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Corporate Social Responsibility as a new Self Regulation

Ben Hunt
Author, 'The Timid Corporation'

: Tuesday 27 April 2004
: 1:00pm - 2:30pm
: CARR Seminar Room, H615


In 1995, the oil company Shell set a precedent for future behaviour when it decided to reverse its decision to dump the oil storage platform, Brent Spar, into the sea. This early example of corporate social responsibility (CSR) illustrated how a moral duty to do 'the right thing' replaced more reasoned, scientific criteria for making decisions. Nearly 10 years on, we see that notions of corporate social responsibility are influencing business behaviour like never before. Food companies are reducing the fat content of their products, and drinks manufacturers are telling their customers to drink more responsibly. Retailers withdraw products from the shop floor, from bullets to sun tan lotion, in an effort to show moral responsibility. Companies send their employees on diversity training courses and encourage them to learn ethical codes of conduct. Internationally, multinationals pull out of infrastructure projects and emerging markets on the grounds of CSR. Elsewhere, virtually all corporations today strive to be more transparent and accountable, improve social, environmental and ethical performance and engage in better stakeholder relations. Yet is CSR a progressive development? It is arguable that CSR is a response to a more insecure, mistrustful society that tends to see all industrial activity from the one-sided perspective of harm and risk, and is disillusioned with reasoned debate. In forging CSR practices, companies have told themselves they must 'listen to society' and 'restore trust', but this is leading to negative consequences. An inflexible dogma of social or moral responsibility is replacing pragmatism and commonsense in decision-making. For instance, corporations may not be responsible for problems concerning personal behaviour. Second, we are creating very defensive, overly cautious economic institutions, to the detriment of society. For instance, companies might unnecessarily withdraw from new technologies or worthwhile investments in the name of responsibility. Third, the framework of CSR is in danger of undermining democratic forums for addressing social problems.