Arguments for and Against Corporate Social Responsibility

Updated on June 24, 2015

Corporate social responsibility is a business’s concern for the welfare of society. This concern is displayed by managers who take into consideration the long-term interests of the company and the company’s relationship with the society it which it operates.

A new theory in social responsibility is sustainability. Sustainability is the concept that companies that are socially responsible will outperform their peers or competitors by concentrating on society’s problems, seeing them as opportunities for profit building and aiding the world at the same time.

Sustainability also includes the notion that companies cannot thrive for very long in a world where billions of people are suffering and desperately poor. Therefore, it is in a company’s best interest to find ways to solve society’s problems. Along with this theory is the belief that only businesses have access to the talent, creativity, executive ability, and capital to make a difference.

Today, few people argue that corporate social responsibility is important. Instead, people debate about the degree and forms of social responsibility in which businesses should engage.

Arguments Against Corporate Social Responsibility

Skeptics often claim that businesses should focus on profits and let the government or nonprofit organizations deal with social and environmental issues.

Milton Friedman claimed that free markets, rather than companies, should decide what is best for the world. He believes that Adam Smith’s “invisible hand” will do all the work to make everything better.

Another argument is that companies are meant to create products or provide services rather than handle welfare activities. They do not have the expertise or knowledge necessary for handling social problems. Also, if managers are concentrating on social responsibilities, they are not performing their primary duties for the company at full capacity.

Finally, being socially responsible damage a company in the global marketplace. Cleaning up the environment, ensuring product safety, and donating money or time for welfare issues all raise company costs. In the end, this cost will be passed on to the consumer through the final prices of the product or service. While some customers may be willing to pay more for a product from a company that is socially responsible, others might not be. This can place a company at an economic disadvantage.

Arguments for Corporate Social Responsibility

The simplest argument for social responsibility is that it is the right thing to do. Some of society’s problems have been created by corporations such as pollution and poverty-level wages. It is the ethical responsibility of business to correct these wrongs.

Another point is that businesses have many of the resources needed for solving society’s problems and they should use them to do so.

Another reason for companies to be socially responsible is that if businesses are not, then the government will create new regulations and establish fines against corporations. This has especially been the case for the pollution issue.

If businesses police themselves, they can avoid government intervention. Finally, social responsibility can be profitable. It is possible for companies to prosper and build shareholder value by working to solve social problems. It can be a great way for a company to build positive public relations and attract top talent in the industry.


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    • profile image

      KARTHIKEYAN 3 days ago


      SOCIETY IN WHICH IT OPERATES..............

    • profile image

      ak pathan 5 months ago

      no example

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      xeddgy eddymond 5 months ago

      next time try to expand on the points

    • profile image

      Havadi 6 months ago

      understandable but too shallow

    • profile image

      hvd 6 months ago

      understandable but too shallow

    • profile image 16 months ago

      Bae I expected more

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      rasha 17 months ago

      Arguments For and Against Social Involvements of Business:

      Arguments For:

      1. Business received its license from society and consequently has to respond to the needs of society.

      2. Society gains through better neighborhoods and employment opportunities; business benefits from a better community since the community is the source of its workforce and the consumer of its products and services.

      3. Social involvement discourages additional government regulation and interventions. The result is greater freedom and more flexibility in decision making for business.

      4. Business have a great deal of power which, , should be accompanied with an equal amount of responsibility.

      5. Modern society is an interdependent system, and the internal activities of the enterprise have an impact on the external environment.

      6. Social involvement may be in the interest of stockholders.

      7. Problems can constitute profits. Items that may once considered waste can be profitably used.

      Arguments Against:

      1. The primary task of business is to maximize profits through economic activities. Social activities might reduce economic resources.

      2. Social involvement can create a weakened international balance of payments situation. The cost of social programs would have to be added to the products price.

      3. Business has enough power, and additional social involvement would further increase its power and influence.

      4. Business people lack the social skills to deal with social problems.

      5. There is a lack of accountability of business to the society. Unless accountability is established, business should not be involved.

      6. There is no complete support for involvement of business in social actions. This different view points might result in frictions.

    • profile image

      nakkazi 17 months ago

      not well explained

    • profile image

      queen 17 months ago

      not good enough..

    • profile image

      ronald dzinduwa 18 months ago

      there is generalization of information

    • profile image

      vic 22 months ago

      directional but a bit shallow

    • profile image

      sandra 23 months ago

      no relevant information available

    • profile image

      komal chaudhary 23 months ago

      It is not explain in points

    • profile image

      mahi 2 years ago

      Not propr material available