Q.Build up arguments for and against social responsibilities.

Arguments for: (i) justification for existence and growth, (ii) long-term interest of the firm, (iii) avoidance of government regulation, (iv) maintenance of society, (v) availability of resources with business, (vi) converting problems into opportunities, (vii) better environment for doing business, and (viii) holding business responsible for social problems.

Arguments against: (i) violation of the profit-maximisation objective, (ii) burden on consumers, (iii) lack of social skills, and (iv) lack of broad public support.

Arguments FOR social responsibility

• (i) Justification for existence and growth: Business exists to provide goods and services that satisfy human needs; profit is the outcome of service to people. Since prosperity and growth are possible only through continuous service to society, assuming social responsibility justifies the very existence and growth of business.
• (ii) Long-term interest of the firm: A firm and its image earn the most profit in the long run when the highest goal is 'service to society'. If workers, consumers, shareholders and officials feel the firm does not serve their interest, they withdraw cooperation — so responsibility is in the firm's own interest and improves its public image.
• (iii) Avoidance of government regulation: Regulations limit business freedom and are seen as undesirable. By voluntarily assuming responsibilities, businesses reduce the need for new laws and avoid the burden of further regulation.
• (iv) Maintenance of society: Laws cannot cover every circumstance. People who feel they are not getting their due may resort to anti-social activities that ultimately harm business itself, so it is desirable for enterprises to assume responsibilities.
• (v) Availability of resources with business: Businesses possess valuable financial and human resources — managerial talent, capital and organising experience — which can be used effectively to tackle society's problems.
• (vi) Converting problems into opportunities: Business has a history of turning risky situations into profitable deals; with the same ability it can solve social problems and make them productively useful.
• (vii) Better environment for doing business: A society full of complex problems is a poor setting for success; helping meet social needs creates a healthier environment — a society with fewer problems is a better place to do business.
• (viii) Holding business responsible for social problems: Some problems — pollution, unsafe workplaces, corruption, discriminatory employment — were created or worsened by business itself, so it is business's moral obligation to help solve them.

Arguments AGAINST social responsibility

• (i) Violation of the profit-maximisation objective: On this view, business exists only to maximise profit, so social responsibility works against that objective; a business best serves society simply by maximising profit through greater efficiency and reduced costs.
• (ii) Burden on consumers: Responsibilities such as pollution control are very costly; businesses tend to pass the burden on to consumers through higher prices, so taxing consumers in the name of social responsibility is unfair.
• (iii) Lack of social skills: Social problems cannot be solved the way business problems are; businesspeople lack the understanding and training to solve them, so such problems are better left to specialised agencies.
• (iv) Lack of broad public support: The public dislikes business interfering in social programmes; without public confidence and cooperation, business cannot operate successfully in the social sphere.