Social responsibility theory

Social responsibility is an ethical or ideological theory that an entity whether it is a government, corporation, organization or individual has a responsibility to society but this responsibility can be ‘negative.’ In that it is a responsibility to refrain from acting or it can be ‘positive,’ meaning there is a responsibility to act.

There is a large inequality in the means and roles of different entities to fulfill their claimed responsibility. This would imply the different entities have different responsibilities, in so much as states should ensure the civil rights of their citizens, that corporations should respect and encourage the human rights of their employees and that citizens should abide with written laws. But social responsibility can mean more than these examples. Many Non-governmental organizations (NGOs) accept that their role and the responsibility of their members as citizens are to help improve society by taking a proactive stance in their societal roles. It can also imply that corporations have an implicit obligation to give back to society (such as is claimed as part of corporate social responsibility and/or stakeholder theory).

A second way that businesses can use ethical decision making to strengthen their businesses is by making decisions that affect its health as seen to those stakeholders that are outside of the business environment. Customers and Suppliers are two examples of such stakeholders. Take a look at companies like Johnson & Johnson, their strong sense of responsibility to the public is well known. In particular, take for instance Johnson & Johnson and the Tylenol scare of 1982. When people realized that some bottles of Tylenol contained cyanide they quit buying Tylenol, stocks dropped and Johnson & Johnson lost a lot of money. But they chose to lose even more money and invest in new tamper resistant seals and announce a major recall of their product. Now when people look at other products, there is a sense of faith and trust in that Johnson & Johnson would not allow a product to harm people just to meet their own bottom line. The exactly opposite picture had been portrayed by Union Carbide in the Methyl Isocyanide gas leak incident in Bhopal, India in 1984.

In economic function, the goal that is trying to be achieved should be measured to see if it meets with the cost guidelines that the business is willing to contribute. If the business were to try to better the plant by reducing its carbon footprint, it must assess how this can be achieved. In the quality of life measurement “should focus on whether the organization is improving or degrading the general quality of life in society”. Social investment eventually documents the role of the business in its goal to being ‘socially responsible.