1.
BUSINESS ETHICS
UNIT-5
CORPORATE
SOCIAL
RESPONSIBILITY
• BY- KRISHAN GOPAL

2.
CORPORATE SOCIAL
RESPONSIBILITY
Index
 Corporate social responsibility
 Importance of corporate social
responsibility
 Social responsibility of business
towards different stake holder
 Social responsibility
 Need of Social responsibility
 Arguments supports Social
responsibility
 Social audit
 Objective & advantages Social audit

3.
CORPORATE SOCIAL RESPONSIBILITY
• Corporate social responsibility (CSR) is a business model in which for-
profit companies seek ways to create social and environmental
benefits while pursuing organizational goals, like revenue growth and
maximizing shareholder value

4.
CORPORATE SOCIAL RESPONSIBILITY
• Corporate Social Responsibility (CSR) is the idea that a company
should play a positive role in the community and consider the
environmental and social impact of business decisions. It is closely
linked to sustainability − creating economic, social, and
environmental value – and ESG, which stands for Environmental,
Social, and Governance. All three focus on non-financial factors that
companies, large and small, should consider when making business
decisions.

5.
IMPORTANCE OF CORPORATE SOCIAL
RESPONSIBILITY FOR YOUR BUSINESS
Reduction operating
cost
Increase productive
and quality.
Improve financial
performances
Reduction OF
CURRUPTION
Organisational
growth’s
Better brand
recognize
•Consumer Protection
Increase sells and
customer loyalty

6.
SOCIAL RESPONSIBILITY OF BUSINESS
TOWARDS DIFFERENT STAKE HOLDERS
BUSINES
S
SHARE
HOLDER
SUPPLIERS
WORKERS
GOVERNM
ENT
CUSTOMER
SOCIETY

7.
SOCIAL RESPONSIBILITY OF BUSINESS
TOWARDS DIFFERENT STAKE HOLDERS
Responsibility towards shareholders or investors:
• Provide reasonable return on their investment.
• Protect their investment.
• Increase the market value of their shares by making a fair profit and
by building a good image of the business.
• Regularly provide an up-to-date, accurate and full information on the
working of business.

8.
SOCIAL RESPONSIBILITY OF BUSINESS
TOWARDS DIFFERENT STAKE HOLDERS
• Treat all shareholders fair and equally well without any bias or
partiality.
• Take necessary steps to expand the business.
• Carry out research and development (R&D) activities to innovate and
improve products and/or services

9.
SOCIAL RESPONSIBILITY OF BUSINESS
TOWARDS DIFFERENT STAKE HOLDERS
Responsibility towards employees or workers:
• Pay fair wages or salaries.
• Provide good working conditions and better work environment.
• Appreciate their job well done and also recognize their talents.
• Arrange training and educational programs for skills enhancement
and improve job performance.
• Sharing profit with employees.

10.
SOCIAL RESPONSIBILITY OF BUSINESS
TOWARDS DIFFERENT STAKE HOLDERS
Responsibility towards the consumers or customers
• Need of satisfaction.
• Provide quality goods and services at reasonable prices.
• Provide a good after sales services and customer support.
• Provide right information about products .
• Fair trade products.

11.
SOCIAL RESPONSIBILITY OF BUSINESS
TOWARDS DIFFERENT STAKE HOLDERS
Responsibility towards supplier
• To Pay Fair Prices of Goods
• To Promote Healthy Competition.
• Information about the taste of customer.
• To Inform Suppliers of Future Developments.
• To Pay in Reasonable Time

12.
SOCIAL RESPONSIBILITY OF BUSINESS
TOWARDS DIFFERENT STAKE HOLDERS
Responsibility towards the government
• Timely Payment of Taxes
• To follow the law and order’s of the government.
• Government to transfer of Technology industry.
• To follow pollution control norms set up by the government.

13.
SOCIAL RESPONSIBILITY OF BUSINESS
TOWARDS DIFFERENT STAKE HOLDERS
Responsibility towards the customers
• To ensure a regular supply of goods and services.
• To offer good quality products and services at reasonable prices.
• To provide information about the product and company.
• To avoid unfair means like adulteration, under weighing, etc.
• To settle quickly the grievances of the consumers.

14.
SOCIAL RESPONSIBILITY
• According to Peter F Drucker, “Social responsibility requires managers to
consider whether their actions are likely to promote the public good, to
advance the basic belief of society, to contribute to its stability strength
and harmony.” Social responsibility refers to the voluntary efforts on the
part of the business to contribute to the social well being. The moral idea
behind this is that the businesses use resources of the society so they
must give something back to the society.

15.
THE NEED FOR SOCIAL RESPONSIBILITY
• Self-interest: It is in the self-interest of the business to have a social
responsibility as it opens opportunities for understanding the problems and
issues of society.
• A better environment for Business: In today’s cynical age, social
responsibility keeps the businesses honest and the market stable.
• Public image: When a business takes initiative to solve the problems of
the society, it puts the business in the goodwill of the people.
• Social power: A leader is a helper. Helping the society is a form of social
responsibility. Executing social work helps the business attain social power
within the society.

