Business Ethics vs Social Responsibility
Businesses aim to gain maximum profits for their owners and shareholders. However, this does not mean they can do whatever it takes to get that maximum profitability. They can’t do crooked things just to get their desired profit. This is where business ethics and social responsibility comes into the picture. There are many confusions between these two terms and they tend to get used interchangeably. Social responsibility is easy to understand, but the word ‘ethics’ causes much confusion. A company policy must be followed to benefit the community. This is coined as the corporate social responsibility. However, when one talks about business ethics, it becomes a very different thing, because ethics is based on conscience.
There is a significant difference between social responsibility and business ethics; and the best way to differentiate the two is by defining both of them.
Before defining business ethics, it is best to understand the meaning of ethics first. Ethics means moral character and comes from the Greek word ethos. Ethical behavior is an aspect concerning the good and right. Ethics is focused on the good and bad, the right and wrong. Using it in business means the company must follow the right behavior to benefit the good of everybody, including the shareholders, stakeholders, and even the community. Even though making a profit is the most important thing in business, if making money is the only concern of a certain business, then it is capitalism in its worst. Businesses should have good business ethics to benefit the entire community or society. This is the main goal of business ethics. That the business activities should not harm the people. Instead, it should benefit them. Businesses that do not have good business ethics are penalized by the law, however, these sanctions are nothing compared to the immoral things that other businesses are capable of doing and have actually done.
‘No man is an island,’ which means human beings are social beings. The behavior that man must display must be according to the acceptable norms of the community or society. Comparing this scenario to business, businesses must still perform its social obligations by performing activities that are according to the norms of society or community. Even if businesses are more concerned on making profits for the company, it should still have a social responsibility towards its community. This is the main meaning of social responsibility. It is more of an obligation or a duty towards the people that the business affects. One of the main examples for this is, reducing the pollution in the company, especially if that certain business is the one creating all the pollution.
There are good things for society that are not good for business and this is where social responsibility comes in. There are also good things in business that are not good for society and this is where business ethics comes in.
Social responsibility is more of a policy or an obligation to the community, while business ethics is more of a conscience.
Business is focused on profits but with social responsibility. It is still obliged to perform beneficial activities for society, while business ethics should make a positive move for society.
With out social responsibility, the community will not benefit, however, without business ethics, business is capitalism at its worst.