Social Responsibility Business and Ethics PDF

# Social Responsibility Business and Ethics ## Business Social Responsibility - Business social responsibility is to create maximum value for shareholders while performing justly to all interested parties, such as owner, employees, customer and society. - **Narayan Moorthy:** "Business social r...

# Social Responsibility Business and Ethics ## Business Social Responsibility - Business social responsibility is to create maximum value for shareholders while performing justly to all interested parties, such as owner, employees, customer and society. - **Narayan Moorthy:** "Business social responsibility is about accepting personal responsibility for the actions and its impact on society." - USA: "Business social responsibility is about business giving back to the society." - The Philippines: A great awareness has to be developed at present about the necessity of fulfilling business social responsibilities. There are some developing forces that will have an impact on the stakeholders and the society in general: - Business competition - Electronic business - Globalization - Environmental pollution There are some main parties to whom the business has to fulfill its social responsibility: - Customers - Employees - Owners - Society - **Right Path To University** - **Preparing by:** Pasindu Kariyapperuma ## Equality good employee relationship job security health and safety - **Employees**: Organizing training programs - **Customers**: Being fair, protecting rights, minimizing damages, providing quality goods - **Owners**: Providing a fair return, providing economic benefits, efficient management - **Society**: Contribute to the employment, paying taxes without fail waste management green products Business should take steps to meet the expectations of all the stakeholders when fulfilling the social responsibility. ### Various benefits that can be obtained by fulfilling social responsibilities: 1. Develop business good will (the standard). 2. Ensure the excitement of business. 3. Ensure business trust. 4. Satisfy customers. 5. Achieve the business objectives. - **Sustainable development:** "Sustainable development is development which meets the needs of the present, without compromising the ability of future generations to meet their own needs." - **World Commission on environment and development** ### Sustainable development is built up of three pillars that are equally important: - Economic sustainable development - Environmental sustainable protectivity - Social sustainable development - **Right Path To University** - **Preparing by:** Pasindu Kariyapperuma **A diagram depicts the concept of sustainable development with the following information:** - **Environment** - **Economic** - **Social** The diagram is a three-part circle where the social, economic, and environment overlap. Where the three circles overlap are the words “Equitable", “Bearable", "Sustainable" and "Viable". ### Economic sustainable development Traditionally economic development was considered as the progress in GDP. It is expected to improve human welfare by enhancing the quality of life and reducing the consumption of resources. It is important here to empower people to have a better standard of living while earning wealth in engaging in economic activities and providing the present and future generations with prosperity and protection by confirming high standard of life style and eradication of poverty of the people worldwide. A competitive market is important for this and it is expected to reach and economic sustainable development by producing eco friendly products that are affordable. ### Environment sustainable production There are limited resources in the world for us. Every human being who lives on earth needs clean air, water, suitable habitat to live in as well as fertile land to produce adequate food. It is expected to satisfy the basic human needs such as air, water, food and shelter through environment sustainable protection by the quality presence, maintenance and protection of the basic human needs. In sustainable Environment protection, human activities for the protection of global environment and for the future generation are expected while considering on how to do effective changes without destroying the natural environment. - **Right Path To University** - **Preparing by:** Pasindu Kariyapperuma ### Adverse effects that have risen such as global warming, destruction of forestry, excessive fishing in oceans should be focused here. - To satisfy human needs, natural resources should be extracted from environment. - Environment sustainability can be protected through consuming resources, which cannot be replaced, at a lower speed rather than the speed they take to replace themselves naturally. ### Social sustainable development To ensure sustainable future, needs and wants of people could be satisfied equally / fairly. In other words, while human needs and wants can be fulfilled at a high standard. There shouldn't be corruption or violation of others rights to do so, To ensure this position in social sustainable development, it emphasizes on giving equality, social capital, social integrity, commitment of community and development of human rights, social responsibility, social justice to everyone. It is expected in social sustainable development to have human development by satisfying human needs while not violating the needs of future generations. The way the businesses can contribute to sustainable development. While selecting strategies and activities by a business to fulfill needs and wants of a business itself and its stakeholders, it should develop and protect natural and human resources for future needs. Then that becomes a sustainable use of a business. To make sustainable development a reality, cannot be done only by one business working it alone, rather consumers including total world economic community should actively contribute for that. ## Contribution of business for economic sustainability There are some facts that a business should concentrate on working towards economic sustainability: - Economic development and stability - Efficient use of resources (get maximum utilization from scarce resources). - Competition (without using misconducts or harming others within the competition, complete fairly) - Production and consumption - Employment (increasing employment opportunities). - International trade - **Right Path To University** - **Preparing by:** Pasindu Kariyapperuma **Q) How businesses can compete fairly?** There are some steps that can be taken by a business to ensure economic sustainability: 1. Job designing 2. Empowering skills (eg, motivation programs). 3. Efficient use of resources. 4. Efficient usage of capital. 5. Risk management. 6. Empower economic development. 7. Growth in benefits of stakeholders. 8. Investment for national economic growth. 9. Introducing innovation. 10. Developing technology. 11. Contributing to the development of business infrastructure. 12. Employee welfare. 13. Improving exchange and transaction process. 