16.
ARGUMENTS SUPPORTING SOCIAL
RESPONSIBILITY
• The justification for existence and growth: The primary goal of business
is to make profits as only profits can help the business sustain and expand. Profits
should only be made as a return of service to the society by producing goods
and services.
• The long-term-term interest in the firm: A firm is to gain maximum
profits in the long run if it has it’s the highest goal as service to society. As humans
are social beings, when they notice that a particular corporation is not serving its
the best interest socially, they do not support the organization further.
• Avoidance of government regulations: Government is the highest
authority in the nation. When a government feels that the business is not socially
responsible or is creating problems like pollution government limits its freedom.

17.
ARGUMENTS SUPPORTING SOCIAL
RESPONSIBILITY
• Maintenance of Society: Business is one of the important pillars on
which society survives. It is the responsibility of business to take care of
society’s needs. Law alone cant help people with the issues they face.
Therefore businesses contribute to the well being, peace and harmony of
society.
• Availability of resources with Business: Business enterprises
have huge financial resources, very efficient managers & contacts and
thereby they can ensure that a social problem can be solved easily.

18.
ARGUMENTS SUPPORTING SOCIAL
RESPONSIBILITY
• Converting problems into opportunities: Business means risk.
And turning risky situations into profits can also be related to solving social
problems.
• Holding Business responsible for Social problems: Business
enterprises are responsible for many problems such as pollution ,
discriminated employment, corruption, etc. It is the duty of the business to
solve the problems created by them.

19.
ARGUMENTS AGAINST SOCIAL
RESPONSIBILITY
• Violation of maximization of the profit motive: This statement
argues that business exists only for maximizing profits and businesses fulfil
their social responsibility best by maximizing profits by increasing efficiency
and reducing costs. They need not take up any additional obligations.
• Side effects on Consumers: Customers suffer because of the solving
social problems and taking social care require huge financial investment. As
the money within the business is used in social help, the business increase
the cost of their products and services.

20.
ARGUMENTS AGAINST SOCIAL
RESPONSIBILITY
• Lack of Social skills: It is often stated that businessmen don’t fully
under the social problems and thus can’t solve them efficiently.
• Personal resistance: People tend to dislike interference from
businesses in their problems.

21.
THE REALITY OF SOCIAL RESPONSIBILITY
• The threat of Public Regulation: Government agencies keep
watchful eye on all the business operations. So to avoid government
action, business should behave in a responsible manner.
• The pressure of Labor movement: Labor play an important
role not only in production but also in the managerial factors of the
organization. Labor nowadays are more educated and their movements are
more powerful. ‘Hire and fire’ policy no longer work. Managers now have to
be more responsible while dealing with labors.

22.
THE REALITY OF SOCIAL RESPONSIBILITY
• Impact of Consumer Consciousness: In this era, consumers are well
aware of the quality and price of the product. Consumers are understanding their
rights over the product and even in small issues, they file a suit in consumer court.
• Development of a Social standard for Business: New social
standards consider business enterprises as legitimate but with a condition,
they must also serve social needs.
• Development of Business Education: Business education has
created an awareness among investors, consumers, employees, etc. and the
world is more sensitive towards social issues.

23.
THE REALITY OF SOCIAL RESPONSIBILITY
• The relationship between Social interest and Business
Interest: People know that social interest and business interest are
complementary. This means long-term benefits of the business.
• Development of Professional and Managerial
Class: Earlier business houses only aimed at profit maximization but
now professional management and educational institution have made a
new kind of managers that give similar importance to social
responsibility.

24.
SOCIAL AUDIT
• A social audit is a way of measuring, understanding, reporting and
ultimately improving an organization’s social and ethical performance. A
social audit helps to narrow gaps between vision/goal and reality, between
efficiency and effectiveness. It is a technique to understand, measure,
verify, report on and to improve the social performance of the organization..
• Social auditing creates an impact upon governance. It values the voice of
stakeholders, including marginalized/poor groups whose voices are rarely
heard. Social auditing is taken up for the purpose of enhancing local
governance, particularly for strengthening accountability and transparency
in local bodies.

25.
SOCIAL AUDIT
• A social audit is an examination of the activities of a business that support
the public interest.
• For example, a firm may support a foundation, make donations to non-profit
entities, or allocate some staff time to pro bono work.

26.
OBJECTIVES OF SOCIALS AUDITS
1.To assess the conditions in which workers are made to work.
2.To determine whether workers are being paid fair wages or not.
3.To determine whether the shareholders of the company are given fair
information about the financial status of the company or not and
whether they are paid their dividend in the company’s income
regularly or not.
4.Creating awareness among beneficiaries and providers of local social
and productive services.

27.
OBJECTIVES OF SOCIALS AUDITS
5.Increasing efficacy and effectiveness of local development programmers.
6. Scrutiny of various policy decisions, keeping in view stakeholder interests
and priorities, particularly of rural poor.
7.Estimation of the opportunity cost for stakeholders of not getting timely
access to public services.

28.
ADVANTAGES OF SOCIAL AUDIT
(a) Trains the community on participatory local planning.
(b) Encourages local democracy.
(c) Encourages community participation.
(d) Benefits disadvantaged groups.
(e) Promotes collective decision making and sharing responsibilities.
(f) Develops human resources and social capita

29.
THANK YOU