Saturday, 6 May 2017

Responsibilities of a business towards Owners and Employees-HSC/Class 12,OC/OCM

Social Responsibilities of Business-

A business comes into existence and grows with the support of society. Being a part of society, every business has certain responsibilities towards all the stakeholders.

Owners are one of the stakeholders and hence the business responsibilities towards owners have been listed below-

Responsibilities of a business towards the owners and the empmoyees.

Responsibility towards owners:

1. Reasonable Profit-  Owners/Shareholders invest money to earn profits. Hence every business has the responsibility to earn a reasonable amount of profit for the owners.

2. Finding New Business Opportunities-  Every company should keep on finding new business opportunities.  If it finds any good business opportunity, it should try to make use of that opportunity.

3. Expansion and diversification-  Every company should keep growing its business through expansion or by diversification to new business opportunities.

4. Best Utilization of Capital-  Every company should ensure that the capital of the business is utilized in the best possible manner to generate maximum profit. The company has to ensure the safety of capital invested by the owners.

5. Regular updates-  It’s the responsibility of every company to give periodic information to the owners about the business. The information provided should be accurate and complete in all respects.

6. Fair Practices on stock exchanges-  Any company should not involve itself in any unfair practices related to stock exchange like providing misleading information to the stock exchanges or trying to make profits from secret information about the business.

7. Minimizing wastages-  Every company should make optimum utilization of all the available resources and should minimize wastages.  Minimizing wastages lead to better productivity.

8. Creating Goodwill-  Every company is responsible for creating a very good image of the company by providing high-quality products and services to all the customers

Employees are also one of the stakeholders and hence the business responsibilities towards employees have been listed below-

Responsibility towards employees:

1. Job Security– It's important for the business to provide employees with a sense of job security. This will give them peace of mind and allow them to concentrate better on work. It will also increase their motivation.

2. Good working conditions– Every company should provide good working conditions for the employees. The office/factory premises should have proper illumination, the facility of drinking water, proper ventilation etc.

3. Fair Remuneration– Every company should provide fair remuneration to its employees like reasonable salaries, bonuses, incentives etc. The company should provide regular increments. The employees should not feel that they are being exploited.

4. Training– The employees should be provided training from time to time. This will help to enhance the skills of the employees and would lead to better productivity.

5. Safety Measures– All health and safety measures must be in place for employees. Offices/Factories/Warehouses should have proper sanitation. Safety Equipment like helmets, gloves, etc. must be provided wherever it's necessary.

6. Career Growth– It's important that the business provides growth opportunities to the employees. Performance appraisals must be done from time to time. Promotion should be given to all the deserving employees.

7. Participation in Management- It's important that employees’ views and opinions are taken while making important decisions This will give them a sense of belongingness towards the organization

8. Grievances Management- Every company must have proper grievances handling mechanisms in place The problems of the employees should be heard and efforts must be made to solve them quickly. The business must recognize the right of workers to join trade unions.

Also refer - Responsibilities of Business towards Investors, Government and Consumers

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