Reference no: EM132254653

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Being one of the major stockholders, I will talk to the board of directors or the head of the organization regarding my concerns about the million dollar sponsorship for a cause which I deeply oppose. There are some things that need to be understood and analyzed here before giving an answer.

Does my opposition to the sponsoring is due to conflict of my personal feelings or opinion towards the cause? Does sponsoring the cause results in any loss to the organization? Does the persons or organization receiving the money for the cause are not as they appear?

If the reason is any of the above except conflict of personal opinion, then I will make sure that the upper management hears the reasons. If they could provide me with reasonable answers which proves me wrong, I will be onboard with the organization. If not, I will try to sell my stocks and walks out of the organization. If the conflict of my personal opinions or feelings is very personal which I can't stand, then I will sell my stocks and start a new relationship with other organization whose policies are sync with mine.

I would like to discuss here the role of an organization when handling the Stock Holders and Stake Holders. Milton Friedman quoted "The Social Responsibility of Business is to Increase Its Profits". Friedman expressed in his book Capitalism and Freedom and later in a New York time magazine article that there is one and only social responsibility of business is using its resources to perform activities that leads to profits.

But the organization has to stay within the rules of the game like doing business in an open and free competition environment without doing any fraud (Friedman,1970). The one way to gain profits and make stockholders happy is to make use of stakeholders (employees, Customers and so on) but not worry about their wellness. Because if business worries about the wellness of stakeholders that's an expense and it cost the stockholders money. But if the stakeholders are not happy, the business wouldn't run longer and has to shut down.

So the social responsibility of business is to earn profits along with taking care of the stakeholders. But improper use of stockholders money for the sole benefit of stakeholders is not acceptable. If the same is the case in the above situation, I would like to end my relationship with the organization as a stockholder.

Reference:

Fulton Friedman (Septmeber, 1970), A Friednzan doctrine.