Corporate Social Responsibility, or two-faced capitalism

There's a thought-provoking piece in the change in strategy among activists toward getting corporations to conduct their business ethically. As usual, however, the Economist staff end on a particularly idiotic note. Here are the last few paragraphs:

The Economist: This week Christian Aid … published a report claiming to reveal the true face of Corporate Social Responsibility (CSR). The charity is “calling on politicians to take responsibility for the ethical operation of companies rather than surrendering it to those from business peddling fine words and lofty sentiments.” … It regards CSR as a “burgeoning industry...now seen as a vital tool in promoting and improving the public image of some of the world's largest companies and corporations.”

The report features case studies of Shell, British American Tobacco (BAT) and Coca-Cola—all of them, it says, noted for paying lip-service to CSR while “making things worse for the communities in which they work.” Shell, says the report, claims to be a good neighbour, but leaves oil spills unattended to. Its community-development projects are “frequently ineffective”. BAT, it says, claims to give farmers training and protective clothes; contract farmers in Kenya and Brazil say otherwise. Coca-Cola promises to use natural resources responsibly. The report accuses an Indian subsidiary of depleting village wells. So, “instead of talking about more voluntary CSR in Davos, government...should be discussing how new laws can raise standards of corporate behaviour.”

This is a switch. CSR was conjured up in the first place because government action was deemed inadequate: orthodox politics was a sham, so pressure had to be put directly on firms by organised protest. Ten years on, instead of declaring victory, as well they might, disenchanted NGOs like Christian Aid are coming to regard CSR as the greater sham, and are calling on governments to resume their duties. Might this be a sign … that CSR has finally peaked? If so, it might be no bad thing. If bosses are no longer to get credit for pandering to their critics, they may as well go back to doing their jobs.

The problem is, of course, that the corporate bosses never pandered to their critics - they only presented the appearance of doing so. Hence the sham. Silly Economist. Tricks are for kids, not readers.

Posted by matt at January 26, 2004 04:39 PM