Arguments for Social Responsibility
(i) Justification for existence and growth: Business exists for providing goods and services to satisfy human needs. Though, profit motive is an important justification for undertaking business activity, it should be looked upon as an outcome of service to the people.
(ii) Long-term interest of the firm: A firm and its image stands to gain maximum profits in the long run when it has its highest goal as ‘service to society’. When increasing number of members of society — including workers, consumers, shareholders, government officials, feel that business enterprise is not serving its best interest, they will tend to withdraw their cooperation to the enterprise concerned.
(iii) Avoidance of government regulation: From the point of view of a business, government regulations are undesirable because they limit freedom.
(iv) Maintenance of society: The argument here is that laws cannot be passed for all possible circumstances. People who feel that they are not getting their due from the business may resort to anti-social activities, not necessarily governed by law.
(v) Availability of resources with business: This argument holds that business institutions have valuable financial and human resources which can be effectively used for solving problems.
(vi) Converting problems into opportunities: Related with the preceding argument is the argument that business with its glorious history of converting risky situations into profitable deals, can not only solve social problems but it can also make them effectively useful by accepting the challenge.
(vii) Better environment for doing business: If business is to operate in a society which is full of diverse and complicated problems, it may have little chance of success.