




































AGORA International Journal of Economical Sciences, http://univagora.ro/jour/index.php/aijes 

ISSN 2067-3310, E-ISSN 2067-7669 

No. 1 (2023), pp. 154-161 

 

154 
 

SOCIAL RESPONSIBILITY OF BUSINESS AS SUSTAINABLE DEVELOPMENT 

APPROACH IN MANAGEMENT 

 

R. ZVARYCH, I. RIVILIS 

 

Roman Zvarych¹, Igor Rivilis² 

West Ukrainian National University, International Economic Relations Department, Ukraine  

¹ orcid.org/0000-0003-3741-2642, E-mail: romazvarych@yahoo.com  

² orcid.org/0000-0003-3764-2843 

 

Abstract. The feature of the effective functioning of social relations and the condition of 

sustainable dynamics of the country's development is socially responsible behaviour of 

business. In times of crisis, socio-economic processes become unstable, social risks increase 

and deepen. It is important to balance of social processes by reconciling the interests of 

economic entities and society, social proportions and certain priorities. In this aspect, the 

problem of social responsibility of business through the creation of a favourable business 

environment is of particular importance. As a result, it is important to study the process of 

corporate social responsibility as sustainable development approach in management. The 

objective of article is methodological research the concept of social responsibility of 

business, the key elements of its development, the obstacles to its implementation and 

systematic improvements of its management. It is proved that responsible business supports 

high rates of economic growth, ensuring career growth for all employees, as a growing 

business constantly needs to attract new employees. It is justified that the policy of social 

responsibility of business must be implemented at the level of strategic management in the 

activities of the marketing, production and sales departments, as well as in the understanding 

of the strategy and the readiness to implement it in the workplace. It is suggested that in 

order to increase the social responsibility of business, it is necessary to ensure the reliability 

of indicators of financial and non-financial (social) reporting and assessment of the 

effectiveness of socio-economic costs. 

Keywords: Business ethics, corporate culture, social responsibility of business, 

sustainable management 

 

INTRODUCTION 

Structural shifts in the economy create challenges for society. Today, the issues of rational 

nature use (greening) of industrial productions, reduction of the material intensity of products 

and stabilization of resource provision of productions are still unresolved. As a result, there is 

a reduction in the number of enterprises, the environmental condition of industries is 

deteriorating, which is accompanied by a significant level of environmental pollution, 

negatively affecting the deterioration of the nation's health. At the business level, the health 

care crisis has enabled the adoption of corporate social responsibility practices, prompting the 

adaptation of business strategy, thus contributing to the mitigation of social and environmental 

problems. 

 

mailto:romazvarych@yahoo.com


Roman ZVARYCH, Igor RIVILIS 

 

155 
 

I. Methodology 

Concept of social responsibility of business 

The concept of social responsibility of business (SRB) appeared at the end of the twentieth 

century and is at the stage of approval. That is why there is no single approach to its definition, 

but its essence remains unchanged – business must be socially oriented in relation to its own 

employees, the state, society, the environment and consumers. In many developed concepts, 

social responsibility is replaced by other definitions, in particular, such as: “corporate social 

activity”, “business ethics” (Kroese, 2022). 

Social responsibility of business has become part of the management system, has acquired 

special importance and includes several stages of development (see Fig. 1). The first stage of 

the formation of SRB (1920-1950) – the main ideologist – H. Bowen (1953, research “Social 

Responsibility of a Businessman”). According to the author, the social responsibility of a 

businessman consists in “implementing policies, making decisions or choosing a line of 

behaviour that would be desirable from the standpoint of society's goals and values”. The same 

time, P. Drucker (1986, research “Management Practice”) considers public responsibility as 

one of the eight key factors for achieving business goals. At the second stage of SRB (1970), 

the word combination of SR and business ethics was introduced, and special attention was 

focused on volunteering. According to M. Friedman (1970), “social responsibility of business 

means using one's own resources and involving them in activities aimed at increasing profits, 

in conditions of open and free competition”. According to A. Carroll (1999), the social 

responsibility of business is compliance with the economic, legal, ethical and philanthropic 

expectations presented by the society to the organization in this period. 

Figure 1. Stages and approaches of social responsibility of business [Authors]. 

