The Social Responsibility of Business Is to Increase Its Profits

As modern economics grow bigger worldwide, new social aspects of business become more and more significant. The issue of corporate social responsibility was first encountered by transnational corporations, which were hugely influenced by the effects of globalization and had to adhere to international standards. As competition between companies increases and the amount of supply grows, consumers get the opportunity to approach the process of choosing the seller more thoroughly using new criteria. Such changes in the approach make it possible for the consumers to influence businesses particularly in the area of social responsibility.

Investors also begin to take various aspects of business reputation into consideration, and reputation is directly related to corporate social responsibility. Therefore, world-wide transnational companies and domestic companies tend more and more to invest into social field instead of simply accumulating profit.

In most cases, businesses develop their social influence and state social responsibility goals in order to achieve certain profitable or beneficial goals. For example, companies are attempting to attract highly qualified employees by improvement of working conditions. Another example may be using social responsibility missions of the company as an element of advertising campaign to ensure audience coverage and sales growth (Friedman, 2007). However, even if corporations only pretend to be concerned about social issues, the strategies they conduct in order to fulfill their business goals may be beneficial for society.

The latest manifestation of corporate social responsibility is being ‘woke’ as a business strategy. More and more corporations tend to take the democratic approach and maintain social justice. Nevertheless, by releasing commercials with social implications companies are trying to attract audience with the most purchasing power. Such commercials represent significant risks for the company, as there is a considerable chance to convey the message incorrectly, or wrongly determine social needs of target consumers. One example or a relatively failed socially aimed strategy may be Pepsi 2017 commercial, which poorly reflected the raised police brutality issue and received negative feedback (Vita, 2019).

Another example might be ‘the best men can be’ Gillette advertisement, which may be considered almost offensive towards the product’s target consumers as it implies that men do not behave properly. On the other hand, Nike has conducted a number of successful socially aimed commercials receiving endorsement from the audience. I believe, that Nike’s success might be explained by the fact that the company advocated social justice for a long period and their concerns on the issue appear to be sincere.

Personally, I think corporations do not owe society anything other than profits. Businesses cannot be obliged for any additional social responsibilities, except for ones provided by the law. Regardless, I believe that healthy competition, prevention of monopolization and development of world-wide trading systems may allow consumers to have impact on social activities of corporations. Company’s concern on the topic of social responsibility may become its competitive advantage, benefitting both the business by allowing acquiring more clients and the society by getting corporations involved in crucial processes.

Moreover, such interactions between consumers and providers may have positive effect on domestic and global politics. Transnational companies grow their influence on governments and international relations and at the same time they tend to depend more on the social needs of their customers, as social aspects represent significant criteria in choosing between competitors. Therefore, in an attempt to address the requirements of the society, corporations might become mediators between the government and people.

There are also many people who believe that corporations are in debt to society, as democracy implies people controlling the government and business cannot exist without legal framework provided by the government. It may be true that any business, from domestic shops to transnational corporations significantly depend on society, so they should conduct various non-profit programs in return. Furthermore, people are the main source of revenue in all areas and play a crucial role for financial health of organizations.

Even though people may be able to influence corporations in every possible way, it usually does not happen, and organizations tend to not take any social responsibility. According to Anderson (2020), “capitalist truism (profits are essential)” turned into a “simple-minded, unhinged, socially destructive monomania (only profits matter).” He believes that if companies are not obliged to conduct socially-aimed programs, irreparable damage can be done to the society (Anderson, 2020). Therefore, business should not only be forced to take social responsibility by competition and altruistic approach of its main stakeholders, but also by governmental regulations and even legislation.

Conclusively, it may not be possible for society to directly influence corporations, making them fulfill socially relevant missions. It may be even more complicated due to the fact that in most cases, acts that may appear as a part of corporative social responsibility are used as backup for making more profits. Such approach may have no positive effect on the society, yet provide higher reputation for the company as it seems to be altruistic. Nonetheless, current state of the relationship between business and society can be changed by modifying consumer and employee approach, making it impossible for organizations to exist without social responsibility.

References

Andersen, K. (2020). How liberals opened the door to Libertarian Economics. The New York Times. Web.

Friedman, M. (1970). The social responsibility of business is to increase its profits. The New York Times. Web.

Vita, R. (2019). “Woke” as a business strategy: An explainer, and how not to screw it up. ISL. Web.

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NerdyTom. "The Social Responsibility of Business Is to Increase Its Profits." August 26, 2022. https://nerdytom.com/the-social-responsibility-of-business-is-to-increase-its-profits/.

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NerdyTom. 2022. "The Social Responsibility of Business Is to Increase Its Profits." August 26, 2022. https://nerdytom.com/the-social-responsibility-of-business-is-to-increase-its-profits/.

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NerdyTom. (2022) 'The Social Responsibility of Business Is to Increase Its Profits'. 26 August.

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