Are we taking corporate responsibility too far?

July 22, 2008

Here’s an intriguing article from Ad Age by Jonathan Salem Baskin. He argues against the current strong trend toward CSR (Corporate Social Responsibility) and as the subtitle suggests believes “there is no morality inherent in corporate functions.”

I suspect that Mr. Baskin wants to stir debate and discussion and this is very valuable–but is he serious? He asks “where is it in the game rules that companies have to be “responsible” for anything other than profits. I’ll tell you where it is–it is called being a member of the human race. It is called the moral code. It is the well accepted idea that one should treat others as they wish others to treat them. Those too are rules to the game.

Not only is Mr. Baskin out to lunch on this, he is also out of touch. I’m pleased that PRSA is having Craig Newmark, founder of Craigslist as a keynote speaker. Mr. Newmark is demonstrating a very different and intriguing model–profits don’t matter. I still subscribe to Peter Drucker’s formula which said profits are the right to do business in the future. Clearly Mr. Baskin sees profits as something quite different from that. But the idea of outrageous, insane, ungodly profits doesn’t have the appeal to a great many people in the corporate world. And young people are turning against big corporate global giants precisely because of the irresponsible position of people like Mr. Baskin.


3 Responses to “Are we taking corporate responsibility too far?”

  1. I appreciate the link to my post, and I understand your perspective. I also don’t agree with it. Business is ‘in business’ to make money. Capitalism has no moral code, and the only real redeeming quality of competition is financial success. Profits not only matter, but they’re paramount to the ways companies are valued, how they reward their employees and stockholders, and generally function. Those are the facts.

    Now, you want something more from business. So do I. And we both want more from the societies in which we live.

    CSR isn’t the answer, unfortunately, any more than the greenwashing I mention in my Ad Age essay. As long as we treat ‘being responsible’ as a marketing or communications strategy, we doom it to being irrelevant or, at best, a tool to confuse consumers.

    If ‘being responsible’ matters, then companies and consumers share the responsibility of making it real: corporations should institute real actions, and consumers should value and reward them. It isn’t about “likeability’ or ‘brand image.’

    Responsibility is about reality. And reality is that companies shouldn’t have to do ‘good things’ because they want to, or because it’ll get them nice PR. It should be sound business strategy, and it should warrant real financial reward from consumers…and not some invented, squint-one-eye accounting nonsense that makes CSR seem like anything more than marketing or branding nonsense.

  2. gbaron Says:

    Thanks for the comment, Jonathan. I suspect as we discuss this we will find more we agree with each other than disagree. CSR, for example. Most of it is a sham and that is a shame. But where we disagree is where you say “the business of business is to make money.” I have two objections. One is the compelling evidence that companies who have a vision for good that supersedes profits are frequently the most successful. This is made clear in well documented books such as Collins’ Good to Great and more recently, Mavericks at Work. My second objection is more significant. Corporations and businesses are not nameless, faceless entities. They are run by people. Some of those people are moral and virtuous and have characters that place the needs of those they are serving very high on their priorities. Others do not.
    Profits are a necessity. Peter Drucker taught that profits are the right to do business in the future–without that, no future. A conversation I once had with Bill Gates early in his career highlighted the point. He was driven by a mission to make computer technology accessible to the masses. I asked him what the money was for. To accomplish my mission he said. Those who seek money alone will find it is poor substitute for meaning and purpose.

  3. I agree re the agreeing point. But I struggle with your caveats to capitalism. i don’t question the merits or moral values — i share them — but they’re simply add-ons to a model that doesn’t rely on them, nor recognizes or values them.

    Your specific examples are good to analyze. “A vision for good” is usually a restatement of a financial or business purpose, only cast in the terminology of spirit. Maybe sometimes that correlation has been impromptu or perhaps even spontaneous (i.e. a virtuous person chanced upon a business opportunity, but that doesn’t make the virtue a causitive agent for the business success). I agree that companies need substantive expression of the HOW they will achieve the WHAT of profits. But “a vision for good” has never been a business strategy, has it?

    Re the morals/virtues of employees…I also agree. Very important. I have always hated the staying “it’s just business” to excuse some otherwise unacceptable statement or behavior. People need to take their personal beliefs and use them to drive their professional lives..and those that don’t are usually unfulfilled or at least conflicted. But to move from that observation to suggest that moral people = moral company is, well, a reach again. It just doesn’t happen. Companies are founded on principles and ruled by law and regulation. People base their psyches on principles and are ruled by law and regulation. I don’t see the need to elevate the role of corporations…

    Your story about Bill Gates is illustrative of my first point, I think. He could have talked about “taking computer tech to the masses” until he was blue in the face, but the only reason you can quote him (i.e. he’s not some nameless failure) is because his vision was synonymous with a market opportunity. It wasn’t a ‘moral’ vision…it was a vision that expressed a business opportunity. I agree that seeking money alone is a poor substitute for meaning and purpose; the flip-side is true, too:

    Seeking meaning and purpose alone is a poor substitute for a business strategy.

Comments are closed.

%d bloggers like this: