1st PUC Business Studies Question Bank Chapter 6 Social Responsibilities of Business and Business Ethics

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Karnataka 1st PUC Business Studies Question Bank Chapter 6 Social Responsibilities of Business and Business Ethics

1st PUC Business Studies Social Responsibilities of Business and Business Ethics Text Book Questions and Answers

Multiple Choice Questions

Question 1.
Social responsibility is
(a) Same as legal responsibility
(b) Broader than legal responsibility
(c) Narrower than legal responsibility
(d) None of them
Answer:
(b) Broader than legal responsibility

1st PUC Business Studies Question Bank Chapter 6 Social Responsibilities of Business and Business Ethics

Question 2.
If business is to operate in a society which is full of diverse and complicated problems, it may have
(a) Little chance of success
(b) Great chance of success
(c) Little chance of Mure
(d) No relation with success or Mure.
Answer:
(a) Little chance of success

Question 3.
Business people have the skills to solve
(a) All social problems
(b) Some social problems
(c) No social problems
(d) All economic problems
Answer:
(b) Some social problems

Question 4.
That an enterprise must behave as a good citizen is an example of its responsibility towards
(a) Owners
(b) Workers
(c) Consumers
(d) Community
Answer:
(d) Community

Question 5.
Environmental protection can best be done by the efforts of
(a) Business people
(b) Government
(c) Scientists
(d) All the people .
Answer:
(d) All the people .

Question 6.
Carbon monoxide emitted by automobiles directly contributes to
(a) Water pollution
(b) Noise pollution
(c) Land pollution
(d) All the people.
Answer:
(d) All the people.

Question 7.
Which of the folio wing can explain the need for pollution control?
(a) Cost savings
(b) Reduced risk of liability
(c) Reduction of health hazards
(d) All of them
Answer:
(d) All of them

1st PUC Business Studies Question Bank Chapter 6 Social Responsibilities of Business and Business Ethics

Question 8.
Which of the following is capable of doing maximum good to society?
(a) Business success
(b) Laws and regulations
(c) Ethics
(d) Professional management
Answer:
(c) Ethics

Question 9.
Ethics is important for
(a) Top management
(b) Middle-level managers
(c) Non-managerial employees
(d) All of them
Answer:
(d) All of them

Question 10.
Which of the following alone can ensure effective ethics programme in a business enterprise?
(a) Publication of a code
(b) Involvement of employees
(c) Establishment of compliance mechanisms
(d) None of them
Answer:
(b) Involvement of employees

Short Answer Questions

Question 1.
What do you understand by social responsibility of business? How is it different from legal responsibility?
Answer:

  1. Social responsibility of business refers to its obligations to take those decisions and perform those actions which are desirable on terms of the objectives and values of our society.
  2. Social responsibility of business refers to voluntary obligation on the part of business concerns to contribute for the welfare ofthe society.
  3. Social responsibility refers any business concerns, not only protecting its own interest such as making profit, it protecting the interest of different groups of society like as owner, investors, consumers, employee, government and society.

Question 2.
What is environment? What is environmental pollution?
Answer:
The environment is defined as the totality of man’s surroundings including both natural and man-made surroundings including natural resources like land, water, air, fauna and flora and raw materials; or man-made resources such as cultural heritage, socioeconomic institutions and the people.

Environmental pollution refers to the injection of harmful substances into the environment which cause change in the physical, chemical and biological characteristics of air, land and water and harm the life of human and other species.

Question 3.
What is business ethics? Mention the basic elements of business ethics.
Answer:
‘Ethics’ is a Greek word meaning character; norms, ideals or morals prevailing in a group or society. Business ethics refers to the relationship between business objectives, practices, techniques and the good of society. It is concerned with the socially determined moral principles which should govern business activities.
Top management commitment:

  • Publication of a ‘Code’.
  • Establishment of compliance mechanism.
  • Involving employees at all levels.
  • Measuring results.

1st PUC Business Studies Question Bank Chapter 6 Social Responsibilities of Business and Business Ethics

Question 4.
Briefly explain

  1. Air Pollution
  2. Water pollution
  3. Land pollution.

Answer:

  1. Air pollution: It is mainly due to carbon monoxide emitted by automobiles. Smoke and other chemicals from production plants pollute the air. It results air pollution. It has created a hole in the ozone layer leading to dangerous warming of the earth.
  2. Water pollution: Business enterprises have been dumping chemical and waste into rivers, lakes. It leads to death of animals and dangerous to human life.
  3. Land pollution: Dumping of toxic wastes on land, causes land pollution. This damages the quality of land and making it unfit for agriculture.

