SOCIAL RESPONSIBILITY Social responsibility is an ethical or ideological theory that an entity whether it is a government, corporation, organization or individual has

s a responsibility to society. TWO MODELS OF SOCIAL RESPONSIBILITY: 1. CLASSICAL VIEW- Managements only social responsibility is to maximize profits by operating the business in the best interests of the stockholders. 2. SOCIOECONOMIC VIEW- Managements social responsibility goes beyond making profits to include protecting and improving societys welfare. Firms have a moral responsibility to larger society to become involved in social, legal, and political issues. ARGUMENTS FOR AND AGAINST SOCIAL RESPONSIBILITY FOR Public expectations Public image Long-run profits Ethical obligation Better environment Balance of responsibility and power Discouragement of further governmental regulation

2. Social Responsiveness- When a firm engages in social actions in response to some popular social need. 3. Social Responsibility- A businesss intention, beyond its legal and economic obligations, to do the right things and act in ways that are good for society. Carrolls Four Part Definition 1. ECONOMIC RESPONSIBILITY- business organizations were create as economic entities designed to provide good services to society. 2. LEGAL RESPONSIBILITY- organizations is expected to comply with the laws and regulations promulgated by national and local governments. 3. ETHICAL RESPONSIBILITY- practice those activities that are expected or prohibited by the society 4. PHILANTROPHY- encompasses those corporate actions that are in response to societys expectation that businesses be good corporate citizens. This includes actively engaging in acts or programs to promote human welfare or goodwill.

REPORTED BY: Kristene A. Velasco Administration and Supervision

AGAINST Violation of profit maximization Costs Dilution of purpose LEVELS of SOCIAL INVOLVEMENT 1. Social Obligation- The obligation of a business to meet its economic and legal responsibilities and nothing more.