Major Arguments For and

Against Social Responsibility

Major Arguments For Social Responsibility:

It is in the best interest of the business to promote and

improve the communities where it does business.

Social actions can be profitable.

It is the ethical thing to do.

It improves the public image of the firm.

It increases the viability of the business system.

It is necessary to avoid government regulation.

 Socio-cultural norms require it.

Laws cannot be passed for all circumstances. Thus,

business must assume responsibility to maintain an
orderly legal society.

It is in the stockholders best interest.

Society should give business a chance to solve social

problems that government has failed to solve.
 Business is considered, by some groups, to be the
institution with the financial and human resources to
solve social problems.

Prevention of problems is better than cure so let

business solve problems before they become too
great.
Major Arguments Against Social Responsibility:

It might be illegal.

Business plus government equals monolith.

Social actions cannot be measured.

It violates profit maximization.

Cost of social responsibility is too great and would

increase prices too much.
 Business lacks social skills to solve societal problems.

It would dilute business primary purpose.

It would weaken the governments balance of

payments, because the price of goods will have to go
up to pay for social programs.

Business already has too much power.

Business lacks accountability to the public.

Such involvement lacks broad public support.

 Historical Phases Of Attitudes Of
Managers Toward Social Responsibility
 PHASE 1 PHASE 2 PHASE 3
PROFIT-MAXIMIZING TRUSTEESHIP QUALITY-OF-LIFE
ATTITUDES MANAGEMENT MANAGEMENT MANAGEMENT
(1800 to 1920s) (late 1920s to early 1960s) (late 1960s to present)
Orientation Raw self-interest 1. Self-interest 1. Enlightened self-
2. Contributors interest interest
2. Contributors interest
3. Societys interest

Economic Values: Whats good for me is Whats good for What is good for society
good for my country organizations and is good for our company
management is good for
our country

Profit Maximizer Profit Satisfier Profit is necessary but

people are more
important than money.

Labor is a commodity Labor has certain rights Employee dignity has

to be bought and to be which must be to be satisfied.
sold recognized.
 ATTITUDES PHASE 1 PHASE 2 PHASE 3
Accountability Accountability of Accountability of Accountability of
management is to the management is to the management is to the
owner. owners, customers, owners, contributors, and
employees, and other society.
contributors.

Technological Values: Technology is very Technology is important People are more

important. but so are people. important than
technology.

Social Values: Employees personal We recognize that We hire the whole

problems must be left employees have person.
at home. needs beyond their
economic needs.

Minority group are Minority groups have Minority group

inferior to whites. They their place in society, members are people,
must be treated and their place is as you and I are.
accordingly. inferior to mine.
ATTITUDES PHASE 1 PHASE 2 PHASE 3

Political Values: That government is Government is a Business and

best which governs necessary evil. government must
least. cooperate to solve
societys problem.

Environmental Values: The natural People can control We must preserve the
environment controls and manipulate the environment in order
the destiny of people. environment. to lead quality live

Aesthetic Values Aesthetic values? Aesthetic values are We must preserve our
What are they? okay, but not for us. aesthetic values, and
we will do our part.