There are two accepted models of social responsibility: the shareholder and stakeholder models. The shareholder model of social responsibility holds that the only responsibility that business has is to maximize profits. Therefore, shareholders are the only people who really matter. Conversely, the stakeholder model of social responsibility holds that management’s most important responsibility is long-term survival, which is achieved by satisfying the interests of multiple corporate stakeholders. Those stakeholders include: • Primary stakeholders, such as shareholders, employees, customers, suppliers, governments, and local communities, on which the organization depends for long-term survival; and • Secondary stakeholders, such as the media and special interest groups, that can influence or be influenced by the company.
1. What are a company’s total social responsibilities
2. What choices (strategies) does a company have when responding to demands for social responsibility?
3. Are socially responsible companies economically successful? In other words, does it pay to be socially responsible?