Business house is an economic entity and should concentrate on wealth maximisation and profit making

madugundurukmini By madugundurukmini, 12th Nov 2013 | Follow this author | RSS Feed | Short URL http://nut.bz/2fthyapv/
Posted in Wikinut>Business>Selling A Business


The firms are not expected to bear the burden of social responsibility beyond the capacity.

Constraints of social responsibilities

The concept of social responsibility is very vague. There are new definite social policies to be adopted. Business house is an economic entity and should concentrate on wealth maximisation and profit making. It concentrates on economic responsibility, social responsibility may be ignored. But a business firm discharges social responsibility by producing economic goods and services and provide them to society all reasonable price. It also provides employment opportunity to the society by using the available resources. It develops technological capabilities and skills and contributes revenue to exchequer in the form of tax.

The firms are not expected to bear the burden of social responsibility beyond the capacity. Social responsibility should not be suicidal to the firms. This may constitute the major constraint, i.e., `Economic constraint'.

Secondly, the social action programmes, the firm take up should be effectively implemented. The firms should not take up the social actions in which they are incompetent to run the activities. If they enter into areas in which they are bot having competence, they get adverse results. Entering into incompetent social actions is another constraint a firm has. If they do not possess skills to perform the social actions, they should not take up such activities.

Thirdly, the companies should not enter into social areas in which they do not have authority, and legitimacy. If they do so it results in corporate unlimited social action which is not accepted by the society. The companies should not encroach on the authority of the government and other concerned institutions while implementing social actions. This is another constraint of social responsibility.

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Comments

author avatar M G Singh
12th Nov 2013 (#)

Madu, you have good knowledge

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author avatar cnwriter..carolina
12th Nov 2013 (#)

interesting indeed Madu...thank you...

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author avatar Fern Mc Costigan
13th Nov 2013 (#)

Nice and interesting post Madu!

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30th Nov 2013 (#)

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