9 Arguments For and 7 Against Social Responsibility [Explained]

Arguments For and Against Social Responsibility

The social responsibility of business has been an essential tool to enhance the living standards of society. However, there have been various arguments for and against social responsibility.

Many argue that social responsibility is good for business and all of its stakeholders whereas others argue against it as it is only a waste of time, effort, and saving for the business organization.

Let’s understand the arguments for and against social responsibility presented by Robbins and DeCenzo.

Arguments For Social Responsibility

There are several benefits a business can enjoy by doing socially responsible activities. These arguments for social responsibility state the reasons why it is necessary. Following are some major arguments for the social responsibilities of business.

Public Expectations

This argument states that now the public expects more from business organizations, not just the goods or services alone. The business should strive to fulfill the expectations of the public.

Similarly, the viewpoint of businesses toward society has been changed. The achievement of organizational economic goals as well as social goals is now unified.

Long Run Profit

Long-term financial security is more common for socially conscious businesses. This is the typical outcome of the increased business reputation and improved community ties that responsible behavior provides.

Even if socially responsible companies experience short-term financial losses, they will undoubtedly succeed in their long-term objectives.

Ethical and Social Obligation

Businesses should have ethical standards in their operation. Being ethical is equally important for the business itself as well as society’s people.

Related: What is Business Ethics?

And, the business operates in society. It is a part of society. As society’s every people or part act upon the welfare of society. Similarly, businesses should not overlook society’s welfare in the course of achieving their business goals.

Public Image

People recall the company that helped them accomplish their social objectives. Every company aspires to improve its public image in order to obtain access to money markets, better staff, more clients, and other advantages.

Since the public believes that achieving social goals is important, businesses can improve their public image by pursuing these social aims.

Better Environment

Social responsibility is equally important to the employees within the organization and the people in the society. Fair treatment of employees ensures a healthy working environment inside and valuing social assets ensures outside.

As such the involvement of business in social activities can solve difficult social problems, thus creating a better quality of life and a more desirable community.

Fewer Government Regulations

The government always aims to maintain a peaceful and desirable community. It expects every part of society should contribute to its welfare. As so businesses should actively be a part of social welfare.

If businesses do not consider contributing to society, the government has the power to take legal action against them. By adopting socially responsible business practices an organization can be free from unnecessary government regulations.

Balance of Responsibility and Power

A business is a powerful entity in society. As it is a fact that more power and less responsibility, result in misuse of power, and responsibility only without power can not be performed well. It is essential to balance them.

Similarly, if the business has powers only and does not have a social responsibility to fulfill it might encourage unethical behaviors that work against the public good. Thus it is necessary to balance business power with social responsibilities.

Stockholders Interests

This argument for social responsibility states that socially responsible business practices also increase the company’s stock price in the long run.

It assumes the market sees the ethical business as less risky and profitable in the long run as such it seeks to invest more money in it. This positively leads the company to fulfill the stockholder’s expectations.

Superiroty of Preventon Over Cures

As business is a socio-economic entity it should work on solving social problems at some time. It should not wait till the problems become very serious. This argument states businesses should take action prior to social issues otherwise their efforts won’t work when issues become more severe and their goal achievement will be at risk.

Also Read: What is Management Ethics?

Arguments Against Social Responsibility

There are also various arguments against social responsibility that claim being socially responsible is not good for organizations. Usually, these arguments are based on the concept of classical viewpoint.

Violation of Profit Maximization

This is the essence of the classical viewpoint. This argument states that the organization aims to generate more revenue for shareholders.

But social responsibility pushes out the profits of the business and does let achieve the maximum profits. Thus, it claims socially responsible behavior of business is not desirable.

Dilution of Purpose

The pursuit of social goals dilutes a business’s primary goals i.e. economic productivity. Society may suffer both economically and socially, and these goals together are poorly accomplished.

Cost

Working for social benefits requires companies to invest money. And it is not sure always if the investment will pay off. Sometimes socially responsible activities do not pay their own way.

As such the business face loss, and it seeks to cover these losses – as such it might charge higher prices for the same products which the customers and society have to pay.

Too Much Power

Business is already one of the most powerful institutions in our society. If it pursued social goals, it would have been even more powerful. Society has given more power to business. And, this argument against social responsibility states that too much power is not always good.

Lack of Skills

To be socially active businesses or managers are required to have social skills like dealing with social problems, interacting with communities’ interests, regularly visiting social sites, etc.

However, most business leaders are only oriented toward the economic objectives of the organization. As such they are poorly qualified to cope with social issues.

Lack of Accountability

Political representatives pursue social goals and are held accountable for their actions. Such is not the case with business leaders. There are no direct lines of social responsibility from the business sector to the public.

Lack of Broad Public Support

There is no broad mandate from society for businesses to become involved in social issues. The public is divided on the issue. In fact, it is a topic that usually generates a heated debate. Actions taken under such divided support are likely to fail.

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