Final answer:
Organization management's duty to act in ways that benefit society and the organization is known as corporate social responsibility. It extends beyond legal compliance to include ethical decisions that positively impact society and the environment.
Step-by-step explanation:
The obligation of organization management to make decisions and take actions that enhance both the welfare of society and the interests of the organization is referred to as corporate social responsibility (CSR). CSR actions go beyond legal requirements and the code of ethics to include broader social and environmental efforts. The debate between stakeholder theory and shareholder primacy represents differing views on whether management's duty is solely to shareholders or to a broader group including employees, customers, and the community.
Economic theories and moral philosophies have influenced these perspectives, with past figures like Adam Smith advocating for minimal government interference while others, such as Karl Marx, pushing for greater protection of workers' rights. Today, corporate social responsibility encompasses not just the pursuit of profit but also acting conscientiously in line with the broader interests of society, encompassing safety, liability, and community engagement.