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 SOCIAL RESPONSIBILITY OF
BUSINESS AND BUSINESS ETHICS

Social responsibility is the obligation of businesses towards the society.

Businessmen should know the impact of their decisions and actions on
the other sections of the society.they should recognise and understand
the aspirations of society in which they carry on their business. A
business cannot exist in isolation so the businessmen may use of
resources of society and earn from the members of society so they must
do something in return for the society.

THE CASE FOR SOCIAL RESPONSIBILITY

A Businessmen must perform the social responsibilities because of the

following reasons-
1. Long term interest of the firm- in the long run a firm and its image
stands to gain 

maximum profits when it has its highest goal as services to society. It
is in its interest if a firm fulfils its social responsibility . The public
image of any firm would also be improved when it supports social
goals. 


2. Avoidance of government regulation- from business point of view ,

government regulations are undesirable because they limit freedom.
So, a business can avoid the problem of regulations by voluntarily
assuming social responsibilities , which helps to reduce the need for
new laws. 


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3. Social power- a business firm has considerable social power . It
directly affects the rate of economic growth, employment opportunities ,
distribution of income etc. business has a corresponding responsibility
toward the society. There must be a balance between the power and
responsibility.
4. Contribution to social problems - business has created social problems
such as pollution , creation of unsafe workplace, discrimination etc.
there is. a moral argument that business has an obligation to help in
solving social problems because it helped in creating those . Business
must take initiative to solve social problems.
5. Better environment for business- social responsibility creates better
environment for business operations as social responsibility improves
quality of life, results in raising standards of living. So business will get
better community to conduct business.
6. Resources used for moral justification- business has resources such as
money , talents , expertise in technical areas , physical and financial
resources. The businessmen can assist government with these resources
involving problems. For eg, business can help in solving problems of
regional disparity by setting up industries in backward regions, business
can help in solving problems of unemployment by offering employment
opportunities . The business should help society in solving its problem.

REALITY OF SOCIAL RESPONSIBILITY

The main reasons and factors which have forced businessmen to

consider their responsibilities towards society-
1. Threat of labour movement- Nowadays, even labour in our country is
getting organised 

and they are far more educated. Labour movements force the

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 business firms to take care of welfare of labour and reward them for
the efficiency. 


2. Threat of Public regulation- government has to take care of various

sections of the 

society , in some situations when a business behaves in a socially
irresponsible manner , action is taken to regulate their activities and
safeguard the interest of the people. 


3. Development of business education - educated and professional

businessmen prefer to 

perform social obligation. Educated persons as consumers ,
investors , employees or 

owners have become more sensitive towards social issues. 


4. Impact of consumer consciousness - because of the development of

mass media , education has made consumers aware of their rights .
In present, day market, the customers is considered as a king.
Because of which business firms have started following consumer-
oriented policies. 


5. Relationship between social interest and business interest- business

organisations have realised that social and business interest are not
contradictory but they are complementary to each other. 


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 SOCIAL RESPONSIBILITY TOWARDS DIFFERENT INTEREST GROUPS



1. RESPONSIBILITIES OF BUSINESS TOWARDS CONSUMERS-
i. To follow fair trade practices. 


ii. To handle consumer complaints and grievances quickly. 


iii.To endure regular supply of goods and services . 


iv.Being truthful in advertising. 


v. To educate customer regarding the use and contents of the product.

2. RESPONSIBILITIES TOWARDS EMPLOYEES-

i. Providing fair compensation and benefits . 


ii. To develop a sense of belongingness 


iii.To ensure fair and regular return on investment. 


iv.To give them opportunities for personal growth and development. 


3.RESPONSIBILITIES TOWARDS COMMUNITY-

i. to protect the environment from all types of pollution. 


ii. To provide more employment opportunities 


iii.Providing economic stability. 


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 iv.To preserve social and cultural values. 


v. To help the weaker section of the society. 


4.RESPONSIBILITIES TOWARDS THE GOVERNMENT-

i. To pay taxes and duties on time . 


ii. To help in solving social problems 


iii.To abide by rules, regulations and laws . 


iv.To cooperate in planning, investigation and administrative activities

of the government. 


