CBSE Class 11 Business Studies Social Responsibilities of Business and Business Ethics Worksheet Set B

Very Short Answer Type Questions

Question. ‘Company has social responsibility towards shareholders or owners’ how?
Answer : Organisation must also provide the shareholders with regular, accurate and full information about its working as well as schemes of future growth. Business enterprise has the responsibility to provide a fair return to the shareholders or owners.

Question. Define environment pollution.
Answer : The environment refers to all types of mankind surrounding both natural and man-made. These surroundings are natural resources which include water, air, flora, and fauna, etc. Environment pollution is the infusion of harmful chemicals or substances into the natural environment and causes unfavorable change.

Question. Define discretionary responsibility.
Answer : Discretionary responsibility refers to the company’s management responsibility to protect the capital investment by bypassing insecure activity and engaging with a healthy business venture.

Question. State two effects of noise pollution?
Answer : Two effects of noise pollution are loss of hearing, malfunctioning of the heart

Question. Give two examples of business ethics.
Answer : The two examples of business ethics are honesty and law-abiding.

Question. State why business ethics are important?
Answer : Business ethics are important because
- It formulates the firm’s image and builds the brand
- It influences the buying decision of the customers
- Build confidence within employees
- Builds advantage on the competitive market

Question. ‘To avoid government regulation, businessmen follow the concept of social responsibility’ .How much this statement is true?
Answer : Government regulations are undesirable because they limit freedom. It is believed that businessmen can avoid the problem of government regulations by voluntarily assuming social responsibilities, which helps to reduce the need for new laws. For example, Central Pollution Control Board takes care of issues related to environmental pollution

Question. Define social responsibility of a business?
Answer : Social responsibility is an ethical framework and suggests that an entity, be it an organization or individual, has an obligation to act for the benefit of society at large. Social responsibility is a duty every individual has to perform so as to maintain a balance between the economy and the ecosystems

Question. Mentioned two value that a business should follow.
Answer : The two value that a business should follow is.
- Social Value- A company gains maximum profit when the company’s main aim is to serve the society. An image of a company improves when they support social goals.
- Professional Value- A company with business ethics provides a satisfying environment for the employee to work and conduct the business. Lack of professionalism can create problems and confusion in the workplace.

Question. Explain how labour movement has helped company to fulfill its social responsibility?
Answer : Labour movement for extracting gains for the working class throughout the world has become very powerful. This has forced business enterprises to pay due regard to the welfare of workers instead of following a policy of ‘hire and fire’ policy

Question. Mentioned one need for social responsibility.
Answer : For every business social responsibility is important to create the company’s brand name and value.

Short Answer Type Questions

Question. What is the need to control pollution and how business should contribute in environmental protection?
Answer : Need for Pollution Control
1. Reduction of health hazards:
There is increasing evidence that many diseases like cancer, heart attacks and lung complications are caused by pollutants in the environment.
2. Reduced risk of liability:
It is possible that an enterprise is held liable to pay compensation to people affected by the toxicity of gaseous, liquid and solid wastes it has released into the environment. Business must install pollution control devices in its premises to reduce the risk of liability.
3. Cost savings:
Cost savings are particularly noticeable when improper production technology results in greater wastes which leads to higher cost of waste disposal and cost of cleaning the plants.
4. Improved public image:
A firm that promotes the cause for environment will be able to enjoy a good reputation and will be perceived as a socially responsible enterprise.
5. Other social benefits:
Pollution control results in many other benefits like clearer visibility, cleaner buildings, better quality of life, and the availability of natural products in a purer form.
Role of Business in Environment Protection
1. A definite commitment by top management of the enterprise to create, maintain and develop work culture for environmental protection and pollution prevention.
2. Ensuring that commitment to environmental protection is shared throughout the enterprise by all divisions and employees.
3. Developing clear-cut policies and programmes for purchasing good quality raw materials, employing superior technology, using scientific techniques of disposal and treatment of wastes and developing employee skills for the purpose of pollution control.
4. Complying with the laws and regulations enacted by the Government for prevention of pollution.
5. Participation in government programmes relating to management of hazardous substances, clearing up of polluted rivers, plantation of trees, and checking deforestation.
6. Periodical assessment of pollution control programmes in terms of costs and benefits so as to increase the progress with respect to environmental protection.
7. Arranging educational workshops and training materials to share technical information and experience with suppliers, dealers and customers to get them actively involved in pollution control programmes.

