Modern companies operate within the framework of a global community and are closely connected with the social environment. In particular, businesses are required to conduct activities in accordance with ethical standards. Organizations need to make decisions that prioritize the good of employees, customers, and society as a whole over their own benefit. This concept is associated with social responsibility, which describes the activities of the company in relation to social challenges. This concept is based on ethics, which allows companies to determine the morally right and wrong behavior. Ethics and social responsibility are connected as a theoretical basis and practical application in the business environment.
Ethics includes socially accepted standards of what is morally right and wrong. Alwagfi et al. (2020) underline that a business ethics is defined by the interaction of four key elements: law, society, organization, and individual. The ethical conduct of a company is based on maximizing morally justified acts in all business activities in relation to employees and customers. Ethical standards are part of the decision-making strategy in modern companies that strive for sustainable development and building a positive reputation (Ferrell, 2019). Ethics allows companies to make decisions aimed at cultivating a human approach to the functioning of business in relation to employees and customers.
Social responsibility describes moral obligations that companies have toward society. In the broadest sense, the concept prescribes to business “to prioritize customers, employees, consumers and organization dealers over making profits” (Alwagfi et al., 2020, p. 28). Researchers define it as “a type of international private business self-regulation” (as cited in Torelli, 2021, p. 725). Torelli (2021) emphasizes that social responsibility includes not only a company’s policies, but its ethical strategies to address factors of external pressure. This approach implies the identification of social or environmental challenges, as well as the acknowledgement of corporate responsibility in taking decisive action in relation to these issues. The company’s motivation may be the desire for ethical behavior, but more often social responsibility helps in achieving a better brand image, higher profits, and gaining competitive advantage (Kolour & Eskandari, 2019; Torelli, 2021). Thus, ethics is the basis for making decisions on building a corporate responsibility strategy, for identifying points of social and moral obligations of the company.
References
Alwagfi, A. A., Aljawarneh, N. M., & Alomari, K. A. (2020). Work ethics and social responsibility: Actual and aspiration. Journal of Management Research, 12(1), 26-36.
Ferrell, O. C., Harrison, D. E., Ferrell, L., & Hair, J. F. (2019). Business ethics, corporate social responsibility, and brand attitudes: An exploratory study. Journal of Business Research, 95, 491-501.
Kolour, H. R., & Eskandari, N. (2019). Relationship between social responsibility, as an ethical factor and corporate image. International Journal of Ethics & Society, 1(30), 47-57.
Torelli, R. (2021). Sustainability, responsibility and ethics: Different concepts for a single path. Social Responsibility Journal, 17(5), 719-739.