 

 
 

І. 
Formation

SRB

ІІ.
Business 

ethics and
SRB

ІІІ.
SRB and 

sustainable 
developmen

t

IV.
Business 

case for SRB

V.
Institutiona-
lization SRB

APPROACH
SRB

corporate 
selfishness

The enterprise is a tool for creating wealth, and its social activity achieves an economic 
result

corporate 
altruism

businesses have the 
ability to influence 

society, and therefore 
must use this ability 

responsibly

social 
requirement

s the enterprise should focus its 
activities on determining the 

social demands of society and 
responding to them, thereby 

contributing to the 
strengthening of its positions

stakeholder
sthe social role of business 

should be determined by the 
requirements of stakeholders, 
thereby replacing the concept 
of society with the concept of 

"stakeholders"

ethical duty

it is based on the idea 
of the ethical duty of 

business and individual 
managers to society



SOCIAL RESPONSIBILITY OF BUSINESS AS SUSTAINABLE DEVELOPMENT APPROACH 

IN MANAGEMENT 

 

156 
 

The third stage of social responsibility of business was characterized by strengthening its 

connection with sustainable development (1980). During this period, M. Friedman's 

stakeholder theory was developed, the organizational structure of business social responsibility 

management began to be discussed, and the concept of sustainable development (development 

that meets the needs of the present without limiting the ability of future generations to meet 

their own needs) appeared. The fourth stage (1990) formed the business case for SRB. At this 

stage, three motivational reasons for the development of the concept were formed: 

environmental protection, ecological diversity and stakeholders (Latapi Agudelo et al., 2019). 

The concept of a triangular balance between economic, social and environmental goals of 

development appeared. The fifth stage saw the institutionalization of business social 

responsibility at the national level and the emergence of international standards. In the 21st 

century a new impetus for SRB development was achieved through the adoption of the ISO 

26000 standard, national strategies, state programs on social responsibility and UN directives. 

As a result, the definition was formed: “social responsibility – company's responsibility for the 

impact of its decisions and actions on society and the environment through transparent and 

ethical behaviour that contributes to the well-being of society; takes into account the 

expectations of interested parties; complies with the legislation” (Zvarych et al., 2022). 

Having studied the existing theories, it is possible to distinguish the following types of 

approaches to the concept of corporate social responsibility of business (Fig. 1). From the point 

of view of corporate egoism, corporations are instruments of wealth creation, and all social 

activity is aimed at achieving economic results. In this way, organizations fulfil their economic 

functions by producing goods and providing services needed by society, while creating jobs 

and maximizing profits for shareholders. Proponents of this concept emphasize that only in the 

long-term profit maximization internally determines the real responsibility of the company, 

since this approach combines the interests of shareholders and other stakeholders (Wickert, 

2021). The approach from the point of view of corporate altruism defines the entrepreneurial 

ability to influence society, and, accordingly, the responsibility to use this ability. The most 

famous is the concept of “corporate citizenship”, which considers the role of business in the 

sense of social investments and obligations to local communities (Lindeque et al., 2022). 

From the point of view of social requirements, the company should focus its activities on 

identifying the social requirements of society and responding to them. That is, there was a 

change from “what is good for society” to “what society requires from business”. The 

stakeholder approach assumes that, regardless of the type of business or organization, there is 

a group of people (stakeholders) who influence the company or are influenced by the company, 

i.e. delegate certain responsibilities. These groups are called “stakeholders” and they include: 

employees, buyers, shareholders, suppliers, communities, countries and society in general 

(Seely, 2022). The ethical approach is based on the idea of moral responsibility of business 

managers and individuals to society. According to Bukreieva (2022), every business has an 

economic, environmental and social responsibility to society, ensuring its viability. So, the 

social responsibility of business is a system of consistent economic, environmental and social 

measures of the company, implemented on the basis of constant interaction with stakeholders 

and aimed at reducing non-financial risks, long-term image improvement and ensuring the 

profitability and sustainable development of the enterprise (Clendaniel, 2022). 



