Chapter social-responsibilities-of-business-and-business-ethics: Social Responsibilities of Business and Business Ethics Application Questions | business studies Class 11 CBSE

Chapter social-responsibilities-of-business-and-business-ethics: Social Responsibilities of Business and Business Ethics Application Questions | business studies Class 11 CBSE | ByteNotes.in

Application Question

Medium difficulty • Concept in a practical situation

Medium

Question 1

Applied Concept

XYZ Textiles Ltd. has been consistently dumping untreated chemical waste into a nearby river, arguing that pollution control equipment is too expensive. With reference to the concept of social responsibility, how would you evaluate this practice, and what steps should the company take?

XYZ Textiles is violating both its legal responsibility (laws on water pollution) and its ethical and discretionary responsibilities; dumping untreated waste harms the community and aquatic life, contradicting the core idea that businesses must act with concern for the effects on society.
The company should install pollution control and effluent treatment facilities; while this incurs initial costs, it reduces the risk of legal liability, improves public image, and may generate cost savings through more efficient production processes.
In the long run, irresponsible environmental behaviour can trigger government regulation, damage the firm's reputation, reduce consumer and investor trust, and undermine the very conditions needed for the business to thrive — making pollution control both an ethical and strategic necessity.

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Application Question

Medium difficulty • Concept in a practical situation

Medium

Question 2

Applied Concept

A consumer reports that a food company has been selling adulterated products. With reference to the social responsibilities of business towards consumers, explain what the company should do and why.

Selling adulterated products violates the enterprise's core responsibility towards consumers: to supply the right quality and quantity of goods at reasonable prices, and to guard strictly against adulteration and dishonest practices.
The company must immediately recall the adulterated products, ensure strict quality control at every stage of production, and provide consumers with accurate information about its products and corrective measures taken.
Failure to do so can result in legal action, permanent damage to the brand's image, loss of customer trust, and ultimately loss of market share; conversely, addressing the issue transparently can demonstrate genuine commitment to consumer welfare and rebuild trust.

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Application Question

Medium difficulty • Concept in a practical situation

Medium

Question 3

Applied Concept

Priya runs a medium-sized manufacturing firm. She believes that her only obligation is to maximise profits for her investors. A consultant advises her that this view is outdated. With reference to the concept of social responsibility, evaluate the consultant's advice.

The consultant's advice is sound: the idea that business exists solely to maximise profits for owners contradicts the broader concept of social responsibility, which recognises that a business has obligations to all stakeholders including workers, consumers, the government, and the community.
In reality, Priya's firm can achieve maximum long-term profits only when it is seen as serving society well: when workers, consumers, shareholders, and government officials feel the enterprise is serving their interests, they provide the cooperation needed for sustained growth.
By focusing only on short-term profit and ignoring social responsibilities, Priya risks inviting government regulation, consumer backlash, and labour unrest — all of which will ultimately hurt the firm's profitability and survival.

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Application Question

Hard difficulty • Concept in a practical situation

Hard

Question 4

Applied Concept

A large steel company qualifies under the Companies Act, 2013 for CSR obligations but has done nothing. The board claims CSR is voluntary. Is the board correct? Explain the CSR provisions applicable to the company.

The board is incorrect: under Clause 135 of the Companies Act, 2013, companies meeting the threshold criteria (turnover of Rs. 1,000 crore or more, net worth of Rs. 500 crore or more, or net profit of Rs. 5 crore or more) are legally required to comply with CSR provisions, making it a statutory obligation — not entirely voluntary.
The company must constitute a CSR committee of board members, including at least one independent director, to oversee CSR planning and implementation.
The Act encourages spending at least 2% of the average net profit of the previous three years on CSR activities listed under Schedule VII; only activities undertaken in India qualify, and programmes exclusively for employees do not count as CSR.

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Application Question

Medium difficulty • Concept in a practical situation

Medium

Question 5

Applied Concept

A pharmaceutical company's CEO publicly declared: 'We will never compromise on drug quality, even if it costs us short-term profits.' With reference to business ethics, analyse what this declaration means for the company's long-term prospects.

The CEO's declaration reflects a strong top management commitment to ethical conduct — the first and most crucial element of business ethics — signalling to all employees and stakeholders that quality and integrity are core values of the organisation.
Ethical business behaviour builds public image, earns consumer trust, and creates long-term loyalty; for a pharmaceutical company, where product safety is directly linked to human life, such commitment is essential for maintaining regulatory approvals and a positive reputation.
In the long run, ethical conduct and profitability are complementary: a company known for never compromising on quality will attract loyal customers, skilled employees, and responsible investors, resulting in sustainable competitive advantage and financial success.

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Application Question

Medium difficulty • Concept in a practical situation

Medium

Question 6

Applied Concept

Workers at a garment factory are being paid below minimum wage, denied union rights, and forced to work in unsafe conditions. With reference to the social responsibilities of business towards workers, what obligations is the management violating?

The management is violating its responsibility to provide meaningful work, fair wages, and healthy working conditions; paying below minimum wage and forcing unsafe conditions directly contravenes workers' fundamental rights and the enterprise's ethical and legal obligations.
The denial of union rights violates the workers' democratic right to form trade unions, which the enterprise must respect as part of its social responsibility towards its workforce.
Such practices damage the enterprise's public image, invite government regulatory action, and fuel labour unrest; by fulfilling its responsibilities, the management would gain worker cooperation, reduce turnover, and improve productivity — all of which contribute to long-term business success.

