Shareholders and Social Responsibility

The article presents an analysis and critique of Milton Friedman’s argument that the social responsibility of business is merely to increase its profits. The analysis uncovers a central claim that Friedman implies, but does not explicitly defend, namely that the shareholders of a corporation have no duty to direct that corporation’s management to exercise social responsibility. An argument against this claim is then advanced by way of a convergence strategy, whereby multiple influential moral approaches are shown to align themselves against Friedman. The convergence strategy shows that Friedman’s position lies on the lonely fringes of Western moral thought, and that at least some of Friedman’s professed adherents appear to offer incoherent moral views. The convergence strategy is shown to suggest, but not entail, a stakeholder model of the corporation. The article concludes by considering two objections.     

The Geographic,Political, and Economic Context for Corporate Social Responsibility in Brazil

This paper provides an overview of corporate social responsibility in Brazil, a country of vast regional and economic differences. Despite abundant natural resources and centers of advanced technology, large numbers of Brazilians live in poverty. Historical factors, which to some extent explain Brazil’s social and economic inequalities – a long period of colonialism, followed by populist reform, repressive military measures, foreign debt, unfair trade agreements, and problems of corruption – have persisted into the current period of democratic reform, marked by economic and political trends toward democratization and corporate social responsibility. This paper considers the civic and business organizations that have been developing strategies to encourage social responsibility and government policies aimed at alleviating poverty. Despite progress, the complexity of the Brazilian context presents challenges for social and economic equality. Margaret Ann Griesse holds a Ph.D. in Education and International Development from the University of Frankfurt. She is currently Coordinator of the Martha Watts Cultural Center at the Methodist University of Piracicaba, Brazil.     

Introducing Ethics and Corporate Social Responsibility at Undergraduate Level in the United Arab Emirates: An Experiential Exercise on Website Communication

In this article, we describe an assignment undertaken by our third-year students at a University Business School in the United Arab Emirates. The assignment serves to introduce corporate social responsibility and ethics in the undergraduate curriculum and to raise student awareness of how corporate activity together with corporate social responsibility can impact a country’s social, political, and cultural landscapes. We outline the assignment, student response to it, and its contribution to student intellectual development in terms of ethical perspective, philanthropy versus ethics, economic development, and cultural diversity. We discuss the implications of this learning experience for our students and their greater understanding of items within the United Arab Emirates government’s strategic directions, namely, creating a cohesive society and a sustainable environment.     

Between Profit-Seeking and Prosociality: Corporate Social Responsibility as Derridean Supplement

This article revolves around the debate surrounding the lack of a coherent definition for corporate social responsibility (CSR). I make use of Jacques Derrida’s theorizing on contested meaning to argue that CSR’s ambiguity is actually necessary in light of its functional role as a “supplement” to corporate profit-seeking. As a discourse that refuses to conclusively resolve the tension between profit-seeking and prosociality, CSR expresses an important critical perspective which demands that firms act responsibly, while retaining the overall corporate frame of shareholder supremacy. CSR does this by ambivalently affirming both profit-seeking and prosociality, a necessary contradiction. Attempts to reduce CSR’s ambiguity can thus only succeed by undermining its viability as a normative discourse that captures how certain elements of society understand how firms should act. The analysis suggests that greater scholarly attention is needed with regard to the material discursive environments within which discourses such as CSR are deployed. A discursive approach to research could thus benefit future practitioners, who have to act according to fluid standards of responsibility that cannot be authoritatively defined, but which can be better understood than they are at present.     

Are Organisation Researchers too Obsessed with the Economic Responsibility of the Firm?

