Social Responsibility of Business to Customer, Society, Environment & More

Organizations should not avoid the social responsibility of business. Many firms recognize the importance of social responsibility and take steps to see that policies are taken and implemented in such a way that they make a positive impact on society.

They should practice social responsibility through community support, self-regulation, and social audit.

Definition of Social responsibility of business

Social responsibility is the awareness that business activities have an impact on society and the consideration of that impact by firms in decision-making. The business organization produces goods and services to generate profit.

At the same time, it does have some impact on society as well as the whole community. Social responsibility is a must for a business organization.

If business firms fail to discharge their responsibility then they will fail to create goodwill and last long.

“Social responsibility of business refers to the obligations of businessmen’s decisions and actions taken for reasons at least partially beyond the firm’s direct economic and technical interest.” —Keith Davis

“Social responsibility is to pursue those policies, to make those decisions, or to follow those lines of action which are desirable in terms of the objectives and values of our society.” —Howard D. Bowen

“Corporate Social Responsibility is a management concept whereby companies integrate social and environmental concerns in their business operations and interactions with their stakeholders.” —United Nations Industrial Development Organisation (UNIDO)

“Corporate Social Responsibility is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large.” —The World Business Council for Sustainable Development (WBCSD).

Social responsibility of business towards the customer, employee, environment, government, competitor, society, and investor

1. Responsibility to the customers

Business organizations survive by selling their products to customers. And for a business organization customers are the main stakeholders. So the business organization must have some responsibility to the customers and these are discussed below:

1.1 The right to be sure about safety: The most basic consumer right is to be sure about the safety of the product’s possession. The business organization should taste the product and give direction to the consumer about its proper use. It should also monitor the product safety that is sold to the customer.

1.2 The right to be informed: The customer has the right to receive available information and all relevant information belfry purchasing a product. The business organization should inform the customer about the limitation, or any kind of problem with the product. They should inform the customer about the harmful effects of a product like, “smoking is injurious for health”

1.3 The right to choose: Customers have also the right to choose a variety of products at competitive prices. They also have the right to buy a product of the right quality at a fair price.

1.4 The right to be heard: Business firms should give customers the opportunity to be heard before taking major decisions regarding the production of goods and services. The consumer relations depart must be activated to learn about consumers, grievances.

1.5 After-sales service: After-sales service create faith among customers. It grows the company’s goodwill.

1.6 Genuine advertisements: Fake advertising is very often today, it may have some benefit for a certain period but in the long run, it will destroy a business.

1.7 Research and development: Research and development is the key to business growth. It helps to increase the quality and decries the price of the product or services.

1.8 Adverse effects: Company should aware of their customer if their product or service have any adverse effects. It may decrease the sales volume but this policy increases brand image and gain customers’ faith.

Social Responsibility of Business
Social Responsibility of Business

2. Responsibility to the employee

No business organization can run its operations without the cooperation of employees…So; the business firms have some responsibility to the employees. The employees expect safe working conditions, fair compensation, equal opportunities, adequate benefits, etc. The major rights of the employees are discussed below:

2.1 Equity in the workplace: Employees expect to be treated equitably in the workplace. Business firms have to ensure fair treatment to all employees regardless of age, race, gender, religion, or national origin.

2.2 Safety in the workplace: The business organization should take necessary steps for safety programs. Emphasis on safety training to avoid different types of accidents should decrease repetitive motion. The organization should also introduce job rotation to avoid repetition.

2.3 Fair wages to employees: A business organization directly connected with their employees. And they are responsible to ensure the right of their employee. So the company should practice a fair policy for employee wages.

2.4 Provide enough training and development facilities: Though this is a business responsibility of a business organization is also a social responsibility of a business organization.

2.5 Employment of women: Women’s employment is essential for women’s empowerment. Roughly half of our population are women. We can’t develop our country/society or family without women’s engagement.

2.6 Promotion in due time: Getting a promotion in due time is the right of every employee but it is the business and social responsibility of the business organization.

2.7 Employee Welfare facilities: A company who are responsible for their employee ensure welfare facility for their employee. At the same time, it grows positivity in worker’s minds toward the company.

2.8 Adequate social security measures: The company should take some social security measures for its employees which are mentioned in International Labour Standards on Social security. These social security measures are Medical care, Sickness benefit, Unemployment benefit, Old-age benefit, Employment injury benefit, Family benefit, Maternity benefit, Invalidity benefit, and Survivors’ benefit.

A business organization should ensure the participation of workers in management.

A worker should get an appreciation for his good work and conduct.

3. Responsibility to the environment

Business activities have an impact on the environment. Our environment is always polluted by the waste of business organizations. So, the business organization has some responsibility to the environment and these are discussed below:

3.1 Preventing air pollution: Air pollution is caused by carbon monoxide and hydrocarbons that come from motor vehicles and smoke. Smoke comes from brick fields. The business organizations which manufacture motor vehicles should take a step toward catalytic converters which have been developed to help control air pollution.

3.2 Preventing water pollution Land is polluted by coal and minerals, forest fires, garbage disposal, cutting of trees, etc. Land pollution often results in water pollution because; toxic water drains into the water supply. So, business organizations can take steps by reusing materials such as paper, plastic, glass, and aluminum to make other products and control land pollution.

