SOCIAL

RESPONSIBILITY

PROJECT BY-
SAMRIDHI SRIVASTAVA
XI-J
 ON
Social responsibility of business refers to its
obligation to take those decisions and perform those
actions which are desirable in terms of the
objectives and values of our society. The assumption
of social responsibilities by business enterprises
implies that they respect the aspirations of society
and would try their best to contribute to the
achievement of these aspirations along with their
profit interests. This idea is in contrast to the common notion
that business exists only for maximizing profits for its
owners and it is irrelevant to talk of public good. It follows
that a responsible business, and indeed any responsible
member of society, must act with due concern for the effects on the lives
of other people
KINDS OF SOCIAL
RESPONSIBILITY
• Legal Responsibility- Every business has a responsibility to operate within
the laws of the land. Since these laws are meant for the good of the society, a
law abiding enterprise is a socially responsible enterprise as well.
• Ethical Responsibility- This includes the behavior of the firm that is expected by
society but not codified in law. For example, respecting the religious sentiments
and dignity of people while advertising for a product. There is an element of
voluntary action in performing this responsibility.
• Discretionary Responsibility- This refers to purely voluntary obligation that
an enterprise assumes, for instance, providing charitable contributions to
educational institutions or helping the affected people during floods or
earthquakes. It is the responsibility of the company management to safeguard
the capital investment by avoiding speculative activity and undertaking only
healthy business ventures which give good returns on investment
• Economic Responsibility- A business enterprise is basically an economic
entity and, therefore, its primary social responsibility is economic i.e., produce
goods and services that society wants and sell them at a profit. There is little
discretion in performing this responsibility.
 RESPONSIBILI
NEED FOR SOCIAL
TY
The very concept of social responsibility implies that it is essentially
an ethical issue, since it involves the question of what is morally
right or wrong in relation to the firm’s responsibilities. Social
responsibility also has an element of voluntary action on the part of
the business person who may feel free to perform or not to perform
such responsibilities. They may also exercise their freedom for
deciding the extent to which they would like to serve various
sections of society. In fact, all business people do not feel equally
responsible towards society. There has been a debate, for some
time now whether business should assume social responsibilities or
not.
SOCIAL RESPONSIBILITY
TOWARDS DIFFERENT
INTEREST GROUPS
Responsibility towards the shareholders or owners: A business enterprise has the responsibility to provide a fair return to the shareholders or

owners on their capital investment and to ensure the safety of such investment. The corporate enterprise on a company form of organization

must also provide the shareholders with regular, accurate and full information about its working as well as schemes of future growth.

Responsibility towards the workers: Management of an enterprise is also responsible for providing opportunities to the workers for

meaningful work. It should try to create the right kind of working conditions so that it can win the cooperation of workers. The enterprise must

respect the democratic rights of the workers to form unions. The worker must also be ensured of a fair wage and a fair deal from the

management.

Responsibility towards the consumers: The enterprise must take proper precaution against adulteration, poor quality, lack of desired service

and courtesy to customers, misleading and dishonest advertising, and so on. They must also have the right of information about the product, the

company and other matters having a bearing on their purchasing decision.

Responsibility towards the government and community: An enterprise must respect the laws of the country and pay taxes regularly and

honestly. It must behave as a good citizen and act according to the well accepted values of the society.
 ROLE OF BUSINESS IN
ENVIORNMENTAL

PROTECTION
A definite commitment by top management of the enterprise to create, maintain
and develop work culture for environmental protection and pollution prevention
 Ensuring that commitment to environmental protection is shared throughout the
enterprise by all divisions and employees
 Developing clear-cut policies and programmes for

purchasing good quality raw materials, employing superior

technology, using scientific techniques of disposal and

treatment of wastes and developing employee skills for the

purpose of pollution control

 Complying with the laws and regulations enacted by the

Government for prevention of pollution

 BUSINESS
ETHICS
Business ethics is the study of appropriate business
policies and practices regarding potentially
controversial subjects including corporate governance,
insider trading, bribery, discrimination, corporate
social responsibility, and fiduciary responsibilities.
Business ethics refers to implementing appropriate
business policies and practices with regard to arguably
controversial subjects.
Some issues that come up in a discussion of
ethics include corporate governance, insider trading,
bribery, discrimination,
social responsibility, and fiduciary responsibilities.
The law usually sets the tone for business ethics,
providing a basic guideline that businesses can
choose to follow to gain public approval.
 ELEMENTS OF BUSINESS
ETHICS
Top management commitment: Top management Establishment of compliance mechanisms: In
has a crucial role in guiding the entire organization order to ensure that actual decisions and actions
towards ethically upright behavior. To achieve results, comply with the firm’s ethical standards, suitable
the Chief Executive Officer (CEO) and other higher mechanisms should be established.
level managers need to be openly and strongly Involving employees at all levels: It is the
committed to ethical conduct. They must give
employees at different levels who implement ethics
continuous leadership for developing and upholding the
policies to make ethical business a reality.
values of the organization.
Therefore, their involvement in ethics programmes
Publication of a ‘Code’: Enterprises with effective
becomes a must.
ethics programmes do define the principles of conduct
 Measuring results: Although it is difficult to
for the whole organization in the form of written
documents which is referred to as the “code”. This
accurately measure the end results of ethics

