Social Responsibility of a Business Term Paper Example | Topics and Well Written Essays - 1000 words

Social Responsibility of a Business - Term Paper Example This famous claim by Friedman however triggered a debate on what the social responsibility of a business is. The businessperson Mackey disagreed with Friedman’s thought terming it as narrow and underselling humanitarian aspect of capitalism. Mackey strongly believes that the social responsibility of a business is not only to increase profits but also to create value for all the stakeholders in the business. Mackey argues that the social responsibility of a business to shareholders, society, and the stakeholders are varied and all are satisfied in different ways, which should be taken seriously by any kind of business to be successful. I strongly agree with Mackey that the social responsibility of a business is not only to increase profits, but also to satisfy the needs of the society, shareholders, and stakeholders, which are as well important. Social responsibility of business to stakeholders The stakeholders in a business comprise the community, employees, suppliers, and cli entele. According to Mackey (2005), all these stakeholders draw the meaning of the business in their own way of satisfaction. It is worth noting that the groups’ needs are varied as well and the needs are satisfied in different ways. ... Satisfied employees in any business will translate into efficiency and quality output, which are valuable assets to the business. The social responsibility of a business to employees include, good working conditions and attractive salaries and wages, social security such as insurance and pension schemes, better living standards among others. Suppliers are as well important to a business and therefore there is need for a business to satisfy the suppliers socially. Mackey believes that all the stakeholders in a business are important for a business to attain its goals. Suppliers supply business raw materials needed to produce certain goods or services and it is their responsibility as well to get the finished products close to the customers. For the smooth functioning of the business, the social function of the business is to give them a fair deal in the business. Social responsibility of a business to shareholders The shareholders in layman’s term are the owners of a business a nd the social responsibility of the business is to satisfy their needs. Although most shareholders majorly focus on increased profits, Mackey admits this though in a different perspective. According to Mackey, profits maximization should not be the soul goal for a business but the business need to put first the interest of the entire stakeholders. Mackey (2005) argues that by putting first the interest of the stakeholders by value creation, this will act as a means to an end. As the business works hard towards maximizing profits for the investors, it is important to bear in mind that by satisfying the customers and other stakeholders, the profits are likely to increase. The shareholders being the owners of