Build a case for the convergence of profit maximization and corporate social responsibility.

Question

What will be an ideal response?

Answer 1

Profit maximization and corporate social responsibility used to be regarded as antagonistic, leading to opposing policies. But the two views can converge. The relationship between corporate social performance and corporate financial performance is complex; socially responsible organizations are not necessarily more or less successful in financial terms. But on net, the accumulated evidence indicates that social responsibility is associated with better financial performance. Companies can avoid unnecessary and costly regulation if they are socially responsible. Such actions also can pay great dividends to the conscience, to the personal reputation, and to the public image of the company as well as in the market response. Plus, society's problems can offer business opportunities, and profits can be made from systematic and vigorous efforts to solve these problems. Firms can perform cost-benefit analyses to identify actions that will maximize profits while satisfying the demand for corporate social responsibility from multiple stakeholders. In other words, managers can treat corporate social responsibility as they would treat all investment decisions. This has been the case as firms attempt to reconcile their business practices with their effect on the natural environment.