Most business enterprises and their top executives now accept that profit maximisation is not a valid objective of business. “The business that is coldly and solely motivated by the marking of money seldom fares well in the long run as it neglects the very source of profits, namely the provision of quality goods and services at reasonable prices produced through well paid labour, “2 According to Henry Ford “mere money chasing is not business”. Food could build up the world famous Ford Motor company because he aimed at earning reasonable profits by supplying a people’s car. Profits through service rather that maximum profits in the real objective of business. Profits through service rather than maximum profits in the real objective of business. Profit is not an objective but a requirement that has to be objectively determined in respect to the individual business, its strategy, its needs and its needs and its risks “.
The economic objectives of business can be realised only by serving the society. Business is an organ of society and it draws resources from the society. A really successful business can be built only on the foundation of service to society. If a business firm cares for different sections of society, profits will flow to it automatically. Social objectives of business refer to the obligations of business towards customers, employees and other sections of society. The profits of business represents a social objectives of business refer to the obligations of business towards customers, employees and other sections of society. The profits of business represents a social surplus in which all the stakeholders must be allowed to share in proportion to their contributions.
The social objectives of business are as follows :
- Service to Customers : The first and foremost social objective of business is to provide regularly the goods and services of proper quality and quantity to consumers at reasonable prices. Today, consumers are conscious of the quality of goods the buy. When goods are of sub-standard quality or adulterated, they stop patronizing the enterprise and the enterprise faces eventual closure.
- Service to Employees : The success of a business depends to a large extent on the hard work and dedication of its employees. Therefore, a business enterprise must provide reasonable compensation and working conditions to its employees. Participation of employees in the management and surplus of business is also the responsibility of business.
- Service to Community : Business owes an obligation to the community in which it functions. Business is expected to contribute to a healthy and pollution free environment for people. Service to community also includes generation of employment opportunities and contribution of public health, education, and cultural heritage.