Professional Documents
Culture Documents
Responsibility - Introduction
-
CSR: responsibility, society and
corporations
- Historical origins
- Possible definitions
- Arguments for and against CSR
- Areas of concern
Corporate Social Responsibility
– uses of term
By businesses as a statement of intent
or marketing device
By governments and international
organisations to exhort ‘good’ conduct
By NGOs as a standard to measure
business activity
- how meaningful is it?
Historical pressures for CSR
1930s - Economic depression and poverty
1960s - Race and gender discrimination
1990s - Environment and global warming
2000s - Financial bubble and bust
Major companies perceived as ‘part of the problem’ – in US
and UK, legislative requirements followed in ’30s/’40s,
’60s/’70s (future prospects…?)
Business response to CSR
Philanthropy – donations, community work
(1960s)
Responsiveness – communications, stakeholder
engagement (1970s)
Commitment – Codes of Conduct,
management/reporting (1980s)
Embeddedness – reexamining business
processes (1990s-)
Why might this development have been from
the top down of the ‘responsibility pyramid’?
CSR: narrow or tall?
Milton Friedman – “the business of
business is business” (making maximum
profit, subject to obeying the law)
Archie Carroll – making a profit, obeying
the law, meeting society’s ethical
expectations and contributing to the
social good
CSR: what and why?
voluntary decision (beyond what law
requires?)
to respect and protect varied stakeholders
(such as?)
and contribute to wider social and
environmental improvement (how far?)
- is it a matter of sound business or moral
imperative or both?
UK Government
“The [UK] Government sees CSR as the
business contribution to our sustainable
development goals. Essentially it is about
how business takes account of its
economic, social and environmental
impacts in the way it operates…
Specifically, we see CSR as the voluntary actions
that business can take, over and above
compliance with minimum legal requirements, to
address both its own competitive interests and
the interests of wider society.”
European Union
“Being socially responsible means not only
fulfilling legal expectations, but also going
beyond compliance and investing ‘more’ into
human capital, the environment and the
relations with stakeholders. The
experience with investment in environmentally
responsible technologies… suggests that going
beyond legal compliance can contribute to a
company’s competitiveness. Going beyond basic
legal obligations in the social area… can also have a
direct impact on productivity.”
International Chamber of
Commerce
CSR “is the voluntary
commitment by businesses to
manage their roles in society in a
responsible way”
World Business Council for
Sustainable Development
CSR “is the continuing commitment
by business to contribute to
economic development while
improving the quality of life of the
workforce and their families as well
as of the community and society at
large”
Arguments for CSR
Corporations granted existence by society through
law – ‘licence to operate’ needed
Legal requirements are a floor for behaviour, not
the whole story
Ethical case - emerging and evolving global norms
should concern companies
Business case – improving reputation, avoiding
threats, seizing opportunities
Arguments against CSR
Only real human beings can sensibly be
‘responsible’ (or ‘irresponsible’)
‘Shareholders’ money’ – should not be spent
on others, except as law demands
Businesses should not do or try to do
Governments’ job for them
Inefficient and too vague – accountable to all
really means accountable to none
Disasters and dilemmas
Nike and ‘sweatshops’ – cheap labour
versus basic development; child labour
and family survival…
Shell and Nigeria – complicity in
oppression; engagement with
governments
Union Carbide and Bhopal
Nestle and infant formula
Key areas of concern
Labour standards and human rights issues –
especially in developing world (ILO)
Bribery and corruption issues (OECD)
Environmental protection – especially climate
change and industrial pollution
Financial risk and reward
Corporate Social
Responsibility – Good
Business or Good Ethics
(or both? or neither?)
- The ‘Business case’ for CSR
- The ‘Ethical case’ for CSR
compatible or conflicting?
Business Case for CSR 1 -
stakeholders
Consumers may boycott
‘irresponsible’ companies (Nestle,
Shell…)
Employees may choose alternative
workplaces
Investors may avoid companies seen
as short-termist/ unethical
Business case for CSR 2 -
strategy
‘Brand premium’ may suffer as a result of
bad publicity
Prescriptive regulation may be imposed if
business or industry fails to act
Avoidable costs may be incurred such as
compensation ot later remedial action
Proof of profits?
Difficult to find comparable ‘responsible’ and
‘irresponsible’ companies
Not easy to establish a connection between
‘responsibility’ and results
JC Collins and JI Porras, ‘Built to Last’, Century,
1998 – ‘visionary companies’ outperform
competitors: about ‘more than profits’
M Goyder, ‘Living Tomorrow’s Company’,
Gower 1998 – having clear values, building
strong relationships key to lasting success
Building a brand
Marks & Spencer:
fair trade
‘Plan A’ on sustainability
Health
diversity persists
On complaints, name and shame
only
United Nations Global Compact
(launched 2000, as amended)
Human Rights
Labour standards
Environmental protection
Combating Bribery