Social Responsibilities and Business Ethics: Key Concepts Explained

What's up everyone? Welcome back to the channel. Welcome to the 100 Days Commerce Pro Series.

And in today's class, we are going to cover another chapter of Business Studies, which is chapter number 6, that is Social Responsibilities of Business and Business Ethics.

It is going to be a very important chapter. After this, I will just make you do one more chapter, which is going to be the formation of a company.

And the syllabus that comes in the majority of the schools will be completed by the end of the semester. Then our accountancy is also almost complete by the end of the semester.

Then we will quickly move forward in Economics. Right, so let's start quickly and see what we have to study in chapter number 6, Social Responsibilities.

Let's begin. So understand what the meaning of Social Responsibility is. There are two topics in it, Business Ethics and Social Responsibility.

So Social Responsibility is in the name. Social means towards the society, for the society. And responsibility means responsibility.

So see, there are some arguments here. The arguments are that business runs in the society. If I am doing any business, then I am doing business in this society.

I should also use the resources of the society. All the people who are able to reach my shop, the roads that have been made, that is the part of the society.

The resources that I use, whether it is electricity, whether it is raw material, it is coming from the society somewhere. All my human resources, the people who are supporting me in my shop to do

business. All that is human resource, is a part of the society. So somewhere there are some responsibilities towards the society of the

business. So what are the responsibilities of a business towards the society? Like I give a small example that do not run any fake advertisement.

Do not make a fool of the society. Do not do any kind of false practice. Do not do pollution.

Make a good quality product at reasonable prices. Generate employment. So there are some things like this, which are our responsibilities towards the

society. We are going to read it here. It is just a simple chapter.

What is social responsibility? It is the responsibility of the business. That is its obligation.

Obligation means duty to take those decisions. And perform those actions. Perform those actions which are desirable.

Desirable means which are considered good. Or which will be good in terms of the objectives and values of our society. Which are the objectives of our society.

Objectives means what our society wants to achieve. And values. Values means which are considered good in our society.

We perform those things. Now what are the responsibilities in this? Towards different groups.

So we will remember SCWG. What will we remember? SCWG.

SCWG. What is S? Responsibility towards the shareholders.

Sir, who are shareholders? Shareholders are owners. Owners.

Whose company it is. Whose business it is. If I have any business.

Then I am its shareholder. I am its owner. I am its owner.

Right. So what is the responsibility of the business towards its owner? First of all.

Giving a good return on investment. Return on investment means whatever capital the owner has invested in the business.

He should earn good money on it. Otherwise he would have kept his money in the bank. He would have invested his money somewhere else.

He would have invested in the property. Its value would have increased. He has invested his hard earned money in the business.

So this is the responsibility of the business. It is the social responsibility. That he should give a good return to the owner on that money.

Earn a good percentage profit. Okay. To ensure safety of investment.

My money should not drown in the business. Business has to make sure. It is the social responsibility of the business that my investment should be

safe. Right. Third.

To provide regular, accurate and full information about the working of the business. Shareholders should know how the business is running.

Now this point is written from the point of view of the company. Where the owner is different. And management is different.

The company is so big that the owner cannot do everything. So there are board of directors for management. So it is the responsibility of the board of directors.

That he should tell everything to the owner that how the business is running. He should have full information about this thing. What is next?

To maximize shareholder's wealth. Shareholder's wealth means that the value of his shares should keep increasing. This is the responsibility towards the shareholders.

What comes next? What does C mean kids? Consumer.

I told you. S, C, W means workers. G means government.

Okay. So let's read this first. What is the social responsibility towards the workers?

So if we think from the point of view of society. So what to do for the workers of the business? No.

1 Give them fair wages and salaries. That is, the wages and salaries that you give them should be fair. Should not be unfair.

Employee should get hard-earned money. Don't keep his hard-earned money. Pay him as much as he deserves.

So give fair wages and salaries. Give good working conditions. What will happen with good working conditions?

