Effect Of Social Responsibility Of Business Organization

Introduction

1.1 Background Information

Social responsibility could be defined as the recognition that business activities have some impact on the entire society and the consideration of that impact in business decision making. Therefore most business sense of responsibility toward the communities in which they operate in new of the adverse effects of production operations on these communities. Some of these social adverse effect range from health hazards displacement human settlements to environment pollution. Shell petroleum development company for instance has been grappling with the restive behaviour of youths in its area of operation occasioned by the activities of oil companies.

Also output whether that of products and or service could have adverse effects consumers some common example are cigarettes and medical drugs. Business for have the responsibility of educating user of their products or service on their correct usage in order to avoid side effects.

Business organizations also show that they are socially reasonable to their host communities by complimenting the efforts of the government by providing infrastructure facilities like schools hospitals tarred road and eve supporting sports

It is with the foregoing in mind that the research carried out this work to identity the effects of social responsibility in Enugu state as well as proffer solutions to the likely problem associated with discharging it.

Simply, many companies have found that SR has often had a positive impact on corporate profits. Of all the topics related to social responsibility, it is environmental initiatives that have produced, so far, the greatest amount of quantifiable data linking proactive companies with positive financial results. Social responsibility in fast moving consumer goods(FMCG) sector would be aimed towards addressing the peculiarity of the socio-economic development challenges of the country (e.g. poverty alleviation, health care provision, infrastructure development, education, etc) and would be informed by socio-cultural influences (e.g. communalism and charity). They might not necessarily reflect the popular western standard or expectations of SR (e.g. consumer protection, fair practice, green marketing, climate change concerns, social responsible investments, etc) as a result of the effect of the global economic meltdown. Companies are assumed to be socially responsible because they anticipate a benefit from these actions. Examples of such benefits might include reputation enhancement, the ability to charge a premium price for its output, or the use of SR to recruit and retain high quality workers.

These benefits are presumed to offset the higher costs associated with SR, since resources must be allocated to allow the firm to achieve SR status, while a key indicator to determine the true worth and value of modern organizations is their ability to give back to the society part of their income through some mutually beneficial initiatives (Nkanbra and Okorite, 2007). There is no doubt that SR is becoming indispensable, though involuntary, in the contemporary business world as societal needs are making it imperative for the corporate organizations to be sensitive to happenings in their environment, which ensure more understanding and good relationship between the organization and the society they exist, since SR contributes to the wellbeing of the citizenry (Osho 2008).

1.2 Statement of the Problem

On discharging their social duties to their host communities business organizations encounter some problem that affect them negatively. Such problems are as follows

Some organizations have insufficient managerial and financial resources to undertake social charges.

Some organization could not fit in be cause of legal protection from the government of the state.

Social values of communities affect the operation activities of business organization.

The contribution of social problem based on personal responsibility affect negatively an business organization. business organizations in Nigeria perceive and practice Social responsibility as a corporate philanthropy aimed at addressing socio-economic development challenges. But then what impact does this have on the profitability of the organization?

It is against this background that, there is the need to find out how SR impact on the profitability of the business organizations especially, Nestle Nigeria Ltd.

1.3 Research Objectives

The general objective of this study is to examine the effect of Social responsibility of Nestle Nigeria on its profitability. But specifically, the study sought to achieve the following objectives:

To find out how Nestle Nigeria carry its SR as a major partner in the fast moving consumer goods(FMCG) industry.

To find out the challenges of Nestle in practicing of its SR programmes.

To investigate whether Social responsibility guarantee customers‘ confidence and security of depositor‘s fund.

1.4 Research Questions

How does Nestle Nigeria embark on Social responsibility?

What challenges does Social responsibility impose on Nestle Nigeria?

Does Nestle Nigeria‘s Social responsibility guarantee the customers‘ confidence level in the organization?

1.5 Justification for the Study

The study is expected to make contribution to knowledge in the following areas: Provide information about SR in relation to corporate institution especially the FMCG sector. It is also to be a fundamental material for scholarly discourse in management science relating to Social responsibility. The study will provide information on the impact of SR on the profitability of business organizations operations in Nigeria. Finally, the research work will provide information on the challenges of SR in the fast moving consumer good(FMCG) sectors with recommendations.

1.6 Scope and Limitation of the Study

The study is focused on the headquarters of Nestle Nigeria. It critically examines what impact Social responsibility has on the profitability of Nestle Nigeria for the period 2008-2010. However the study is limited to finding out how much in monetary terms Nestle commits to towards social responsibility programmes yearly.

1.7 Brief Methodology of the Study

Primary data was used through the administering of questionnaires to respondents at Nestle Nigeria Limited, Customers, Nestle Business partners and shoppers in general.

The study population is very large, so 100 respondents were selected from the top level management, middle level management and the supervisors which is a good representation of the population based on stratified sampling.

This cuts across the various departments in the organization such as corporate affair department, customer services department, retail department, marketing department and others. Again 300 shoppers/customers were selected through random sampling. Finally, 5 business partners of Nestle were also interviewed through administering of simple structured questionnaires for their response in relation to the study.

1.8 Organisation of the Work

This work is organized and presented in five chapters.

Chapter one covered the background information to the study, objectives of the study, the research questions, significance of the study as well as the limitations of the study.

Chapter two looked at the review of literature on the subject. This is a review of books, papers, publications of earlier writers on the topic or similar to that.

Chapter three did an appraisal of Nestle Nigeria and their operations, it discussed the methods of collecting the data into details.

Chapter four analyzed and discussed the data collected for the study.

Finally, chapter five discussed the findings, conclusions and recommendations for addressing the problems identified in the study.