Ch. 4 Business Ethics and Social Responsibility 4.2 Social Responsibility

Business and Social Responsibility Social Responsibility: the duty to do what is best for the good of society. Some people feel that if a business is producing goods and services that benefit society that the business is fulfilling their social obligation. Some people do not feel that way. How do you feel?

Responsibility to Customers Customers are a business’s first responsibility. They should offer safe product or services at reasonable prices. Federal Trade Commission (FTC): a federal government agency that protects consumers from dangerous or falsely advertised products. Fair competition is necessary for the marketplace to operate effectively. It is a major component to the Market Economy.

Responsibility to Employees Businesses have a social responsibility to provide employees with: Safe working conditions Equal treatment Fair pay Over the years, government has passed laws to protect workers from unfair pay and unsafe work conditions. Equal Pay Act (1964): requires that men and women get paid the same wage for doing equal work. Does the gap in pay still exist?

Responsibility to Society Businesses have a social responsibility to protect the environment. Environmental Protection Agency (EPA): a government agency that enforces rules to protect the environment and prevent pollution.

Responsibility to Creditors and Owners Businesses have a responsibility to its creditors and owners to keep accurate records of earnings. In the 1990’s, many businesses were keeping inaccurate accounting records to show higher profits than what was actually happening.

Homework Review the questions on page 63, 1-3 Complete Chapter 4-2 Reading Activity and Graphic Organizer Quiz on Friday.