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Corporate Social Responsibility
News
9.26.2005 ET
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Corporate Social Responsibility a Myth, Says Article in Stanford Social Innovation Review
(CSRwire) STANFORD, Calif.- Big companies are rewarded for maximizing profits,
not necessarily social benefits. As a result, the corporate social
responsibility movement -- which assumes that companies can do well by
doing good -- is lulling the public into a false sense of security, warns
Deborah Doane, author of the featured article in the Fall 2005 issue of
Stanford Social Innovation Review (www.ssireview.com).
"CSR as a concept simplifies some rather complex arguments and fails to
acknowledge that ultimately trade-offs must be made between the financial
health of the company and ethical outcomes," argues Doane, who is a
writer, lecturer, activist, and campaigner on CSR and global
sustainability issues. When trade-offs are made, she adds, profit
undoubtedly wins over principles.
Doane contends that four key myths of CSR prevent the movement from
effecting fundamental change:
Myth 1: The market can deliver both short-term financial returns
and long-term social benefits.
Myth 2: The ethical consumer will drive change.
Myth 3: There will be a competitive "race to the top" over ethics
among businesses.
Myth 4: In the global economy, countries will compete to have the
best ethical practices.
Among alternatives to CSR that Doane proposes is a change to the legal
structure of the corporation both in Europe and the United States, so that
company directors would view as company stakeholders not just shareholders,
but communities, employees, and the environment as well.
More information on this and other articles is available online: www.ssireview.com
The Stanford Social Innovation Review is published by the Center for
Social Innovation at the Stanford Graduate School of Business. Building on
the Business School's 34-year commitment to public and nonprofit
management, the Center promotes solutions to social problems through a
unique combination of interdisciplinary research and teaching that extends
beyond the classroom. The Center dissolves traditional sector boundaries to
bring together nonprofit leaders, corporate executives, government
officials, and philanthropists to discuss, debate, analyze, and take
action to strengthen our communities.
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