SOCIAL RESPONSIBILITY

OF ENTREPRENEURS
LC: SUGGEST WAYS TO ENHANCE EMPLOYER-EMPLOYEE RELATIONSHIP AND
ENCOURAGE JUST AND FAIR BUSINESS POLICIES AND PRACTICES SUCH AS
RECRUITMENT, PROMOTION, RETENTION, MARKETING AND ADVERTISING,
I NTELLECTUAL PROPERTY RI GHTS, SOURCES AND USES OF FUNDS, AND THE L IKE
The Concept of Corporate Social Responsibility
The fundamental reason for examining the activities of business from the moral perspective is
for the promotion of the common good, protection of the individual’s interest and the
preservation of the human society in general.
Without Ethics, business will be chaotic because there will be no understanding and agreement
about what is wrong and right in the human conduct.
Social Responsibility is a moral obligation of each and every individual, institution, business and
organization since they all compose the society.
Big corporations not only do business by maximizing profit but also incorporate social
responsibility as an integral part of their business operations and strategies.
According to Bauer, Corporate Social Responsibility means seriously considering the impact of
the company’s actions on society.
Davis and Blomstorm, on the other hand, defined Social Responsibility as the obligations of
decision makers to take actions which protect and improve the welfare of the society as a whole
along with their own interests.
McGuire, on his part, said “the idea of social responsibility supposes that the corporation has
not only economic and legal obligations, but also certain responsibilities to society which extend
beyond these obligations.
Epstein, maintains that corporate social responsibility is that which “relates primarily to
achieving outcomes from organizational decisions concerning specific issues or problems which
have beneficial rather that adverse effects upon pertinent corporate stakeholders.
Professor Keith Davis of Arizon State University defines social responsibility as “the response of
the corporation to issues beyond its narrow economic, technical, and legal requirements.
CSR Responsibility (Davidson,2009)
1. that profit maximation is not the sole purpose of the firm
2. that a firm’s shareholders are not the only stakeholder group whom managers bear some
responsibility
Moral Compass – values other than the ubiquitous profit margin need to inform business
practice.
Perpective on Corporate Social Responsibility
People’s attitudes, values and management culture differ. Consequently, each has a social responsibility in society
since every individual, body or institution makes up a society. Businesses have different viewpoints on social
responsibility as well.
CLASSICAL VIEW MANAGERIAL VIEW PUBLIC VIEW CHRISTIAN VIEW
The primary responsibility of Doers do not emphasize Includes the needs and Excess wealth should be
business is profit profit maximation and interests of the whole society given to the less fortunate.
maximation. interests of stockholders. in contrast with the classical Wealthy individuals have a
and managerial views. responsibility to share their
blessings with the poor.
Obligation of management is To balance the interests of Establishes harmony with A successful corporation
to satisfy stockholders for employees, customers, both business operations and should perform its social
their investments. suppliers and the local plant public interest. responsibility more by
community is the role of returning a fair portions of its
managers of big businesses. profits to the people in the
form of social services.
Supported by Milton Based on the teachings of
Friedman, one of the most Jesus Christ as taught in the
effective advocated of bible.
economic freedom and free
enterprise.
The Four Corporate Social Responsibilties
Taking it from The Pyramid of Social Responsibility, a four-part model
developed by Arhie B. Carroll and published in the July-August
1991issue of the Business Horizons, the corporate social
responsibilities of a business can be classified into four as can be seen
from the next figure.
1.1 Philantrophic Responsibilities – DESIRED of business by society
1.2 Ethical Responsibilities – EXPECTED of business by society
1.3 Legal Responsibilities – REQUIRED of business by society
1.4 Economic Responsibilities – REQUIRED of business by society
 Philantrophic
Responsibilities
(Good
corporate
Citezenship)

Ethical Responsibilities
(Obligation to be ethical:
do what is right and
avoid harm)

