ASSIGNMENT:

SUBMITTED BY
Rajkumar k. II year MBA 301225

CORPORATE CITIZENSHIP
Corporate citizenship is a term used to describe a company's role in, or responsibilities towards society. For this reason it is sometimes used interchangeably with corporate social responsibility, and in fact many companies including Microsoft, IBM and Novartis have used it in this way to describe their social initiatives. However, many also take it to mean that corporations should be regarded as citizens within a territory - i.e. that corporations have citizenship of some sort. This is usually based on the principle of corporate personhood, in that in certain legal jurisdictions, such as the United States, companies are afforded some of the same legal rights as individuals. Therefore, if corporations are 'artificial persons' under the law (e.g. they own their own assets, they can sue and be sued etc), then they can also claim some of the entitlements, privileges and protections of citizenship such as rights to free speech and political participation. Although this debate remains very active (see legal controversies below), a more recent approach to corporate citizenship has also stressed the political role of corporations in protecting or inhibiting the citizenship rights of individuals (such as by taking over previously governmental roles and functions) or direct political activity such as lobbying and party financing.

USES OF THE TERM

The term 'corporate citizenship' has been in use for some decades, but only rose to prominence during the 2000s. There is considerable confusion over what exactly is meant by the use of the term. Matten and Crane (2005) distinguish between three views of corporate citizenship.

Limited view - where corporate citizenship is used to denote corporate philanthropy in the local community, such as being a 'good citizen' in donating money to charity or helping out a local sports or arts institution. Equivalent view - where corporate citizenship is used to refer to corporate social responsibility. Matten and Crane refer here to a paper by Archie Carroll who described the "four faces of corporate citizenship" exactly the same as he had previously defined the four levels of CSR - as economic, legal, ethical, and philanthropic responsibilities. Many authors, companies, and consultancies adopt a similar approach. It is also evident in annual rankings of the 'top corporate citizens', such as those by CRO Magazine and Corporate Knights Extended view - where corporate citizenship is seen in terms of its distinctly political connotations, such as corporate claims to citizenship entitlements, firms' participation in global governance, or corporate involvement in the administration of individuals' social, civil and political rights. Some authors refer to this as "political CSR" or a "beyond CSR" perspective.

All three approaches can be seen in practice, but in the business world the first two views predominate, whilst in academia the extended view has started to gain greater prominence.

CORPORATIONS AS CITIZENS

Although it is generally accepted that corporations are not citizens in the same way that "real" citizens are - they cannot hold passports or vote in elections for example - it has been recognized that they do share in some of the same or similar practices, such as paying taxes, engaging in free speech, and expecting certain protections from the state. There is concern, however, that extending the scope of citizenship to incorporate corporations may infringe upon democracy and equality given their access to substantial power and resources. Some authors have suggested that corporations should not be considered in terms of the legal status or identity of citizenship but could be thought of as acting as if they were citizens when they participate in politics through lobbying and governance type activities. Perhaps the strongest argument against corporate citizenship is that corporations are properties. You can buy and sell them. When the United States was founded, only property owners were citizens, but properties (slaves for example) could not vote. Isn't it strange to say that now we given property the status of citizen? There are other dimensions of corporations, of course, but to ignore their status as property is a serious mistake.

CORPORATIONS AS POLITICAL ACTORS

Some authors and commentators subscribe to a view of corporate citizenship as denoting that corporations are political actors or that they have political agency of one sort or another.[12] This is closely related to the idea that corporations are heavily influencing or even 'taking over' certain functions of politics from governments (a phenomenon that has been remarked upon for some time and was popularized by books such as Noreena Hertz's The Silent Takeover). Corporate citizenship theorists tend to particularly focus on the spread of global capitalism and voids in global governance, such as the protection of human rights in developing countries and access to basic public goods such as clean water. Corporations, they suggest, are increasingly influential in whether these rights of citizenship are respected or not. This 'extended' perspective on corporate citizenship, sometimes dubbed 'new corporate citizenship theory' has been controversial in that it is seen by some as legitimizing a role for corporations beyond their traditional economic functions. However, in defense of their approach, proponents that "The blurring boundaries between government, business and civil society

challenge many of our existing constructs in the social sciences, of which citizenship and governance are just two prominent examples... to deny the changes that confront us just because they have some rather problematic or undesired implications will not make them go away.