The original intent of business education in America focused on the development of professional managers who would look after the interests of society. As economic and shareholder theories influenced business education, firm performance became the manager’s top – if not only – priority. The economic responsibility of the firm also appears to be dominating scholarly interest in organisations as well. However, business firms constitute part of the fabric of society and closer attention should be paid by organisation researchers to the social responsibilities of the firm. In doing so, a more balanced research approach can be achieved. In this article, we give evidence that research within the study of the organisation, specifically in the field of management, has predominately turned its attention to the economic responsibility of the firm. We close by demonstrating that other fields within organisation research also appear to be favouring the study of performance and we offer suggestions as to how scholars might better address the firm’s role in society beyond its economic responsibility. Jeremy Galbreath is a Postdoctoral Fellow at Curtin University of Technology where he is studying corporate social responsibility (CSR). He has published extensively, with over 50 articles in print and 3 book chapters. Dr. Galbreath's research and teaching focuses on strategic management, the resource-based view of the firm, corporate social responsibility, stakeholder management, the ethicality of profit making strategies, intellectual capital and information technology.     

Working with Corporate Social Responsibility in Brazilian Companies: The Role of Managers’ Values in the Maintenance of CSR Cultures

Corporate social responsibility (CSR) refers to the duty of management to consider and respond to issues beyond the organization’s economic and legal requirements in line with social and environmental values. However, ‘management’ is constituted by real people responsible for routine decisions and formulation and implementation of policies. It can be said therefore that the ethical ideals and beliefs of these individuals – in particular their personal values – play an important role in their decisions. It is contended in this article that the personal values of managers may contribute to the creation and maintenance of ‘CSR cultures’ in their organizations; that is, organizational cultures focused on ensuring environmental and social sustainability. Based on an exploratory study carried out in Brazil in 2008, this article explores the perceptions of five CSR managers in relation to the influence of their personal values on their work. The first part discusses the notion of CSR within the context of Brazilian society, the second provides a brief literature review on the link between values and organizational cultures and the third explores the perceptions of the participating managers, identifying the main thematic patterns that emerged in the study.     

Corporate Identity of a Socially Responsible University – A Case from the Turkish Higher Education Sector

Facing increased competition, universities are driven to project a positive image to their internal and external stakeholders. Therefore some of these institutions have begun to develop and implement corporate identity programs as part of their corporate strategies. This study describes a Turkish higher education institution’s social responsibility initiatives. Along with this example, the study also analyzes a specific case using concepts from the Corporate Identity and Corporate Social Responsibility literature. The motives leading the university to manage its corporate identity, the social responsibility initiatives in the local and national communities, and the possible benefits of these initiatives for the parties involved are all identified. The major finding is that philanthropy is one of the main elements of Istanbul Bilgi University’s corporate identity program and that the university has altruistic motives for its social responsibility initiatives. M.G. Serap Atakan is an assistant professor at the Department of Business Administration of Istanbul Bilgi University, Turkey. She is teaching and conducting researches on business ethics, corporate social responsibility and retailing. She has a co-authored article published in the Journal of Business Ethics. Tutku Eker is a doctorate student at the Department of Management of Bogazici University, Istanbul, Turkey. Her research interests include business ethics, corporate social responsibility and branding. She is also a teaching assistant at the Department of Business Administration of Istanbul Bilgi University.     

An Analysis of Cause-Related Marketing Implementation Strategies Through Social Alliance: Partnership Conditions and Strategic Objectives

Cause-related marketing (CRM) is an effective marketing tool for promoting corporate social responsibility (CSR) activities and the bulk of campaigns are designed and delivered through collaborative ‘social’ alliances with non-profit organisations (NPOs). The authors seek to uncover some of the factors that explain how firms and NPOs choose their potential partners in the development of their CRM strategy. The rationales for the observed patterns are investigated through semi-structured interviews conducted with managers employed by the UK-based firms and NPOs. The authors find that each party has specific preferences when choosing the particular CRM implementation strategies in different situations, as well as different initial positions when negotiating the formation of the social alliance. This article contributes to our understanding of the CRM implementation strategies and both the company’s and the NPO’s behaviours toward each of the strategies.     

