Social Responsibility Then And Now: Read The Following Artic

Social Responsibility Then And Nowreadthe Following Article See Attac

Write a 2- to 3-page letter responding to Mr. Friedman, and explain to him why his perspective no longer works in the 21st-century role of business. Address the following points in your letter: Reasons profits are no longer an indicator of corporate health Changes in corporate relationships with stakeholders that now determine corporate concerns outside of making a profit In times past, employees were told to bring their mind and body to work and check their heart and soul at the door. Changes in business and corporate strategy require businesses to pay closer attention to employee needs. Use information from the readings, outside research, or other valid sources to support your views and ideas. Submit your letter for grading. MUST BE IN APA FORMAT- NEED NY 2300 HOURS EST 4/30/16

Paper For Above instruction

In the seminal 1970 article “The Social Responsibility of Business is to Increase its Profits,” Milton Friedman asserts that a company's primary goal should be to maximize profits for shareholders, emphasizing the importance of shareholder value as the fundamental indicator of corporate success. However, as we have progressed into the 21st century, this perspective appears increasingly obsolete and insufficient to encapsulate the multifaceted role that modern businesses play within society. The contemporary corporate landscape demands a broader understanding of success—one that recognizes diverse stakeholder interests, sustainability, ethical responsibility, and employee well-being—as vital components of organizational health and long-term viability.

One of the key reasons profits are no longer a sole indicator of corporate health is the growing awareness that financial performance, while essential, is not an exhaustive measure of a company's sustainability. Financial metrics such as quarterly earnings or stock prices can fluctuate due to market dynamics, short-term speculative activities, or economic downturns, which do not necessarily reflect a company's operational integrity or societal contributions. For instance, Edmans (2019) highlights that firms committed to social responsibility and stakeholder interests often outperform less ethical peers over the long term, indicating that focusing solely on profits can obscure a company's true health and future prospects.

Furthermore, the shift from a profit-centric view has been accompanied by an evolution in corporate relationships with stakeholders, including employees, customers, communities, and the environment. Unlike the era when companies prioritized shareholder interests exclusively, today’s organizations recognize that engaging with and addressing the concerns of multiple stakeholders is instrumental in ensuring sustainable success. Freeman's (1984) stakeholder theory underscores this paradigm shift, emphasizing that corporations owe responsibilities to all groups affected by their actions. Companies that neglect these responsibilities risk reputational damage, regulatory penalties, and declining customer loyalty, thereby undermining their long-term profitability and societal license to operate.

In the past, employees were often expected to detach emotionally from their work, bringing only their physical effort and cognitive focus. The notion of "checking one's heart and soul at the door" reflected a transactional view of employment, where organizational success was disconnected from employee well-being. Today, however, the recognition that engaged and motivated employees are crucial to organizational excellence has prompted a fundamental change in corporate strategy. Empirical research, such as that by Harter et al. (2020), demonstrates a positive correlation between employee satisfaction, organizational commitment, and overall performance. Modern companies are adopting practices that foster a supportive work environment, emphasize mental health, and promote work-life balance—all of which contribute meaningfully to innovation, productivity, and loyalty.

This evolution in corporate strategy aligns with the wider concepts of corporate social responsibility (CSR) and environmental, social, and governance (ESG) criteria, which integrate social and ethical considerations into business decision-making. Studies, including those by Sisodia et al. (2014), show that firms committed to CSR initiatives tend to realize enhanced reputation, customer trust, and operational efficiencies over time—a clear departure from Friedman’s narrow focus on profit maximization. These developments reflect a societal shift towards valuing ethical conduct, environmental sustainability, and social equity as integral to economic success.

In conclusion, Friedman's assertion that the social responsibility of business is solely to increase profits no longer aligns with the expectations and realities of the 21st century. Modern corporations are increasingly viewed as custodians of social and environmental welfare, with a duty to balance profitability with ethical responsibility and stakeholder engagement. Embracing this broader perspective is essential for long-term success, resilience, and societal benefit. As such, businesses must evolve beyond Friedman's narrow profit motive to integrate social responsibility into their core strategies, ultimately fostering a more sustainable and equitable future for all.

References

• Edmans, A. (2019). Grow the Pie: How Great Companies Deliver Both Purpose and Profit. Cambridge University Press.
• Freeman, R. E. (1984). Strategic Management: A Stakeholder Approach. Pitman.
• Harter, J. K., Schmidt, F. L., & Hayashi, J. (2020). Career engagement, employee well-being, and organizational success. Organizational Psychology Review, 10(4), 273–297.
• Sisodia, R., Sheth, J., & Wolk, D. (2014). Firms of Endearment: How World-Class Companies Profit from Passion and Purpose. Pearson.
• Friedman, M. (1970, September 13). The social responsibility of business is to increase its profits. The New York Times Magazine.