Importance Of Social Responsibility
(Why Is Social Responsibility Important For Business?)
The importance of social responsibility of business is now universally accepted. It is important to business and to the society. Social responsibility is important to business as it gives many benefits to business enterprises. It gives social recognition to business and facilitates co-operation from social groups. This indirectly facilitates business growth and provides market standing and goodwill. How to discharge such responsibility in a purposeful manner is the main consideration in this regard.
Business and society are closely inter-related and interdependent. Business needs social support for its growth and prosperity. Similarly, society needs the services of business for meeting its needs and also for raising social welfare. Business enterprises are not supposed to operate only for profit maximization but for the satisfaction of needs of consumers and also for raising social welfare. Business will get the support from the government, local community and also from the consumers only when business enterprises are conscious of their duties and responsibilities towards different social groups (consumers, shareholders, employees and the society at large).
Business develops goodwill and reputation by discharging social responsibilities on voluntary basis. All social groups form favourable opinion about the company, which honors social obligations honestly and sincerely. Such companies get moral support from investors, customers and employees. Reputation or corporate image building is a necessity and not a luxury in the present business environment. Such corporate image promotes sales and raises profits. It enables a company to face market competition effectively and brings expansion and diversification. Finally, it creates brand loyalty, which is essential/useful in times of crisis. In short, a company can have market reputation/ good corporate image by discharging its social responsibilities honestly.
Businessmen should understand that discharging social responsibility honestly is the best alternative available to them. It will give social recognition to their activities. In addition, there will be social support to their business operations. This will bring prosperity to their business. Businessmen will have to face many problems if they refuse to honor social responsibilities on their own. In such case, the support from the government, consumers, shareholders and employees may not be available. There will be non-cooperation from different social groups. Government restrictions may increase. All such unfavourable factors will affect the stability, progress and prosperity of business. The profitability in business will go down. Such situation will be harmful to businessmen and the society as a whole. The better alternative is to have support and co-operation from the government and other social groups. This will expand the business activities and offer more profit to businessmen. A part of such profit can be used for discharging responsibilities to different social groups.
In brief, discharging social responsibilities honestly is the best alternative available to businessmen. It will ensure prosperity to businessmen and the society, as a whole. It is, no more, a mere theoretical concept but a practical reality. Businessmen just can’t afford to neglect it or oppose it. They have to find out ways and means for discharging social responsibilities in the fair manner. This is necessary for their survival/prosperity.