B-Akansha Kansal

A business enterprise may pursue the

objectives though these goals keep changing
from time to time.

B-Akansha Kansal
 Objectives

Non-
Economic Economicobje
objectives ctives

Organic Human Social National

B-Akansha Kansal
Economic objectives of business are as follows-
Profit maximization
Increase industrial productivity
Optimum allocation of resources
Customer creation
Innovation

B-Akansha Kansal
a. Organic objectives
b. Human objectives
c. Social objectives
d. National objectives

B-Akansha Kansal
As an entity, a business has its own stages of
infancy, childhood & maturity.
Survival
Growth
Goodwill(socially acceptable)
Resources

B-Akansha Kansal
 Effective utilization of
manpower
Development of human
resource
Participation in management
Training and motivation
Satisfaction to human
beings- fair wages to
employees, dividend to
shareholders, tax to
governement.

B-Akansha Kansal
 Customer satisfaction
Remove social problems
Fair trade practices
Employment
opportunities

B-Akansha Kansal
 Development of
backward areas
Generation of export
status
Combinations of
research and
development
Provide for social justice
Development of small
enterprises

B-Akansha Kansal
 B-Akansha Kansal

RELEVANCE
OF PROFIT
OBJECTIVE
 Profit is not an objective
but it is a requirement
that has to be objectively
determined in respect of
the individual business,
its strategy, its needs
and the risks.

B-Akansha Kansal
 Recovers costs.
Strengthening of reserves.
Survival & growth
Proof of economic
efficiency
Increase public image.

B-Akansha Kansal
 May try to maximize profits by
socially undesirable means such as
black marketing.

May ignore the interest of labor,

customers etc.

May divert the attention of

management from other activities
like research, development, labour
welfare etc.

B-Akansha Kansal
B-Akansha Kansal
 It was against the business assuming social
responsibilities.
It states that business is an economic institution and
its primary responsibility is to produce goods and
services efficiently and to earn profits for its owners.
there is only one social responsibility of business- to
use its resources efficiently and engage in activities
designed to increase profit without deception or
fraud.

B-Akansha Kansal
 It is the responsibility of management to follow social
obligations.
Expenditure on socially responsible activities may not
lead profit in short run but will increase productivity in
long run.
If business concern is allowed to ignore social
responsibilities, it may resort to unfair and unethical
practices to maximize its profits.

B-Akansha Kansal
1. Use of societys Resources
2. Long term Business Interest
3. Moral Justification
4. Better public image
5. Conscious Customers
6. Strong trade Unions
7. Fear of Government Intervention.

B-Akansha Kansal
1. Business is an economic activity- it is argued that the
main function of business is to look into economic
viability of its operations.
2. Quantification of social benefits.
3. Cost-benefit analysis- any social-benefit programme
where initial cost exceed its benefits is not likely to
be taken up.
4. Transfer of Social Cost- by increase in prices.
Reduction in wages, reduction in profits.

B-Akansha Kansal
 Shareholders

Society Suppliers

Segments

Employees Government

Customers

B-Akansha Kansal
 Reasonable Dividend
Stability and Growth
Information
Protection of assets
Trustee of shareholders

B-Akansha Kansal
 To produce satisfying products to consumers.
To make goods of the right quality available to
the right people at the right time and place and
at reasonable prices.
To provide prompt, adequate and courteous
services to customers.
To ensure that advertisements and other
statements are true and fair.
To follow fair trade practice.

B-Akansha Kansal
 Fair terms and conditions regarding price,
quality, delivery of goods and payments.

Try to maintain healthy relationship with

suppliers.

B-Akansha Kansal
 Fair wages
Good working conditions
Adequate service benefits
Cooperation
Recognition of workers rights
Opportunity for growth

B-Akansha Kansal
 To abide by laws of the nation.
To pay government taxes honestly
and in time.
To avoid corrupting government
employees.
To discourage the tendency of
concentration of economic power
and monopoly.
To encourage fair trade practices.

B-Akansha Kansal
 Socio- economic objectives
Improvement of local environment
Create employment opportunities
Efficient use of resources
Welfare activities
The CSR programs of corporations like GlaxoSmithKline
Pharmaceuticals focus on the health aspect of the
community. They set up health camps in tribal villages
which offer medical check-ups and treatment and
undertake health awareness programs.

B-Akansha Kansal
B-Akansha Kansal
 All human beings are concerned with some
standardised form of behavior known as ethics.
Ethics specify what is good or bad, fair or unfair,
right or wrong.

B-Akansha Kansal
B-Akansha Kansal
Business ethics refer to the moral
principles(the principles of right and wrong
that is accepted by individual or society) which
should govern business activities.
It provide code of conduct(set of rules
outlining the responsibilities) for the business.

B-Akansha Kansal
1. Social Factors- For eg, Cow is worshipped in India,
consumed in Pakistan.
2. Personal Values- For eg, drinking alcohol is not
acceptable to some individuals.
3. Political and Legal Factors- For eg, receiving gifts for
favoring clients are not illegal, but unethical.
4. Industry Codes/ Professional Codes-For eg, Chartered
accountants to give true & fair view of companys
financial position.
5. Organizational Factors- For eg, the views & values of
management.

B-Akansha Kansal
 Immoral- No ethical practices followed by managers.
Managers care about only maximizing companys
profits.
Moral- Managers also aims at increasing profits but
within the confines of ethical values & principles.
Amoral- Lies between immoral and moral ethics.
Managers respond to ethics only when they are
necessarily required to do so, otherwise there is lack
of ethical awareness.

B-Akansha Kansal
 Employees
Consumers
Management
Industry
Society

B-Akansha Kansal
B-Akansha Kansal
 Paying lower salary than that fixed by
government.

Poor working conditions.

Lack of safety measures and lack of provision

for welfare activities.

B-Akansha Kansal
 Evasion of excise duty, sales tax, income tax,
etc.

Smuggling of goods.

Offering bribes to government officials and

politicians for getting favors.

B-Akansha Kansal
 Adulteration of goods, e.g., mixing of papaya
seed with black pepper.
Sale of duplicate products under popular
brand names.
Sale of product injurious to public health.
False claims in advertisements.
Pollution of environment.

B-Akansha Kansal
B-Akansha Kansal
 Values are the beliefs that guide
an individuals actions.
Persons belief about what is
right or wrong.

B-Akansha Kansal