open for business updates

 

We won't send a ton of junk, just the good stuff.


28-May-2014

Business Success and Social Responsibility


Social responsibility offers the possibility for differing opinions. Some see this issue as so crucial they insist investment portfolios of the companies who are part of that portfolio meet certain criteria. At the extreme, others argue (persuasively) that the only social responsibility a business has is to maximize profits for the benefit of the stockholders or owners of the business.


The latter view was given credence by a celebrated Nobel Prize winner in Economics, Milton Friedman, from the University of Chicago. Using his viewpoint, one can argue that business managers do not possess any kind of special talent justifying diversion of successful business profits to any cause in the community, no matter how worthy or popular.

source: youtube.com


The exception to this view is when a sole proprietor/entrepreneur decides to support a charity of choice. Here, the manager is the owner and the decision to support a particular cause is fully personal.


All this ignores what is key to a successful business: to provide high-quality goods or services that meet the needs of customers at a fair price. It just so happens this key to success is also a great definition of a business being socially responsible.

Achieving business success means critical questions have been adequately addressed:


1. Do we know who are likely to be customers? What level of quality and subsequent service do they expect? Can we meet those customer expectations in a competitive manner and at an acceptable price?

2. Are employees fairly compensated for their skills and dedication? Do we give them timely and helpful feedback on their job performance? Are employment policies up-to-date and followed in a consistent manner?

3. Do we value vendors/suppliers and potential vendors? Are their billings paid promptly?

4. Is transparency real when it comes to communicating with major creditors and investors?

Business social responsibility can actually be reduced to sound and progressive management practices. These basics hold up regardless of expectations for community involvement.


In recent years, a new twist entered into this discussion. Let’s call it “cause-based marketing.” The ethical issue is whether a decision to spend business dollars to support a charitable cause is based on a true desire to help the charity, or is it really a ploy to get the business’s name and products in a marketing campaign that benefits from being identified with the charitable cause?


This latter activity is an interesting middle ground. Managers don’t have to apologize for using business resources to support a charity, yet the charity benefits as the “marketing partner” of the business. When you see a symphony concert “underwritten” by a business, for example, are not both the business and the symphony benefiting? And isn’t the business involved in both a dynamic marketing effort while practicing socially responsible business?



About the Author

Roger Doerr
Professor Emeritus, Hastings College, Hastings, Neb.

Roger Doerr is a retired professor emeritus of business and economics at Hastings College where he taught for 44 years. 
He was two-time President of the Nebraska Economics and Business Association.








Tell A Friend

Tell a Friend

From:

To:

Check out this article from Open for Business Magazine!
 
Captcha Image
 

Submitting Form...

The server encountered an error.

Form received.

Captcha Image


Key Factors in Becoming a Nonprofit07-Dec-2015

501(c)(?) Most of us have been involved in some type of organization that is considered a not-for-profit entity. Typically, an organization wi..


Future of Post Secondary Ed22-Jul-2015

Students jump-start careers attending community college This may come as a shock to many of you coming from a parent, ..


Visitors: The Growing Economy28-May-2015

Various GI events draw regional audience PHOTO COURTESY NEBRASKA STATE FAIR Events and festivals play an important role in..


Prosperity and Population17-Mar-2015

The financial impact of farming Nebraska’s agricultural sector is a diverse and important contributor to the state’s e..


Oil Prices Drop, Small Business Opportunities Grow27-Jan-2015

2015 may be record year for economy Oil prices are dropping dramatically and we are seeing that at the pump. The cost of oil is t..


Anticipating Higher Education in 202019-Nov-2014

To degree or not degree Can you picture the University of Nebraska at Lincoln without “Big Red” Division I football, ..


Importance of Perspective08-Oct-2014

Overlooked aspects of current issues Issue 1: Immigration Reform We all understand the United States has a..


The Masters and the Grasshopper23-Jul-2014

Use an advisory board, bring expertise Are you surrounded by competence? Has everyone in your organization adopted the mission of you..


Socially Responsible Economics01-May-2014

Business Success and Social Responsibility Social responsibility offers the possibility for differing opinions. Some see thi..


The Economic Twist26-Mar-2014

Tax implications bring perplexities Early in my career, I worked at a small CPA firm in Omaha. We did tax work for successful indivi..


Economic Twist21-Jan-2014

Planning for a balanced budget; Federal vs. State The government/civics class in high school and the political science I studied in colle..


Our Partners:

© 2015 Open for Business Magazine, LLC  All rights reserved