Is There Room at the Bottom for CSR? Corporate Social Responsibility and Nanotechnology in the UK

Nanotechnologies are enabling technologies which rely on the manipulation of matter on the scale of billionths of a metre. It has been argued that scientific uncertainties surrounding nanotechnologies and the inability of regulatory agencies to keep up with industry developments mean that voluntary regulation will play a part in the development of nanotechnologies. The development of technological applications based on nanoscale science is now increasingly seen as a potential test case for new models of regulation based on future-oriented responsibility, lifecycle risk management, and upstream public engagement. This article outlines findings from a project undertaken in 2008–2009 for the UK Government’s Department of Environment, Food and Rural Affairs (DEFRA) by BRASS at Cardiff University, involving an in-depth survey both of current corporate social responsibility (CSR) reporting in the UK nanotechnologies industry, and of attitudes to particular stakeholder issues within the industry. The article analyses the results to give an account of the nature of corporate social performance (CSP) within the industry, together with the particular model of CSR operating therein (‘do no harm’ versus ‘positive social force’). It is argued that the nature of emerging technologies requires businesses to adopt particular visions of CSR in order to address stakeholder issues, and that the nanotechnologies industry presents specific obstacles and opportunities in this regard.     

The Multinational Corporation and Global Governance: Modelling Global Public Policy Networks

Globalization has increased the economic power of the multinational corporation (MNC), engendering calls for greater corporate social responsibility (CSR) from these companies. However, the current mechanisms of global governance are inadequate to codify and enforce recognized CSR standards. One method by which companies can impact positively on global governance is through the mechanism of Global Public Policy Networks (GPPN). These networks build on the individual strength of MNCs, domestic governments, and non-governmental organizations to create expected standards of behaviour in such areas as labour rights, environmental standards, and working conditions. This article models GPPN in the issue area of CSR. The potential benefits of GPPN include better overall coordination among industry and government in establishing what social expectations the modern MNC will be expected to fill. David Detomasi is an assistant professor of international business at the School of Business, Queen’s University, Kingston, Ontario Canada. His research areas include corporate governance, corporate social responsibility, and business and society.     

What Managers Could See in the Philosophical Block of “Free Will”?

Business ethics’ theories have come under a lot of criticism lately. The problem has been the lack of a philosophical base or the inadequate implementation of it. We are trying to solve this problem by examining the roots of ethics and then applying it to the business environment. The root that has been undeservedly overlooked has been the concept of free will, the oldest philosophical problem on which every ethics theory lies. We have chosen two theories that we think would be the best base for business ethics. We will shortly present the others. Since free will presents the core of business ethics, business ethicists must first agree on which theory to implement. Aristotle’s and Aquinas’ theory of free will best amplify the core of economic theory, because it gives reason a central and most important role in the theory. The concept of free will is mainly philosophical as is business ethics so the article follows this tradition, but we tried to give business examples where possible. We do not give a final conclusion because it should be reached by debate and mutual agreement between business ethicists. Matej Drascek is presently a graduate student at University of Ljubljana, Faculty of Social Studies. His research interests include: corporate social responsibility, stakeholder theory and business ethics. Stane Maticic got his Phd in Theology at University of Lateran, Rome. He is presently a priest at the Archbishopric of Ljubljana. His research interests include: ethics, symbolism and theology.     

Social innovation, an analytical grid for understanding the social economy: the example of the Québec housing sector

Over the past few decades, there has been renewed interest in the social economy, especially in relation to the employment crisis and the reshaping of State’s interventions. The social economy plays an important role in solving new social problems with pioneering solutions, especially in the field of public services. It is important to better understand its innovative function. This article discusses the notion of social innovation and explains how it can be used as an analytical framework for understanding the social economy. The case of Québec’s social economy housing serves to illustrate this proposition.     

Doing good,doing better: Two views of social responsibility

Two articles debate the meaning of social responsibility for today's corporation.     

