Milton Friedman Summary

Milton Friedman was an American economist who received the 1976 Nobel Memorial Prize in Economic Sciences for his research on consumption analysis, monetary history and theory and the complexity of stabilization policy. During his career, he spent time teaching in University of Minnesota and University of Chicago. In 1970 Friedman wrote an article in The New York Times Magazine, where he said he believes the only social responsibility of a business is to increase its profits. In this essay I hope to give my opinion on this issue and discuss examples we can see today in the IT industry. Social responsibility or corporate social responsibility (CSR) is a form of corporate self-regulation that is integrated into a business model. The CSR policy

The CEO has a direct responsibility to his or her employers. That responsi¬bility is to conduct the business in accordance with their desires, which generally will be to make as much money as possible while con¬forming to the basic rules of the society, both those embodied in law and those embodied in ethical custom. Friedman is very clear in his belief that if a CEO has a “social responsibility”, it must mean that he is to act in some way that is not in the interest of his employers. He uses an example of not increasing the price of the product in order to contribute to the social objective of preventing inflation, even though a price increase would be in the best interests of the corporation. Or hiring long-term un-employed instead of better qualified available workmen to contribute to the social objective of reducing poverty. In these cases the CEO would be spending someone else’s money for general social

Today, the majority of large companies issue a corporate social responsibility report while ten years ago very few did. Also, more than 8,000 businesses around the world have signed the UN Global Compact pledging to show good global citizenship in the areas of human rights, labour standards and environmental protection. One such example of a company is Walmart. Traditionally, they were not a very socially responsible company. They paid their employees poor wages and had a very high employee turnover rate even though their owners are listed as some of the wealthiest people in America. However, they have now made commitments to sustainability as a way to save money and tighten their supply chain. They hope to be fully supplied by renewable energy, to create zero waste and to sell products that sustain people and the environment. They are also making attempts to improve their employee relations. This year they have raised wages to compete with rival companies and have also raised the temperatures in their stores in colder areas of America. This will make it a more comfortable work environment for Walmart