Evaluating the Social Responsibility of Business to Increase Profits

This essay critically examines Milton Friedman's assertion that the social responsibility of business is solely to increase its profits. It delves into the concept of social responsibility, its importance, and its implementation within businesses, providing real-world examples such as Ford's environmental initiatives and Netflix's employee benefits. The essay contrasts Friedman's capitalist perspective with the belief that companies have a duty towards communities and stakeholders beyond profit generation. It explores ethical theories like teleological moral theory and utilitarianism, discussing the responsibilities of employers, the importance of employee well-being, and the provision of equal opportunities and health safety. The essay also addresses the responsibility of companies to provide quality products and accurate information to customers, using Nestle as an example. Ultimately, the essay navigates the complexities of balancing profit motives with ethical considerations and social responsibility in the modern business landscape.

Business Ethics

Business ethics
“The Social Responsibility of Business is to increase its Profits”
Abstract
It can be stated that profits are one of the essential factor on which every company focuses. It is
important for the company to earn profits so that it can be easy to attain growth in the market.
So, to earn profits, it can be analyzed that social responsibility is one of the factor of the business
in which the company emphasizes on satisfying the needs of the stakeholders or the customers.
The company also thinks about the society welfare but with the maim motive of earning profits.
So, in this paper the discussion will be related with the concept of social responsibility.
Introduction
It can be analyzed that social responsibility plays an important role in relation to the overall
activities of the business. If there is no social responsibility considered by the company then it
can be difficult to achieve growth in the competitive business world. So, in this paper the
discussion will be made on the topic “Social responsibility of the business to enhance its profits”.
For example: the best real life example is related with ford Motor in which the initiative is taken
to bring improvisation in the overall environmental performance. The company focused on
reducing the GHG emissions by developing Eco Boost engine which can help in reducing the
pollution and also it saves fuel. So, this has also enhanced the overall sale of the company in the
competitive market.
Friedman states that the owner of the business believes that they are defending free enterprise
and when they proclaim that the company not only focuses on profits but also it promotes the
desirable social needs. The corporate social responsibility is related with the belief that
companies have the duty towards the communities and also stakeholders. But, the company does
not have the aim to focus emphasize on boosting the social responsibility with the aim of earning
profits (Jahn and Brühl, 2018) . The paper will discuss about the various concepts related with
the responsibility of the business and also to consider where the accounting will fit. So, this will
emphasize on exploring the ethical responsibilities that the organization have beyond generating
the profits for its shareholders.
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Business ethics
Social responsibility
Social responsibility in the business is important as it can help in boosting the overall image of
the company and will also maintain the large market share in the competitive market. It is one of
the concepts which are necessary to be considered as it can help in achieving the set targets and
goals of the company in the market. This initiative is started by the companies as it can help in
boosting the image of the company in the competitive market. It is implemented by the top
management of the company as it can help in maintaining the image in the market. The top
management focuses on this concept as it help in enhancing the satisfaction level of the
employees in the market (Hack, Kenyon and Wood, 2014).
For example: Netflix provide 52weeks of paid parental leave to the employees that can be
applied by both the parents. Also in this timeframe, the employees have the choice to go back to
work and then take their paid leave according to their need. For the leaves they will receive a
full salary. The company also provides unlimited vacation to the employees.
Capitalist economy
Friedman has an opinion in relation to the capitalist economy and also there is one responsibility
of the organization. The responsibility is to focus on maximizing the use of the resources and
also to engage in the operations that enhance the profits for the long time. It has been examined
that when the person is looking for the responsibilities it is important to focus on the entire roles.
Top management of the company has the fiduciary responsibility to behave in the overall interest
of the shareholders. The managers are considered as the agents of the shareholders and also they
focus on the obligation to control the activities of the company in the overall interest of the
shareholders. This has the main aim to generate money and also to enhance the wealth of the
shareholder. It has been seen that shareholders are the owners of the company and also they
focus on making profits in the market (Saeidi et al., 2015).