Question 5.
What are the major areas of social responsibility of business?
Answer:
When the business commences, social objective of the firm is recognized and it is important for the organization to know to whom and for what the business and its management are responsible. The major areas of social responsibilities of business include the following.

(i) Responsibility towards the shareholders or owners:
A business enterprise has the responsibility to provide a fair return to the shareholders or owners on their capital investment and to ensure the safety of such investment. The corporate enterprise on a company form of organisation must also provide the shareholders with regular, accurate and full information about its working as well as schemes of future growth.

(ii) Responsibility towards the workers:
Management of an enterprise is also responsible for providing opportunities to the workers for meaningful work. It should try to create the right kind of working conditions so that it can win the cooperation of workers. The enterprise must respect the democratic rights of the workers to form unions. The worker must also be ensured of a fair wage and a fair deal from the management.

(iii) Responsibility towards the consumers:
Supply of right quality and quantity of goods and services to consumers at reasonable prices constitutes the responsibility of an enterprise toward its customers. The enterprise must take proper precaution against adulteration, poor quality, lack of desired service and courtesy to customers, misleading and dishonest advertising, and so on. They must also have the right of information about the product, the company and other matters having a bearing on their purchasing decision.

(iv) Responsibility towards the government and community:
An enterprise must respect the laws of the country and pay taxes regularly and honestly. It must behave as a good citizen and act according to the well accepted values of the society. It must protect the natural environment and should avoid bad, effluent, smoky chimneys, ugly buildings dirty working conditions. It must also develop a proper image in society through continuous interaction with various groups of people.

Long Answer Questions

Question 1.
Build up arguments for and against social responsibilities.
Answer:
Arguments for Social Responsibility:
(i) Justification for existence and growth:
Business exists for providing goods and services to satisfy human needs. Though, profit motive is an important justification for undertaking business activity, it should be looked upon as an outcome of service to the people. In fact, the prosperity and growth of business is possible only through continuous service to society. Thus, assumption of social responsibility by business provides justifications for its existence and growth.

1st PUC Business Studies Question Bank Chapter 6 Social Responsibilities of Business and Business Ethics

(ii) Long-term interest of the firm:
A firm and its image stands to gain maximum profits in the long run when it has its highest goal as ‘service to society’. When increasing number of members of society including workers, consumers, shareholders, government officials, feel that business enterprise is not serving its best interest, they will tend to withdraw their cooperation to the enterprise concerned. Therefore, it is in its own interest if a firm fulfills it’s social responsibility. The public image of any firm would also be improved when it supports social goals.

(iii) Avoidance of government regulation:
From the point of view of a business, government regulations are undesirable because they limit freedom. Therefore, 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.

(iv) Maintenance of society:
The argument here is that laws cannot be passed for all possible circumstances. People who feel that they are not getting their due from the business may resort to anti-social activities, not necessarily governed by law. This may harm the interest of business itself. Therefore, it is desirable that business enterprises should assume social responsibilities.

(v) Availability of resources with business:
This argument holds that business institutions have valuable financial and human resources which can be effectively used for solving problems. For example, business has a pool of managerial talent and capital resources, supported by years of experience in organising business activities. It can help society to tackle its problems better, given the huge financial and human resources at its disposal.

(vi) Converting problems into opportunities:
Related with the preceding argument is the argument that business with its glorious 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.

(vii) Better environment for doing business:
If business is to operate in a society which is full of diverse and complicated problems, it may have little chance of success. Therefore, it is argued that the business system should do something to meet needs before it is confronted with a situation when its own survival is endangered due to enormous social illnesses. A society with fewer problems provides be ‘ r environment for a firm to conduct its business.

(viii) Holding business responsible for social problems:
It is argued that some of the social problems have either been created or perpetuated by business enterprises themselves. Environmental pollution, unsafe workplaces, corruption in public institutions, aid discriminatory practices in employment are some of these problems. Therefore, 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 on their own.

Arguments against Social Responsibility Major arguments against social responsibility are:
1. Violation of profit maximisation objective:
According to this argument, business exists only for profit maximisation. Therefore, any talk of social responsibility is against this objective. In fact, business can best fulfill its social responsibihty if it maximises profits through increased efficiency and reduced costs.