Roman ZVARYCH, Igor RIVILIS 

 

157 
 

II. Results 

II.1. Key elements of entrepreneurship development 

Analysing business activities, it is worth noting that socially responsible companies attach 

special importance to the training of their professionals, devoting approximately 10% of their 

own resources to this. Companies also lobby for the teaching of specialized subjects in higher 

education institutions, both for master's and postgraduate studies, as well as in business schools, 

provide sponsorship and award the best projects of the final year at universities. Sustainable 

development involves reducing inequality, and corporate social responsibility includes an anti-

discrimination policy aimed at avoiding any discrimination or inequality based on race, gender, 

sexual identity, sexual orientation, age, religion or belief, disability, marital status, pregnancy 

or maternity. The company's anti-discrimination policy includes: cooperation agreements 

aimed at promoting social and labour inclusion of people with disabilities in the normal 

working environment; participation in the training program on labour inclusion of young 

people with certain disabilities; charity sports events for social integration of people with 

disabilities (Bukreieva & Denysenko, 2022). 

The key elements of entrepreneurship development are innovation and industry 

specialization: investment in business capacity, research and development; financing of 

analytical research and creation of databases; digital transformation and development of 

artificial intelligence; exchange of knowledge, participation in specialized forums; 

participation in industry associations. In addition, socially responsible companies have a 

corporate culture that assumes equal opportunities and gender equality, without any 

discrimination, as a basic principle. That is why companies are constantly taking measures 

aimed at equality between women and men in such key areas as access to work, job stability, 

pay, regardless of the legal system in the country. Responsible business supports high rates of 

economic growth, ensuring career growth for all employees, as a growing business constantly 

needs to attract new employees (young graduates) (Boiko, 2022). 

The main points of such obligations include: creation of quality employment; cooperation 

agreements with schools that give high school students the opportunity to get their first 

experience working in a business environment; cooperation with universities and business 

associations – seminars and courses on entrepreneurship; participation in programs that 

promote innovation and entrepreneurship, fosters critical thinking, problem solving, teaching 

children and youth certain skills; support for microfinancing, facilitating access to credit and 

financing for the most disadvantaged groups in society; sponsorship of family entrepreneurship 

and family business programs (Tuxbury, 2022). 

 

II.2. Obstacles to implementation of social responsibility of business 

Many factors influence the possibility and scale of corporate policy regarding the social 

responsibility of business, namely (Fig. 2): the level of socio-economic development of the 

country; the quality of the institutional environment; specifics of the business and social 

business environment (international business integration, company size, law and order, level 

of income, consumer protection, level of competition; pandemic; war); differentiation of areas 

of social responsibility of business; the nature of the impact of social responsibility on financial 

and economic results in the short- and long-term periods; value orientations of company owners 

and top managers (Greenaway, 2022). The problems and obstacles of social responsibility of 



SOCIAL RESPONSIBILITY OF BUSINESS AS SUSTAINABLE DEVELOPMENT APPROACH 

IN MANAGEMENT 

 

158 
 

business include its limited promotion and practical application, in particular (Fig. 2): 

employers violate international norms of human and labour rights; non-compliance with social-

legal and labour rights; low wages; salary arrears; insignificant investments in labour 

protection, health of employees and professional development (Stern, 2022).  

In addition, it is worth noting the lack of a sufficient number of interested and competent 

managers, because the policy of social responsibility of business must be implemented at the 

level of strategic management in the activities of the marketing, production and sales 

departments, as well as in the understanding of the strategy and the readiness to implement it 

in the workplace. In addition, there are problems such as low product quality, failure to meet 

technical production requirements, environmental pollution and unfair competition. Also, lack 

of financial resources, inconsistency of criteria for assessing corporate social responsibility; 

low level of corporate culture; legal nihilism; and lobbying interests (Kurland et al., 2022). 

 

Figure 2. The problems and obstacles to implementation of social responsibility of business 

[Authors]. 

 
 

II.3. Systematic improvement the social responsibility management 

Regarding the macroeconomic environment in which companies operate during the crisis, 

it is worth noting that more sustainable growth in markets requires complex and interconnected 

actions at the national and regulatory levels. To adjust the growth rates, it is necessary to 

improve corporate governance. The structure of economy can be segmented to accelerate 

growth by improving corporate governance using a two-step algorithm. Prospects for the 

development of social responsibility projects in developing markets require a national 

mechanism to promote the systematic improvement of social responsibility of business entities 

(Fig. 3). 