Question. LMN Ltd. is filing its income tax returns on time. They are also updating their shareholders about their projects and provide for return to them. Towards which interest group are they fulfilling their responsibility?
Which values are being followed by the Co.?
Answer : They are fulfilling their responsibility towards shareholders and owners and towards the government.
Organisation must also provide the shareholders with regular, accurate and full information about its working as well as schemes of future growth. Business enterprise has the responsibility to provide a fair return to the shareholders or owners. An enterprise must respect the laws of the country and pay taxes regularly and honestly.
Values followed by company are as follows:
1. Legal Responsibility: Every business has a responsibility to operate within the laws of the land a law abiding enterprise is a socially responsible enterprise as well.
2. Ethical Responsibility: Behaviour that is expected by society but not codified in law.There is an element of voluntary action in performing this responsibility

Question. Enumerate any three responsibilities of business towards employees.
Answer : Three responsibility of business towards employees are as follows:
- The right kind of working conditions to be given so that it can win the cooperation of employees.
- The enterprise must respect the democratic rights of the employees to form unions.
- The employee must also be ensured of a fair wage and a fair deal from the management

Long Answer Type Questions

Question. Explain the forces which are responsible for increasing concern of business enterprise towards social responsibility.
Answer :

Protect the interests of stakeholders
To get the support of employees, it has become necessary for organisations to discharge responsibility towards their employees.
Consumer does not buy what is offered to him. He buys what he wants. Consumer sovereignty has, thus, forced firms to assume social responsiveness towards them Fulfilling social obligations is beneficial for long-run survival of the firms

Long-run survival
A firm and its image stands to gain maximum profits in the long run when it has its highest goal as ‘service to society’
It is in its own interest if a firm fulfills its social responsibility.
The public image of any firm would also be improved when it support social goals

Self-enlightenment
With increase in the level of education and understanding of businesses that they are the creations of society, they are motivated to work for the cause of social good.
Managers create public expectations by voluntarily setting and following standards of moral and social responsibility.
Rather than legislative interference being the cause of social responsibility, firms assume social responsibility on their own.

Avoids government regulation
Government regulations are undesirable because they limit freedom.
It is believed that businessmen can avoid the problem of government regulations by voluntarily assuming social responsibilities, which helps to reduce the need for new laws For example, Central Pollution Control Board takes care of issues related to environmental pollution

Resources
Business organisations have enormous resources which can be partly used for solving social problems.
Businesses are the creation of society and must work in the best interest of society, both economically and socially.
It can help society to tackle its problems better, given the huge financial and human resources at its disposal

Professionalisation and Better environment
Management is moving towards professionalism which is contributing to social orientation of business.
The ethics of profession bind managers to social values and growing concern for society .
A society with fewer problems provides better environment for a firm to conduct its business.

Holding business responsible for social problems
Social problems have either been created or perpetuated by business enterprises themselves.
It is the moral obligation of business to get involved in solving these problems, instead of merely expecting that other social agencies will deal with them.

Converting problems into opportunities
Business with its history of converting risky situations into profitable deals, can not only solve social problems but it can also make them effectively useful by accepting the challenge.

Question. State the factors against social responsibility?
Answer :
Violation of profit maximisation objective
Business exists only for profit maximisation. Therefore, any talk of social responsibility is against this objective.
Business can best fulfill its social responsibility if it maximises profits through increased efficiency and reduced costs.

Burden on consumers
Social responsibilities like pollution control and environmental protection are very costly and often require huge financial investments.
Businessmen simply shift this burden of social responsibility by charging higher prices from the consumers instead of bearing it themselves.

Lack of social skills
Businessmen do not have the necessary understanding and training to solve social problems
Social problems should be solved by other specialised agencies.

Lack of broad public support
Public in general does not like business involvement or interference in social programmes.
Therefore, business cannot operate successfully because of lack of public confidence and cooperation in solving social problems.