Week 4 Assignment #2….
State and defend your personal position in agreement with Milton Friedman’s opposition to (p. 148 of text, Slide 10 of PowerPoint file) or William Byron’s support of making social responsibility a key criterion in business planning and management (or explain and justify a middle ground between the two). See the notes accompanying Slide 10 for some issues you might consider in developing your initial posting.
- What strengths or weaknesses do you see in the position?
- What additional perspectives you should consider?
Title: Social Responsibility
Date assignment is due:
The emerging critique on corporate social responsibility is easy to detect in the modern world. It entails a delicate mix of the roles of the state and business players. Milton Friedman, an award-winning economist, once wrote that social corporate responsibility officials thoroughly undermine the very fundamental foundation of free human society. They do this by endeavoring to make as much money for all their stakeholders as they can.
I think Friedman’s position is sometimes correct. This is because if businesses have any other responsibility rather than making a profit, it is difficult to determine what motive it really is. Likewise, it is completely difficult for self-selected private entities to determine what this self-interest ought to be.
In my view, a corporation is best considered a pathological institution and a dangerous possessor of the great powers it wields over societies and individual persons. In this regard, social responsibility and corporate social responsibility are mere ‘branding themes’ that are used merely for marketing purposes. They only bring about a sense of legitimacy in the company. They are ways of mitigating the harmful things that are caused by corporations, by their very nature.
Some people consider this view of corporate social responsibility to be pessimistic, deterministic and negative. However, I feel that this notion can be dispelled easily if one regards a corporation simply as an individual way of doing certain things. Without a particular structure, it is impossible for a corporation to maintain focused, controlled achievements of various tasks.
I agree with Milton Friedman that it is not possible for corporate social responsibility to exist hand in hand with the profit-making motive. Any business that tries to achieve on one must give up on the other role. Obviously, a business exists in order to make as much profit as possible for the shareholders. Any efforts at corporate social responsibility lead to a reduction in these profits, and it is therefore counterproductive.
In sharp contrast, William Byron supports social responsibility as a major criterion in the task of planning and managing businesses. Byron argues for the need to look at the full costs of an individual or corporate entity’s behavior and then taking all societal costs into account in the course of an individual’s decision-making process.
In my view, it is impossible to consider the social costs of doing business in an objective and honest manner. The profit-making motive always gets in the way of an accurate determination of such social costs. For such consideration to be taken care of, there is a need for synchrony in both internal and external constituencies. In a business setting, external constituencies can never be brought into the business’s decision-making platforms without steering clear of the core aims of the corporation.
My honest view is that the concept of ‘giving back to the local community’ is a marketing catchphrase that organizations use in order to justify their continued exploitation of the local community’s natural and human resources. I do not understand how a middle ground can be achieved between the meeting needs of profit generation and social well-being. It is upon the government to impose control measures that ensure that all corporate players conduct their business in a socially responsible and sustainable manner.
As Milton Friedman puts, if businesses have any social responsibility other than making as many profits as possible for shareholders, it is not clear what such social responsibility would entail. After all, it is not the role of business to define what constitutes socially responsible practices. Moreover, shareholders would automatically reject any efforts by the company to engage in social responsibility-related activities since they do not relate directly to the profit-making motive.