Do you think business organizations should be socially responsible?

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Lorraine Caplan | College Teacher | (Level 1) Educator Emeritus

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There are arguments for and against businesses being socially responsible, but it is my thought that they should be, for reasons practical, social, and moral. And by social responsibility, I mean something beyond obeying all laws and regulations and paying taxes.  Social responsibility is a concept that involves giving back to society in a way one has no legal obligation to provide.

First, social responsibility is good for a business's bottom line in at least a few ways.  Some socially responsible expenditures provide tax advantages. One example is a tax credit for hiring people with various kinds of disabilities. Another is a write-off for some kinds of donations.  Social responsibility endeavors are also good public relations, getting the business's name out there in a positive way, which is a form of marketing, really, since name recognition is essential to marketing one's products or services. The more people hear of a business in a positive way, the greater the chance they will avail themselves of what the business has to offer. Also in a marketing vein, people often have causes they want to support, and a social responsibility campaign on behalf of a particular cause will draw those people to the business.  If education is my cause,  I am more likely to spend my money at the supermarket that donates 10% of what I spend to my local school than at the supermarket that does not do this. 

Second,businesses are as much a part of society as individuals are. They exist due to the good graces of the societies they live in. So, if only as a form of quid pro quo, businesses should be socially responsible.  Businesses reap the advantage of all that society provides them with: roads and airports to distribute their goods, fire and police protection, education to provide good workers, libraries for research, and health care.  Without all of these, businesses could not exist.  It is in the best interests of every business to see to it that these societal advantages continue, and giving back to the society is one means of doing that.

Finally, I believe we all have a moral or ethical obligation to support our communities, and businesses should not be excluded from this obligation. This could be looked at as utilitarian, Rawlsian, or even religiously ethical, but there is no doubt in my mind that social responsibility can and should be viewed as an ethical or moral construct as well.  No matter what ethical or moral framework we look at, we are our brothers' keepers, and businesses should be part of that, too. 

There are two primary arguments against social responsibility in business. First is that businesses have an obligation to make money for their shareholders, and social responsibility dilutes that obligation.  Second is the idea that businesses are not in the business of social responsibility, thus they are not going to be particularly good at it, not knowing the best places to apply their efforts or actually causing harm to the people they meant to help.  In recent years, for instance, there have been socially responsible attempts by corporate sponsors to reform education.  That has brought about results more disastrous than helpful.

Imagine that you are the business person deciding whether or not you should lead your business in a socially responsible direction. Looking at the arguments pro and con, think about what you should do.

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