2012-08-08 00:00:00GeneralEnglishhttps://quickbooks.intuit.com/in/resources/in_qrc/uploads/2017/05/CSR1.jpghttps://quickbooks.intuit.com/in/resources/general/social-responsibility-part-business-ethics/Social Responsibility as part of Business Ethics

Social Responsibility as part of Business Ethics

2 min read

Corporate Social Responsibility (CSR) has become a term widely used for large businesses and a number of corporates have adopted policies to give back to society in equal measure. Businesses need to take steps to create a strong link between entrepreneurship and giving. Most customers feel that a company that’s associated with a strong cause is worth associating with. Businesses that can build a connect between a cause, its own products and its clients, will have an edge over those that do not. While large businesses have more scope, means and resources to adopt a socially responsible behaviour, they should not be the only ones carrying out philanthropic work. Small and medium enterprises are equally accountable for their behaviour in society and they need to adopt policies along those lines right from the start. Companies like Body Shop and Ben & Jerry’s started out as SMBs and were committed to social responsibility from day one. In Asia, the understanding and penetration of social responsibility among corporates lags behind when compared to the West. It is important for Asian companies to understand the significance of giving back to society. Only when they understand it well, will they appreciate the need for it. The Indian SMEs have an important part to play in narrowing the social gap and paving the growth path for India. As a first step, SMEs need to promote ethics in business. They need to provide a healthy work environment, pay all taxes and duties and adopt green technology. They must shun all corrupt practices to solicit business. All these actions will collectively contribute to a more equitable society. SMEs account for forty five per cent of Industrial output and forty per cent of Indian export market. They are the backbone of the Indian economy. SMEs should realise that they are dependent on the local communities for their basic needs like water, power, land and must learn to return the favours to these communities. SMBs can help these communities by providing them employment opportunities, use their agricultural produce, and employ the locals in day-to-day business activities. According to a Nielson survey customer confidence in business has seen a decline globally. Businesses today have a fight on their hands as they struggle to increase sales and turnover during the last few months of 2012. Customers need to be assured now more than ever that they would be spending for a good reason. It is imperative to convince them to spend and when they have a strong cause attached to their spending, they would be easily convinced. However, inculcating social responsibility in an organisation is a long term process and cannot be achieved in a short span of time. It requires a change in the mind sets of people, the cultural fabric of society. Businessmen need to think and act differently keeping in mind the long term effects of their business endeavours on society. Small Businesses need to be as socially conscious as large businesses for this change to take place.

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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