• Posted on January 19, 2024
• Amisha Choudhary

Assignment Sample on Business Case Report

Responsibilities in business

 Various aspects characterise an organization’s operating environment, each of which can have a significant impact on the company’s performance. The regulatory bodies, the competition, the suppliers, and the customers are the main groups that have an impact on a company’s environment. The company must pay more to satisfy the needs of all of these constituents, who are all active participants in the business’s environment. Making and expanding one’s profit margin is the holy grail of any firm. The addition of social responsibility, on the other hand, deviates from the conventional view that a company must always act in a commercial manner. To be socially responsible, a company must recognise that it functions within a context established by a wide range of interested parties and act accordingly (Martos-Pedrero et al., 2019). Many prominent economists have shared their thoughts on the topic of corporations’ ethical responsibilities to society, including Milton Friedman. The moral perspective on the problem has also been articulated in several church documents, such as the compendium of the church’s social doctrine (CSDC). In this study, we examine the economics literature and the debates that have arisen from different schools of thought on the topic of corporate social responsibility.

The concept of corporate social responsibility was popularised by Milton Friedman, who stated that a company’s primary responsibility is to maximise profits. According to Friedman (1970), corporations have no ethical duty to work toward socially desirable goals like protecting civil liberties, keeping the environment pristine, or providing decent working conditions for their employees. To back up his argument, he admitted that firms are generic entities that are not qualified to handle social responsibilities. He argued that corporations had no more right to shirk social responsibilities than the internet or any other public utility. Entrepreneurial and corporate systems, on the other hand, are exempt from social responsibility, per (Friedman, 1970). Friedman’s beliefs have been backed up by other economists, who agree that businesses lack moral agency and should not be held to the same standards as individuals. They argue that corporations are morally indistinguishable from individuals from a legal standpoint, and therefore bear no further obligation. To add insult to injury, corporations lack a sense of identity, making it difficult for them to determine what is morally correct in social contexts.

Role of the manager

According to Milton Friedman, a company’s principal duty in a capitalist system is to maximise their economic resources and  thus participate in activities that make a profit within a socially and legally acceptable framework. Understanding one’s place in society is crucial when contemplating one’s personal or company’s social responsibilities. Managers, as the company’s agents, are morally obligated to steward the company’s stakeholders. Managers, as stated by Friedman (1970), owe their stakeholders directly in the form of financial success. It is highly unusual for a company in today’s capitalist society to engage in an enterprise without any reason other than to make a profit. Businesses, being private institutions, operate with the same disregard for ethics as any other enterprise operating within the capitalist economic system. Friedman’s work is rooted in the classical school of thought, with an underlying management idea that invisible forces use their balancing and allocative skills to determine how resources are allocated, how businesses are run for the greater good of society, and how businesses’ futures are determined (Karnani, 2010). According to Friedman, the guiding premise of a socially responsible firm is to maximise profits while remaining in compliance with the law. Business, as outlined in the teachings, is also expected to serve societal purposes including creating venues for people to network and collaborate and empowering those who participate in it. Conditions for achieving economic goals as well as moral and social goals in launching the firm should be accounted for in the economic dimensions. Although the goals of a business must be achieved in accordance with economic standards, the genuine values that contribute to individual and societal growth must not be overlooked, as outlined above. Business, they argue, is not just a society of capital commodities but also a community of individuals, with varied roles and duties.

It is important for businesses to be aware that their entry into society serves the interests of all its members rather than merely serving the interests of their owners. A genuine cooperation programme among diverse labor partners can be developed as a result of this realisation and it could help build an economy that actually helps people. Successful companies have figured out how to treat its management, staff, customers, and suppliers like members of a valued society. Without incorporating communitarian values into everyday business practices, the strategy is doomed to fail. A morally sound society is emphasized throughout these teachings. Management ethics should be developed to represent the shareholders’ interests, that is, to ensure that shareholders’ wealth is maximized as prescribed by law, especially in U.S. Given the many people who make up the organisation they’re in charge of, as well as the fact that human civilization itself depends on the health of the environment in which it operates, managers have ethical responsibilities that go much beyond those of a simple fiduciary nature (Keat & Young, 2013). The actions of the business have a significant impact on the nature and stakeholders. Hence, those decisions are intrinsically moral, and the managerial behaviors, the decisions, and the actions of the business are also moral.

According to the general conception of the role of a manager in managerial economics, the decision-making process carried out by managers impacts the business, its employees, and its environment in a wide range of ways. Managers, therefore, have inherent ethical responsibilities.

Examples of a successful organisation or manager in this area

Many modern businesses have entire departments and even chief executive officer positions devoted to corporate social responsibility and environmental protection. Businesses that participate in CSR work to maximise profits while also serving the greater good. For example-

• Lego’s Dedication to Environmental Sustainability- Lego is a trusted global brand that fosters a healthy environment and helps children develop through imaginative play. Toy company Lego has become the first and only Climate Savers Partner with World Wildlife Fund. In addition to its partnerships, it is committed to sustainability. The LEGO Group is working hard to tackle pressing environmental challenges and build a more sustainable future through all of these initiatives
• Ethical Sourcing at Starbucks-It was Starbucks’ goal to become known as much for its social responsibility initiatives as it was for its products when it introduced its first corporate social responsibility report in 2002. This goal has been achieved through ethical sourcing. In order to keep a positive social impact, Starbucks sources its coffee from farms that meet specific economic, social, and environmental standards

Conclusion

Managers have an essential role in shaping the laws, regulations, attitudes, and cultural norms that encourage employees to act ethically and raise awareness of CSR initiatives. Specifically, this research focused on the part that managers play in emphasising these values and encouraging their implementation throughout their organisations. In this analysis, we see that managers, in their roles as company leaders, play an important part in encouraging CSR initiatives. Managers should make sure that everyone in the company is aware of and appreciative of CSR’s many advantages. Further, managers must encourage stakeholder accountability. This article has shown that accountability is the bedrock of CSR initiatives. A manager’s duty with regard to the promotion of ethical behaviour is to ensure that there is a ethical responsibility that is binding on all members of the organisation, including employees, management, and external stakeholders.

References

• Tepper, T. (2022) Milton Friedman on the social responsibility of business, 50 years later, Forbes. Forbes Magazine. Available at: https://www.forbes.com/advisor/investing/milton-friedman-social-responsibility-of-business/ (Accessed: December 2, 2022).
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• Steinberg, J. (2012) The case against corporate social responsibility, The Wall Street Journal. Dow Jones & Company. Available at: https://www.wsj.com/articles/SB10001424052748703338004575230112664504890 (Accessed: December 2, 2022).
• Keat, P.G. (2013) Managerial Economics, global edition, Google Books. Pearson Higher Ed. Available at: https://books.google.com/books/about/Managerial_Economics_Global_Edition.html?id=-_2oBwAAQBAJ (Accessed: December 2, 2022).
• The relationship between social responsibility and business performance … (no date). Available at: https://www.researchgate.net/publication/337258656_The_Relationship_between_Social_Responsibility_and_Business_Performance_An_Analysis_of_the_Agri-Food_Sector_of_Southeast_Spain (Accessed: December 2, 2022).
• Pontifical Council for Justice and peace, compendium of the social … (no date). Available at: https://onlinelibrary.wiley.com/doi/abs/10.1111/j.1758-6623.2012.00186.x (Accessed: December 2, 2022).

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