For example: it can be stated that Wells fargo set the goal to donate 1.5% of revenue to the
charitable causes like Neighbor works. Also in this the resources of the company are utilized and
managers give two paid days off to the employees to volunteer.
Responsibility for the employers
In the workplace the manager has the responsibility for the employers so that overall activities
can be managed according to the desires which are related with making money. In the capitalist
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society, there are many reason related to it other than only making money. The corporate agent
is the executive of the people who are the owners of the business. Friedman also states that the
companies are considered as the private property and also, they have the same social
responsibility as compared to the companies in the capitalist economy. This will help the
company to generate money by considering the overall framework of the rules and regulations
(Orlitzky, 2015).
For example: the pharmaceutical company named as Pfizer raises the awareness for the
infectious diseases and also offers healthcare support to women and children who need care. The
multi doses of its vaccine are supplied by the company in fewer dollars.
Teleological moral Theory
It is also important for the companies to focus on the theories related to teleological moral
theories in which the first factor is related to Ethical egoism. With proper framework, it can be
seen that the overall consequences depends on the individual for the long term and also the
decisions can be ethical (Dyllick and Muff, 2016). So to enhance the profits, the companies
should focus on the long term interest of the company so that it can be easy to maintain the
overall ethical framework. For example: Tesco emphasized on reducing the cost of the products
and they push the suppliers to reduce the cost. So, in this context the company forced the
suppliers to reduce the cost for their own benefits. If the cost will be reduced the company can
earn more profits.
It can be stated that social responsibility of the company is to focus on its employees. It is
important to emphasize on the growth of the employees so that they can give their best towards
the overall activities of the company in the competitive market. The employees in the work
should be motivated by the top management so that they can be efficient towards the overall
operations. For example: Linkedln offers paid parental holidays to the employees so by this
facility the employees feel motivated the morale of the employees enhances. So, if they are
happy they will also engage themselves in serving the society. It is the responsibility of the
management to focus on their needs so that they can be dedicated towards overall operations of
the company in the competitive market. If focus is given on the employees and they are
motivated then positive impact can be seen on the overall profits in the workplace. The concept
of utilitarianism focuses on considering the overall act of management by considering the ethical
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approach with utilitarianism. It has been analyzed that the consequences of the actions can be
stated as the ethical if advantages are attained through it. So, utilitarian reasoning also consider
the actions which can help in generating the overall utility (Grayson and Hodges, 2017).
Attractive salary
It is also the responsibility of the company to offer attractive salary to the employees so that their
needs can be fulfilled and also it will help in enhancing the overall satisfaction level in the
business. For example: Like in California, Netflix offers full salary to the employees also when
they are on the parental leave. If the employees are satisfied then it can help to attain more
profits in the competitive market. The social responsibility is not only related with profits but it
is also related with enhancing the overall satisfaction level of the employees so that they can give
their best towards the activities of the company (Kolk, 2016).
Employees have their own skill set through which they can offer proper salary to the employees
and also it helps in maintaining the security. It is important to maintain the overall environment
in the workplace as it can help in assist in boosting the overall working pattern towards the
activities of the company.
Equal opportunities
Equal opportunities to the employees can also be considered as one of the important factor that
should be considered. It has been examined that top management should offer equal opportunity
to the employees so that they can be dedicated and also it will help to boost the confidence level
of the employees in the workplace. Confidence level is the factor that can be boosted if top
management emphasizes on offering equal opportunities to the employees (Lins, Servaes and
Tamayo, 2017). For example : Like in Netflix every employee is given parental leaves but if
company only offers to some employees in the workplace then it can be difficult for the company
to boost and engage themselves towards the CSR activities. So, equal opportunity should be
offered to employees so that they actively engage in the activities.
