Social Responsibility of Business Class 11 Short Notes

Social Responsibility of business refers to its obligations to make these decisions & perform those actions that are desirable in terms of the objectives & values of our society. Here are the social responsibility of business class 11 short notes.

Types of Social Responsibility

There are four types of social responsibilities:

1) Discretionary Responsibility

It refers to purely voluntary obligations that an enterprise assumes. For example: providing charitable contributions to educational institutions helping affected people during floods.

2) Economic Responsibility

A business enterprise is an economic entity & therefore its primary social responsibility is to produce goods & services that society wants & sells them at genuine profits.

3) Ethical Responsibility

This includes the behaviour of the firm i.e., expected by society but not codified in law. For example: Respecting the religious sentiments & dignity of people while advertising a product.

4) Legal Responsibility

Every business has a responsibility to operate within the laws of the land. Since these laws are meant for the good of society, a law-abiding enterprise is a socially responsible enterprise.

Social Responsibility Towards Different Interest Groups

The business and its management are responsible to various interest groups which are:

1) Responsibility towards Shareholders & Investors

• To provide a fair return to them on capital invested by them.
• To ensure the safety of their investments.
• To provide regular, accurate & full information about the working of the business.

2) Responsibility towards Workers/Employees

• To provide healthy working conditions.
• It should try to win the cooperation of workers.
• They should be given fair wages & fair deals by the management.
• They should be allowed to form unions.

3) Responsibility towards Consumers

• To supply better quantity goods at reasonable prices.
• To ensure regular supply of goods & services.
• Not to follow unfair trade practices like poor quality, misleading advertisements, etc.
• To provide full information about the product.

4) Responsibility towards Govt. and Public

• No to create pollution
• To respect the laws of the country
• It should be regular taxes.
• It should try to develop a good image in society through continuous interaction with various groups of people.

Business & Environmental Protection

Pollution

The injection of harmful substances into the environment mainly because of industrial production is known as pollution.

Causes of Pollution

There are 4 types of pollution:

1. Air Pollution
2. Water Pollution
3. Land Pollution
4. Noise Pollution

Air Pollution

It is the result of combinations of factors that lower the quality of air. Harmful gases such as carbon dioxide emitted by automobiles & smoke and chemicals released from manufacturing plants cause air pollution. It has also created a hole in the ozone layer.

Water Pollution

The dumping of waste & chemicals into rivers, streams, lakes, etc. has resulted in water pollution. It leads to the death of several animals & also poses a serious threat to human life.

Land Pollution

Land pollution is caused by the dumping of toxic waste on land. It results in the reduction of the quality of land & also makes it unfit for cultivation.

Noise Pollution

It is not only annoying but also causes serious health hazards like loss of hearing, mental disorders, etc. Running of factories & vehicles are the main source of noise pollution.

Need for Pollution Control

The important reasons that show the relevance of pollution control are as follows:

• Reduction of health hazards: There is a n increasing evidence that many diseases like cancer, heart attacks & lung problems are caused because of pollution.
  Pollution control measures will help to reduce such health hazards.
• Reduce the risk of liability: An enterprise may be held liable to pay compensation to people affected by the waste (gaseous, liquid, or solid waste) that it has released into the environment.
  Therefore the policy to install pollution control measures helps to reduce the risk of liability.
• Cost saving: An effective pollution control program is needed to save costs which are the cost of waste disposal & cost of changing, etc.
  Such costs can be saved through pollution control measures.
• Improved Public Image: A firm policy & practices for controlling pollution will increasingly influence people’s attitude towards the organizations.
  A firm which uses good reputation & will be precise as a socially responsible enterprise.
• Other Social Benefits: Pollution control results in many social benefits like cleaner visibility, cleaner building, better quality of life, etc.

Role of Business in Environmental Protection

The steps which can be taken by businesses for environmental protection are:

1. A commitment by the top management to create maintain & develop a work culture for environmental protection and pollution control.
2. Ensuring that the commitment is to be shared throughout the whole enterprise.
3. Developing policies & programs for purchasing good quality raw materials using superior technology using better techniques of disposal of waste & developing skills in employees for pollution control.
4. Complying with the rules & regulations enacted by the govt. for pollution control.
5. Spreading awareness regarding pollution control with suppliers, dealers, and customers by arranging educational workshops & sharing training material, and providing technical information.

Business Trade and Commerce Class 11 Notes

Business Ethics

The word ethics has been derived from the Greek word ethics which means ideals and norms. Ethics clearly defines what is right & what is wrong as approved by society.

Business ethics can be defined as socially determined moral principles that govern business activities.

Elements of Business Ethics

1) Top Management Commitment

Top management has a crucial role in guiding the entire organization to achieve ethically upright behavior the higher-level managers need to be strongly committed to ethical conduct. They must work as a role model for the entire organization.

2) Publication of a Code

Enterprises with effective ethics programs define the principles of conduct for the whole organization in the written form document known as a code.

Code includes areas such as fundamental honesty, product quality & safety, health & safety at the workplace, conflict of interest, financial reporting, etc.

3) Establishment of Compliance Mechanism

To ensure that actual decisions & actions comply with the firm’s ethical standards, a suitable mechanism should be established.

4) Involving employees at all levels

It is the employees at different levels who implement ethics policies to make the ethical business a reality. Therefore, their involvement in ethics programs becomes a must.

5) Measuring Results

Although it is difficult to accurately measure the result of an ethics program the firms can certainly audit to ethics program. The firms can certainly audit to monitor compliance with ethical standards.