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Est1 Task 1

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Est1 Task 1
The primary goal of the formation of a business is to produce a profit for its shareholders and to create return for its investors. Although this is the primary goal, it is not the only one. Businesses often become too focused on the bottom line that they forget about the things that will really make them successful. An entity must not only focus on its shareholders, but all of its stakeholders: owners, investors, creditors, suppliers, customers, employees, the government, and even the community. Focusing on all of these groups is what differentiates a successful business from a mediocre one. One of the many important things for a business to focus on besides a profit is its social responsibility to the surrounding community.
In evaluating Company Q’s attitude toward social responsibility, one can see they have conveyed a reputation of not caring for the community by closing stores in higher crime rate areas, only offering a limited supply of health-conscience and organic products, and denying food bank donations. Company Q has developed an attitude of a business that cares more about its profits and losses than that of its customers and communities.
The first area that could be improved regarding the company’s attitude towards social responsibility is its reputation. “The value of a positive reputation is difficult to quantify, but it is very important. A single negative incident can influence perceptions of a corporation’s image and reputation instantly and for years afterwards” (Ferrell, Ferrell, Fraedrich, 2009, p. 18). There are many repercussions that can form from Company Q closing its stores in the higher crime rate areas, such as the loss of jobs, the rise in vacant buildings and the possibility of increased crime near those vacant structures. These effects could not only damage the company’s reputation, but it can give their customers and the community the perception that Company Q does not care for them. Additionally, by increasing the



References: Ferrell, O.C., Fraedrich, J., & Ferrell, L. (2009). Business Ethics, Ethical Decision Making and Cases. Chpt. 2, p. 18, Mason, Oh. South-Western Cengage learning.

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