The Social Responsibility of Business free essay sample

The Social Responsibility of Business is to Increase its Profits Milton Friedman The New York Times Magazine September 13, 1970 When I hear businessmen speak eloquently about the social responsibilities of business in a free-enterprise system, I am reminded of the wonderful line about the Frenchman who discovered at the age of 70 that he had been speaking prose all his life. The businessmen believe that they are defending free enterprise when they declaim that business is not concerned merely with profit but also with promoting desirable social ends; that business has a social conscience and takes seriously its responsibilities for providing employment, eliminating discrimination, avoiding pollution and whatever else may be the catchwords of the contemporary crop of reformers. In fact they areor would be if they or anyone else took them seriouslypreaching pure and unadulterated socialism. Businessmen who talk this way are unwitting puppets of the intellectual forces that have been undermining the basis of a free society these past decades. We will write a custom essay sample on The Social Responsibility of Business or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page The discussions of the social responsibilities of business are notable for their analytical looseness and lack of rigor. What does it mean to say that business has responsibilities? Only people have responsibilities. A corporation is an artificial person and in this sense may have artificial responsibilities, but business as a whole cannot be said to have responsibilities, even in this vague sense. The first step toward clarity in examining the doctrine of the social responsibility of business is to ask precisely what it implies for whom. Presumably, the individuals who are to be responsible are businessmen, which means individual proprietors or corporate executives. Most of the discussion of social responsibility is directed at corporations, so in what follows I shall mostly neglect the individual proprietors and speak of corporate executives. In a free-enterprise, private-property system, a corporate executive is an employee of the owners of the business. He has direct responsibility to his employers. That responsibility is to conduct the business in accordance with their desires, which generally will be to make as much money as possible while conforming to their basic rules of the society, both those embodied in law and those embodied in ethical custom. Of course, in some cases his employers may have a different objective. A group of persons might establish a corporation for an eleemosynary purposefor example, a hospital or a school. The manager of such a corporation will not have money profit as his objectives but the rendering of certain services. In either case, the key point is that, in his capacity as a corporate executive, the manager is the agent of the individuals who own the corporation or establish the eleemosynary institution, and his primary responsibility is to them.