Health safety
Social responsibility of the company is also towards providing health safety to the employees as
it can help in boosting the overall working structure. If the employees know about their safety in
the workplace then it can be easy for them to be efficient and confident towards the overall
activities. If employees are motivated then it can be simple for the company to achieve growth in
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Business ethics
the market. For example: Pfizer focuses on providing health care to women and children who are
struggling from care.
Quality of products
The companies also have the responsibility towards the customers. It is the responsibility of the
management to offer proper quality in the market so that the overall demand can be enhanced in
the market. If proper quality is not offered to the customers then it can be difficult for them to
retain the customers in the workplace or to boost the overall demand of the products in the
market. Quality is one of the aspects that are considered by the companies so that it can be easy
to maintain the goodwill in the competitive market. If quality products are offered in the market
then it can be simple to attract the customers towards the products and also it will satisfy the
needs of the customers in the society (Mansell, 2015).
Social responsibility is related to offering accurate information to the customers so that they can
feel satisfied and happy towards. If the company gives inaccurate information to the clients then
it can enhance the dissatisfaction level of then customers and also it can impact the overall sales
in the competitive market. The company will able to earn profits if the customers are satisfied
and happy. If they are happy and satisfied then only it will be able to boost the image in the
market (Cheng, Ioannou and Serafeim, 2014)
Nestle Example (South Asia)
For example: Nestle is one of the largest company in the food and beverage sector. It can be seen
that company is committed towards the individuals, families and communities. The company
focuses on the three pillars related to creating the share value in relation to nutrition, water and
rural development.
The company also promotes the nutrition education and physical activities among the children of
the school in the rural areas through the Nestle healthy kids program and also the program
related to knowledge sharing. The company set up the purified drinking water tanks and also
sanitation facilities for the girls in the schools so that education for the children can be promoted.
The company also partnered with Local NGO’s to train the farmers and also for implementation
of the program in Bangladesh known as “Amra Korbo Joy” so that it can be easy to boost the
livelihood of the street vendors and also to organize the series of the nutrition training programs
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Business ethics
for women. The company also focused on creating shared value, sustainability and also
compliance is non – negotiable. It can also been seen that customers should be treated as the
member of the overall network of the stakeholder as without them it will not be possible for the
company to achieve growth in the market. They offer the revenue that is required for the
organization to attain the main goal related to profits. So, it is important for the company to focus
on maximizing the overall satisfaction level as it can help in accomplishing the desired goals in
the market (Moore, 2014).
Also, the company should focus on offering product at low cost so that large market share can be
grabbed. It has been seen that if the product cost is low and also quality is good then it can be
simple to boost the overall market share of the company in the competitive market. Community
is the next stakeholder for the company and in this the company grants rights to exist in the
society. The rights are granted so that facilities can be created to manage and also to but the
products of the company (Schwartz, 2017).
So, it is important for the community to focus on the process of decision making as it can help in
considering the accurate decisions which are beneficial for the company and also for themselves
in the market. It can be analyzed that business has the responsibility to focus on the interest of all
the parties which affect the overall business activities in the market. The company should not
only focus on the shareholder but also emphasize on the overall stake in reference to the results
which are derived (Nollet, Filis and Mitrokostas, 2016).
The customer service should also offered in a proper manner by considering the overall interest
of the customers as it can help in boosting the image in the market and also the company will
achieve success in the market.
Conclusion
So, it can be concluded that it is important for the companies to focus on maintaining their social
responsibility so that it can be simple to boost the overall goals and objectives in the competitive
market. It is the duty or the responsibility of the company to focus on considering all the factors
related to its stakeholders so that their needs and wants can be satisfied. The company should
focus on maximizing the overall satisfaction level of the customers so that it can be easy to boost
the overall sales of the company. So, it can be stated that social responsibility is not only for
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enhancing the profits but it is also for creating good culture in the workplace and longtime
relation with the customers in the competitive market. So, it is also important for the company to
focus on the stakeholder theory by considering the overall interest of the stakeholders. The focus
should be given on needs of the stakeholders so that growth can be attained and profits can be
maximized.
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