Corporate Social Responsibility: Case Study of Pfizer
The responsibility that a business play in the society in which it is carried out has been subject to various kinds of debate. While it is reckoned that the basic objective of any organization is maximization of profit, others feel that a business should go far beyond just profit maximization to embrace issues such corporate social responsibilities. Moreover, Zain (2008) believes that social responsibilities must be performed by businesses entities. She reinforces this by arguing that the primary responsibility of a company is to meet the expectations of every stakeholders of earning then dividends for their invested capital (Zain 2008, para 2). This calls for not mistreating the employees of an organization even if the primary aim should be shareholder profit maximization. Provided the firms operate within the regulations that are provided for by the pre-defined legislation, and having taken into account the interest of the shareholders, all the other supposed roles should automatically be fulfilled (Zain 2008). Friedman argues that if business organizations simply capitalize on profit maximization while operating under the established legal procedures, then the firm is assured a continued business life, as there will be funds for inventory maintenance and expansion.
In his (Friedman’s) view, the management of a firm or business enterprise that engages itself in additional social responsibility may be faced with difficulties in executing its duties to be able to continue with the growth as well as development of the firm, an issue that Zain dismisses. Friedman opines that every firm should engage in free and open competition without engaging in any form of unethical activities or those that does not add value to stakeholders’ capital. Hence, by engaging in social responsibilities that benefit a society, it would be going against the business primary responsibility. Furthermore, he argues that a business that spends its earnings to benefit the society would compromise shareholder’s earnings (Zain 2008, Para 6).
Indeed, Zain (2008) agrees that Archie Carroll has a larger view of the supposed responsibility of business. In the context of the socio-economic school of thought, Carroll considers the responsibility of business as four-fold and extends beyond shareholder’s profit maximization. In his view, business plays economic roles, ethical roles, legal roles as well as other voluntary roles that help shape the society in general (Zain 2008, para.5). The first responsibility in this model is in line with Friedman’s profit maximization. To be able to contribute to the macro-economic development, businesses need to emphasize on the maximization of their profits by capitalizing on their strength and market opportunities (Velasquez 2012). Businesses need to embark on thorough market and marketing research so as to identify what types of products to deal in, how much to keep in inventory and when to do so. Secondly, the government has the role of providing certain regulations in relation to the business activities to be undertaken as well as the mode of operations. Abiding by these laws and regulations is also a responsibility business.
Zain (2008) describes that legal responsibilities refers to laws that limits businesses to operate within certain confines. The other set of responsibility that Carroll considers fundamental in the operations of a business enterprise is ethical responsibility (Beauchamp, Bowie & Arnold 2009). He believes there should be some set of moral standards from which the management of an organization should draw its governing principles. In striving at the maximization of profits of shareholders, the employees of the organization may be forced to work extra hours (Crane & Matten 2010). Ethical considerations will see the employees receiving remuneration that is proportional to the amount of extra work done. Business management needs to employ ethics in ensuring the employees work under conducive environment. They need to have that sense of humane in handling the employees (Zain 2008, Para 8). Finally, the last set of a firm’s responsibility according to Carroll include carrying out other activities within or outside the firm, but under the firm’s directives, that has the main aim of alleviating members of the society from poverty.
In the context of the broad social view, these theorist looks at the integration of the social demand by the business. They believe that businesses actually depend on the larger society for their existence, growth as well as continuity (Horrigan 2010). The social demands are simply the particular ways the society often interacts with the business and consequently giving it some level of prestige and legitimacy. Therefore, the corporate management is expected to take into consideration the social demands and subsequently integrating them in such a manner that the operations of the business are in accordance with the social values.
Even though, the above views seem to diverge, they initially have one observation in common and which is of utmost importance in arguing out the major responsibility of a business enterprise such as the drug company monopolies and profits in the case study. Both Carroll and Friedman seem to accept the opinion that a business’s main role is to maximize its values. They also go ahead to argue that undertaking in such activities would be in line with standards. The drug company monopolies and profits are not to engage in illegal activities as well as unethical activities’ (Zain 2008, para 9). In the context therefore, the companies are not observing their corporate responsibility adequately since they are mainly focused on profits forgetting the social roles of ensuring that the companies help individuals and eventually operating within the set social values.
Pfizer as a company is doing well in the context of corporate social responsibility. The company outlines on its website under corporate social responsibility that it undertakes a number of measures to assist communities where it serves (Pfizer 2018b). For example, some of the activities that the company conducts includes protection of environment, contributing and partnering with community based groups, special charity events, and healthcare charitable contributions (Pfizer 2018a). Indeed, another important view that people have concerning business ethics is that good ethics means good business. The involvement of ethics in business is considered essential even to this date (Becker 2009). In deed, this is a view that is consistent with the above view concerning conformity to a kind of legislation. Desirable qualities in a business like business courtesy, honesty, office etiquette, and transparency all derive their roots from good ethics (Visintin, 2012)).
However, the chords of conduct need to be practiced by all the parties involved in the business set-up Pfizer (Price 2007). This has never been the case and the effect is a total lose on the side of the firms that maintain their morals. The few firms that abide by the set business rules often find their business progress slower than the other more powerful firms that do not follow the rules. Becker explains that when considered in public life, it would involve the role of laws to establish policies and standards that guides organizations. However, the same law has failed to protect the interests of external as well as internal stakeholders (Becker 2009). Thus, for a continued success in the business industry, legislation alone may not be sufficient. Instead, of more importance is a high standard of morals for all the stakeholders in the industry.
Finally, after the review of the literature and critical analysis of the case study of Pfizer, this paper is of the opinion that the social responsibility of company is significant not only to its productivity but also to its overall acceptance and relations with the larger society (Hoffman, Frederick & Schwartz 2001). Today, Corporate Social Responsibility is being taken seriously by many organizations such as Pfizer, especially because of globalization, competition and therefore a deliberate attempt to please and play meaningful roles in the lives of communities. In this quest, many organizations have executed concerted efforts in demonstrating and attempting to respond to both ethical and legal standards, and also by virtue of paying attention and incorporating values that ensure an enhanced welfare of communities and the society at large (Golan 2008). The ways in which this is being executed include among others being involved in charity affairs, money donations, financing community projects, streamlining education and training, and involving in such project as water and sanitation, among others.
Conclusion:
It is first worth noting that while a business enterprise has responsibilities towards a society where it operates, it must fulfil its major responsibility of maximizing profits of the shareholders. Communities where companies operate have stakeholders that get motivated to purchase products distributed by the same companies. Consequently, this helps companies increase their volume of sales and hence, profitability margins. Currently, Pfizer implements programs that seek to increase the welfare of communities where it operates. Some of the programs focus on environment, social projects, as well as health initiatives to benefit all stakeholders. Besides, the company should ensure universal morality in its entire leadership. Management can achieve this by adhering to all the three viewpoints that include economic, socio-economic and social viewpoints.
Corporate governance is the process of transforming the company into meeting its set objectives. Corporate Social Responsibility (CSR) is a significant component of corporate governance structure in terms of reputation risk management. The evaluation of the social, environmental and ethical risk assessment has been carried out to ensure the success of the corporate governance (Valor 2005). CSR in organizations is a model debated upon and has attracted arguments in academic discourse for sometime now. The significance of CSR in organizations and the relationship that they portend for organizational structure and management cannot be overlooked (Leat 2007). This is especially because; it is seen as important aspect that functions to bring justice in organizations. Becker (2009) notes that the search for justice and broadened organizational performance in the work place in line with business and professional ethics are closely toed to corporate social responsibility. This essay will assess CSR in the context of Pfizer pharmaceutical company as a case study
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