Ethics and social responsibility play a significant role in the management of a business. Companies, both public and private, understand the need to include corporate responsibility in their organizational ethos. The idea of ethics deals with people’s actions within a corporation when dealing with problems that arise in their company. Cooperate social responsibility entails a business’s moral responsibilities and the fashion in which the company processes their decisions. “For many businesses, their social actions are probably better viewed as being socially responsive rather than socially responsible.” (Robbins, 2019)
There are many similar traits between ethics and social responsibility such as dealing with environmental issues, but when broken down each has its own distinctive features. Ethics and social responsibility must go hand in hand for a corporation to morally sound. The main objective of any business is to maximise profits, whilst trying to balance social objectives to ensure the public image is upheld. “Managers at the Co-op balance two objectives to make a profit, and to meet social goals. These continue to express the founders’ vision of a fairer and more democratic society. Making the profit necessary to meet the social objectives is challenging in the intensely competitive retail sector.” David Bobby, 2016. Business ethics involves examining ethical decisions, principles, and activities in line with business interests.
There are many arguments for and against cooperate social responsibility within business management in todays ever changing markets. Business managers must find the correct balance to ensure their company can flourish. When a company pursues social responsibility, their public image tends to be more favourable with the general public who demand the upmost effort from companies. This can in turn see the log-run profits become more secure though consumer loyalty.
Another positive for business grappling with cooperate social responsibility is that it is morally the correct thing to do and government regulations tend not to be as stringent for business practising it. Cooperate businesses have a lot of power in the world today and have a responsibility to place there resources correctly to support public projects and charities, by doing so a company can increase there stock price and market share therefore its in the stockholders best interest. Corporations also see the negative side to being ethical and socially responsible as it can infringe on their maximisation of profits. The cost of socially responsible actions can be very expensive, and these actions do not cover their own cost so money must in turn be taking from business profits. A lack of skills holds management back in addressing the problems that arise socially whilst, a lack of accountability is also at the forefront of this problem as there is no governing body dealing with this.