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Application Question

Easy difficulty • Concept in a practical situation

Easy

Question 7

Applied Concept

A multinational FMCG company voluntarily sets up schools in tribal areas and provides scholarships even though no law requires it to do so. Identify and explain the type of social responsibility this represents.

This represents discretionary responsibility — the highest level of social responsibility — which involves purely voluntary obligations assumed by an enterprise beyond what law or social expectation requires.
Setting up schools and providing scholarships with no legal compulsion reflects the company's genuine concern for community welfare and willingness to invest resources in social development without any regulatory mandate.
Such discretionary action enhances the company's image as a caring corporate citizen, builds goodwill in the community, and contributes to long-term sustainability by creating a more educated and capable population that can become future consumers, employees, and partners.

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Application Question

Medium difficulty • Concept in a practical situation

Medium

Question 8

Applied Concept

A city's residents are experiencing severe respiratory illnesses. Investigation reveals that a cluster of factories is releasing carbon monoxide and chemical smoke without filters. With reference to the causes and effects of air pollution, analyse this situation.

The factories are causing air pollution by releasing carbon monoxide — a primary pollutant from combustion — and smoke laden with chemicals from the manufacturing process, exactly as described in the causes of air pollution in the chapter.
These pollutants lower air quality in the surrounding area, contributing to respiratory diseases; air pollution is also known to create a hole in the ozone layer and cause dangerous warming of the earth, compounding long-term environmental damage.
The factories must immediately install emission control devices, comply with the Air (Prevention and Control of Pollution) Act, and engage with government and community programmes to reduce emissions; failing to do so exposes them to legal liability, reputational damage, and potential closure by court orders, as has happened in cities like Delhi and Agra.

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Application Question

Medium difficulty • Concept in a practical situation

Medium

Question 9

Applied Concept

Ramesh is a plant manager who discovers that his factory's effluents are being discharged into a local river without treatment. His supervisor says it saves costs. With reference to the need for pollution control, explain what Ramesh should recommend and why.

Ramesh should recommend immediate installation of effluent treatment facilities; while the supervisor argues for cost savings, untreated discharge creates far greater risks including legal liability for environmental damage and compensation to affected communities.
Pollution control also generates genuine cost savings in the long run: efficient production processes with minimal waste reduce raw material wastage and cleaning costs, more than offsetting the initial investment in treatment facilities.
Additionally, controlling effluents improves the factory's public image; as communities become increasingly environmentally conscious, a firm with responsible waste management practices earns the reputation of a socially responsible enterprise, which has tangible commercial and regulatory benefits.

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Application Question

Medium difficulty • Concept in a practical situation

Medium

Question 10

Applied Concept

A new CEO of a software company publishes a Code of Ethics but does not set up any system to enforce it. Employees ignore it. With reference to the elements of business ethics, what has the company done right and what is it missing?

The company has correctly fulfilled one element of business ethics — publication of a Code — by defining principles of conduct in a written document; this is an essential foundation for an ethical organisation.
However, it is missing the establishment of compliance mechanisms: without systems to audit behaviour, reward ethical conduct, and allow employees to report unethical incidents, the Code remains a paper declaration with no practical impact.
The company is also failing to involve employees at all levels through training and group discussions, and is not measuring results through audits; without these elements, the ethics programme cannot translate values into actual workplace behaviour.

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Chapter social-responsibilities-of-business-and-business-ethics: Social Responsibilities of Business and Business Ethics | Application Questions

XYZ Textiles Ltd. has been consistently dumping untreated chemical waste into a nearby river, arguing that pollution control equipment is too expensive. With reference to the concept of social responsibility, how would you evaluate this practice, and what steps should the company take?

A consumer reports that a food company has been selling adulterated products. With reference to the social responsibilities of business towards consumers, explain what the company should do and why.

Priya runs a medium-sized manufacturing firm. She believes that her only obligation is to maximise profits for her investors. A consultant advises her that this view is outdated. With reference to the concept of social responsibility, evaluate the consultant's advice.

A large steel company qualifies under the Companies Act, 2013 for CSR obligations but has done nothing. The board claims CSR is voluntary. Is the board correct? Explain the CSR provisions applicable to the company.

A pharmaceutical company's CEO publicly declared: 'We will never compromise on drug quality, even if it costs us short-term profits.' With reference to business ethics, analyse what this declaration means for the company's long-term prospects.

Workers at a garment factory are being paid below minimum wage, denied union rights, and forced to work in unsafe conditions. With reference to the social responsibilities of business towards workers, what obligations is the management violating?

A multinational FMCG company voluntarily sets up schools in tribal areas and provides scholarships even though no law requires it to do so. Identify and explain the type of social responsibility this represents.

A city's residents are experiencing severe respiratory illnesses. Investigation reveals that a cluster of factories is releasing carbon monoxide and chemical smoke without filters. With reference to the causes and effects of air pollution, analyse this situation.

Ramesh is a plant manager who discovers that his factory's effluents are being discharged into a local river without treatment. His supervisor says it saves costs. With reference to the need for pollution control, explain what Ramesh should recommend and why.

A new CEO of a software company publishes a Code of Ethics but does not set up any system to enforce it. Employees ignore it. With reference to the elements of business ethics, what has the company done right and what is it missing?

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