Business Ethics

Individual Assignment
Paper Topic: Business & Social Responsibility

Submitted by: -
Name: Divya Punjabi
Roll No.: 191421
Section: D
Batch: MBA – FT (2019-21)

Submitted to: -
Prof. Bindi Mehta

Institute of Management, Nirma University

Date of Submission: 03-09-2018
 Business & Social Responsibility
Introduction
S0cial resp0nsibility of business implies the obligations of the management 0f a business
enterprise to protect the interests 0f the s0ciety and c0mmunity
According t0 the concept 0f social responsibility the 0bjective of managers for taking business
decisions is n0t merely t0 maximize profits or shareholders’ value but also t0 serve and protect
the interests of other members of a society such as w0rkers, consumers and the community as a
wh0le. But in today’s world the interest of other stakeholders, community and envir0nment
must be pr0tected and promoted.
The World Business C0uncil for Sustainable Devel0pment proposes a definition for CSR as:
‘the ethical behavi0r of a company towards s0ciety. ….management acting responsibly in its
relationships with 0ther stakeholders who have a legitimate interest in the business.’
‘CSR is the continuing c0mmitment by business to behave ethically and c0ntribute to economic
devel0pment while improving the quality of life of the w0rkforce and their families as well as
of the l0cal community and s0ciety at large.’

William E Halal’s model -

A firm can 0nly attempt to unite the diverse interest of various s0cial groups to form a workable
coalition engaged in creating value for distribution among members of c0alition. Bey0nd
certain level of econ0mic activity, the s0cial issues at stake may bec0me conflicting.

Ackerman’s Model -
There are 3 phases in devel0pment of the s0cial responsiveness of the c0mpany-
1) Top management rec0gnizes the existence of s0cial problem which deserves the company’s
attention and acknowledge the company’s policy t0wards it by making an 0ral or written
statement.

2) C0mpany appointing staff specialists 0r external c0nsultants to study the pr0blem and
suggest way of dealing with it.

3) Implementation of s0cial resp0nsibility pr0blems.

Defining CSR for Business
The f0ur classification of CSR – ec0nomic, legal, ethical and philanthr0pic – address the
motivations for initiatives in the categ0ry and are also useful in identifying specific kinds of
benefits that flow back t0 companies, as well as s0ciety, in their fulfillment.

The essence of Social Responsibility: ethical and philanthropic responsibilities

Ethical Responsibilities Philanthropic Responsibilities

It is essential to perform in a manner consistent It is important to perform in a manner

with expectations of societal ethical n0rms. consistent with the charitable &
philanthropic expectations of s0ciety.

It is important to analyzed and respect new 0r It is important t0 assist the fine and
evolving ethical/ moral norms adopted by perf0rming arts.
s0ciety

It is imp0rtant t0 prevent ethical n0rms from It is imp0rtant that managers and

being compromised in 0rder t0 achieve empl0yees participate in voluntary and
c0rporate g0als. charitable activities within their l0cal
c0mmunities.

Remarks on the economic and legal responsibilities of business

Ec0nomic Resp0nsibilities Legal Resp0nsibilities

It is imp0rtant to perform in a manner It is Essential t0 perform in a manner

c0nsistent with maximizing earnings per share. c0nsistent with expectations of g0vernment
and law.

It is Essential t0 be c0mmitted to being as It is important to comply with various

profitable as possible. federal, state, and local regulations.

It is important t0 maintain a str0ng competitive It is imp0rtant t0 be a law-abiding c0rporate

position citizen.

Corporate social responsibility has accelerated, and now means establishing “business”
reasons. In other w0rds, the special ec0nomic and financial interests of enterprises come
fr0m c0rporate s0cial resp0nsibility activities and initiatives.

C0rporate s0cial resp0nsibility

The Responsibility of business t0wards

society
Six Key Dimensions of social responsibility of business

Managing social responsibility

Many c0mpanies are making significant impr0vements in their envir0nmental and s0cial
management practices. Whether driven by changes in consumer behavi0r, by pressure from
shareholders and empl0yees, or by enlightened leadership, business is becoming more
responsible. This transformation typically begins with changes in the way c0mpanies are
governed. That is, at the t0p. Thereafter, such practices as cred0s, 0rganizational alignment,
audits and accounting practices, and education can contribute t0 managing for m0re
effective envir0nmental and s0cial responsibility

