Business’s social responsibility has increased due to several reasons. Control from the government and the necessity to inform the society are among them. But the matter is that the company makes its decisions within itself and that creates two opposite approaches that managers of the companies use to social responsibility – economic and social-oriented economic approach (Galbreath, 2009).
The business itself means that the company provides the society with products and services, gets income from that and gives working places to the society. According to such a definition, the economic approach means that it will be better for the society not to bother the company with the questions of responsibility and let it just produce and sell what the society needs. Managers, who use this approach, do not really care about social responsibility of the company. In fact, investors give their money in order to get profit from that and the company has to work according to the financial interests of its investors, but not to be socially responsible (Cramer, 2003).
On the other hand, some companies consider that their investors are not the only ones to whom they are responsible. Such companies think that they are also responsible to their clients, the rest of the people that are in some way connected with the work of a company, and in fact, to the society itself, and such an attitude is known as a social-oriented economic attitude. This attitude means that the company gives importance not only to the income but also to the influence of the decisions that company makes on a society (Viswesvaran, 1998). During the last years more and more companies chose the social-oriented economic approach in their work, and there are several reasons that make them make such a choice. First of all they consider that any business and any company is a product of a society (Duckworth, 2010). In the second, many companies begin to be proud of the contribution that they make into social life. And in the third, many companies start thinking that it will give them a better benefit, if they begin to think about social responsibility before their competitors do (Zairi, 2000).
The advantages of economic and social-oriented economic approaches have been discussed for many years by all the participants of business life. And both sides of the debates have several statements to prove their point of view. The supporters of social-oriented economic approach claim that business should not only look for benefits but also should participate in solving social problems because business is also the product and one of the components of the society (Ralston, 2010). Besides, business has money, techniques and other reserves that are necessary for solving social problems. Plus, if business takes part in solving social problems, it will create a positive surrounding for the business that will allow it to have more benefits. Supporters of social-oriented economic approach also consider that participation of business in social life will lessen the influence of a government on a business, because it will try to make business do what they didn’t manage to do themselves. All the mentioned opinions claim that business is not responsible only to the investors, but also to the whole society (Mandhachitara, 2011).
Those who doesn’t support the adherents of social-oriented economic approach say that business exists in order to make benefit from producing and selling goods and services to people. They say that companies are responsible to their investors, so workers and managers should concentrate on compensating of the investments (Thompson, 2010). They also claim that all the financial, personal and other resources of the company should work only to make the benefits of business better. If a society has problems, and those problems influence the whole society, then why should some company or some business solve these problems? Besides, there are special people in the state and in the government who are responsible for the social problems and all the social matters in general and it is their job to take care of these issues (Nemerowicz, 1997). These are the opinions that are based on a hypothesis that business should care only for better benefits and social problems is the problem of a State and it’s government.
Cramer, J., Bergmans, F. (2003). Learning about corporate social responsibility: the Dutch experience. p. 137.
Duckworth, H.A., Moore, R.A. (2010). Social Responsibility: Failure Mode Effects and Analysis. p. 69.
Galbreath, J. (2009). Building corporate social responsibility into strategy. European Business Review, 21(2), 109-127.
Mandhachitara, R., Poolthong, Y. (2011). A model of customer loyalty and corporate social responsibility. Journal of Services Marketing, 25(2), 122-133.
Nemerowicz, G.M., Rosi, E. (1997). Education for leadership and social responsibility. pp. 101-102.
Ralston, E.S. (2010). Deviance or norm? Exploring corporate social responsibility. European Business Review, 22(4), 397-410.
Thompson, D.W., Panwar, R., Hansen, E.N. (2010). Examining social responsibility orientation gaps between society and industry executives. Management Decision, 48(1), 156-171.
Viswesvaran, C., Deshpande, S., Milman, C. (1998). The effect of corporate social responsibility on employee counterproductive behavior. Cross Cultural Management, 5(4), 5-12.
Zairi, M. (2000). Social responsibility and impact on society. The TQM Magazine, 12(3), 172-178.