Page 174 - DMGT401Business Environment

Unit 7: Socio-cultural Environment

8. To ensure that the product supplied does not have any adverse effect on the customer Notes
9. To hear and redress the genuine grievances of customers
10. To avoid any type of cartel formation that a attempts to reap monopoly profits.

7.7.4 Responsibility towards Community

1. To prevent environmental pollution and to prevent ecological imbalance
2. Improve the efficiency of business operations

3. Contributing to research and development
4. Development of backward areas
5. Promotion of small scale industry

6. Development of region in which they are operating
7. This includes working on development of schools, social awareness programmes, adult
education, health, medical facilities, helping NGOs and the government for social causes
such as the Pulse Polio Mission, etc.
8. Taking steps to conserve scarce resources and developing alternatives, wherever possible.

7.7.5 Major Social Responsibilities of a Business

1. Optimum Utilisation of Scarce National Resources: All corporations must use resources
judiciously and not waste, misutilise, damage or cause to deteriorate the resources at its
disposal. It is essential in an energy/power scarce country like India. Not only this, business
should develop alternative sources of energy and power.

Example: ITC uses wind power for some of its projects, while Mahindra and Mahindra
spends on research an alternatives fuels.
Reliance is a classical example of efficient utilisation of resources as it uses by-products and
waste of one project in another. Its petrochemical plants and refineries are so integrated that
they use each other's products.
2. Responsibility Not to Make Losses: A loss-making unit is a burden on society. It should
not only conserve resources of the society but perform its duty towards the customer by
providing better products, towards the shareholder by creating wealth, towards the society
by utilising its resources well, and towards its employees by not meeting better HR
standards.

Most PSUs that make losses but are kept alive in the name of socialism and employment,
are basically a burden on society. Their losses are met by taxing the society. One can say
that society pays higher taxes to subsidies the inefficiencies of PSUs. The question arises,
why should they?

3. Improved Quality of Life: An organization should help improve the society's standard of
living, which is based on financial power and material growth.
4. Responsibility of Employment and Income: Every business should make provisions for
the payment of fair wages, satisfactory working conditions, steady employment and job
security, prospects for promotion, growth and development of workers, and also take
adequate measures for employee welfare.

LOVELY PROFESSIONAL UNIVERSITY 167