Legal Responsibilities
(Compliance with laws and
regulations)

Economic Responsibilites
(Being Profitable)
Social Responsibility Towards Consumers
Consumers are considered to be the most important stakeholders of the business
besides its own employees. Companies are duty-bound to fulfill and be
conscientious of their social responsibility towards the customers of their
business. Not only workers experience exploitation, cheating and abuse. These
also happened to customers in the beginnings of the history of social responsibility
when workers were force to work longer hours and were treated as slaves. Albeit
their awareness of the poor quality of their products, avaricious businessmen
during the early periods cheated their customers by selling their poor quality
products with very expensive prices. Even at present, there are still a great
numbers of cheating businessmen who swindle, deceive and take advantage of
their trusting customers. Consumer rights which are, the right to safety, the right
to be informed, the right to choose, and the right to be heard were introduced by
the famous former US President John F. Kennedy. These rights became
contributory to the now more intelligent and smarter consumers of our
generation. As more and more customers become aware of their rights, business
in turn have to take care not to violate these rights.
Social Responsibility Towards the Community & Environment
All living things are dependent on the earth’s natural resources. Therefore, man
has the moral obligation to preserve the environment and respect the natural
order of things. Of all the living things created by God, man is the only living things
given the responsibility of taking care of all the rest of the creatures on earth. It is
a clear order from God as written in the bible. Only man is given authority over all
the other creatures in the same way that he is the only one given the ability to
protect the environment, and not to intervene with the forces of nature.
The business industry is no doubt the primary user of the earth’s natural
resources. In the everyday course of a business, an enormous quantity of energy
and raw materials are being used in the manufacturing of products and services.
Energy are both employed and discharged into the environment. When resources
and energy is used, the earth’s natural resources are depleted. Business benefit so
much form the environment in order to produce the products, goods and services
they need for their businesses to prosper.
They primarily rely on the benefits provided by the environment. In
turn, businesses have the corporate social responsibility of preserving
and maintaining the balance of nature because once natural resources
are depleted, these can never be replaced no matter how magnificent
the power of man’s brain is.
Current Activities Related to CSR
Establishment of certifying bodies to develop standards, programs and to train and
certify employees, managers and business with quality programs, certifications and
accreditations e.g., ISO Certifications; Total Quality Management; 5s of Good
Housekeeping; Self-evaluating and Product Teams; Occupational Health and Safety;
Health Safety and Environmental Accreditations that will ensure continual improvement
of all aspects of the business.
 Training their employees for customer care and people skills with the application of
Customer Relationship Management standards. Training of employees for continuous
improvement and development of skills.
Improvement of compensation and benefits packages for employees to enjoy from
hiring to retirement while a number of benefits are also rewarded to families of the
employees such as health and medical assistance, hospitalization benefits, scholarship
grants, among others.
….
Establishments of programs for the protection and preservation of the environment
some of which include tree-planting activities, recycling of waste materials,
segregation of hazardous, infectious, biodegradable and non-biodegradable waste
materials.
Active participation in socio-civic and charitable activities, adopt-a-community
programs, adopt-a-school programs, book and toys donation to government agencies
and NGOs, scholarship grants, volunteer work to communities and those affected by
calamities.
Development of customer complaint desks or hotlines, a large number of which are
impressively using state-of-the-art technology or sub-contract with call centers in
order to reach customers wherever they are across the globe 24 hours a day, 7 days a
week.
Recruitment of competent and technical employees to ensure manufacturing of
their products follows the strictest standards.
Questions:
1. Is it possible for a company to be profitable and
socially responsible at the same time?
2. Cite some examples of companies engaged in
projects and activities geared towards the promotion
of the quality of life of people.
3. Is the Christian view on CSR applicable to business?
COMPETENCIES:
advocate honest policies and practices in
all aspects of business operations
 observes and promote policies and
practices in environmental management
 cite examples of companies that practice
social responsibility in the conduct of their
business