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Business Ethics & Social Responsibility
Business Ethics & Social Responsibility
QUESTION:
Why is it important for a company to balance its social responsibility efforts with its need
to generate profits?
Introduction
There is no single definition of social responsibility but it can be said as acting with
concern and sensitivity, aware of the impact or the disadvantages of the action to the others. It is
generally to be understood to include the obligations of a business to protect the interests of its
customers, employees, suppliers, and the general public. Social responsibility goes beyond the
firm’s relationships with their customers, includes the areas of environmental protection,
community needs and firm’s contributions to the community organizations. Besides of business
and government, activist group and local communities can also associated with social
responsibility. Different entities have different responsibility, for example a state has to ensure
the citizens civil right and the business organizations should concern with human rights of their
employees.
Social responsibility can be divided into two main parts, the responsibility to human and
the environment.
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Responsibility to human means being responsible to people, for the action of people and
the affect of any action to the people. This is concern with the way of the organization in treating
their customers with respect and attention, which is not for profit but taking care of the
customer’s wants and needs. In order to carry out the social responsibility, an organization tries
to perform as best as they can, instead of being irresponsible and often try to keep away
themselves as much as possible from any problem they faced. For example, when the customer
feel that the organization have done something wrong, the company will take the blame and do
some steps needed to fix the problem. Organization has the moral responsibility that empowered
them to help people and not to harm them. Social responsibility is a doctrine that state, whether it
is a village, town, state, corporation, organization, government or individual, each have the
responsibility to the environment and the world around them than to individual because the
impact on the environment is larger and broad than the impact to consumer. An organization
which concern with its social responsibility, will take every consideration into account when
making their decision. This has been proved to become one of the reasons of the company to be
profitable in the long run. Nowadays, many companies are more concern in fulfilling their social
responsibility and every choice they made affect the consumers environmental. Some companies
produce products that are packed in more than required packaging thus all the cost and impact
was passing directly to the consumer but some become more socially responsible. They design
their packaging to be more environmental friendly such as using items that can be recycle rather
than using and wasting more resources that can be used for another important task.
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The need for a company to balance its social responsibility and gain profits is crucial as
The communities where the company operates are very important to them. The scope of
social welfare is wide and varied. The companies can measure their performance, assess the
impact and be committed in making further improvements for the community. The companies
also can gain good image from the community by doing their social responsibility. They are
viewed by the public as a good company who are concern about them. So, the public will turn to
their products and services as they have the good impression about the company and buying their
product or using the services will be a support or reinforces for the company to stay longer in the
business, being well known and gain more profits. A company will also fulfill their social
responsibility to enable them to gain appropriate standard as an achievement for the company.
The standard will enable them to be known as a company who are balance in their efforts in
gaining profits and taking care of the society. Companies also involve in doing social
responsibility to reduce risk management by gaining good impression from their business
partner. They recognize that robust management of more diverse and complex risk, sound
business operations and stable earnings growth are essentials to gain broad trust of market and
customers.
Kellogg Company
Company overview
There are some companies that have been active in fulfilling their social responsibility.
One of them is Kellogg Company. This company was established in 1906 by its founder W.K.
Kellogg. It is a leader in producing cereal and convenience foods including cookies, toaster
pastries, cereal bars, frozen waffles and meat alternatives. With only 44 employees in its early
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opening, today it have more than 26 000 workers, operates in 17 countries and sells its products
at more than 180 countries around the world. The company’s brands include Pop-Tarts®, Cheez-
It®, Rice Krispies®, and Chips Deluxe®. The sought by W.K. Kelloggs “invest my money in
people”, act as a guide to the company and their people in accomplishing their social
responsibility.
Their commitment in doing this as a good corporate citizen includes protecting the
environment, selling nutritious products and advocating healthy lifestyles, acting with integrity
and adhering to the highest ethical standards, promoting diversity in work force and partnering
with diverse suppliers and also ensuring a safe and healthy work place. For communities, this
companies choose to focus on three major area; helping children and youth reach their potential,
improving opportunities for minorities and women and also strengthening the communities. They
support many program and endeavors, contribute money and products and encourage their
They contributed for communities by giving donations for children and youth needs for
their educations and potential growth and invested in a program that benefits this generation.
One of the programs is Help One Student to Succeed (HOSTS), a program that helps teachers in
creating individualized academic plans that can be delivered to the students anytime and
anywhere. Hundreds of Kellogg’s employees and retirees become a volunteered in this program
as mentors to help the students succeed in the school. For minorities and women, they provide
scholarship for talented young people and involves in many programs such as in Girls on the Run
programs that encourages girl in age between 8-13 to be more active, eat right and live a balance
and healthy lifestyle. They also support for the American Heart Association’s Go Red For
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Women, an American heart association for heart diseases. Each year this company donates $20
million of their food products for the hunger and relief to help people in needs.
