We need a new definition of corporate social responsibility (CSR) to apply not only to corporations, but also to governments, NGOs – any organization that competes for societal resources – thereby helping societies set a sustainable path.
The economic crisis is a good opportunity for social scientists to talk to each other, who for decades have been telling us that organizations are not perfect: Herbert Simon and many others have proved Max Weber wrong. For what concerns the environment nothing is very new either: The Limits to Growth was published 40 years ago. As for self inspection, on one side, we demonized Milton Friedman when he said that the business of business is business, on the other side, the Global Compact points the finger at the bad corporations, but we were never able to analyze countries’ workforces and figure out the job responsibility of each person in the economy.
The work that I have done in my book, Values and Stakeholders in an Era of Social Responsibility, draws from diverse fields of social science: micro-economics, public relations and organizational behavior. The book seeks to address some of the points that need to be fixed in current capitalism: no economics textbook in fact ever said that capitalism was not in need for careful attention.
CSR is too often manipulative public relations or bombastic marketing. CSR should reflect the accountability of the core business. I develop the concept of “accounting for work” as a duty for everybody within society. I analyze the CSR reports of corporations, presenting them as cases in capsule form.
One result of this analysis is that preventing irresponsibility is of the essence as we run the risk of anesthetizing ourselves in the CSR reports (and in reality) with all the good deeds we do and avoid the key issues that afflict our organizations. This problem can be observed in the over-wording of most CSR reports. I also analyze the potential CSR that is there even if no reporting takes place. An example of “no reporting” is in the financial accounts of many governmental organizations that only balance the flow of funds and do not say a word about the quantity and the effectiveness of the work done.
Of the cases, one reviewer wrote: “this book has the courage to take a point of view by disclosing its specific criticism of individual corporations, while avoiding ideological traps. It does confront and challenge the powerful. The result is convincing to the skeptical executive.”
Through one hundred cases in all sectors of the economy and society, I demonstrate that responsibility is for all organizations and that being subject to competition is a key driver of accountability. Where there is no competition, it is much harder for users and citizens to get good service. My analysis in fact focuses on the accountability of work throughout the economy and the workforce. As the economic crisis has revealed, a large share of the employed population is not accountable for their work, not being subject to fair and transparent competition. Government agencies for instance very seldom account for their work, even though they metabolize more than half the GDP of nations. NGO’s themselves sometimes think they are good in their DNA and don’t need to prove their effectiveness to their sponsors and to society.
Through the rethinking of the corporate social responsibility concept and discipline, I have developed a comprehensive approach to dealing with the current and future straits of the economy. I have also developed an operational definition of CSR as the discipline to account for the potential irresponsibility of organizations.
We have to acknowledge that fair implementation of capitalism is still far from our reach and strive for that goal. We have to make an effort to become aware of our own individual responsibilities. Accountability of work can therefore be analyzed and built through a process framework formed from four values: stewarding the unknown stakeholder, providing select disclosure, focusing on implementation and practice micro-ethics. These values take into account the specific criticism of organizational behavior, economics and society that has been formulated within the general view of capitalism.
Paolo D’Anselmi is a management consultant and a lecturer at the Università di Roma Tor Vergata.
Johnny, I understand your dissatisfaction (see my comment on Nestle talk last night at my website http://www.paolodanselmi.com). I also appreciate the energy of your comment. Do you think the world is fine as it is or do we need some concept and action thereof to make things a little better? We could call this concept “Sarkiapone” (with thanks to Toni Muzi Falconi) so that no previous meaning is implied.
“Corporate Social Responsibility” is a cant phrase invoked by those who pretend to know better than the rest of us how we should live, work and run our businesses. It has over the past decade or two become a guiding economic vision (and mission statement!). Its invokers come from a long line of cranks whose motivation is largely that of envy of jealousy. CSR ought to be tossed on the ash heap of silly and pointless euphemisms.