Social+Responsibility

**Social Responsibility**  Social responsibility “is the principle that companies should contribute to the welfare of society and not be solely devoted to maximizing profits.” 1       Companies can demonstrate social responsibility in a myriad of ways. They can donate funds to education, arts and culture, underprivileged children, animal welfare, sponsor events, etc., or they can make commitments to reduce their environmental footprint, implement fair hiring practices, or work only with suppliers with similar values, etc. In its    [|National Corporate Social Responsibility Report]     the  [|Conference Board of Canada], a not-for-profit organization that specializes in economic trends, organizational performance and public policy,      suggests that social responsibility is a way of conducting business, balancing long-term organizational objectives, decision-making, behaviour and the values, norms and expectations of society. 2

The notion of social responsibility is far from new. Its roots are in [|economics] and the writings of [|Andrew Carnegie] (1835-1919), a Scottish-born businessman and founder of [|U.S. Steel]. Carnegie’s business philosophy was based on two principles:
 * History of Social Responsibility **
 * charity – the more fortunate assist those who are less fortunate; and
 * stewardship – the rich hold their money “in trust” for the rest of society, using it for any purpose society deems appropriate. 3

[|Milton Friedman]  (1912-2006), an American economist and [|Nobel Laureate] , later advocated that corporations exist only to maximize profit and behave in their own best self-interest. He argued that corporations’ attempts at social responsibility were “morally wrong,” as social issues and concerns were best dealt with by government. 4 <span style="font-family: Verdana,Geneva,sans-serif">In the last half century, highly publicized corporate behaviour like the handling of the <span style="font-family: Verdana,Geneva,sans-serif">[|Exxon Valdez oil spill] <span style="font-family: Verdana,Geneva,sans-serif">, the financial scandal of  <span style="font-family: Verdana,Geneva,sans-serif">[|Enron] <span style="font-family: Verdana,Geneva,sans-serif"> and the more recent  <span style="font-family: Verdana,Geneva,sans-serif">[|subprime mortgage crisis] <span style="font-family: Verdana,Geneva,sans-serif"> have all undermined trust in corporations. Social responsibility has taken on heightened importance as a way of building trust in relationships.

** <span style="font-family: Verdana,Geneva,sans-serif">Corporate Social Responsibility (CSR) and Ethics ** <span style="font-family: Verdana,Geneva,sans-serif">Consumer pressure is driving organizational change toward more ethical behaviour, transparency and two-way symmetrical communication with stakeholders. “These pressures have transformed CSR from merely being about philanthropy or environmental protection to a concept that is much broader in scope.” 5  <span style="font-family: Verdana,Geneva,sans-serif"> From  <span style="font-family: Verdana,Geneva,sans-serif">[|Starbucks] <span style="font-family: Verdana,Geneva,sans-serif"> to  <span style="font-family: Verdana,Geneva,sans-serif">[|The Toronto Star] <span style="font-family: Verdana,Geneva,sans-serif"> more and more companies are issuing  <span style="font-family: Verdana,Geneva,sans-serif">[|Corporate Social Responsibility Reports] <span style="font-family: Verdana,Geneva,sans-serif"> on environmental and other social performance. <span style="font-family: Verdana,Geneva,sans-serif">Despite this mounting pressure, organizations still struggle with their responsibility to shareholders and society. This may be because the definition itself is so broad. In the last decade the concept has brought together corporate social responsibility, responsiveness, and “the entire spectrum of socially beneficial activities of businesses.” 6 <span style="font-family: Verdana,Geneva,sans-serif">CSR programs take on many forms in many organizations, but its core is integrating social values and operational decision-making. “With a performance perspective, it is clear that firms must formulate and implement social goals and programs as well as integrate ethical sensitivity into all decision making, policies, and actions.” 7 <span style="font-family: Verdana,Geneva,sans-serif">Social responsibility and ethics are inextricably linked. In a capitalist society, businesses exist to maximize profit, which is why what is ethical will often clash with what is profitable. Author <span style="font-family: Verdana,Geneva,sans-serif">[|David Vogel] <span style="font-family: Verdana,Geneva,sans-serif">, a professor of business ethics at the  <span style="font-family: Verdana,Geneva,sans-serif">[|Haas School of Business] <span style="font-family: Verdana,Geneva,sans-serif"> and a professor of political science at the  <span style="font-family: Verdana,Geneva,sans-serif">[|University of California Berkeley] <span style="font-family: Verdana,Geneva,sans-serif">, writes in his book, <span style="font-family: Verdana,Geneva,sans-serif">[|The Market for Virtue: The Potential and Limits of Corporate Social Responsibility] <span style="font-family: Verdana,Geneva,sans-serif">, that companies will only commit to CSR programs for the long term if it’s profitable. 8 <span style="font-family: Verdana,Geneva,sans-serif">Such motivation is contrary to what <span style="font-family: Verdana,Geneva,sans-serif">[|deontological ethical theories] <span style="font-family: Verdana,Geneva,sans-serif"> such as  <span style="font-family: Verdana,Geneva,sans-serif">[|W.D. Ross’s] <span style="font-family: Verdana,Geneva,sans-serif"> prima facie dutiesor  <span style="font-family: Verdana,Geneva,sans-serif">[|Immanuel Kant’s] <span style="font-family: Verdana,Geneva,sans-serif">Categorical Imperative <span style="font-family: Verdana,Geneva,sans-serif"> espouse as fundamental – that the intention behind the act determines the degree of moral goodness.

