Q. 1. What are social responsibilities at business organization?
Ans: The term business refers to all those activities of persons and organizations whose main aim is to earn profit The term society refers to all those people who directly or indirectly help business to earn profit.
Business depends on society. Society depends on business in other words business and society are interdependent on each other or survival and growth. Business is a part of society. It works in the society It cannot function independently Business works as per the rules and regulations framed by the society. The success. survival and growth of business depend upon support and co-operation of society.
Business depends upon society for the supply of raw materials, capital, laborers and other such things. The profitability and prosperity of business depend Upon the support and cooperation of society Hence, it is the responsibility of business to look after the needs and welfare of the society This is nothing but the social obligation at business organization towards society.
It is the responsibility of business to pay fair wages to employees, to supply quality goods at fair price to consumers, to pay fair dividend to shareholders and to pay taxes on time to government. etc. These are called social responsibilities of business organizations towards society.
What are social responsibilities of business organization towards employees?
Ans: The success, survival and growth of business depend upon efficiency and co« operation of its employees. The employees can give quantity as well as quality if they are properly motivated. In order to motivate the employees, the business organization should fulfill the following social responsibilities towards employees.
1) Job security: Business organization should provide job security to its employees. They should provide them permanent jobs and not temporary. Otherwise they will not work with commitment and dedication.
2) Fair wages: Business organization should pay fair wages to its employees. Along with wages it should pay incentives like bonus traveling allowance medical allowance. etc. to its employees. There should be increment in wages and incentives from time to time.
3] Proper working conditions: The efficiency of employees depends upon working conditions. Business organization should provide proper working conditions to its employees. There should be sufficient lighting and ventilation at the place of work. There should be no dirt. dust and noise at the place of work. That affects the efficiency and productivity of employees.
4) Health and safety measures: Healthy and efficient employees are the assets oi the organization Business or women should ensure proper health and safety of employees for this. business organizations should provide free food service; canteen facilities medical facilities start its employees. Proper maintenance of machine in the factory must be done to prevent accidents.
5) Proper personnel policies: Business organization should adopt proper personnel policies regarding recruitment. transfer, promotion, training, etc. There should not be any partiality regarding recruitment, transfer, promotion, training, etc.
6) Division of labour: Business organization. should maintain proper division of labour in the organization. The jobs should be given to the employees on the basis of the qualification, knowledge, experience and interest. Business organization should be that there is a right person at the right place.
7) Workers union: Forming union is the right of employees. Business organization should allow its employees to form their own union. Management should not follow divide and rule policy which may weaken the strength of employees.
8) Participation in management: Business organization should encourage its employees to take part in the management. This can be done by issuing shares of a company to its employees, by inviting suggestions from employees regarding management, etc.
What are the social responsibilities of business organization towards consumers?
Ans: The success. survival and growth of business organization depend upon satisfaction and support at consumers. In order to win over the confidence of consumers the business organization should fulfill the following social responsibilities towards consumers:
1) Regular supply: Business organization should supply goods and services regularly to the consumers. It should not create any artificial shortage of goods and services to exploit the consumers.
2) Quality goods and services: Business organizations should supply quality goods and services. It should try hard to improve the quality of goods and services. For this it should undertake research and development and quality control measures.
3) Pair price: Business organization should supply goods and services at fair price. It should try to reduce the price of goods. It should try to earn profit by increasing sales and not by increasing the price.
4] After sale service: Service provided after the sale is called “After Sale Service”. Business organization should provide quick and efficient after sales service. It is necessary in case of consumer durables like television, washing machine, refrigerator, etc.
5) Consumer safety: Business organization should produce and market only those firm, which are consumers health oriented. It should not produce and market those those which are harmful to the consumers.
6) Honest advertising: Business organization should make honest advertisements. improper of advertisement is to inform the consumers about the availability of goods, malt merits and so on and not to cheat the consumers.
7) Consumer complaints: As far as possible business organization should try not to ii any complaint from consumer. However, if complaint is received it should be promptly. Necessary corrections should be made in the product.
8) Avoid monopoly: Business organization should not exploit the consumers by monopoly There should be free and fair competition in the market.
What are the social responsibilities of business organization towards Shareholder?
Ans: Persons purchasing shares of company are known as shareholders. They are the Owners of the company: They expect following responsibilities from company management towards them:
1) Proper use at shareholder’s money: Management should make proper use or shareholders’ money. It should use their money in productive manner. it should not waste their money in unproductive manner.
2) Pair return on investment: Shareholders are basically investors They expect lair return on their investment. Management should pay higher rate of dividend every year to their shareholders.
3) Expansion and diversification: Expansion means starting more and more, factories and diversification means producing variety of products Management should undertake certain expansion and diversification programmers. This will give more dividends to shareholders.
4) Proper disclosure: Management should maintain proper books of accounts. The accounts should be audited on time. One copy of audited balance sheet and profit and loss account must be sent to all shareholders.
5) Periodic information: Management should inform the shareholders about important happenings in the company either through correspondence or through company meetings. After all they are the owners of the company.
6) Proper conduct of shareholders meetings: Shareholders can manage their company only through company meetings by voting in the meeting. Management should conduct the shareholder’s meetings properly and on time. At meeting every shareholder must be given a chance to express his views regarding the activities of the company.
7) Good public image: Management should develop and maintain good public image. A company that enjoys name, tame and reputation enjoys respect and trust in share market labour market capital market, etc.
8) Proper method of accounting: Management should adopt fair and proper method of maintaining books of accounts The books of accounts should show the true and fair picture of the working of the company.
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