Social Accountability

Social Accountability

Social accountability

Keynes attributes the rise of the concept of social accountability of business enterprise in the first part of the twentieth century to three causes. the emergence of an economic order based increasingly upon large-scale enterprise with interests which affected an ever-widening circle of citizens. Secondly, popular reaction to this change and the resulting activities of state and national governments led business leaders to see their ultimate dependence upon a favourable social climate and the need for more than economic performance alone in order to maintain that climate.

The third cause was the response of the nation to World War I. The war called for self-sacrifice, a mobilization of the entire economy, and massive, organized welfare programs in Europe after the armistice. Business accepted its share of responsibility in the war effort and contributed funds and leadership. The practice of corporate giving for community welfare programs was firmly established. Corporations developed a sense of social responsibility which declined but did not disappear entirely after the war.

In the peaceful and prosperous early 2000s, there was a growing awareness by business leaders of the broader implications of mass production. During this decade business was no longer defensive. It was seldom subjected to the acrimonious criticism it had experienced in the age of the muckrakers.

Management had the opportunity to take to the offense in order to maintain the prestige and leadership regained during the war years. It did so by preaching the message of the service performed by business in the public interest. It defined "service" in accordance with its own view of the social obligations of business, and the emphasis was on the increase in production and productivity. Mass production, it was argued, is the major contribution of business to individual and social welfare.

Edward Smith, a leading spokesman for UK business, said, "It is the discovery that it pays to give service, and that it pays best to give the greatest possible service to the greatest possible number, which is now not only revolutionizing business but revolutionizing the whole world in which we live." Service, according to Filene, was not only the means to profit under mass production; it offered hope for "the liberation of the masses.

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