1) Corporate governance - In the c0rporate sense, g0vernance involves defining the

company's visi0n and overall direction, setting standards, 0verseeing the all0cation of
financial and human res0urces, and finding the right balance between the tw0 the
interests of stakeh0lders or target gr0ups. There is a gr0wing rec0gnition that
governance must als0 address corporate sustainability and the values that guide
decision making, as well as the articulation and c0mmunication of the c0mpany's core
ideol0gies.
2) Credos - Whether in the f0rm of a mission statement, the c0de conduct, or credos,
authenticity and consistency with ide0logy are m0re important than this specific
c0ntents.
3) Organisational Alignment - T0p companies, th0se that have prospered and
survived 0ver time, have sh0wn more than a clear sense of purpose and c0re values.
They have als0 translated them int0 action and ensured that they are reflected
consistently throughout the 0rganisation in everything the c0mpany does. They
achieve this "alignment" through-their g0als, strategies, tactics, and systems,the way
they 0rganize (structures, building, office lay0uts),their human res0urce policies and
practices, and their day-t0-day decisions.
4) Audits and Accounting Practices - The annual social reports evaluate
performance against these plans just as the annual financial rep0rts show financial
results compared to prior years and sometimes 0bjectives.
Examples of Social responsibility for business
1) HSBC - CSR for Corporate Sustainability

HSBC’s c0rporate sustainability strategy includes the devel0pment 0f sustainable

business 0pportunities, management of its 0wn environmental fo0tprint, and its
community investments.CS is much more than funding of social sector projects.
HSBC believes in the true spirit of partnership, and is an active player in all the CS
initiatives which it undertakes. HSBC w0rks closely with n0t-for-profit organizations,
micro-finance institutions, s0cial enterprises, and vari0us state governments t0 deliver
the financial inclusion agenda. HSBC believes, financial inclusi0n can never be
l0oked at in is0lation. Critical to its success is education HSBC aim to lend and invest
resp0nsibly, avoiding projects where the p0tential for environmental damage
0utweighs the economic benefits.
2) CSR at Coca - Cola

In a w0rld where populations are growing, natural resources are stressed,

communities are forced t0 d0 more with less, and C0ca - Cola consumers’
expectati0ns are expanding, C0ca Cola understand that sustainability is core to their
business c0ntinuity and depends on how they create l0ng-term value. Started different
programme like Active healthy living pr0gramme, Building sustainable communities,
Water stewardship, Drip irrigation pr0jects etc. Through ‘Live Positively’, they see
role as reducing their 0wn environmental footprint while helping sustain c0mmunities
through economic devel0pment and community support and c0ntinuing to deliver
great-tasting, refreshing beverages that are enj0yed around the world. In the arena of
water stewardship, their global goal is t0 safely return to nature an amount of water
equivalent to what Coca-Cola uses in all beverages and production and they achieved
this goal for India operations in 2010 with respect t0 the use of groundwater.

Creating Shared Value: Going beyond Traditional CSR Approaches

Shared value differs from traditional CSR in that it compels firms to view social
pr0gress as a key factor in the devel0pment of their business strategy. It requires
companies t0 break previous assumptions that trade0ffs exist between s0cial good
and corp0rate profitability.
Conclusion
The s0cial responsibility of business means various obligations or responsibilities or
duties that a business-organization has t0wards the society within which it exists and
operates fr0m. Business is generated from the members of s0ciety. Business stability
and growth is closely related to customer preference for the pr0ducts and its use as
well as availability of service in the long run. Naturally it is the resp0nsibility of the
business houses to ensure well being of the people , so that the business remains
stable. By pr0moting socials causes and by undertaking social responsibilities the
business houses are indirectly supporting their own causes. It als0 gives marketing
advantage since there is wide publicity of their contributions. Many c0rporate are
d0ing envir0nment protection,many are running education/health pr0gramme,many
are working on road safety etc.There are many areas where business can d0 social
responsibility through their res0urces.
Reference

 B. Carroll and K.M. Shabana (2010). The Business Case for Corporate Social
Responsibility: A Review of Concepts,International Journal of Management
Reviews (2010) 86-105 DOI:10.1111/j.1468-2370.2009.00275.x
 M. Palazzi and G. Starcher Corporate Social Responsibility and Business Success
 Archie B. Carroll The Pyramid of Corporate Social Responsibiiity: Toward the
Moral Management of Organizational Stakeholders Business Horizons 39 - 48
 P S Narayan, Niraj K Lal, Archana Dutta, Tushna Mehta - Corporate Social
Responsibility: Practice, Theory, and Challenges - 73-116