4. Responsibility to the investors:

Business organizations also have some responsibilities to the people who invest money. Because the business is run with the investor’s money. The responsibilities of investors are given below:

4.1 Proper management of funds: Firms have a responsibility to manage funds properly. Management has the responsibility to safeguard the interests of the investors. They have to be conscious of the faith of the investors.

4.2 Access to information: Firms have the responsibility to make stock information available to all potential investors and have to stop insider trading for reserving the faith of the investors.

4.3 Executive compensation: The Company should maintain a suitable compensation structure for the executives. They should be well paid and rewarded for good performance.

4.4 A fair return on investment: A business enterprise should ensure a good return on investment to its shareholders. And this is only possible when a business earns enough profit.

4.5 Make the share price stable: Fluctuation of the share price is not acceptable for a company. It may bring harm to the company. So, a business should be concerned about share price.

4.6 Improve company image: Goodwill or brand image is everything for a product or service. Without a growing company image, a business can’t survive long.

4.7 Generate adequate funds: A company should have enough funds in reserve so they can use them for re-investment or for various purposes.

5. Responsibility to the Suppliers:

5.1 Timely Payment: Suppliers are one of the most vital parts of the business. Getting payment timely increase responsibility among suppliers toward that business.

5.2 Fair credit policy: Credit policy should be clear and fair. An unfair credit policy will be harmful to a business in the long run.

5.3 Maintain fair terms and conditions: A business enterprise should maintain fair terms and conditions for business goodwill.

6. Responsibility to the competitors

6.1 Healthy competition: healthy completion in business is bringing good for all. It encourages employees, investors, and competitors to work hard. Healthy competition provides good products or services.

6.2 Don’t harm competitors: Doing harm to others can’t bring any good to anyone. Though doing harm to competitors is illegal but it is also a social responsibility of a business not to do harm to its competitor.

6.3 Don’t copy competitor’s strategy or policy: Coping competitor strategy is a common thing now but this is not fair policy.

6.4 Be fair to the competitor: A business must have competition but fair competition is based on price, quality, service, etc. Every business should maintain fair business competition.

7. Responsibility to the Government:

From the beginning of a business, the government plays a vital role in business. The government ensures so many things for a business like utility facilities, security, communication, and many more. As well as a business also have some social security measure toward a government which is mentioned below:

7.1 Pay all taxes and duties: Paying taxes and duties is not an only financial liability but is the social responsibility of a business.

7.2 Fairtrade policy: As a part of social responsibility a business organization should practice a fair trade policy.

7.3 Ignore political favors: Now a day many businesses take political favor to grow big or to get new business projects.  But that is not a fair policy; a business organization should avoid political favor.

7.4 Avoid bribe: Bribe is the main barrier to economic growth, so a business organization should avoid bribe. By not giving bribes a business can ensure its social responsibility to the government.

By abiding by all relevant government legislation businesses can be responsible for the government.

8. Responsibility to society

A business enterprise exists in us and functions among us which means in society. A business enterprise is a part of our society; it cannot ignore the responsibility toward society. Let’s discuss the major social responsibility of business toward society:

8.1 Increase general amenities to society: As a part of social responsibility, a business institution should take some steps to extend a few general amenities to society like car parking, sports, and recreation, facilities for senior citizens, tree plantation, etc.

8.2 Wasteful expenditure: A business has various types of expenditure and may some of them are excessive and wasteful. A business organization should be concerned about that expenditure. And they can use this money to improve our society.

8.3 Improve living standard: Large-scale businesses can improve the living standard of a certain community. By improving certain things like income, employment opportunities, the cost of goods, and services living standards can be improved.

A business enterprise can adopt some village or area to improve its/educational, social, health, and economic development.

9. Community Support:

Business organizations provide a wide variety of support for the community. They donate money for the welfare of the community. They build schools, parks, roads, etc. and sponsor academic scholarships and help to reduce distress in the community.

10. Self-regulation

Sometimes business organizations establish a code of conduct and ensure that all the members of the community follow it.

11. The social audit

A social audit means a systematic review of an organization’s performance in social responsibility activities. With information from social audit, managers can evaluate how effective the current programs, prices safety, measures, etc., and initiate a new course of actions

Some examples of the social responsibilities of a business


Coca-Cola is one of the largest soft drink sealers on this planet. Also, their supply chain is huge. In 2014 they noticed that their delivery trucks generate 3.7 million metric tons of greenhouse gas that year. They take initiative to reduce the amount and shift to different trucks that are powered by alternative fuels.

Johnson & Johnson

Global giant Johnson & Johnson decide that they will produce 35% of their energy needs from renewable sources.


From a social responsibility, Netflix gives their employee 52 weeks of paid parental leave. An employee can take this leave at any time of his/her job period. Whereas other tech companies give 18-week leave.

From the above discussion, we have understood clearly the social responsibilities of business. At first glance, someone can think that social responsibility is not profitable for the business.

But these types of social activities help a business in many ways. Doing social activities increase brand value, increases the company’s public image grows customers’ faith, sometimes it increases share value.

Overall a company can gain respect from people by doing social responsibility activities. Business organizations must take proper care of social responsibility in order to survive and grow.

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