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Social Responsibility of Business


Social  responsibility of business means duties and obligations of business towards different social groups I.g., shareholder, consumers, employees legal.


The social responsibilities concept implies that business must behave like an ordinary citizen. It must discharge its legal, moral and social functions sincerely. The following factors explain in need for social responsibilities of business.

  1. To protect Environment

The  purpose of business is to create wealth and satisfy human wants. It usees the natural and human resources to produce goods and service. There is every possibility of the business misusing the resources for personal gains. Therefore the business must be made accountable and punished for its wrong deeds. This is possible by fixing social responsibilities on business.

   2. Good public image

 A business which responds favorably to social needs enjoys a good reputation and good public support. A good public image generates more demand, attracts better employees and offers many other benefits. Therefore, a business must voluntarily honour its social commitment for better public image.

     3. Concept of Trusteeship

This  concept states that a business must be held in trust legally and morally for the benefit of people. The business is the custodian. It has moral obligations to promote and protect the welfare of the community.

      4. Minimize Government Control

Government  is a supreme authority. If it is found that the business is conducted in an unethical manner or against the public interest, the government may bring the business under its control. Therefore to minimize government control the business must come forward and carries out social responsibilities.

     5. Changed Expectations

The  activities of business are regularly checked by the society and if any defects or discrepancy is found the society will withdraw its support to the business. Therefore, the business must respond to the changing needs of the society.

    6. Better Utilization Resources

Business  has a great control over the productive factors. This is seen from the ever increasing pollution, deforestation and ecological imbalance. Therefore, some control is necessary to  ensure better utilization of natural.

     7. Assist The Government

A progressive and socially aware business can join hand with the government in solving many social problems. The business can also help the government in controlling pollution and preserving ecological balance.

     8. Accountability

Business  is accountable for its economic and social performance. The performance of business is measured with new techniques of public relations, consumer satisfaction, contribution to social cause, etc. so business has to adopt a positive attitude toward social responsibilities.

     9. Growth Perish

 "Growth perish" is the norm of the present era. Every organization wants to expand its activities through expansion and diversification. The society would support only if the business organization has fulfilled its social obligations.

   10. Growing Awareness

Organization  have to be social responsible. With media explosion, the awareness among people in general is increasing. They are becoming more and more aware about environmental issues.

     11. Enactment of Laws

Government  has enacted various laws viz. Consumer protection act, prevention of Food adulteration act.and so on. There are more than 30 environmental legislations which have been enacted. This has put not only moral pressure but also legal pressure on organisation to adhere to the rules.

    12. Moral Duty

 The  business organisations have realized that certain actions even if legally right but morally wrong should not be adopted.

      13. Consumerism

Consumerism  is a movement or a set of policies aimed at regulating the products services, methods, and standards of manufacturers, sellers,  and advertisers in the interest of the buyer.

The  business organizations have realized that people have become aware of their right and have started organizing themselves. So business organization should fulfill social responsibilities and avoid public displeasure.


The  following are some of the factors which suggest that business should not fulfill its social responsibilities:

     1. Business is for profit

Business  is an economic activity. Its main objective is to earn profit only. If business does social work, it will have to divide its limited resources between economic and social activities. Therefore, the business must concentrate on the profit making area and leave the job of the social welfare to the government & other services or cultural organizations.


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