14. Encouraging production processes. ## Contribution of businesses for environment and sustainability There are some facts that should specially be focused on by businesses when achieving environment sustainability: - Consumption of resources. - Raw materials and waste management - Risk management - Protection of natural and cultural heritage - **Right Path To University** - **Preparing by:** Pasindu Kariyapperuma There are some activities that can be done by a business to ensure environment sustainability: 1. Buying eco-friendly products. 2. Use of eco-friendly transport modes. 3. Putting 4R practice concept such as waste management. 4. Engaging activities by retaining resources such as use of low materials, energy, walk in the production process. 5. Minimize the pollution of water, air and soil. 6. Taking action to protect Biodiversity. 7. Acting in accordance with environment rules and regulations. 8. Working together with government and non government firms for environment. 9. Protection / eco friendly activities. 10. Usage of eco friendly powers such as solar power. ## Contribution of businesses for social and cultural sustainability There are some facts that a business should focus on to ensure social and cultural sustainability: - Enhance the standard of living of people. - Provide equal opportunities to people. - Create social integrity. - Encourage international participation. - Maintain human capital. - Protect local traditions and customs. - Protect cultural environment. - Take action to minimize poverty (people in need). - Employee relationships - **Right Path To University** - **Preparing by:** Pasindu Kariyapperuma ### There are some steps that can be taken by a business to ensure a social and cultural sustainability: 1. Respect for human diversity. 2. Contribute to the protection of human rights. 3. Contribute the essential facilities such as education, health to people. 4. Act with equality with people. 5. Contribute to the social assurance activities. 6. Contribute to respect and protect cultural diversity. 7. Contribute to protect low and peace. ## Concepts that businesses use for sustainable development at present ### 4R concept for sustainability Accumulating an unbearable amount of waste for a day in production and consumption activities has become a global problem. Therefore, concentration is focused on to it globally to achieve sustainable development through 4R concept in production consumption waste management. 4R is: - Recycle - Reuse - *use something by cutting* - Reduce - Replace ### Recycle Waste is separated here to form a material to produce another product. Here are physical state of substance is changed. Recycling can be done in two ways to have two outcomes. - Materials with lower values is transferred into products with higher value (upcycle) - *example producing ppr from hay* - Materials with higher value is transformed into materials with lower value (downcycle). **Ex: Making irons by crashing vehicles that are discarded in japan.** - **Right Path To University** - **Preparing by:** Pasindu Kariyapperuma ### Reuse Using products that can be used over and over in production and consumption activities is known as reuse. Eg: Using lunch boxes (can be used over and over) instead of lunch sheets. ### Reduce This means the production of waste that is released to the environment. This can be done easily by reducing the discarding amount used at consumption production. The contribution to sustainable development can also be done by eliminating the use, by avoiding the use or by not using the harmful products at all. eg - Not using non degradable polythene for packing, not bottling drinking water in plastic bottles. ### Replace Among the natural resources that are used in production, the replacement of resources that are replaceable is known as replace. eg - Start a reforestation project by a firm that uses timber as its a raw material/farming fishery resources by a business that engages in fishing industry. ## Adverse effects of business activities 1. Import low quality products expecting more profits. 2. Higher competition of businesses. 3. Release waste and pollute environment. 4. Conduct business activities by wasting natural resources. 5. Unbiased employee welfare. 6. Create advertisements that don't suit our society and culture. 7. Designing cloth which will not suit our society and culture. 8. Introducing goods and services that do not suit for our cultural rituals and habits. - **Right Path To University** - **Preparing by:** Pasindu Kariyapperuma ## Business Ethics To act favourable to all the interested parties acknowledging the good and bad (business ethics) It is important for businesses to follow business ethics. **Eg:** - By supplying quality goods and services, fairness can be fulfilled, there by increasing their trust on business. - By following ethics related to accounting, financial irregularities and misconduct can be avoided by ensuring trust. - By following ethics related to the rights and responsibilities of both employers and employees, unfairness by caste, social status, religion or gender can be avoided, thereby leading to a better human resource management. ### Factors to be considered when forming a code of ethics - Business - Customs - Employees - Competition - Organizational culture - Product - Practicalness - **Right Path To University** - **Preparing by:** Pasindu Kariyapperuma | Factor | Details | |:---------------|:---------------------------------------------------------------------| | Buisness | What is the nature of the business, is it a small scale buisness or a large scale buisness? | | Customers | Their demand patterns, communication, religious & Social cultural factors | | Employees | Rich level, employee, their enviroment, their needs & wants should be considered | | Competitors | Are their competitors?, what are the ethics they follow. | | Organizational culture | Customs and practices, values, habits of the business. | | Product | Does it produce good or service? What are the type of products they introduced need to evaluate | | Practicalness | It should be considered if ethical code of system can practically be implementing when formulating it | - **Right Path To University** - **Preparing by:** Pasindu Kariyapperuma ### Code of ethics When the code ethics of a business **is** written, **it** is known as code of ethics. ### Advantages of following business ethics - Increasing the business good will. - Can face the business competition easily. - Due to protecting accounting and financial ethics more investors attracting to the business. - New investors can attract easily due to protecting finance and accounting ethics - Increasing customers loyalty towards the business - When practicing code of ethics in human resource management business can maintain equality among employees. ### The differences between business ethics and social responsibilities - **Business ethics** means at favourable to all the interested parties acknowledging the good and bad. Business social responsibility is to create maximum value for shareholders while performing justly to all interested parties such as customers, employees, owners and society. - **Business social responsibility** means the values business giving back to the society **but** business ethics means act favourably to all the intrested parties when reporting business. - **Right Path To University** - **Preparing by:** Pasindu Kariyapperuma