Sunday 30 October 2016

Is there a thing called "social responsibility"?

The primary goal of a company is to maximize the profits of their shareholders and currently the public generally agree that a company should also take some social responsibility, which sometimes could violate the interest of the company's shareholders. Under a fully free market, the social responsibility should not become a company's goal or burden, as all a company needs to focus is to maximize its profits.

Some of these social responsibilities are hiring a relatively big number of workers in order to provide more jobs to the society, using greener energy and processes of production, which can have higher costs and many other things.  Therefore, the cost of production will definitely increase and the productivity will decrease. Maybe this is part of the reason why some countries have poor productivity. In terms of environmental issues, when the public is influenced by the environmental problems caused by a company, I believe the prices of this company's products will be dragged down as the customers realize the utilities of the products are actually lower than their previous expectations and the cost of productions will increase as some of its workers may get sick due to the environmental problem. Such things will force companies to deal with this kind of problems, not such environmental problems but also many other issues.

However, if there is no such thing called "social responsibility", then there could be one problem that every individual is making decisions based on their individual matters, and when something happens to the entire nation or the entire world, each individual is so separated with others that it will take quite a lot of time to reunite people together and deal with a large scale problem, sometimes it can be too late. This is a danger without the sense of social responsibility.

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