Corporate Social Responsibility (CSR) has been a growing trend between organizations in Australia and all over the world. CSR has now grown rapidly and relatively smoothly in the last two decades with the increase in number of organisations raising the standards of CSR in attempts to make their operations more social and moral. This report outlines the arguments for and against CSR and the two opposing views of CSR being the Classical view and the socioeconomic view.
The Classical view which is purely economic and states that the only responsibility managers have is to work on maximising the profits. Where as the socioeconomic view states that the manager's responsibility is not only to work on maximising the profits but also protect and improve the society and its well being. In the socioeconomic view the debaters argue that the organisation's maximising of profits is not its first priority. The first priority of the organisation is its survival.
In the classical view, the manager's only main concern is the shareholders welfare, not the well being of the stakeholders.
The report clarifies economist Friedman's and Davis's arguments of CSR and their views regarding CSR. Davis maintains that organizations should employ the powers they have to improve the society which sustains the organisation and hence the organizations should have social responsibility to the society. Friedman claims that an organization has one and only one responsibility, which is to use all the recourses available for activities to generate higher profits. According to the findings from the research, it is recommended that managers should take into account CSR and not ignore it.
IntroductionOrganizations, governments and activists currently face the challenges in how to respond to the growth of Corporate Social Responsibility (CSR). CSR has now grown swiftly and relatively smooth over the last two decades as...