Social Responsibility of Business — OCM STD 11 Commerce — Question
Gujarat BoardEnglish MediumSTD 11 CommerceOCMSocial Responsibility of Business3 Marks
Question
Explain responsibility of business towards owners.
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Answer
Social Responsibility of Business towards Owners:
In company form, numerous of equity shareholders are its true owners.
On their behalf, company's management is carried out by their representatives of Board of Directors.
The owners and directors of the company are different The directors should perform social responsibilities towards their owners.
They are as under.
Shareholders be allowed to participate in decision process :
The Board of Director should take equity shareholders, the true owners of the company in confidence while taking policy-related decision. They should be made partners in decision making process
To protect the interest of Owners :
The Board of Directors should make efforts to make the capital grow and to maintain safety of capital. Protection of the interest of owners is desirable long life of the company and from the view point of society and nation
Safety and growth of Capital :
Board of Directors should manage the company so efficiently that the capital of the owners grow and remain safe.
Safety and growth of Capital :
Board of Directors should manage the company so efficiently that the capital of the owners grow and remain safe.
To give Proportance to Original owners in progress :
When the company needs more capital it should accept it from the owners. Company should offer them right share as per requirement.
To present true and fair annual accounts :
Company should present true and fair annual accounts before share-holders in the meeting and should give necessary clarifications, This is economic responsibility of directors towards owners.
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