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Introduction

In recent years, the yardstick used to judge the success of large businesses has

grown beyond profits delivered. The principles and values a business lives by are

becoming more and more vital (Vian, et al., 2007). This change can be attributed to

increasing poverty levels and social and economic disparities (Leisinger, 2005). These

corporations are being expected to fulfill obligations to employees, communities, and the

environment. This concept is also known as corporate social responsibility which

involves organizations putting societal issues and the unmet needs of the community at

the same level as corporate and strategic goals (Vian, et al., 2007). The major question

that is argued for the corporate social responsibility of the pharmaceutical industry is to

whom, for what, and to what extent is a pharmaceutical corporation responsible?

(Leisinger, 2005). The pharmaceuticals role in the global economy is to research,

develop, and produce innovative medicines that have the ability to save peoples lives.

Like any corporation though, they have a duty to make and increase profits which causes

people to believe there is a conflict of interest in the industry (Lee & Kohler, 2010).

Corporate social responsibility

The social responsibility of the pharmaceutical industry can be split into three

different categories of obligations: the must do, the ought to do, and the can do

(Leisinger, 2005). The must do dimension includes the non-negotiable responsibilities

to provide goods and services that effectively meet customer demands. They are also

responsible to sell these goods at competitive prices and in the best interest of the

corporation. To be successful, a pharmaceutical corporation must raise the quality of life

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of sick people, avoid costly hospitalization, and allow people to live normal and working

lives. The profits made in a corporation ensure the preservation of jobs, fair salaries, and

contribution to insurance and pension plans. Profits make an important contribution to

financing the functions of the corporation (Leisinger, 2005).

The ought to do dimension refers to the obligations of corporations to avoid

questionable practices and go beyond what the law actually requires. Many human rights

activists claim that large corporations are not using their powers to help people in need,

especially large pharmaceutical businesses (Leisinger, 2005). Lee and Kohler (2010)

argue that the pharmaceutical industry is not doing enough to give back to the community

and has excessively high prices for life saving medicines for those in the developed

world. They state that the industry has a moral obligation to help those in need when

pharmaceutical companies produce a larger profit margin than others.

Other opponents of the pharmaceutical industry argue that the increase in direct

consumer advertising of pharmaceuticals is detrimental to both the industry and the

consumers. It is argued that by marketing prescription drugs to consumers, the industry is

not upholding their social responsibility to provide balanced information about the drugs

the same as a medical professional. It is also believed that if medicines are marketed, the

for-profit aspect will overpower the goal of education and health of consumers (van de

Pol & de Bakker, 2009).

The can do dimension of social responsibility includes the desirable actions that

are not required by law or the industrys practices. These actions are a way for

corporations to give back to the community by providing services or goods for those less

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fortunate. In the pharmaceutical industry this would apply to providing prescription drugs

to poorer communities or services such as doctor consultations or testing.

Corporate social responsibility is an important aspect to any large corporation,

especially in the pharmaceutical industry. There are some disputes between what the

industry is actually responsible for mainly because there is no clear definition of social

responsibility. A solution to this problem could be for each corporation to define their

own set of social responsibilities to avoid confusion. Another would be for the

government to set these standards for each industry to ensure that they are met. Meeting

social obligations will help public perception of a company increase as well as promote

safe and effective practices within the organization.