When you give them good working conditions. Then they will feel safe. Will work well.

There will be no injury. No employee will get hurt. So give good working conditions.

Give extra services. Like medical facilities. Gave insurance.

Insurance of children. Gave education. All these benefits should also be given.

Along with that. Develop skills. Do time to time training.

Time to time of their development. Take care of overall development. Along with that.

We talked about their skills. Give them democratic rights. Democratic rights means.

Give them the right to speak. They can make their unions. Workers can work well.

So all these rights should also be given to the workers. So this is the social responsibility towards the workers. Next is the responsibility towards the consumers.

What is the responsibility towards the public? Number one. Good quality and good quantity at a reasonable price.

The goods you are selling. Good quality. Good quantity at reasonable prices.

Second. Adequate supply. It should not be that there is one day in the market.

There is no next day. So there should be a proper supply of product. Third.

Third. No unfair trade practice. No adulteration.

No fraud. No wrong advertisement. This should not happen.

Black marketing should not be underweight. Consumers should get proper information about new products. And if the customer has any problem.

So the customer's problem should be solved well. Not that it should be ignored. So this should not happen.

Your customer. Even after selling the product. It is your customer.

So taking care of it is your social responsibility. SCWG. What is the social responsibility of your business towards the government?

What is the social responsibility? Number one. To respect the laws of the country.

You have to respect the laws of the country. All the country's rules and regulations are laws. It has to be fulfilled.

Second. Taxes have to be paid regularly and honestly. All the taxes have to be paid regularly and honestly.

Behave like a good citizen. Have to behave like a good business. Have to behave like a good business.

Along with that. Have to protect the natural environment. Bad.

Along with that. Smokey chimneys. Ugly buildings.

Have to save the society from all this. Environment. Have to make a proper image in the society with it.

How is the image made? Make good public relations. Time to time donations have to be made.

Camps have to be set up. So a good image and reputation is built in this way. So SCWG.

There are four people towards the society. Towards whom you have social responsibility. Shareholders.

Consumers. Workers. Government.

SCWG. Remember. Okay.

What is the next topic? Arguments for social responsibility. Why is it that we have to fulfill social responsibility?

That is, what are the arguments? That is, what are the things that say that social responsibility is very important?

So you can remember any of the three to four here. Your work will be done. First of all, it is written.

Justification for existence and growth. Look, I told you in the beginning that a business exists and grows around the society.

It uses the resources of the society inside the society. So this should be your responsibility. That you do something for the society too.

So if you do good for the society. So that is the justification of your growth. You will see that a business will grow only what is doing good in the society.

Doing good for everyone. No wrong practices. All the businesses will do wrong practices.

They will not be able to grow. So if you are growing. If you are moving forward.

Expansion is happening. So that is the justification that yes, you are socially responsible. So business exists for providing goods and services to the society.

Profit motive is an important justification. Profit is there. But along with that.

It should be looked upon as an outcome of service to the people. Profit will come only when you serve people well. What is coming second?

Long term interest of the firm. If you want to run your business for a long time. If you want your business to run for a long time.

People remember you for years. There are so many big businesses in our country. Tatas are there.

Whose respect is there. Value is there. People remember.

Give an example that brother has to make a business like Ratan Tata. How did he make such a good image? In what way?

Because he fulfilled his social responsibility very well. He did a very good job for the society. So what is written?

When increasing number of members of the society including worker, consumer, shareholder, government official. Feel that business is not serving its best.

They will tend to withdraw their cooperation. So business does not give its best. So everyone withdraws their cooperation.

Then goals cannot be achieved. So if you want your business to run for a long time. Then you have to do good.

Next. Avoidance of government regulation. See children, the government also imposes penalties on you.

Punishments on you. Such things are imposed on you only if you do anything wrong. So if you want to avoid all this from penalties, punishment, headache.

So you do business by being socially responsible. In a good way. So no regulation will bother you.

