Business undertaking/Enterprises/Sectors are of two types, according to their ownership 1. Private, and 2. Public. Hear the important question is, whether the concept of social responsibility of entrepreneurs is applying to both the public and private sectors.
In reply thereof, some people feel that this approach applies only to the private sector because the main objective of its establishment is not only the earn profits but to earn maximum profits, whereas the public sector is established for achieving social objectives.
But, this approach is not correct, because, both the private and public sectors have equally contributed to economic development.
Social Responsibilities are Equal for Public & Private Sectors
So, it may be said that both the sectors of the economy are functional as the two ways of vehicles and hence it may be asserted that his concept applies equally to both types of sectors, due to following reasons:
The concept of social responsibilities equally applies to both private and public sectors, as both of them are established in society and their development and expansion are possible only in society.
2. Business Tendencies
Both private and public Enterprises undertake business, meaning thereby that their inherent tendency is the business tendency.
3. Investment of Earned Wealth
The wealth earned by the society is invested in both, private and public sector enterprises.
4. Natural and Human Resources
Since the natural and human resources of the society are utilized both by public and Private sector enterprises.
The concept of social responsibilities is also equally applicable to both types of Enterprises.
5. Success of Enterprises
The success of both types of Enterprises depends upon the role and contribution of various sections of the society, like – investors, suppliers, employees, and consumers, etc.
Hence, both types of Enterprises have to assume social responsibilities towards them.
6. Utilization of Social Infrastructure
Social infrastructure, like electricity, water, roads, and communications are utilized both by the public sector and private sector enterprises.
7. Facing of Evils and Problems
The society has to face certain evils and problems by the establishment of enterprises in both sectors.
8. Earning of Profits for Generation of Surplus
However, it does not mean that these Enterprises do not earn profits. It earns reasonable profits.
As regards private Enterprises, they do earn profits. However, the social responsibilities are applicable to them, with situations of profits or surplus.
9. Economic Development
Both, the public and private Enterprises contribute to the development of the country and hence the concept of social responsibilities applies to both types of Enterprises.
10. Fulfillment of Social Interest and Social Welfare
Both Private and Public Enterprises are established to fulfill social interests and promote social welfare.
Hence, social responsibilities are also equally applicable to both of them.
It is evident from the above explanations that the concept of social responsibility is equally applicable to both the private and public sector enterprises/businesses.
Thus, now you know the social responsibilities are equally applicable to public and private entrepreneurs.