Kellogg company encourage eating well and healthy living, based on the philosophy that
people can improve their health by eating a balanced diet and engaging in regular physical
activity. They produce high-fiber cereal products that reduce the risk of heart disease and cancers
that also help in achieving and maintaining a healthy body weight. This company valued and
encourages the diversity of their employees backgrounds, experiences, styles, approaches and
ideas that inspires the innovation to gain competitive advantage in serving customers around the
world. This company is very committed in providing safe and healthy work place for their
employees. They encourage employees to search for health rules and practices that can be
applied to their job, include taking precautions to protect themselves and co-workers by reporting
accidents, injuries and unsafe conditions. Kellogg are very concern about the environment. They
work very close and have good cooperation with the local communities, suppliers and
contractors, government agencies and other organizations in improving for better environment.
They have their own environmental policies that promotes and maintain environmentally
responsible practices for the benefits of the customers, consumers, employees and the
communities. They practices their policies by using heat recovering systems, turn wasted food
into animal feed, practices water conservation and reuse and participate in recycling programs.
Besides focusing in energy use, they also held an audit program to measure air and water quality,
waste management practices, spill prevention and control, hazardous materials management and
employee awareness. This company also use completely recycle materials for their packaging for
safe, efficient and environmentally reason which is applicable with their official environmental
policies.
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By performing their social responsibility very well, this company manages to stay longer
in the market and gain lots of customers, including gaining more trust among their business
Lenovo Company
Company overview
Lenovo Company. Lenovo is an international technology company that formed from the merger
of Lenovo Group and IBM Personal Computing Division. This company develops, manufacture
and market cutting-edge, reliable, high quality PC products and professional services for their
customers around the world. Company’s headquarters are located in Purchase, New York, USA
with branches and enterprise sales organization worldwide which employs more than 19 000
peoples. This organization is committed to four company values that are; the customer service,
innovative and entrepreneurial spirit, accuracy and truth seeking and trustworthiness and
integrity.
Lenovo is one of the companies which do very well in performing their social
responsibility. As they have strong commitment to the social responsibility, they are very strict in
ensuring their products, employees, sites and suppliers to apply the responsibility in their
business practices. Lenovo are going deeper to integrate the core value of customer service,
innovative and entrepreneurial spirit and integrity in its business and policies and procedures in
the aspect of quality and safety of their products, employee’s welfare, managing a global supply
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Lenovo is very clear in ensuring the best quality and safety of their product and until now
they are still continually put on their efforts in developing and evaluating new safety initiatives.
They are focusing on the safety of their products at the entire lifecycle of the production from
manufacturing, transportation and installation for customer to use, service and disposal. This is
done to ensure that the product produced meets all legal requirement and safety rules for every
product they sold. Their safeties practices are aim to help to reduce the risk of personal injuries,
property damage, ergonomic discomfort and data loss while using their product. Their emphasis
for product safety and quality enables them to gain high customer’s satisfaction, delivering
quality products, solutions and services that help them a lot in maintaining their company in
competitive business world. For this company, the people inside the organization are the most
important assets for the company. Lenovo are very committed in providing safe and healthy
working environment by supplying their employees with safe and relevant products and
equipments for use in their daily work. It also focuses its efforts in preventing accidents at work
place, injuries and illnesses among its employees. This company was known as a great employer
for its employees as it provides compensation packages and abides for its employees which is
applicable at minimum wage requirements at wherever places it operates. Lenovo also very
concern and committed to the high standards of integrity and responsibility while working with
all the stakeholders as they provide wide ethical guidance to all its employees. They also focus in
helping people around the world to increase their standard of living, such as encouraging
business development and social entrepreneurship. It also shows its respect on the intellectual
property rights of individuals or company such as, supporting China in fighting the piracy in that
country.
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Conclusion
As a conclusion, companies must incorporate their social obligation with the need to
earn profits. Meeting the society’s expectation may be expensive but it will worth with the
company’s goal to gain profits. Companies which are consistent in fulfilling their social
responsibility may bring themselves to be as one of the members of the community that may
attract loyal customers for the good image they have. Doing social obligation will not turn profit
seeking businesses into charitable organization. Practicing social responsibility may leave
positive impact on profits as they can convince more customers and remain stable in business
world.
References:
• http://en.wikipedia.org/wiki/Social_responsibility (1/10/2007)
• http://www.gapinc.com/public/SocialResponsibility/socialres.shtml (1/10/2007)
• http://www.investorwords.com/4616/social_responsibility.html (1/10/2007)
• http://www.entrepreneur.com/encyclopedia/term/82646.htmlefinition: (3/10/2007)
• http://www.pc.ibm.com/ww/lenovo/about/sustainability/ (6/10/2007)
• http://en.wikipedia.org/wiki/Societal_Marketing_Concept (6/10/2007)
• http://www.entrepreneur.com/encyclopedia/term/82646.html (6/10/2007)
• http://www.pc.ibm.com/ww/lenovo/about/sustainability/index.html(10/10/2007)
• http://www.tamron.co.jp/en/envi/report_2006/report05.html (10/10/2007)
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