Be Socially Responsible or Perish!
Ntim, Collins G., Be Socially Responsible or Perish! February 9, 2020
3 Pages Posted: 10 Mar 2020
Date Written: February 9, 2020
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: Suggested Citation