A business's only responsibility is to produce profit. To what extent do you agree with this statement - Essay Example

The Core Responsibility of a Business The Core Responsibility of a Business Although it remains the central target of every entrepreneur, making profit does not have to be the sole responsibility of business (McNulty, 2013). All businesses have stakeholders who in one way or the other also depend on it. The stockholders of the businesses include the business partners, the society, its shareholders, and employees; all of the stakeholders depend on the successful operation of the business. The stakeholders are of great importance to the enterprise and, therefore, despite just concern to the multiplication of profit the business should ensure corporate social responsibility (CRS) to the stakeholders (Williams 2014, p. 15). A business should maximize on value rather than profits as explained by Blodget (2012).

Involvement in CRS is expensive but it has a high long-term advantage to the business. Providing incentives to employees is not a waste of resources by the management. Considering the workers welfare is important to boost the morale of employees. Employees, if well motivate, perform high-quality tasks that can attract more customers, rewarding to the stakeholders and so make the business sustainable. It may even draw new employees with a high level of skills.On the other hand, failure to consider employees’ welfare results to unique situations that may scare other stakeholders from associating with the business.

Besides, it is important for the business to consider environmental obligations as they do production. Environment conservation policies benefit humans. For instance, the regulations aim to reduce pollutants to the environment. Every country or trade region has it set regulations on environmental factors that businesses should consider in its operations. Failure to consider the rules in its operations, the business is likely to face criticism. Further, it may influence smooth functioning of the business and its profitability.

An example is the case of Coca-Cola Company’s failure to ensure standards set by the America’s Environment Protection Agency. Early in the 2000’s, failure to consider strict environmental policy threatened the Coca-Cola Company. The company used non-environmental friendly plastic bottles, for a long time the company was on poor terms with the government or the U.S.A. Though it may be expensive for the business to adhere to the regulations, they are very critical for the sustainability of the enterprise and survival of other sectors of the economy.

Adhering to the CSR is important to keep a good relationship with the stakeholders and so for the sustainability of the business (Horrigan 2010, p. 45). To achieve these merits, the CRS should first be a business-based model with a social purpose. Secondly, the model should clear the Theory of change by sparking a new collective change. The stakeholders must receive adequate information on the importance of the initiative, it is essential to concentrate effort on a single issue. Finally, collaborating will see the program credible and accepted and so a win-win situation between the business and the stakeholders (Pohl & Tolhurst 2010, p.85).CRS enables the business to create a win-win relationship with the stakeholders.

These advantages involve avoiding strict regulations, good customer relationship; strengthen the reputation of the business, and reducing the risk of opposition by the stakeholders amongst other competitive advantages (Horrigan 2010, p. 43). Besides its targeted objectives of profit making, CSR is an important obligation that every business should embrace. Bibliography Blodget, H, December 8, 2012, ‘We Need to Stop Maximizing Profit and Start Maximizing Value’, Business Insider, Retrieved March 12, 2015 from http://www.

businessinsider.com/lets-stop-maximizing-profit-and-start-maximizing-value-2012-12Horrigan, B 2010, Corporate Social Responsibility In The 21st Century Debates, Models And Practices Across Government, Law And Business, Cheltenham, U.K., Edward Elgar. McNulty, E, February 18, 2013, ‘Doing the Right Thing or Making a Profit – Which Comes First?’ Harvard Business Review, Retrieved March 12, 2015 from https://hbr.org/2013/02/doing-the-right-thing-or-makinPohl, M., & Tolhurst, N 2010, Responsible Business: How To Manage A CSR Strategy Successfully, Chichester: West Sussex, Wiley.

Williams, O 2014, CSR: Will it Change the World? Journal of Corporate Citizenship, 53, pp. 9-26.