Assessing Corporate Social Responsibility PART TWO

The argument that doing “good” can be deterrent to the survival of the business is a parallel to the “either or conundrum” advanced under Friedman theory. As an illustration, a grocery store either feeding the homeless to be socially conscious or refusing to feed the homeless for survival of its business (keeping jobs open for its employees, providing a needed service to its community, protecting its thin profit margin, etc.).  The grocery store does not necessarily have two opposing cases at hand: widening the spectrum of alternatives is a better way of thinking than just merely viewing this social challenge as an “either or” solution: perhaps the grocery store can donate groceries near expiration date to the hungry instead of throwing them in the garbage, such solution would not affect the profit margins of the business yet it would help resolve a serious community problem (Jennings, 2012).  

                                                 

 This example alone dismantles Dr. Freeman’s stance on the high costs and marginal benefits of voluntary and socially responsible actions by companies, of course not all CSR interventions are successful and economically viable but a well-planned, studied and prepared CSR program can attain meaningful goals in a sustainable manner.  In some cases, the two are compatible: business leaders can simultaneously run the corporation in the interests of firm stockholders (profits) while upholding interests of customers, suppliers, local communities and employees. A major issue with CSR arises when advancing socially conscious actions is considered an exterior or outside interest: what could be considered outside interests of the firm may actually be very well embedded in the existence of the firm. A corporation operating in a community becomes a part of that community since some of the community members will be employees and consumers as well, or even suppliers. It could also be argued that whatever affects stakeholders will affect the corporation sooner or later, the firm needs stakeholders to exist because they bring revenue one way or another (Jennings, 2012).  

                                                     

            Friedman’s theory advancing the need for a business leader to be an elected official before conducting societal decisions can be countered for many reasons: (1) elected officials often make unpopular and poor decisions, (2) firms can partner with governments in solving world problems (3) some firms are more in tune with surrounding communities than governing bodies because of the dynamics the firm has with its immediate environment (4) firms can be quicker to act than governments or elected officials (5) firms are more efficient at identifying, planning and implementing solutions: a good example is the ability of Coca-cola to globally distribute its beverages in the most remote geographical locations (Jennings, 2012).

                                             

               Although Friedman’s almost cynical view of social responsibility of firms doesn’t properly capture its true meaning, one cannot help but admit that some corporations have used the cloak of CSR to pretend being socially conscious while they were not.  For example, in the cases of Ben & Jerry’s and Body Shop International, Entine and Jennings point out how corporations cannot be always be trusted to actually fulfill the social actions they claim to be taking, similarly even if a firm aims to do well, it will not attain perfection. No firm is perfect even in the execution of its most basic operations of management, human resources, market strategy and others, let alone CSR practices which are in the realm of private enterprise a fairly recent trend (Jennings, 2012).