The paper "Two Views of Corporate Social Responsibility" is an outstanding example of management coursework. In recent times, Corporate Social Responsibility (CSR) has drawn a lot of public attention due to the obvious significance for the economic and social health of companies and general society (Bartkowiak p. 135). The headline in recent years has depicted sad news of business ethics and even lack of it. In the debate, the differences between opinions on CSR whether it should be adopted have emerged. Margolis, Elfenbein & Walsh (2007) argue that corporate social responsibility is a driver of sustainability and long term relationship with customers.
In spite of divergence of views concerning the effectiveness of CSR, there has been a common agreement amongst policymakers, practitioners and academicians that companies serve with a social authority which needs that they work within the culture and norms of the societies where they operate (Devinney 2009, p. 44). Based on the contentious topic, this essay will compare and contrast the two views of corporate social responsibility. The views to be discussed include the classical view and the socioeconomic view. Definition of CSR According to Bartkowiak (2006), corporate social responsibility is defined as the form of business self-regulation incorporated into a firm’ s business model in which a business control and make sure there is active compliance with ethical principles and global norms and with law.
Proponents of CSR claim that the course supports a positive effect on the environment and the stakeholders such as employees, consumers, investors and communities, among others (Fisman, Heal & Nair 2007). It is a major aspect of proponents of the theme of CSR that firm gets a sanction from the society which needs that they in response, make a contribution to the development and growth of the society (Devinney 2009, p. 44). Devinney (2009, p. 45) says that the term sanction may not be true, but society expects the management of the organizations to use common sense to realize the communities expect employment from them, to improve society by developing and deliver consumer needs, creating markets for suppliers, making good returns to the shareholders and also paying government taxes (Devinney 2009, p. 45).
However, as much as some companies are praised for taking part in CSR they have equally been condemned.
For instance, BHP-Billiton Company which is Anglo-Australian giant usually puts much emphasis on CSR surveys majorly owing to because it is regarded by Global Reporting Standards to be responsible in terms of environment and to be implementing safety and environmental policies and practices (Devinney 2009, p. 45). Nevertheless, the same company has been vilified criticized and boycotted by environmental activist groups for its effect on the environment. Classical View The classical observation holds that the sole social responsibility of the management is to maximize business profits (Lenkowsky 2006, p. 48).
One of the famous economists who believe the sole purpose of business is to make a profit is Milton Friedman. He thinks that the managers have the right to increase the profit at the confines of the law (Friedma, 1970, p. 2). In his piece titled, 'The social responsibility of business is to increase its profits', he says that “ There is only one social responsibility of business, which is to employ its resources and take part in activities created to enhance its profits provided that it remains within the rules of the game, that is, to engage in clear and free competition with no fraud or deception. "