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SAI INTERNATIONAL SCHOOL
CLASSS XI
SUBJECT: BUSINESS STUDIES
CHAPTER -6,
Social Responsibility of Business and Business Ethics
Topics: Reality of Social Responsibility and Kinds.
(Lesson –note-27)
Reality of Social Responsibility
On the basis of the above arguments for and against social responsibility, one may
wonder what the businessmen do in reality. Do they concentrate on profit
maximization? Or, do they support social goals?
The fact is that one of the most important recent changes in the attitude of
business people has been the realization that they have social obligations to fulfill
besides ensuring their own existence through profitable activity.
It will be useful here to go into some of the reasons and factors, which have
forced businessmen to consider their responsibilities and the conditions which
were favorable to the development of business concern with social responsibility.
Some of the more important among them are:
(i) Threat of public regulation: Democratically elected governments of today
are expected to act as welfare states whereby they have to take care of all
sections of society. Thus, where business institutions operate in a socially
irresponsible manner, action is taken to regulate them for safeguarding
people’s interest. This threat of public regulation is one important reason
due to which business enterprise feels concerned with social responsibility.
(ii) Pressure of labour movement: Over the last century or so, labour has
become far more educated and organized. Accordingly, labour movement
