As the attitude of society concerning the commercial activities began to change with the beginning of 19th century, it led to gradual growth of capitalism and strengthening of corporate potency. The businesses were allowed to utilise fully the resources of society for the generation of uttermost profit. Thus, the corporations exploited their employees, customers and suppliers without any due considerations for social welfare. Luthans et al. (1990) illustrate that businesses assumed no specific social responsibility in that era and remained concerned with maximisation of economic gains without respite. They also elaborate that the situation aggravated when firms entered into competition with each other in the pursuit of market supremacy and wealth maximisation.
The most important factor contributing to the precipitation of corporate barbarism in the 19th century was the fact that there happened to be minimal or negligible government regulation over the corporations that led to a socially irresponsible behaviour on the part of businesses. Hence, the society soon lost trust in capitalism and economic instability cam to prevail at a wider scale. Luthans et al. (1990) explain that the notion that businesses should be regulated by government for socially responsible behaviour emerged and uprose soon after that, which led to the imposition of government restrictions on corporations concerning social responsibility.
The infliction of laws and regulations for the perpetuation of social responsibility among the corporations led to the great extent a change in the attitude of corporate world towards society. These laws initially prevented the businesses to cause any harm or damage to the society during its course of profit maximisation. Hence, government regulations seem to have played a great role in bringing about this 'socially responsible' behaviour, rather than the pure intention of social and human welfare on the part of the corporations.
In the modern era, the concept of social responsibility evolved into the 'corporate social responsibility', which is a further enhanced concept embodying much more responsible behaviour than is required by law. Businesses should not only refrain from afflicting any harm to society as restricted by law, but also endeavour and strive within its possible capabilities for the betterment of society and the individual altogether, even when it is not circumscribed in its legal requirements. Bloom and Gundlach (2001, p142) as pinned down the term 'corporate social responsibility' as,
"The obligations of the firm to its stakeholders; people and groups who can affect or a who are affected by corporate policies and practices. These obligations go beyond legal requirements and the company's duties to its shareholders. Fulfilment of these obligations is intended to minimize any harm and maximize the long-run beneficial impact of the firm on society"
Thus, in this definition, the social responsibility of business encompasses a wider spectrum of a firm's responsibility. It leads a