You will easily avoid them. It is believed that businessmen can avoid the problems. By assuming social responsibilities.

What comes next? Availability of resources with the business. It says that all the resources that have come to the business.

They have all come from the society somewhere. So how should we use them? Society's problem should be used in solving.

So all the resources. Utilize them in solving the society's problems. Better environment for doing business.

If a business works in society. And sees a lot of problems. So he should come forward to solve those problems.

What will happen with that? He is solving the problem. Along with that, other businesses will also get a good environment.

And a good ecosystem will develop. As we say, the startup ecosystem is developing in our country. Businesses are coming forward.

Youth is making their own business. Developing. So what is happening with this?

A good environment is being created. Getting a better environment. A society with fewer problems.

Provide better environment for a firm to conduct its business. Along with that, next comes. Holding business responsible for social problems.

So you have to keep in mind. That if anywhere your business is doing environmental pollution. Giving unsafe workplace.

That is, the workers are getting hurt. Corruption is happening. So for all these things, the business is considered responsible.

So you have to make sure. That there is no such practice in your business. And you develop a good business.

By understanding your responsibility in a society. Work with service motive. You will earn profit on your own.

So all these things come under social responsibility. Okay. We will quickly take a screenshot of this.

After this, it is coming to us. What is the role of business in environmental protection? That is, how should the business take steps?

To protect the environment. So son, the main thing here would be pollution. That we do not pollute in any way.

Now we have made big businesses. Chemicals came out, put them in water. Smoke is coming out all over the world.

Sound pollution is happening. Big machines are running. So don't do all this.

So how can the business solve these problems? What steps can it take? These steps can ask you.

So what will we write in the steps? First of all, the top management should make this commitment. Because look, top management means the top ones.

The CEOs, CEOs, CFOs, President, Vice President, Chairman. These are the people. If these people make a commitment.

Let's make a promise that brother is fine. We will develop such a work culture. In which there will be talk of environmental protection.

In which there will be talk of pollution prevention. So it will be fun. So first of all, the top level people.

Set an example. Brother, we will work well in a pollution-free environment. Second, ensuring that commitment is shared throughout the enterprise.

After that, this commitment. It should be followed by every employee at every level. What is the third?

Making such policies, making programs. In which we will buy good quality goods. We will not buy or sell bad quality goods.

So we will buy good quality raw material. We will put good technology. We will use scientific techniques.

So that there can be disposal and treatment of waste. Whatever waste is coming, we will dispose it well. Let's finish it well.

Waste should not be lying here and there. There should be proper disposal of it. Either recycle or dispose properly.

There should not be pollution. After that, complying with laws and regulations enacted by the government. Complying with all the rules and regulations made by the government.

After that, the programs of the government. In which there is management of hazardous substances. Seminars are being held.

Lectures are being held. How to clean polluted rivers. Plantation of trees.

Participate in such activities. Plant as many trees as possible. This business can take a step.

Keep doing periodical assessment with it. There are a lot of pollution control programs. Which the government tells you to do.

You can be a part of those programs. And you can also implement those programs in your business. So that you can control pollution.

These are all the pointers. You can remember any 3 to 4 points. It is very simple to write when you come to your exam.

Along with that, educational workshops, training. You can also participate in this. And you can arrange to educate different businesses.

What can a business do for environmental protection? Then we are getting a topic. Business ethics.

You understand everything about business. Buying and bringing raw material. Making and selling goods.

Business is business. Profit motive is its purpose. Now what is ethics?

Ethics means moral values. Which you learn. There used to be a subject in small classes.

Moral science. In which good things were taught to children. So the same moral science has to be applied in business.

So see what is written. In business, we are making products. And all the work is being influenced by the society.

What does ethics mean? Ethics has come from a Greek word. Whose name is Ethos.

Which means good character. Norms means rules. Ideals means being an inspiration.