Since CSR has its roots in ethics, so too does its criticisms. Cynicism around the motivation of organizations employing such programs is the basis for most critiques. Critics maintain that CSR programs - whether a response to pressures in the environment or a means of avoiding regulation or generating good will, hence profit - often mask as ethical behaviour. <span style="font-family: Verdana,Geneva,sans-serif">[|R. Edward Freeman] <span style="font-family: Verdana,Geneva,sans-serif"> and <span style="font-family: Verdana,Geneva,sans-serif">[|Jeanne Liedtka] <span style="font-family: Verdana,Geneva,sans-serif">, both researchers and faculty members at the  <span style="font-family: Verdana,Geneva,sans-serif">[|University of Virginia Darden School of Business] <span style="font-family: Verdana,Geneva,sans-serif">, are two such critics. They see CSR as a barrier to meaningful communication and dialogue since the main purpose of an organization is to maximize profits. 9 They have put forward three propositions of replacing what they call the “worn-out language of corporate social responsibility with new, rich and more useful conversations.”10 <span style="font-family: Verdana,Geneva,sans-serif"> As organizations become more sophisticated in engaging with stakeholders, issues around regulation, environmental impacts, human rights, philanthropy, and sponsorship will continue to frame the discussion around ethics and social responsibility.
 * Criticism and Cynicism **
 * <span style="font-family: Verdana,Geneva,sans-serif">**The Stakeholder Proposition** - corporations are connected networks of stakeholder interests;
 * <span style="font-family: Verdana,Geneva,sans-serif">**The Caring Proposition** - Corporations are places where both individual human beings and human communities engage in caring activities that are aimed at mutual support and unparalleled human achievement; and
 * <span style="font-family: Verdana,Geneva,sans-serif">**The Pragmatist Proposition** - Corporations are mere means through which human beings are able to create and recreate, describe and redescribe, their visions for self and community. 11

<span style="font-family: Verdana,Geneva,sans-serif"> <span style="font-family: Verdana,Geneva,sans-serif">** References **__ [1] http://dictionary.reference.com/browse/social%20responsibility [2], [5] Greenall, D. (2004). //The national corporate responsibility report: Managing risks, leveraging opportunities//. Ottawa, ON: Conference Board of Canada. [3], [4], [9], [10], [11] Freeman, R.E. & Liedtka, J. (1991). Corporate social responsibility: a critical approach - corporate social responsibility no longer a useful concept. //Business Horizons//, //34//(4), 92-98. [6], [7], Carroll, A. (1991). The pyramid of corporate social responsibility: toward the moral management of organizational stakeholders - balancing economic, legal, and social responsibilities. //Business Horizons//, //34//(4), 39-49. [8] Vogel, D. (2006). //The market for virtue: The potential and limits of corporate social responsibility//. Washington, DC: Brookings Institution Press.