The social obligations of business - Strategic Management

Any topic concerned with the social responsibilities of business seems to draw a lot of heat, particularly from people in the community sector. While lack of trust and suspicion of business has been common for 15-20 years – and of course there are many instances where it has been well founded – it is relatively new that the language of social responsibility or social obligations have been so widely applied in discussions about business. These terms have been present for some time in certain circles but the profile of these concepts is now much more public.

When the McClure report first came out I heard an ABC interview with an extremely annoyed academic talking about the anomaly of including the role of business as part of an approach to solutions. There is the notion that structural changes in companies and the drive for shareholder value are part of the problem so why ask business to be part of the solution without first addressing the causes? I prefer to think the inclusion of business as a separate and active part of social as well as economic life is an important shift in thinking about relations in the Australian community.

The topic is also a hard one for the Australian business community and there is by no means consensus on these issues. There have been many, sometimes heated, discussions behind closed doors trying to tease out the parameters of responsibility and obligations that should or could apply to business. This includes where these obligations sit in relation to the core purpose of business, which is to create wealth, and what social outcomes would be of most value for business and the community.

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