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Why firms must pursue social responsibility

Organizations have, for a long time, acknowledged their responsibility towards the community and the environment in which they operate. Responsibility does not end with the production of goods or rendering of high quality service as required by the community, but extends into the social field. Social responsibility is a social norm that holds any social institution, including the smallest family unit and the largest corporation, responsible for the behaviour of its members. An organisation’s responsibility extends far beyond the internal maintenance of its human resources to outside the work environment as well.

The social responsibility of an organisation is becoming even more important today. Organisations are expected to be involved in real social problems of the community to show that they do not want to use the community for personal gain only, but that they want to give something back to the community to ensure better dispensation for both parties (Pincus, 1992). Today, however,

organisations pursue multiple goals with emphasis on social awareness, care and commitment.

Social responsibility is so import- ant that the sources of an organisa- tion may depend to a large extent on the social commitment.

 

Arguments for and against CSR Why does an organisation become involved in social responsibility pro- grammes? Roy Pascoe (1998) says that social responsibility is just as important to an organisation for the achievement of good profitability. He adds that there are several reasons why an organisation should show its social responsibility:

 

 

relationship with employees

A good relationship with employ- ees is established if an organisation supports the education, culture and welfare organisation serving these employees. Supporting the organi- sation that serves employees ensures improved employee morale because their living standards are raised and this may result in increased pro- ductivity. The promotion of these relationships is inherent in human resources management process such as equal employment opportunity programmes, health and safety pro- grammes and the provision of incen- tives and fringe benefits.

 

relationship with the community Skinner and Von Essen (1995 p 2258) state that an organisation cannot build a relationship with the community on the basis of prom- ises and propaganda. A good rela- tionship with the community is the product of responsibility, policy and conduct on the part of an organi- sation. Raymond Ackerman  (1997) Chairman Pick  n’  Pay  states  that  if we help the community, it will respond by helping us.

 

relationship with consumers

By making contributions to social causes, an organisation fosters good relationships with consumers, com- merce and shareholders. Pincus (1192 p 31) reports as follows: “Pick n’ Pay” which won the Food Marketing Institute International Hall of Fame Award for Social Responsibility in 1984, was found- ed on consumerism and a strong base of social responsibility.” He says that, after all, consumers, commerce and shareholders are the groups who provide the financial resources that enable organisations to become involved in social responsibility pro- grammes.

 

public image

Companies enhance their public image to get increased sales, better employees, access to financing and other benefits.  Because,  the  pub- lic considers social goals important, business can create a favourable public image by pursuing social goals.

 

Better environment

A business environment can help solve difficult social problems, create a better quality of life and give rise to a desirable community in which to attract and keep skilled employees.

possession of resources Business firms have the financial resources, technical expertise and managerial talent to support public and charitable projects that need assistance.

 

superiority of prevention over cures

Social problems must be addressed one  at  a  time.  Business  should act before these problems become serious and costly to correct, tak- ing managers’ energies away from accomplishing their goals of produc- ing goods and services.

dilution of purpose

The pursuit of social goals dilutes business’s primary purpose i.e. eco- nomic productivity. Society may suf- fer if both economic and social goals are poorly accomplished.

 

costs

Many socially responsible actions do not cover their costs. Someone has to pay those costs. Business must absorb the costs or pass them on to the consumers through higher prices.

 

too much power

Business is one of the most pow- erful sectors of our society. If it pursues social goals, it will have even more power. Society has given business enough power.

 

lack of accountability

Political representatives pursue social goals and are held account- able for their actions. Such is not the case with business leaders. There are no direct lines of social account- ability from the business sector to the public.

 

importance of social responsibility

Cronje et al (1990 p 389) maintains

that the social responsibility of busi- ness is increasingly coming to the fore. The public expects an organ- isation to become closely   involved in the real social problems of the community in which it operates. One of the tasks of management is to initiate programmes to bring the corporate sense of social responsi- bility to the attention of the external public. Management should keep a watchful eye on activities that might be construed by external groups as irresponsible, giving rise to resent Robbins  and  Coulter  (1999  p146) state that it is a business firm’s obligation (beyond that required by law and economics) to pursue long- term goals that are good for the society.

Social responsibility adds an ethical imperativeness to do the things that make society better instead of those that make it worse.

A socially responsible  organisation goes beyond what makes economic sense and is obligated by the law and chooses to help improve soci- ety  because  it  is  ethical  to  do  so.

A company that meets pollution control standards established by the government or does not discrimi- nate against employees over the age of forty in promotion decisions is meeting its social obligation.When it provides on-site child-care facilities for employees, it is being socially responsible.

Conclusion

Long-term profitability cannot be attained if an organisation does not act in a socially responsible way. Social responsibility is not con- fined solely to matters affecting the external  environment. The internal

environment and the well-being of workers and their working condi- tions are no less important. Cronje et al (1992) are of the opinion that the support of such services by an organisation, fosters good moral and allows for higher standard of living for its staff which can also lead to higher productivity. When it becomes known that an organisa- tion has the welfare of its employees at heart, this creates a spirit of  good will and commitment and the, organisation then does not need to scrape the labour market barrel to get and keep good workers.

By Dr Isaac Chaneta teaches at the University of Zimbabwe – Harare, Zimbabwe