Marxism,Business Ethics,and Corporate Social Responsibility

Originally delivered at a conference of Marxist philosophers in China, this article examines some links, and some tensions, between business ethics and the traditional concerns of Marxism. After discussing the emergence of business ethics as an academic discipline, it explores and attempts to answer two Marxist objections that might be brought against the enterprise of business ethics. The first is that business ethics is impossible because capitalism itself tends to produce greedy, overreaching, and unethical business behavior. The second is that business ethics is irrelevant because focusing on the moral or immoral conduct of individual firms or businesspeople distracts one’s attention from the systemic vices of capitalism. I argue, to the contrary, that, far from being impossible, business requires and indeed presupposes ethics and that for those who share Marx’s hope for a better society, nothing could be more relevant than engaging the debate over corporate social responsibility. In line with this, the article concludes by sketching some considerations favoring corporations’ adopting a broader view of their social and moral responsibilities, one that encompasses more than the pursuit of profit.     

Fund Loyalty Among Socially Responsible Investors: The Importance of the Economic and Ethical Domains

The corporate social responsibility literature has emphasized the importance of both economic and ethical domains of corporate behavior. Analyzing unprecedented survey data from investors in a socially responsible (SR) mutual fund, this article considers how economic and ethical concerns shape shareholder investment behavior. In particular, this article analyzes levels of investor fund loyalty, defined as the continued investment in a mutual fund despite the belief that one is earning a lower return on investment. Building upon existing research that shows SR fund assets are more stable than conventional fund assets, this article leverages within respondent comparisons to clarify that dual investors (i.e., those who invest in both SR and conventional funds) are more loyal to their SR fund than to their conventional fund. This suggests that a corporation’s ethical behavior attracts more patient investment capital, an important consideration for any corporation that is deciding to what degree it should engage in corporate social responsibility. In addition, this article empirically demonstrates that economic motivations reduce SR fund loyalty and that ethical motivations induce SR fund loyalty. This evidence that ethical motivation is associated with fund loyalty advances research on morality in the market by yielding empirical evidence to a largely theoretical debate.     

Finance as a Driver of Corporate Social Responsibility

Finance is grease to the economy. Therefore, we assume that it may affect corporate social responsibility (CSR) and the sustainability of economic development too. This paper discusses the transmission mechanisms between finance and sustainability. We find that there is no simple one-to-one relationship between financial development and sustainable development but there are various – often indirect – linkages. It appears that most of the literature concentrates on the role of public shareholders when it comes to changing corporate policy and performance in a more sustainable direction. However, this focus neglects the potential impact of the credit channel and private equity on a firm’s non-financial policies and performance. These very powerful mechanisms can govern business policies and practices. Therefore, there appears to be much more scope for finance to promote socially and environmentally desirable activities and to discourage detrimental activities than has been acknowledged in the academic literature so far.Bert Scholtens received his Ph.D. at the University of Amsterdam in 1994. Since 1999 he has been working at the Department of Finance of the University of Groningen, the Netherlands. His research particularly looks into the interactions between financial institutions and sustainable development/corporate social responsibility. He has recently published in, among others, Ecological Economics, Journal of Banking and Finance, Finance letters, Journal of Investing, and Sustainable Development.     

Reflections on Corporate Moral Responsibility and the Problem Solving Technique of Alexander the Great

The academic debate over the propriety of attributing moral responsibility to corporations is decades old and ongoing. The conventional approach to this debate is to identify the sufficient conditions for moral agency and then attempt to determine whether corporations possess them. This article recommends abandoning the conventional approach in favor of an examination of the practical consequences of corporate moral responsibility. The article’s thesis is that such an examination reveals that attributing moral responsibility to corporations is ethically acceptable only if it does not authorize the punishment of corporations as collective entities, and further, that this renders the debate over corporate moral responsibility virtually pointless.     

