Social Responsibility of Business Is to Increase Profit
The social responsibility of business is to increase profit As an individual living in a unified society, everyone has certain social responsibilities to play. Businesses too, as parts of society, as they utilizes the available resources like water, land, roads and power of the society and depend on the society for its functioning. This creates an obligation on the business part to look after the welfare of society that it operates in and is indebted to.
It should take care of those who are involved in securing its existence and survival such like- the proprietors, shareholders, employees, customers, government, society and community in general. So, every business should contribute part of its profit for the welfare of the society in some way or another for their benefit. For example, businesses should ensure satisfactory rate of return to shareholders, provide good wages and proper working conditions to its employees, make quality products at reasonable price to its customers, and etc.
This may leads one to ask, why should businesses come forward and be responsible towards these interest groups instead of focusing first and foremost on maximizing their profit. This is because profit making is not the sole function of business, at least not anymore. Values, expectations and the roles of people have changed. Nowadays there are new realities that a company need to face and for which new strategies have to be formulated in order to keep the business in pace with the changing times.
Increasing evidence has shown that environmental and social responsibility makes good business sense. A company with good social and environmental records tends to perform better in the long run in comparison to those that do not behave responsibly. Why is this so? Well, you may have yet to realize that environmental and social criteria are increasingly influencing the individuals and organizations’ investment decisions both as customers and shareholders in today’s times.
With customers becoming more conscious about their rights, they protest against the supply of inferior and harmful products by forming different groups. This has made it mandatory for businesses to protect their customers’ interest by providing only quality products. In addition, people prefer to buy product of companies that engages itself in various social welfare programmes, this helps in creating a good public image. Company that carries good public image attracts honest and competent employees to work with such employers.
With competent employees, employers should try to fulfill all expectations of the employees because employee satisfaction is directly related to productivity and long-term prosperity of an organization. In general, consumers are more likely to support businesses that contribute to community organizations. Many consumers believe that companies should help support and build the communities that helped generate their profits.