Business 6 (1) · Section 7

responsibility has made more and more people aware of the social purpose of business. Educated persons as consumers, investors, employees, or owners have become more sensitive towards social issues than was the case earlier, when such education was not available. (vi) Relationship between social interest and business interest: Business enterprises have started realising the fact that social interest and business interest are not contradictory. Instead, these are complementary to each other.

The feeling that business can grow only through exploitation of society has given way to the belief that long-term benefit of business lies in serving the society well. So also, a useful institution like business is recognised as an essential element of a modern civilised society. (vii) Development of professional, managerial class: Professional management education in universities and specialised management institutes have created a separate class of professional managers who have got an altogether different attitude towards social responsibility as compared to the earlier class of owner manager. Professional managers are more interested in satisfying a multiplicity of interest groups in society for running their enterprises successfully than merely following profit goals.

These and a number of other social and economic forces have combined together to make business a socio- economic activity. Business is no longer a mere occupation; it is an economic institution that has to reconcile its short-term and long range economic interests with the demands of the society in which it functions. Essentially, it is this which gives rise to the general and specific social responsibilities of business. While there is no denial of the fact that business is essentially an economic enterprise and that it must ultimately justify itself on economic performance, it is also true that business is an organ of society and as such it must justify its continuance by fulfilling its roles and responsibilities of society.

. KINDS OF SOCIAL RESPONSIBILITY Social responsibility of business can broadly be divided into four categories, which are as follows: (a) Economic responsibility: A business enterprise is basically an economic entity and, therefore, its primary social responsibility is economic i.e., produce goods and services that society wants and sell them at a profit. There is little discretion in performing this responsibility. (b) 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. (c) 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