CHAPTER ONE

INTRODUCTION

1.1     BACKGROUND OF THE STUDY

This chapter distinguishes between socially responsible policies and policies that simply represent sound business practice. Attention to customer preferences is sound business practice and requires no justification other than the remuneration it provides. Similarly, creating a culture that builds mutual commitment between the firm and its employees requires no justification beyond the benefit it provides. In contrast, responding to a community need for low, income housing is beyond the normal scope of sound business practice. The strategic use of corporate social responsibility to increase profit thus should be distinguished from morally motivated actions.

The motives for taking action are also important for distinguishing between socially responsible actions and actions that are forced on the firm by its environment. Negotiating with an interest group to minimize the damage it could impose should be should be distinguished from an action taken voluntarily by a firm. Social responsibility is the management philosophy, policy, procedures and actions that have the advancement of society’s welfare as one of its primary objectives.

In dynamic society like ours, business organizations either in the private or public sector are being called upon to perform their social responsibilities to the society. The relationship between organization, society and participants is very complex yet dynamic. The notion of social responsibility has emerged out of dynamism of the relationship between these parties. Corporate organizations have grown in size, the level of education has significantly increased and people now ask a lot more questions about their rights and privileges. Related to this is the fact that the awareness of the social impact of business activities on the society as a whole is enormous both directly and indirectly. For as long as a business organization remains a sub-system of the society, the business manager is left with no other choice but to be concerned with social responsibility is a nebulous concept that has been described in a number of ways. Most writers on social responsibility see the concept as the disposition of an organization to exhibit “missionary rather than mercenary”. Attitudes towards the society social responsibility can be defined as “the intelligent and objective concern, which restrains individual or corporate behaviour from ultimately destructive activities no matter how immediately profitable, and leads to the direction of the positive contribution of human betterment” (Steiner, 2001).

Presumably, corporate executive as agents of the owners are to be responsible for conducting he business in accordance with the desire of the owners while confirming to the basic rules of the society. The responsibility has three broad facets (Edward, 2002):

1.     Contribution to charity.

2.     Elimination of social costs.

3.     The adoption and observance of ethical codes aimed at reducing business malpractice.

In summary, Nigerian business organization and other type of business must be seen in many actions domains can pursue social responsibility in areas such as: Concern for ecology and environment, Commitment to quality, Truth in advertisement, Customer’s satisfaction and education. Other concerns includes: Service to community needs, fair employment practices, progressive labour relations employment assistance and corporate philanthropy (Forters, 2002).

The strength of an organization’s commitment to corporate social responsibility ranges from low to high. At the low end of the range is an obstructionist approach (fight the social demands), which reflects mainly economic priorities. A defensive approach (“do the minimum legally required”) indicates the least commitment to ethical behaviour it seeks to protect the organization by doing the minimum legally required to satisfy expectation. Accommodative approach (“do the minimum ethical required”) is an acknowledgement of the need to support social responsibility. Organizations adopting such strategy accept their social responsibility role and try to satisfy criteria of economic, legal and ethical responsibility.

Finally, the proactive (assumed leadership in social initiatives) is designed to meet all the criteria of social performance. Managers taking a proactive approach activity embrace the need to behave in socially responsible and go out of their ways to learn about the needs of different stakeholders and are willing to utilize organizational resources to pursue the interest of the stakeholders (Friedman, 2009).

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