5.RESPONSIBILITIES TOWARDS THE OWNERS/SHAREHOLDERS/

INVESTORS.
i. To ensure safety of investment. 


ii. To ensure fair and regular return on investment. 


iii.To give them opportunities to participate in decision making. 


iv.To give them full information of the financial position of the business. 


6.RESPONSIBILITIES TOWARDS SUPPLIERS.

i. To ensure regular payment to the suppliers. 


ii. To adopt fair dealings with suppliers. 


iii. To protect and assist small-scale suppliers buy placing orders with
them.
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 BUSINESS AND ENVIRONMENT PROTECTION

The main problem that industries and businessmen are creating is that of
pollution. The damage to the environment has contributed to increasing
disease and disaster.

Causes of environmental pollution

Pollution can be defined as the injection of harmful substances into the

environment .

1.AIR POLLUTION- air pollution refers to injection of harmful substances

in the atmosphere which results in lowering the quality of air we breathe
in. It is a serious problem for the whole world as it has created a hole in
the ozone Laye of atmosphere . Smoke, chemical emitted by factors and
smoke emitted by vehicles are the main causes of air pollution.

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2.WATER POLLUTION- it refers to dumping of chemical and other
wastes in rivers , lakes etc. factories located near the rivers , streams
dump their tase into rivers , lakes, etc causing pollution ofd water.

3.LAND POLLUTION- it refers to dumping of toxic waste in the land

which affects the fertility of land and makes it unfit for agriculture.

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 NEED FOR POLLUTION CONTROL

Nowadays , pollution is a serious problem . It is spoiling the quality of

environment. The main reason to control the pollution are as follows-

1. To ensure healthy life- to control pollution is a must to ensure a

healthy life of people. Pollution leads to many diseases. Air pollution
is the main cause of heart and lung diseases and cancer , whereas
water pollution leads to liver and kidney problems . So , pollution
control is must to keep a check on these diseases. 


2. To maintain natural beauty- pollution has a direct impact on the

natural beauty . Such as rivers , mountains, trees , lands etc.
pollution is affecting all of these. 


3. To ensure safety- due to environmental pollution and smoke the

visibility is reducing. Which results in more accidents of automobiles
on highways and it can be hazardous for the landing and taking off
the aeroplanes. Therefore , to improve such situations a check on
environment is needed.

4. Economic losses- air pollution is blackening the building , on the

other hand water 

pollution is affecting the sea and land pollution is affecting the
fertility of land. All these 

are bringing heavy economic losses for the country. 


5. To lead a comfortable life - Pollution is creating nuisance and

inconvenience . Because of 


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 pollution rivers become unfit for swimming fishing. Air pollution
causes eye irritation, or coughing and breathing problems, thus
pollution control is required to reduce inconvenience so that people
can lead a comfortable and healthy life. 


BUSINESS ETHICS



It refers to set of moral values or standards or norms which govern the
activities of a businessman . Ethics define what is right and what is
wrong . For a businessman ethical decisions expected are-
• To provide the customers with true information regarding the
products and services. 


• Allowing the customers to amok free choice. 


• Providing quality of products at reasonable prices. 


ELEMENTS OF BUSINESS ETHICS 


Some of the basic elements of business ethics are-


1.TOP MANAGEMENT COMMITMENT- top management has a vey
important role to guide the entire organisation towards ethical
behaviour. The CEO and other top level managers must be openly and
strongly committed towards ethical conducts and guide people working
at middle and low level to allow ethical behaviour.

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2.PUBLICATION OF A “CODE”- ethical organisation define a code of
conduct and set of ethics for all the employees in the organisation .
These principles, are defined in a written document called code.

3.INVOLVING EMPLOYEES AT ALL LEVELS- while making ethical

programmes and policies employees must be involved because these
have to be practised by them only . Forman small group of employees
the ethical policies can be discussed by. Them and can be examined.

4.MEASURING RESULTS- it is very difficult to measure the ethical results

but it must be verified and audited that how far work issuing carried on
according to ethical standards . From time to time top level must meet
the employees to set the future plan of action.

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