So we have to do our business in such a way. That our business becomes an inspiration for other people. And we do not do anything wrong ethically.

Do not do anything wrong morally. People will say that if there is a business, it is like this. If there is a human being, it is like this.

So this is business ethics. What is it? Ethics refers to the code or other systems for controlling means.

So that they serve human ends. Business ethics refers to socially determined moral principles. Which should govern business activities.

Business activities should be done by properly following everything morally. There can be some examples of business ethics. Who will believe that we are running business ethically?

Take a screenshot first. First of all, you are not charging an unfair price. You take a fair price.

You take your hard-earned money. You charge a fair price. You use fair weights with it.

You do not cheat in measurement. Many people do it. Instead of 1 liter, put 800 milliliters.

Did work for 200. There is a lot of theft on the petrol pump like this. So all this should not happen.

It is not ethical. Give fair treatment with it. Treat workers well.

Earn reasonable profits. Do not do any illegal activity. All this is the part of business ethics.

Take a screenshot of this. After this, what comes in ethics? Elements of business ethics.

If a business is ethical, then how will it be considered? The first point you have to remember is top management commitment. Whatever the top management is, see any work starts from the elder.

Those who do big work, learn small. So first of all, give your top management commitment. Top management sets an example that whatever business we do, we will do it

ethically. So top management has a crucial role in guiding the entire organization towards ethically upright behavior.

What is ethically correct? What is ethically wrong? This top management has to make sure in its entire organization.

Publication of a code. What is code? Children, code is a statement.

In which all the rules, regulations, everything is written. So in the publication of code, we can say that we will make such a standard code of conduct.

We will make such a standard behavior in the entire organization that you have to follow these things. So enterprise with effective ethics programs do define the principles of

conduct for the whole organization. Which we write in the written statement. This is called code.

What comes inside this? Honesty, adherence of the laws, integrity, product safety, health and safety of the workers.

Fairness in selling. There should be no fraud basically. So top management's commitment is required.

Then we will make a code. Take a screenshot. What will happen after this?

We will develop a compliance mechanism. Compliance mechanism means we will make sure that that code is also followed. We don't just have to make a code of conduct and leave it.

That code of conduct also has to be followed. Rules also have to be followed. So in order to ensure that actual decisions and actions comply with the

standards. We will have to make some mechanisms. Like giving value, giving attention to ethics.

In every decision making. Any decision is being made, it should be ethical. Bring corporate ethics in training.

Whenever you train employees, then generate a good moral value in it. Develop ethics. Auditing performance regularly.

Audit all our performance in the organization. That is, check whether it is happening according to moral values or not. Involve employees at every level.

Give employees a chance to speak. Take good ideas from them. Take suggestions.

Appreciate them time to time. Give them awards time to time. Like we say employee of the month.

Employee of the week. Employee of the year. Make such events.

So ethically good, morally good. It is the employees at different level who implement ethics policies to make ethical business.

Therefore, their involvement becomes a must. And in the last, measure the results. See if all this is being followed properly or not.

And what output is coming out of it. So these kids have all the elements of business ethics with us. We studied business ethics, studied the elements of business ethics.

What can a business do? This was studied in environmental protection. Social responsibility was studied.

Social responsibility was studied towards different people. Cases of social responsibility were studied. And with this, ladies and gentlemen.

As per your syllabus, our chapter ends. A lot of other things have also been given in the books. But you don't have to do that.

It is not in your syllabus. Open the syllabus of CBSE. Check what is in the syllabus.

I have read all those things in the latest videos. There is no need to waste extra unnecessary time. As per the syllabus, we will read.

Alright. So one more chapter ends for you. And we are one step closer.

To finish our half-endly syllabus of business studies. I hope all things will be clear to you. If you don't understand anything.

Then do let me know in the comment section. That's all for now. Chapter ends.

We will meet in the next class. With some more new things. Till then.

Thank you so much. Keep growing. And keep glowing.