Do corporations have a social responsibility beyond just obeying the law

Do corporations have a social responsibility beyond just obeying the law? To understand the basic definition of a corporation, one must understand its main objective. Every corporation, excluding a Club or Non-Profit Corporations, has a sole objective, i.e. making a profit. This is the basic foundation of every business and corporation that is created in the first place. The profit is basically the difference between the revenue that the corporation generated and the cost that it incurs. However, corporations do have to operate according to the law. For example every corporation pays taxes on its ‘sky high’ profits but is that the only thing a corporation should do for the betterment of society? Obeying the law includes several other things including labor rights, minimum wages, working conditions and several consume rights including misleading advertisement. “If ethics are poor at the top that behavior is copied down through the organization” quoted Mr Robert Noyce, the inventor of the silicon chip (Butler, 2003).
Business ethics is one of the terms that many might have heard. Not many businesses run ethically but some businesses are adapting the ethical strategies for giving something back to the society. Anita Roddick was one of the most ethical founders of the Body Shop and quoted “Being good is good business” in 1942. Ethics mainly refers to what is happening inside the business environment. It is basically the rights and wrongs that a business does and the decisions that it makes. Unethical decisions might benefit the business but are considered bad for the society and ethical decisions might be bad for the business but good for the society. This is the entire foundation that a business works on. Social responsibility is related with business ethics (PSO, 2011). It basically is the action of a business that affects the society directly and indirectly. There are several cases where a corporation is not socially responsible and it leads to the 3rd party being affected in a negative way.
There are several cases where a business has to be ethical and socially responsible. Why a business goes for an unethical practice is because of the fact that the action gets the business a higher return. “For every complex problem, there is a simple solution that is wrong” said Mr. George Bernard Shaw, the famous Irish poet. Thinking about a society and taking desirable actions for the 3rd party usually results in a less return or a loss to the corporation (Newton, 2005 p. 10). One of these actions is pollution and dumping the waste in the sea. This is one of the most common examples. A manufacturing entity usually looks for cheaper ways for producing. Most of these factories dump the wastage including harmful chemicals in the sea which effects wild life and some of these companies use cheaper equipment that results in toxic wastage and harmful smoke. These corporations do have an option to switch to more advanced equipment but most of them simply refuse to do so because of the investment (Stewart, 2011). Another action is the exploitation of labor. Some corporations offer very poor working conditions to the laborers which can be dangerous to their well-being. Child labor is another action that the NGOs and governments are trying to stop. Companies like Nike and Apple have hugely benefited from child labor. One of the most unethical practices is the exploitation of the consumers and customers. These people are the money makers for the corporation and still they are being exploited. Violating consumer rights using misleading advertisement and false claiming of the product benefits are a part of exploiting the consumer and tricking them into buying the product (Stanlake, 1980).
Businesses do operate under the basic law but it is not enough for the society. Corporations like monopolies have the power to take full advantage of the consumers. However, this is wrong and every corporation needs to adapt CSR (Corporate Social Responsibility).
References:
Butler, S. H. (2003).&nbsp.Hearts desire creating wealth fast. Victoria, B.C: Trafford.
Newton, L. H. (2005).&nbsp.Business ethics and the natural environment. Malden, MA: Blackwell.
Pakistan State Oil. (2011). Corporate social responsibility. Retrieved from http://www.psopk.com/csr/
Stanlake, G. F. (1980).&nbsp.Macro-economics: An introduction. London: Longman.
Stewart, A. (2011, Oct 25). Raising the credibility quotient of responsible leadership . Retrieved from http://business-ethics.com/2011/10/25/1147-raising-the-credibility-quotient-of-responsible-leadership/

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