Previous Year: Long Questions with Answers - Social Responsibilities of Business and Business Ethics | Business Studies (BST) Class 11 - Commerce PDF Download

Q.1. What are the social objectives of a business?
Ans. The objectives of business should not always be economic. No doubt economic objective is indispensable for existence and development, but economic objectives can be achieved only when a business has social standing. In other words, the objective of business should be to earn profit through social service. According to Henry Ford, “Service first and profit next should be the motive of every businessman.” Ruskin called it as, “Service first and fee second.” According to F. E. L. Bresh, “Business has no meaning unless to serve and satisfy a customer at a profit.”
The social objectives of a business may be summarized as follows
(i) Production of quality goods: The objective of business is not only to provide goods to the society but also to provide goods and services of high quality. The business should also try to improve the quality of goods and services continuously. A businessman may earn good profit by selling adulterated goods but he cannot carry on his business for a long time like this.
(ii) To charge fair prices: The social objective of business is not only to provide quality goods to the society but also at reasonable prices. Undue profits earned by increasing the prices of the goods may not last long.
(iii) To provide employment: The social objective of business is also to provide employment to the society. With the development of business, the need for employees arises. Thus, the business needs the services of good employees. So, the business provides employment to the society.
(iv) To provide regular and fair returns to investors: It is also a social objective of business to provide regular and fair returns to investors. Investors invest money and bear risk. So, the investors must be suitably rewarded.
(v) To promote the progress of the society: Business is a part of the society. The society provides regular market for goods and services of the business apart from factors of production. The progress of the business is linked with the progress of the society. So, to promote the progress of the society has also become the objective of the business.

Q.2. State some of the responsibilities of business towards the government and the consumers?
Ans. The responsibility of business towards the government are as follows:
(i) To set up business as per guidelines issued by the government.
(ii) To ensure regularity and honesty in the payment of fees, duties and taxes.
(iii) To follow pollution control norms set up by the government.
(iv) To establish new business units in rural and backward areas for balanced regional development of the country.
(v) To avoid indulging into monopolistic and other trade restrictive practices.
(vi) To avoid indulging in unlawful activities like bribing, etc.
The responsibility of business towards the customers are as follows
(i) To ensure regular supply of goods and services.
(ii) To offer good quality products and services at reasonable prices.
(iii) To provide information about the product and company.
(iv) To avoid unfair means like adulteration, under weighing, etc.
(v) To settle quickly the grievances of the consumers.

Q.3. Discuss with reasons why business organizations must assume social responsibility. (NCERT 2011)

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Explain any six arguments for social responsibility of business. (NCERT 2008)

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Discuss the arguments in favour of social responsibility of business.
Ans. 
(i) Moral justification: On moral grounds, it is the responsibility of the enterprise to fulfill the obligations of social responsibility due to the fact that it uses the resources offered by the society.
(ii) Survival and growth: The business must fulfill the social responsibility obligation in order to sustain a sound position in the society. The fulfillment of such obligations are necessary for the growth and survival of the concern.
(iii) Resources and skills: There are a huge number of resources which can be utilized in a better way for solving many severe problems of society. The business being a part of the society must utilize the resources for the betterment of the society.
(iv) Employee satisfaction: Besides good salary packages, the company must provide its employees the facility of accommodation, transportation, etc., which not only results in employee satisfaction but also reduces labour turnover and increases in productivity of the concern.
(v) Public image: By fulfilling its social responsibility, the public image of the concern improves. The customers feel attached to the company and demand products offered by the company which enhances profitability. Moreover, the employees feel motivated by working with such concerns that fulfill social responsibility and thus it reduces labour turnover.
(vi) Consumer awareness: In the modern era, where the consumer is treated as the king of all business activities, it is the responsibility of business to provide good quality products at reasonable prices so as to make the consumer attached with the concern. This would automatically result in increasing productivity of the concern.

Q.4. Write a detailed note on business and environment protection. (NCERT 2010)

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What steps can an enterprise take to protect the environment from dangers of pollution?

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‘Businessmen are responsible for aggravating the problem of pollution. So it becomes their moral duty to take steps for controlling pollution’. In the light of this statement, explain any six steps to be taken by the businessmen in checking pollution. (NCERT 2009)

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What is environment? Discuss the role of business in environmental protection.
Ans. The environment is the sum total of all the surroundings both natural and man-made. The quality of the environment is fast deteriorating because of the business activities. The smoke, effluents and other wastes released from the industries pollute the environment and hence affect the health of the people. Therefore, it is essential that we should protect our environment. 11⁄2 Role of business in environmental protection:
(a) Preventive role: It concentrates on preventing pollution from different activities. This includes:
(i) Use of CNG vehicles.
(ii) Recycling of industrial waste.
(iii) Scientific treatment of emission before their release.
(iv) Installation of pollution resistant machinery.

(b) Curative role: Steps must be taken to rectify the damage caused to the environment:
(i) Promoting afforestation.
(ii) Assisting government agencies and other NGOs in cleaning polluted rivers and management of harmful substances.
(c) Awareness role
(i) Promoting awareness about ecological balance.
(ii) Creating awareness about various causes and effects of environmental pollution.

Q.5. Explain the reasons for the need of pollution control.
Ans. The need of pollution control can be ascertained from the following reasons:
(i) Reduction in health hazards: Environmental pollution causes many health hazards which affect human beings adversely. Therefore, to protect the human beings from these health hazards, it is necessary to control environmental pollution.
(ii) Reduction in safety hazards: Environmental pollution causes several types of safety hazards, more particularly in the winter season, resulting in air, rail and road traffic problems. Air pollution mostly causes this problem.
(iii) Reduced risk of liability: Organisations which cause environmental pollution by releasing hazardous gases, chemicals and solid wastes are held responsible for this. Such an act attracts penal provisions too. Therefore, it is beneficial for such organisations to control pollution in order to avoid their liability which may arise because of polluting the environment.
(iv) Reduction in economic losses: Pollution control leads to reduction in economic losses for both the organisation and society. Organisations may reduce economic losses by producing lesser toxic wastes, thereby saving the cost of disposing huge wastes. Pollution control reduces economic losses of society because pollution causes damage to vegetation, land fertility, health, etc.
(v) Aesthetic look: Environmental pollution damages the natural environment thereby reducing the quality of look of natural resources and man- made aesthetic elements like lakes, monuments, etc. By controlling environmental pollution, aesthetic look can be maintained which provides a sense of beauty.
(vi) Improved public image: Generally, organisations which undertake suitable measures for controlling pollution are perceived positively by the society. This improves the image of the organisation before the public which itself is a significant achievement for the organisation.