Towards the Weaker Sections of Society
The obligations of a business enterprise to the weaker sections of the society are:
(a) Helping the weaker sections by providing to them an opportunity for growth.
(b) Encouraging voluntary organisations and agencies engaged in improvement of the weaker sections.
Towards the Economic Policy of State
The obligations of a business enterprise towards the economic policy of state are:
(a) Encouraging development of small business, import substitution and self-reliance and dispersal of economic activity.
(b) Producing goods to meet the needs of the various sections of society.
(c) Helping the government in its efforts to hold the price line.
(d) Taking measures to subserve the national policy to establish an egalitarian social order in the country.
An analysis of the components of social responsibility of a business enterprise reveals that the business enterprise owes social obligations to consumers, workers, owners, society, government, weaker sections of society, and to the economic policy of the state.
Fig. 3.1 Business and its Social Responsibility
In above Fig. 3.1., the social responsibility of business towards the different components of society is given.
Balancing of Various Interests
We have seen that there are different interests of public affected by the business. In view of this, it is necessary for an enterprise to manage its affairs in such a way that it is able to strike an equitable and proper balance between the interests of the people affected by its activities. To quote Ernest Dale, the manager of an enterprise "sees himself as an arbiter among the many interests of public affected by the business: the stockholders, the employees, the suppliers, the local community and the customers. It is his duty to distribute the returns from the business equitably by providing a 'fair' return to the shareholders, fair working conditions and pay for the employees, 'fair' price to the suppliers and customers and to make the business in general an asset to the local community and the nation."
How can business be made to discharge Its responsibility?
Following are some of the ways which may help business in discharging its social responsibilities:
1. Self-education through —
(i) a free, vigorous and fair press;
(ii) local get-togethers of representatives of business, shareholders, workers and others.
3. Encouraging internal accountability by —
(i) Making a mention of these responsibilities in the company's memorandum;
(ii) Establishing consumers' advisory councils;
(iii) Providing for social audit. Men trained in the social performances of a business.
4. Shunning active participation in and direct identification with any political party.
5. Rendering financial and technical help to municipalities, corporations and district boards.
6. Supporting education, slum-clearance and similar other programmes. Discharge of social obligations, however, cannot be a one-way traffic. It is necessarily a mutually interacting process where action produces reaction. Social responsibilities of business are not limited to only a liberal policy on the part of management and no obligation on the part of others. In order that a businessman may discharge his duties, workers and others must discharge their social responsibilities. The workers' social responsibilities include doing a good day's work for a good day's wages, cooperating in increasing productivity and submitting to the discipline of business organisations. The social responsibilities of consumers are to resist high prices and exploitation in any form and to limit purchases of scarce essential goods. The state should try to avoid legislative uncertainty and statutory confusion which stifle the creation of a dynamic economy. It should develop such import and export policies which may result in creating a favourable balance of trade.