Final answer:
The socioeconomic view of organizational social responsibility is true, which extends management's responsibility to protecting and improving society. This contrasts with shareholder primacy and aligns with stakeholder theory, by considering the interests of all stakeholders. Over time, regulations like OSHA have been established to protect workers, reflecting a broader sense of social responsibility.
Step-by-step explanation:
In the socioeconomic view of organizational social responsibility, it is indeed true that management has a responsibility that extends beyond the corporation itself, which includes protecting and improving society. This includes various aspects such as helping workers as a group, protecting the environment, and advancing national defense, among other things. This perspective is a contrast to the shareholder primacy theory, which posits that the primary responsibility of a firm's management is to increase shareholder wealth. However, the socioeconomic view aligns more with stakeholder theory, which advocates for considering the interests of all stakeholders in the firm's operations, not just shareholders.
Shareholder vs. Stakeholder Theories
The debate between shareholder primacy and stakeholder theory is significant in the understanding of corporate social responsibility. The former focuses on shareholder wealth, while the latter suggests a balance of interests from all stakeholders, suggesting a broader social responsibility.
Historical Context
Historically, the approach to business and worker welfare has evolved greatly. Earlier times saw a laissez-faire attitude towards business operations, but with the advent of the Industrial Revolution and its impact on worker conditions, there has been a shift towards greater government intervention and the establishment of regulations like those by the Occupational Safety and Health Administration (OSHA) to protect workers.