Question

Please answer below two question in your own words and in brief

The following passage summarizes some of the central points in the debate as to the value of corporations to devote significant resources to corporate social responsibility:

Stakeholders Versus Shareholders

Although corporate social responsibility may appear to be an “apple-pie virtue,” it is quite controversial. Below are some of the chief arguments for and against it:

Proponents will claim that it…

• BURNISHES A COMPANY’S REPUTATION. In the wake of corporate scandals, corporate social responsibility builds goodwill—and can pay off when scandals or regulatory scrutiny inevitably arise.
• ATTRACTS TALENT. Many young professionals expect their employers to be active in social issues. Membership in Netimpact.org, a network of socially-conscious MBA graduates, jumped from 4,000 in 2002 to 10,000 in 2004.

On the other hand, Detractors will argue that it…

• COSTS TOO MUCH. Giving by corporate foundations reached an all-time high of $3.6 billion last year. However, it can come at the expense of other priorities, such as research and development, and is rarely valued by Wall Street.
• IS MISGUIDED. Many corporate executives believe, as economist Milton Friedman does, that the role of business is to generate profits for shareholders—not to spend others’ money for some perceived social benefit.

1. What is your view on this issue? Would that view be different if you were a stockholder of a firm?
2. Do you know of any companies that have engaged in Socially Responsible behavior? Please explain, Please use an example.)

Answer 1

I am in the favour of doing  corporate social responsibility,i can explain my point with the help of following benefits of corporate social responsibility-

1) It enhances relationships with clients- A strong corporate social responsibility framework is essential to building and maintaining trust between the company and clients. It can strengthen ties, build alliances and foster strong working relationships with both existing and new clients.

2) provide satisfied customer- Consumers increasingly don't accept unethical business practices or organisations who act irresponsibly. Advances in social media (giving everyone a voice) mean that negative or destructive practices quickly fuel conversations online. Organisations are accountable for their actions like never before.

3)Attract, retain and maintain a happy workforce and be an Employer of Choice

4)Save money on energy and operating costs and manage risk

5)Differentiate yourself from your competitors

There are 2 types of stock holder-

1 long term investors- since corporate social responsibility increases company earning in long term therefore as a long term investor i will support it.

2 short term investor-aim in this case is to make quick profit by selling and buying new shares and they are least bothered about corporate social responsibility thus in this case i will against corporate social responsibility.

companies that have engaged in Socially Responsible behavior is GOOGLE For example, Google Green is a corporate effort to use resources efficiently and support renewable power. But recycling and turning off the lights does more for Google than lower costs. Investments in these efforts have real-world effects on the bottom line. Google has seen an overall drop in power requirements for their data centers by an average of 50 percent. These savings can then be redirected to other areas of the business or to investors.