Runnig Head: Social Responsibility

The Social Responsibility of Business is to Increase its Profits

The Social Responsibility of Business is to Increase its Profits

Introduction

Modern empirical analysis suggested that large firm's can strategically engaged in social responsibility activities in order to increase their business profits (Abbott & Monsen, 1979, pp. 502). These firms can avail additional benefits from CSR activities, including enhancing reputation of firm and ability to generate profits by differentiating products, ability to extract premium charges for its products or ability to hire high qualified personnel's.

Friedman however noted that there are a number of circumstances in which the firm's senior executives may engage in such actions that serve them for long term interest of firms and also have an indirect positive impact on society (Cowen et.al, 1987, pp. 112). Different examples of social responsibilities are investment in local community that can improve potential employer's quality or make contribution in charitable organization though which they may take advantage of tax deduction. Such actions from large organizations not only justified their self interest, but they engage to earn firms goodwill as a by-product. In addition, this goodwill serves to differentiate themselves from their competitors and providing an opportunity to create extra economic profit.

According to (Alexander & Buchholz, 1978, pp.480) Social responsibility of a large organization is to impact its actions and decision on society and environment in an ethical way that is consisted on suitable development of the welfare of society. Corporate social responsibility of business is also known with other names such as corporate ethics, corporate responsibilities, corporate citizenship or stewardship.

This study discuss famous quote of Milton Freidman (1970), social responsibility of business is increased its profit” with perspective of large companies and focus on industry, geographical location and local context.

Discussion

Strategic CSR for Large Companies

Similarly, economist Donald Vitaliano and Donald Siegel examined that large companies strategically engaged in to profit maximization CSR. Their analysis focus on specific CSR activities that make it more likely social responsible but actually they targeted to maximized business profits. They conclude high profile activities of CSR are; improving working condition for employees or voluntary efforts to reduce environmental pollution.

Study indicates that consumers are willing to pay more amounts if company offers them a product that based on environment friendly (Knox et.al, 2005). Majority of large companies prefer to make their investment in improved working conditions for an employee that helps workers to perform in effective and efficient way that increase firms production. Although there is no doubt that companies have major focus on long term benefits beside performing CSR but such strategy does not claimed either unethical nor illegal.

Social Responsibility of Large Companies in Textile Industry

Like other industries, textile industry realizes its responsibility towards different practices that associated with CSR and make their surrounding environment be safe. Large companies choose different ways to play their role in social responsibility and while focus on long term business profit. We discuss here two multinational firms Burberry and Welspun and analyze their practices of ...