2. Burden on consumers:
It is argued that social responsibilities like pollution control and environmental protection are very costly and often require huge financial investments. In such circumstances, businessmen are likely to simply shift this burden of social responsibihty by charging higher prices from the consumers instead of bearing it themselves. Therefore, it is unfair to tax the consumers in the name of social responsibihty.

3. Lack of social skills:
All social problems cannot be solved the way business problems are solved. In fact, businessmen do not have the necessary understanding and training to solve social problems. Therefore, according to this argument, social problems should be solved by other,specialised agencies.

4. Lack of broad public support:
Here the argument is that the 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.

1st PUC Business Studies Question Bank Chapter 6 Social Responsibilities of Business and Business Ethics

Question 2.
Discuss the forces which are responsible for increasing concern of business enterprises toward social responsibility.
Answer:
The following forces have been responsible for increasing concern of business enterprises towards social responsibihty.
(i) Threat of public regulation:
Democratically elected governments of today are expected to act as welfare states whereby they have to take care of ah sections of society. Thus,.where business institutions operate in a socially irresponsible manner, action is taken to regulate them for safeguarding people’s interest. This threat of pubhc regulation is one important reason due to which business enterprise feels concerned with social responsibihty.

(ii) Pressure of labour movement:
Over the last century or so, labour has become far more educated and organised. Accordingly, 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’ under which they could deal with workers at their will.

(iii) Impact of consumer consciousness:
Development of education and mass media and increasing competition in the market have made the consumer conscious ofhis right and power in determining market forces. The principle of caveat emptor (or let the buyer beware) has been substituted by the principle of customer is king’. Business enterprises have started following customer-oriented policies.

(iv) Development of social standard for business:
Businesses are no longer considered merely money crazy entities which can be allowed to mint money at any cost and get away with any kind of business practices. New social standards consider economic activity of business enterprises as legitimate but with the condition that they must also serve social needs.

No business can be done in isolation from society. It is the society that permits business to exist and grow and it is on the basis of social standards that business functioning is to be ultimately judged.

(v) Development of business education:
Development of business education with its rich content of social responsibility has made more and more people aware of the social purpose of business. Educated persons as consumers, investors, employees, or owners have become more sensitive towards social issues than was the case earlier, when such education was not available.

(vi) Relationship between social interest and business interest:
Business enterprises have started realizing the feet that social interest and business interest are not contradictory. Instead, these are complementary to each other. The feeling that business can grow only through the exploitation of society has given way to the belief that long-term benefit of business lies in serving the society well. So also, a useful institution like business is recognized as an essential element of a modem civilised society.

(vii) Development of professional, managerial class:
Professional management education in universities and specialised management institutes have created a separate class of professional managers who have got an altogether different attitude towards social responsibility as compared to the earlier class of owner manager.

Professional managers are more interested in satisfying a multiplicity of interest groups in society for running their enterprises successfully than merely following profit goals. These and a number of other social and economic forces have combined together to make business a socioeconomic activity.

Business is no longer a mere occupation; it is an economic institution that has to reconcile its short-term and long range economic interests with the demands of the society in which it functions. Essentially, it is this which gives rise to the general and specific social responsibilities of business.

While there is no denial of the feet that business is essentially an economic enterprise and that it must ultimately justify itself on economic performance, it is also true that business is an organ of society and as such it must justify its continuance by fulfilling its roles and responsibilities of society.

1st PUC Business Studies Question Bank Chapter 6 Social Responsibilities of Business and Business Ethics

Question 3.
‘Business is essentially a social institution and not merely a profit-making activity’. Explain.
Answer:
A business enterprise is permitted by society to carry on industrial or commercial activities and earn profits from it. Therefore, a business enterprise is expected to do business and earn money in ways that fulfill the expectations of the society. Like every individual living in society, business too has certain obligations towards society in terms of respect for social values and norms of behavior.

It is obligatory on part of the business enterprise not to do anything that is undersirable from society’s point of view. Manufacture and sale of adulterated goods, making deceptive advertisements, evading taxes, polluting the environment and exploiting workers are some examples of socially undesirable practices which may increase the profit of enterprises but which have adverse social effects.