 

PROBLEMS

legal economic informational

FACTS OF INFRINGEMENT OF SRB

violation of 
labor standards

non-compliance 
with rights of 

employees

low level of 
salary

arrears from 
the payment of 

salary

savings on 
professional 
development

non-compliance 
with technical 
requirements

environmental 
pollution

OBSTACLES SRB

limited incentive
distorted role of 

mass media
capacity of 

influence groups
limited culture of 

cooperation

adaptation of 
international 

policies

lack of competent 
managers

FACTORS SRB
level of socio-economic 

development of 
country

specifics of the business 
and social environment

the nature of 
connection of the SRB 

directions

the nature of the 
influence of SRB

value orientations of 
top managers



Roman ZVARYCH, Igor RIVILIS 

 

159 
 

Figure 3. Mechanism of systematic improvement the social responsibility of business entities 

[Authors]. 

 
Also, the social responsibility of business is closely interconnected with social 

consumption. Socially responsible consumers consider the social consequences of their 

consumption and use their purchasing power to incorporate social change into the company 

(Gilles, 2021). In this sense, it is a conscious choice of consumption based on moral and 

personal beliefs. It is conceptualizing the consumer as the responsible person who, based on 

the purchase of a certain product or service, minimizes or eliminates harm to society, thus 

maximizing positive impact in the long term (Zvarych et al., 2022). Ethical consumer 

behaviour, on the other hand, refers to their choice of one company and one or another product 

based on political, religious, environmental or social motives, as well as considering labour 

issues when shopping. In this case, in order to increase the SRB, it is necessary to: create a 

system for obtaining reliable and timely information about the social, economic and public 

impact of companies; ensuring the reliability of indicators of financial and non-financial 

(social) reporting and assessment of the effectiveness of socio-economic costs; financial 

support of the social package through the social security plan of the organization's employees 

(an integral part of the event organization plan) (Zvarych et al., 2022). 

 

CONCLUSIONS 

Global crises have encouraged companies to increasingly include social and 

environmental aspects in their business activities. This was largely driven by government 

regulations and is a potential source of competitive advantage for companies. In addition to 

government pressure, coercion has been another catalyst for the adoption of corporate social 

responsibility practices. Actions focused on environmental outcomes have become central to 

sustainable development, as the adoption of such practices drives corporate development as 

well as investment. The debate between interest groups and shareholders has intensified in 

recent years as regulatory and enforcement pressures on companies have led to the inclusion 

of sustainable indicators such as ESG (environmental, social and governance indicators), which 

include aspects of related to climate change, pollution, working conditions. The components 

that make up social responsibility have been disrupted by the pandemic, which has greatly 

affected the global economy due to the policies put in place to stop the spread of the virus. 

protection of social and 
labor rights of 

employees and 
consumer rights

improving community 
life and reducing gaps in 
regional development

ensuring the sustainable 
development of the 

country's economy and 
society

increasing the 
competitiveness of the 

economy, social 
consumption

reduction of 
unemployment, removal 

of social tension

raising the standard of 
living, creating a middle 

class

rational use of natural 
resources and reduction 

of pollution

promotion of 
investment and 

innovation processes

economic and social 
integration



SOCIAL RESPONSIBILITY OF BUSINESS AS SUSTAINABLE DEVELOPMENT APPROACH 

IN MANAGEMENT 

 

160 
 

Environmental performance during the pandemic and war in Ukraine prompts a decline in 

proactive environmental action, as these issues are central to the world (Zvarych et al., 2022). 

Responsible business supports high rates of economic growth, ensuring career growth for all 

employees, as a growing business constantly needs to attract new employees: creation of 

quality employment; cooperation with universities and business associations; support for 

microfinancing; sponsorship of family entrepreneurship. The obstacles of social responsibility 

of business include: violation by employers the international norms of human and labour rights; 

non-compliance with social-legal and labour rights; low wages; salary arrears; insignificant 

investments in labour protection, health of employees and professional development. The 

prospects for the development of social responsibility projects require a national mechanism to 

promote the systematic improvement of social responsibility of business entities. Also, socially 

responsible consumers consider the social consequences of their consumption and use their 

purchasing power to incorporate social change into the company. Future research in this 

direction should be directed to the problems of sustainable business development in the 

conditions of war, as well as to the areas of manifestation of the implementation of social 

responsibility of business in the post-war period. 

 

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