For or Against Corporate Identity? Personification and the Problem of Moral Agency

This article explores the concept of corporate identity from a moral perspective. In it we argue that the reification and personification involved in attributing an identity to an organization has moral repercussions. Through a discussion of ‘intentionality’ we suggest that it is philosophically problematic to treat an abstraction of the corporation as possessing identity or acting as a conscious moral agent. The article moves to consider practical and ethical issues in the areas of organizational commitment, of health and safety, and corporate social responsibility, and finds that the notion of identity can be abused, although it will no doubt continue to be used as it does have some practical utility. In conclusion, we argue that despite being meaningless from a philosophical stance, the concept of corporate identity need not be discarded, however, it is far from benign and intense moral scrutiny is necessary wherever it is applied. Ian Ashman PhD is a senior lecturer in the HRM division of the Lancashire business School, University of Central Lancashire. He has recently authored a number of papers on business ethics, leadership and research methods, all of which draw upon his interest in philosophies of existential phenomenology. He is an executive member of European Business Ethics Network U.K. Professor Diana Winstanley PhD, FCIPD was Director of Postgraduate Programmes at Kingston Business School, Kingston University. She wrote over 50 articles and five books, including her latest, ‚Personal Effectiveness: A Guide to Action’ (2005, CIPD) and Ethical Issues in Contemporary Human Resource Development (2000, Macmillan). She was a trained humanistic counsellor and an executive member of European Business Ethics Network U.K. Her research interests were in the areas of workplace learning, development, diversity and business ethics. Sadly, Diana Winstanley, died last summer.     

Environmental Costs and Responsibilities Resulting from Oil Exploitation in Developing Countries: The Case of the Niger Delta of Nigeria

Interest shown on the environmental impact of operations of multinational enterprises in developing countries has grown significantly recently, and has fuelled a heated public policy debate. In particular, there has been interest in the environmental degradation of host communities and nations resulting from the operations of multinational oil companies in developing countries. This article examines the issue of environmental costs and responsibilities resulting from oil exploitation and production in the Niger Delta region of Nigeria. The case study is based, in part, upon series of interviews with key stakeholders in the Nigerian oil industry. The article further examines the implications of the current practice and policies of multinational oil companies with respect to environmental impact of oil exploitation. The study’s findings illustrates that it is becoming increasingly apparent to oil companies that pollution prevention pays while pollution does not and under pressure from stakeholder groups, oil companies now routinely incorporate environmental impact assessments into their corporate strategy.Dr Gabriel Eweje is a lecturer in Management and International Business at College of Business, Massey University, Auckland Campus, New Zealand. Previously, he worked as a Research Fellow at the United Nations University, Institute of Advanced Studies (UNU/IAS), Tokyo, Japan, and taught at Royal Holloway University of London, England. His PhD from University of London focused on Corporate Social Responsibility and Activities of Multinational Oil and Mining companies in Developing Countries. He also worked as a Research Fellow with International Institute for Environment and Development (IIED), London on a project on how mining and minerals can contribute to sustainable development (MMSD). His research interest lies around the issues of business ethics, corporate social responsibility and sustainability related disciplines.     

Proximity and Rationalisation: The Limits of a Levinasian Ethics in the Context of Corporate Governance and Regulation

In this article, I explore how the ideas of French philosopher Emmanuel Levinas offer insights into a debate often held today in the field of corporate governance, concerning the relative merits of statutory and voluntary approaches to the regulation of business. The philosophical position outlined by Levinas questions whether any rule-based systematisation of ethical responsibility, either statutory or voluntary, can ever equate to a genuine responsibility for the other person. I reflect on how various authors have adapted Levinas’s philosophy to form a critique of bureaucracy and rule following in business, and the lack of ethical authenticity in corporate codes. However, this article also considers the question of whether a theoretical separation can be made between an ethical responsibility based on sensibility (as is suggested by Levinas) and a rational conceptualisation of how one is required to act. Considering the difficulty of disentangling these notions of ethics, I return to the problem of corporate governance and suggest an approach to stakeholder conflict based on mediation and dialogue, which rules out neither principles of conduct nor an openness of responsibility to the Other.