of ethical motive and Corporate sociable responsiblenessIn the modern era, the expectations of the consumers and the society have immensely changed and, resultantly, modern corporations have become much aware of their ethical and social responsiveness. However, opinions vary from scholars to scholars as to whether business should possess much, at least any, ethical and social responsibilities.DisadvantagesThe creator of any business is to maximize its profit. However, much ethical determine and social responsibilities may act against this objective.Any investment (or loss) incurred by the business as a result of good social or ethical behavior are adjusted by increasing the selling of its products. Hence, the motive would be socially less desirable than in the days before when business were concerned with social responsibilities (Friedman 1970).Business derives immense power through its social involvements and ethical behavior. This power is generally derived from the government or through other political means. This increment in power can lead to rottenness and even conflicts with customers, governments and the society as a whole in the consequent times.Generally, business people lack the required skills to deal with the problems outside the organization. affable responsibility can be an excess burden of duty to them.AdvantagesSocial involvements and strong ethical behavior boost up the image of the business corporations in the eye of the customers. Being socially responsive, business can increase the number of its loyal customers. A favorable public image helps the business to attract more employees, customers and investors.By being socially responsible, business organizations can easily avoid the attention of regulatory agencies and earn governments trust resulting in increasing flexibility and independence in their mode of operations.Businesses can increase conservation of natural resources by being socially responsible. F or example, Items that were considered as waste before (like empty soft drink cans and charge plate bottles) can be recycled and profitably used again.Society and business are equally benefited if a symbiotic relationship exists between the two. Instead of allowing superior rate of unemployment leading to social crisis (which may ruin business operations in subsequent periods), businesses can rather be the source of employment in the economy for qualified and eligible people.ConclusionIt is beyond any iota of doubt that every civil citizen must possess some moral or ethical values and responsibilities for the society in which he lives. Business organizations, considered as artificial people, therefore, should have the same values incorporated in it. Obviously, there are certain principles which is directed against this conclusion, but it is a cardinal truth that business corporations must behave ethically and contribute to economic development while improving the quality of life- time of the workforce and their families as well as of the local community and society at large (Holme and Watts).ReferencesBowen, H.R. (1953), Social Responsibilities of the Businessman, Harper & Row,New York, NYCorporate Social Responsibility Evolution of a Definitional Construct Carroll Business Society.1999, pp. 268-295Davis, K. and Robert, L. B. Business and Society, purlieu and Responsibility, RevisedEdition, Tata McGraw Hill Book Company Inc. New York, 1975Friedman, M. The Social Responsibility of Business is to Increase its Profit, New YorkTimes Magazine, 13 September, 1970Kuhn, J.W. Issues and Analysis, Values in a Business Society, Harcourt Brace Jonanovich,New York, 1968Holme, L and Watts, R. The World Business Council for Sustainable Development,MakingGood Business Sense http//www.mallenbaker.net/csr/CSRfiles/definition.htmlJoseph, L. M. Ethical and environmental Foundations, Essentials of Management, FourthEdition, Thirteenth Indian Reprint, Prentice-Hall of India, Ne w Delhi, 1995Mackey, J. (adapted from) Rethinking the Social Responsibilities of Business, October 2005 http//www.reason.com/news/ make/32239.htmlMcNamara, C. Complete Guide to Ethics Management An Ethics Toolkit for Managershttp//www.managementhelp.org/ethics/ethxgde.htmRichard, M.H. and Fred, L. Ethics and Social Responsibilities, world-wide Management,Third Edition, McGraw Hill International Editions, 1997Stehi, S.P, Dimensions of Corporate Social Performance, An analytical Framework,California Management Review, Vol. 17, No. 3, 1975, p. 58 64The International Seminar on Social Responsibilities of Business (as quoted by Mukharji,P.B. Social Responsibilities of Business, p. 9