Be Socially Responsible or Perish!

Ntim, Collins G., Be Socially Responsible or Perish! February 9, 2020

3 Pages Posted: 10 Mar 2020

See all articles by Collins G. Ntim

Collins G. Ntim

University of Southampton Business School, UK; University of Southampton

Date Written: February 9, 2020

Abstract

Specifically, Friedman argued that the main objective of business leaders, such as finance directors and CEOs should be to make as much money as possible for their owners, whilst operating within the law. Friedman made a number of arguments in support of his view. For example, he argued that by maximizing profit, a firm will invariably be contributing to, and performing, its social responsibilities, if indeed it had any at all, in many ways, including creating jobs, providing essential goods and services, and paying more taxes. Similarly, Friedman argued that even if the corporation has social responsibilities, managers were ill-placed to identify the most urgent needs of society and therefore, any investments by business leaders may be misplaced. Managers may, for example, be biased in their choices – they may invest in issues that they are personally interested in or benefit from rather than those that society actually needs. Additionally and by contrast, government collects taxes, and therefore, it is not only the primary responsibility of the government to identify and meet the social needs of society, but they are also better placed to do so effectively and efficiently through political campaigns and elections. Consequently, Friedman argued that a business has no social responsibilities beyond complying with the law, such as faithfully paying its fair share of taxes.

Keywords: Corporate Social Responsibility

JEL Classification: G30

Suggested Citation

Ntim, Collins G., Be Socially Responsible or Perish! (February 9, 2020). Ntim, Collins G., Be Socially Responsible or Perish! February 9, 2020, Available at SSRN: https://ssrn.com/abstract=3534934

Collins G. Ntim (Contact Author)

University of Southampton Business School, UK ( email )

Southampton Business School
Highfield
Southampton, England SO17 IBJ
United Kingdom
+44 (0) 238059 4285 (Phone)
+44 (0) 238059 3844 (Fax)

HOME PAGE: http://www.southampton.ac.uk/business-school/about/staff/cgn1n11.page

University of Southampton ( email )

Southampton, SO17 1BJ
United Kingdom

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