SOCIAL RESPONSIBILITY

OF BUSINESS

 Every

business enterprise is an integral

part of the society.
It uses the scarce resources of the
society to continue and grow.
Thus no activity of business should be
injurious to the interests of the society.

Social Responsibility of business

Meaning
Obligation of business enterprises to adopt
policies and plans of actions that are
desirable in terms of the
Expectation
Values
Interest of the society.
It ensures that the interests of different
groups of the public are not adversely
affected by the decisions and policies of the
business

Social Responsibilities of Business towards

Different Stake holders

Responsibility towards the shareholders or

owners.
Responsibility towards the Employees.
Responsibility towards the Consumers.
Responsibility towards the Suppliers.
Responsibility towards the Financiers.
Responsibility towards the Government.
Responsibility towards the Community.

Responsibility towards the shareholders

or owners.
Fair return on their investment.
Appreciation in the value of share.
Ensure better performance
Full disclosure of information
Organizing AGM
Voting rights

Responsibility towards the Employees

Ensure a fair wage or salary
Working Hours
Good and Safety working condition
Medical Facilities
Housing Facilities
Canteen Facilities
Leave facilities
Retirement benefits
Educational allowances for children
Reasonable amount of bonus
Provision for participation in management

Responsibility towards the Consumers

Quality of products / services
Reasonable Price.
Adulteration should be avoided.
Packaging and labeling.
Advertisements should not mislead the
customers.
After sale service.
Customers grievances should be redressed
immediately.

Responsibility towards the Government

A
business enterprise must follow the
guidelines of the government while setting up
the business.
It conduct the business in lawful manner.
It should disclose the required information.
Taxes must be paid honestly and on time.
It should not indulge in any corrupt practices
or unlawful activities.

Responsibility towards the Community

Promoting social and cultural values.
Generating employment opportunities
Contribution
towards the upliftment of
weaker sections.
Protecting
the physical and ecological
environment of the society.
Contribution to the community development
programmes like public health care, sports,
cultural programmes.

Responsibility towards the Suppliers

Payment should be made promptly.
Responsibility towards the Financiers
Prompt payment of interest and repayment of
principal amount.

Business Ethics

Meaning of Ethics
Ethics originated from the Greek word ethos
Culture prevalent behaviour in the society.
Character, conduct and activities of the people based
on moral principles / values.
It is concerned with what is right and what is wrong
in human behaviour on the basis of standard
behaviour or conduct accepted by the society.
Honesty,
truthfulness,
compassion,
sympathy,
feeling of brotherhood etc.

Ethics is about voluntarily conforming to what is

good/acceptable/desirable behaviour without the force
of any legal/social obligation.
Choosing to do some thing that is not mandated by
the law or not doing some thing that is permitted by
the law but may cause harm to some one.
Ethics can result from
Religion
Philosophy
Family teachings
Social value

Business Ethics

Business ethics are the moral principles, which

guide the behaviour of businessmen or business
activities in relation to the society.
It provides certain code of conduct to carry on
the business in a morally justified manner.
Doing what's right in relationship with
stakeholders.
Normal principles and standards that define
right and wrong behavior in the world of
business.
What is right and wrong is determined by public
interest groups/ business organizations.

Broad Areas of Business Ethics

Managerial Mischief
Illegal, unethical, or questionable practices of
individual managers or organizations.
Moral Mazes
Ethical problems that managers must deal with on
a daily basis

Business Ethics
Avoiding Malpractices
Black-marketing,
Artificial high pricing,
Adulteration,
Cheating in weights and measures,
Secret kick backs to administrators and politicians
Selling of duplicate and harmful products,
Hoarding, etc.
Improving Customers' Confidence
Being honest and truthful about quality and
quantity of goods,
Charging fair prices.

Safeguarding Consumers' Rights

right to health and safety,
right to be informed,
right to choose,
right to be heard,
right to redress, etc.
Protecting the rights - Employees,
Shareholders,
Suppliers, Financiers,
competitors.
Encouraging Healthy Competition
Paying taxes and discharging other
obligations promptly.

Theories of Ethics
Utilitarian Theory
Plans and actions of the business should be
evaluated by their consequences.
Basic Rights Theory
Functions / activities of the business must
not violate basic rights.
Theory of Justice
Business decisions must guided by fairness,
equity and impartiality to ensure justice.

Elements of Business Ethics

High Business Value
Ethical evaluation of Management Decision
Adoption of fair means to achieve objectives
Discharge Social Responsibilities
Keeping Promise
Upholding Cultural & Religious value of society
Ethical Co operation