Arguments for Social Responsibility Justification for Existence and GrowthThe prosperity and growth of business is possible only through continuous service to society. Though, profit motive is an important justification for undertaking business activity, it should be looked upon as an outcome of service to the people. Thus, assumption of social responsibility by business provides justifications for its existence and growth.
- Long-term Interest of the Firm: Long term interest is achieved by following the goal which is to service the society. If the society feels that the business enterprise is not serving with its best interest, they will eventually withdraw their support to the enterprise. Therefore to maintain their image a firm must fulfill its social responsibility.
- Avoidance of Government Regulation: Government regulation limits the freedom of business and hence they are not desirable. Therefore by voluntarily assuming social responsibilities, businessmen can avoid the problem of Government regulations which helps to reduce the need for new laws.
- Maintenance of Society: Laws cannot be passed for all possible circumstances. People who feel that they are not getting their due from the business may resort to anti-social activities, not necessarily governed by law. This may harm the interest of business itself. Therefore, it is desirable that business enterprises should assume social responsibilities.
- Availability of Resources with Business: Business institutions have valuable financial and human resources which can be effectively used for solving problems. Therefore, it can help society to tackle its problems better with the huge financial and human resources at its disposal.
- Converting Problems into Opportunities: Business has this tendency to convert risky situations into profitable deals. This can help solve social problems and also make them effectively useful by accepting the challenge.
- Better Environment for Doing Business: A business cannot succeed in an environment full of diverse and complicated problems. Therefore, it must primarily equip themselves for such situations where its own survival is endangered due to enormous social illnesses. It is better to choose an environment with fewer problems to conduct its business successfully.
- Holding Business Responsible for Social Problems: Business is held responsible for social problems like environmental pollution, unsafe workplaces etc. Therefore, it is the responsibility of the business enterprise to solve the problem created by them instead of waiting for other groups to deal with it.