generally covers areas such as fundamental honesty programmes, the firms can certainly audit to

and adherence to laws; product safety and quality; monitor compliance with ethical standards. The
health and safety in the workplace; conflicts of interest; top management team and other employees
employment practices; fairness in selling/marketing should then discuss the results for further
practices; and financial reporting course of action.
CASE STUDY
CORPORATE SOCIAL RESPONSIBILITY

OF STARBUCKS
Starbucks is the world’s largest and most popular coffee company. Since
the beginning, this premier cafe aimed to deliver the world’s finest
fresh-roasted coffee. Today the company dominates the industry and
has created a brand that is tantamount with loyalty, integrity and
proven longevity. Starbucks is not just a name, but a culture.
Every company has problems they can work on and improve in
and so does Starbucks. As of recent, Starbucks has done a great
job showing their employees how important they are to the
company. Along with committing to every employee, they have gone
to great lengths to improve the environment for everyone.
The corporate social responsibility of the Starbucks Corporation address
the following issues: Starbucks commitment to the environment, Starbucks
commitment to the employees, Starbucks commitment to consumers,
discussions of ethical and unethical business behavior, and Starbucks
commitment and response to shareholders.
• COMMITMENT TO THE ENVIRONMENT
The first way Starbucks has shown corporate social responsibility is through their
commitment to the environment. In order to improve the environment, with a little push from
the NGO, Starbucks first main goal was to provide more Fair Trade Coffee. Starbucks aims
to only buy 100 percent responsibly grown and traded coffee. Not only does responsibly
grown coffee help the environment, it benefits the farmers as well. Responsibly grown coffee
means preserving energy and water at the farms. In turn, this costs more for the company
overall, but the environmental improvements are worth it. Starbucks and the environment
benefits from this decision because it helps continue to portray a clean image.

• COMMITMENT TO CONSUMERS
The second way Starbucks has shown corporate social responsibility is through their
commitment to consumers. By doing research on Starbucks consumer demographics, they
realized that people with disabilities are very important. The company is trying to turn stores
into a more adequate environment for customers with disabilities. A few changes include:
lowering counter height to improve easy of ordering for people in wheelchairs, adding at least
one handicap accessible entrance, adding disability etiquette to employee handbooks,
training employees to educate them on disabilities, and by joining the National Business
Disability Council. By joining the National Business Disability Council, Starbucks gains
access to resumes of people with disabilities.
• COMMITMENT AND RESPONSE TO SHAREHOLDERS
One way Starbucks has demonstrated their commitment and response to shareholder
needs is by giving them large portions. By large portions, Starbucks is implying that they plan
pay dividends equal to 35% or higher of net income to. For the shareholders, paying
high dividends means certainty about the company’s financial well-being. Along with that,
they plan to purchase 15 million more shares of stock, and hopefully this will attract investors
who focus on stocks with good results.

• COMMITMENT TO EMPLOYEES
The first and biggest way Starbucks shows their commitment to employees is by just taking
care of their workers. For example, they know how important health care, stock options, and
compensation are to people in this economy. The Starbucks policy states that as long as
you work 20 hours a week you get benefits and stock options. These benefits include
health insurance and contributions to employee’s 401k plan. Starbucks doesn’t
exclude part time workers, because they feel they are just as valuable as full time
workers. Since Starbucks doesn’t have typical business hours like an office job, the
part time workers help working the odd shifts.
• ETHICAL/UNETHICAL BUSINESS BEHAVIOR
The last way Starbucks demonstrates corporate social responsibility is through
ethical behavior and the occasional unethical behavior. The first ethically positive thing
Starbucks involves them self in is the NGO and Fair Trade coffee. Even though
purchasing mostly Fair Trade coffee seriously affected their profits, Starbucks knew it was
the right thing to do. They also knew that if they did it the right way, everyone would benefit,
from farmers, to the environment, to their public image.
THANK YOU