Kinds of Social responsibility

Kinds of Social responsibility

Social responsibility of business can broadly be divided into four categories, which are as follows: 

Economic Responsibility

A business enterprise is basically an economic entity and, therefore, its primary social responsibility is economic i.e., produce goods andservices that society wants andsell them at a profit. There is little discretion in performing this responsibility.

Legal Responsibility

Every business has a responsibility to operate within the laws of the land. Since these laws are meant for  the good of  the society, a law abiding enterprise is a socially responsible enterprise as well.

Ethical Responsibility

This includes the behaviour of the firm that is expected by society but not codified in law. For example, respecting the religious sentiments and dignity of people while advertising for a product. There is an element of voluntary action in performing this responsibility.

Discretionary Responsibility

This refers to purely voluntary obligation that anenterpriseassumes, forinstance, providing charitable contributions to educational institutions or helping the affected people during floods or earthquakes. It is the responsibilityofthecompanymanagementto safeguard the capital investment by avoiding speculative activity and undertaking only healthy business ventures which give good returns on investment.