On the other hand, supplying good quality goods, creating healthy working conditions, honestly paying taxes, prevention of pollution and resolving customer complaints are examples of socially desirable practices which improve the image of enterprises leading to higher profits in the long run.

The major areas of social responsibility of business which explain that business is essentially a social institution and not merely a profit making activity include the following:

When the business commences, social objective of the firm is recognized and it is important for the organisation to know to whom and for what the business and its management are responsible. The major areas of social responsibilities of business include the following.

(i) Responsibility towards the shareholders or owners:
A business enterprise has the responsibility to provide a fair-return to the shareholders or owners on their capital investment and to ensure the safety of such investment. The corporate enterprise on a company form of organisation must also provide the shareholders with regular, accurate and full information about its working as well as schemes of future growth.

(ii) Responsibility towards the workers:
Management of an enterprise is also responsible for providing opportunities to the workers for meaningful work. It should try to create the right kind of working conditions so that it can win the cooperation of workers. The enterprise must respect the democratic rights of the workers to form unions. The worker must also be ensured of a fair wage and a fair deal from the management.

(iii) Responsibility towards the consumers:
Supply of right quality and quantity of goods and services to consumers at reasonable prices constitutes the responsibility of an enterprise toward its customers. The enterprise must take proper precaution against adulteration, poor quality, lack of desired service and courtesy to customers, misleading and dishonest advertising, and so on. They must also have the right of information about the product, the company and other matters having a bearing on their purchasing decision.

(iv) Responsibility towards the government and community:
An enterprise must respect the laws of the country and pay taxes regularly and honestly. It must behave as a good citizen and act according to the well accepted values of the society. It must protect the natural environment and should avoid bad, effluent, smoky chimneys, ugly buildings dirty working conditions. It must also develop a proper image in society through continuous interaction with various groups of people.

Question 4.
Why do the enterprises need to adopt pollution control measures?
Answer:
Pollution prevention or control is needed to preserve precious environmental resources and to improve the environmental quality so that the preserved resources can be utilized for the benefit of mankind and the improvement of health and wellbeing of the people.

The amount of damage to a particular medium (air, water, land) varies according to the type of pollutant, the amount of pollutant disposed of, and the distance from the source of pollution.
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. Pollution control measures can not only check the seriousness of such diseases but can also be supportive of a healthy life on earth.

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. Therefore, it is sound business policy to install pollution control devices in its premises to reduce the risk of liability. ‘

3. Cost savings:
An effective pollution control program is also needed to save costs of operating business. 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:
As society becomes increasingly conscious of environmental quality, a firm’s policies and practices for controlling wastes will increasingly influence people’s attitude towards its working. 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.

1st PUC Business Studies Question Bank Chapter 6 Social Responsibilities of Business and Business Ethics

Question 5.
What steps can an enterprise take to protect the environment from the dangers of pollution?
Answer:
Since the quality of the environment is important for all of us, we have a collective responsibility to protect it from being spoiled. Whether it is government, business enterprises, consumers, workers, or other members of society, each one can do something to stop polluting the environment.

Government can enact laws to ban hazardous products. Consumers, workers and the members of society can avoid using certain products and doing things that are not environment friendly. The business enterprises should, however, take the lead in providing their own solutions to environmental problems.

It is the social responsibility of every business to take steps not only to check all sorts of pollution but also to protect environmental resources. Business enterprises are leading creators of wealth, employment, trade and technology. They also command huge financial, physical and human resources.

They also have the know-how to solve environmental pollution problems with a preventive approach by controlling pollutants at the source. In most cases, modification or change in the process of production, redesign of equipment, substituting poor quality materials with better ones or other innovative approaches could greatly reduce or even eliminate pollution entirely. Some of the specific steps which can be taken by business enterprises for environmental protection are as stated below:

  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 6.
Explain the various elements of business ethics.
Answer:
1. Top Management Commitment:
Top management has a crucial role in guiding the entire organization towards ethically upright behavior. To achieve results, the ChiefExecutive Officer (or CEO) and other higher level managers need to be openly and strongly committed to ethical conduct.

2. Publication of a ‘Code’:
Enterprises with effective ethics programs define the principles of conduct for the whole organization in the form of written documents which is referred to as the “code”. This involves areas such as fundamental honesty and adherence to laws; product safety and quality; health and safety in the workplace etc.

3. Establishment of Compliance Mechanisms:
Company must ensure that actual decisions and actions comply with the firm’s ethical standards by establishing suitable mechanisms. Some examples of such mechanisms are: paying attention to values and ethics in recruiting and hiring; emphasizing corporate ethics in training; auditing performance regularly to analyze the degree of compliance; and instituting communication systems to help employees report incidents of unethical behavior.

4. Involving Employees at all Levels:
Involvement of employees in ethics programs is a must as at different levels they are the ones who implement ethics policies to make ethical business a reality. Although it is difficult to accurately measure the end results of ethics programs, the firms can certainly audit to monitor compliance with ethical standards. The top management team and other employees should then discuss the results for further course of action.

5. Measuring results:
Although it is difficult to accurately measure the end results of ethics programmes, the firms can certainty audit to monitor compliance with ethical standards. The top management team and other employees should then discuss the results for further course of action.

1st PUC Business Studies Social Responsibilities of Business and Business Ethics Additional Questions and Answers

One Mark Questions

Question 1.
State any one argument for social responsibility of business.
Answer:
Favourable environment of business

1st PUC Business Studies Question Bank Chapter 6 Social Responsibilities of Business and Business Ethics

Question 2.
State any one argument against social responsibility of business.
Answer:
Lack of social skills

Question 3.
State any one of the social responsibility of business towards investors.
Answer:
Chairman and directors of the company should be easily accessible to the investors.

Question 4.
State any one of the social responsibility of business towards consumers.
Answer:
Right Information about product

Question 5.
State any of the causes for pollution.
Answer:
Population growth

Question 6.
Mention any one of the type of pollution.
Answer:
Air Pollution

Question 7.
State any one need for pollution control.
Answer:
Reduced risks of liability

Question 8.
What is business ethics?
Answer:
Business ethics is the set of values, principles and standards governing the moral conduct of the business.

Question 9.
State any of the elements of business ethics.
Answer:
Involving employees at all levels

Two Marks Questions

Question 1.
What is social responsibility of 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.

Question 2.
State any two arguments for social responsibilities of business.
Answer:

  1. Avoidance of government regulation
  2. Long term interest of the firm

Question 3.
Mention any two arguments against social responsibility of business.
Answer:

  1. Lack of Public Support
  2. Burden on customers

1st PUC Business Studies Question Bank Chapter 6 Social Responsibilities of Business and Business Ethics

Question 4.
State any two responsibilities towards employee.
Answer:

  1. Proper incentives measures
  2. Promotional opportunities

Question 5.
What is environment protection?
Answer:
Environmental protection is a practice of protecting the natural environment on individual, organisation controlled or governmental levels, for the benefit of both the environment and humans.

Question 6.
What is air pollution?
Answer:
Air pollution occurs when gases, dust particles, fames (or smoke) or odour are introduced into the atmosphere in a way that makes it harmful to humans, animals and plan

Question 7.
State any two needs for pollution control.
Answer:

  • Improved public image
  • Cost savings

Question 8.
Mention any two elements of business ethics.
Answer:

  1. Top management commitment
  2. Publication of a code

Five Marks Questions

Question 1.
What are the Responsibility of business Towards Investors
Answer:

  1. Shareholders who are the owners of business should be provided with correct information about company to enable them to give them true and fair position of the company to enable them to decide about farther investments.
  2. Company should provide a fair return on the investment made by shareholders. If shareholders do not get proper dividend then they will hesitate to invest additional funds in the concern.
  3. Shareholders should be kept fully informed about the working of the company for healthy growth of the business. The Companies Act 1956 also requires company to give fall disclosure in the published statements.
  4. Company should strengthen the share prices by its growth, innovation and diversification.
  5. At the same time shareholders shall also offer wholehearted support and co-operation to the company to protect their own interests.

Ten Marks Questions

Question 1.
What are the Responsibilities of business towards Consumers.
Answer:

  1. Quality: The company should produce quality goods. The company should try to improve its quality because at not time quality can be 100%. There is always room for improvement of quality.
  2. Fair Prices: The customers should not be cheated by charging high prices. It is not possible to fool the customer at all the time. Thus, fair price convert a customer into permanent customer.
  3. Honest Advertising: The customers want to know the facts, features, advantages, side effects, etc, of the product. The advertisement conveys this information. Thus, the company must see that the advertisement is not being misleading and it must be done by providing the true and actual information.
  4. After Sales Service: The company is expected to provide after sale service for maintenance of goods during the period of warranty. Efficient and effective after sale service helps to establish good relation between the customers and the company.
  5. Research and Development: The consumers require that the business organization must conduct research and development for the purpose of improving the quality and reducing the cost of production. That is, it must provide ISI or AGMARK products to the customers.
  6. Consumer’s Safety: The business must ensure that the product supplied will not adversely affect on the life and health of the customers. Unsafe product must not be marketed by the company.
  7. Regular Supply: Consumer should be supplied with the goods regularly as and when required by them The commercial organization should not create artificial shortage of goods.
  8. Attend Complaints: The consumer complaints must be attended immediately.
  9. Avoid Monopolistic Competition: The commercial organization should avoid monopolistic competition in the interest of consumers.
  10. Training: The commercial organization should arrange to train the customers either free or for a fee. It must be in case of computers, etc.

1st PUC Business Studies Question Bank Chapter 6 Social Responsibilities of Business and Business Ethics

Question 2.
What are the Responsibility of business Towards Government
Answer:
The social responsibilities of a business organization towards government can be explained with the help of the following points:

  1.  Observation of Rules and Regulation: The organization are required to follow the rules and regulations laid by the government in proper manner.
  2. Payment of Taxes: The business organizations must pay taxes and duties regularly to the government such as sales tax, income tax, octroi duty, custom duty, VAT, etc. Nonpayment of taxes is an offense because it would be difficult for the government to undertake development programs. .
  3. Assistance in Implementing Socio-Economic Policies: The government expects co-operation and help from the business sector to help in implementing programs and policies relating to social and economic development.
  4. Earning Foreign Exchange: The government also expects from business organization that it will earn foreign currency by exporting goods in the foreign market. The government requires this foreign currency for importing valuable and important products.
  5. Advising the Government: The business organization has to provide timely advice to the government in respect of framing important policies such as Industrial policy, Import & Export policy, Licensing policy, etc.
  6. No Favors: The commercial organization should not take any type of favor from government officials by bribing or influencing them
  7. Contributing to Government Treasury: The commercial organization must contribute the funds to government during the emergencies and natural calamities like floods, earthquakes, etc.
  8. Political Stability: The commercial organizations should work towards the political stability of the country. The stable government often brings more return and peace in a democratic country.

Question 3.
What are the Responsibilities of business towards employees
Answer:
Employees provide human resources to the organization. They are very important to the company. Therefore, the responsibilities of a business organization towards the employees should be fulfilled in proper manner because this will give a greater productivity to the oiganization. We have explained the responsibilities of a business organization towards employees in brief as follows:

  1. Meaningful Work and Job Satisfaction: In a country like India, the job opportunities are limited with a serious problem of unemployment. Therefore, to provide a good work, proper working conditions and job security are the social responsibilities of commercial organizations.
  2. Fair Returns: Workers should be paid sufficient wages and salaries, other incentives like bonus, medical allowance, traveling allowances, etc. Prompt payment to the workers, results in higher motivation to the work force.
  3. Best Physical and Mental Atmosphere: Fresh and decent working conditions, proper sanitary facilities, cool and fresh drinking water and etc. items are the essentials of employees. Therefore, by taking in to consideration these requirements, proper attention should be givento the facilities.
  4. Participation in the Management: The workers must be encouraged to take part in management by forming workers committee, suggestion scheme, profit sharing, co¬partnership, etc. It is an important responsibility of commercial organization.
  5. Training, Promotion and Welfare Schemes: Modem business demands efficient and trained staff. Therefore, proper training should be provided to the employees. Welfare facilities like scholarship, transport facility, refreshment facility, games, etc. should also be provided to the employees so that they can complete the work in efficient manner.
  6. Recognition of Unions: Organizations should recognize workers right of forming union. It will help in maintaining industrial peace.
  7. Proper Personnel Policies: There must be proper personnel policies in respect of transfers, promotions, recruitment, training, etc. There should be no partiality in promotion, transfer or any other activity for the employees.
  8. Health and Safety Measures: The commercial organization should take adequate measures to protect health of the employees. They should be provided with proper canteen, medical and other facilities. ,
  9. Grievance Procedure: There should be proper grievance procedure to handle employee complaints. These are the social responsibilities of a business organization towards employees

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