The Social Responsibility of Business Is to Increase Its Profits
01 Jan 2007-pp 173-178
TL;DR: When I hear businessmen speak eloquently about the social responsibilities of business in a free-enterprise system, I am reminded of the wonderful line about the Frenchman who discovered at the age of 70 that he had been speaking prose all his life as mentioned in this paper.
Abstract: When I hear businessmen speak eloquently about the “social responsibilities of business in a free-enterprise system”, I am reminded of the wonderful line about the Frenchman who discovered at the age of 70 that he had been speaking prose all his life. The businessmen believe that they are defending free enterprise when they declaim that business is not concerned “merely” with profit but also with promoting desirable “social” ends; that business has a “social conscience” and takes seriously its responsibilities for providing employment, eliminating discrimination, avoiding pollution and whatever else may be the catchwords of the contemporary crop of reformers. In fact they are — or would be if they or anyone else took them seriously -preaching pure and unadulterated socialism. Businessmen who talk this way are unwitting puppets of the intellectual forces that have been undermining the basis of a free society these past decades.
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TL;DR: In this article, the authors present a complex theoretical explanation that draws on multiple bodies of literature to present an academically rigorous version of a simple argument: good deeds earn chits.
Abstract: I present a complex theoretical explanation that draws on multiple bodies of literature to present an academically rigorous version of a simple argument: good deeds earn chits. I advance/defend three core assertions: (1) corporate philanthropy can generate positive moral capital among communities and stakeholders, (2) moral capital can provide shareholders with insurance-like protection for a firm's relationship-based intangible assets, and (3) this protection contributes to shareholder wealth. I highlight several managerial implications of these core assertions.
2,020 citations
TL;DR: In this paper, the authors trace the evolution of the corporate social performance model by focusing on three challenges to the concept of corporate social responsibility: economic responsibility, public responsibility, and social responsiveness.
Abstract: This paper traces the evolution of the corporate social performance model by focusing on three challenges to the concept of corporate social responsibility: economic responsibility, public responsibility, and social responsiveness, it also examines social issues management as a dimension of corporate social performance. It concludes that the corporate social performance model is valuable for business and society study and that it provides the beginnings of a paradigm for the field.
1,808 citations
TL;DR: In this article, the authors present a dynamic equilibrium model of organizing, which depicts how cyclical responses to paradoxical tensions enable sustainability, peak performance in the present that enables success in the future.
Abstract: As organizational environments become more global, dynamic, and competitive, contradictory demands intensify. To understand and explain such tensions, academics and practitioners are increasingly adopting a paradox lens. We review the paradox literature, categorizing types and highlighting fundamental debates. We then present a dynamic equilibrium model of organizing, which depicts how cyclical responses to paradoxical tensions enable sustainability—peak performance in the present that enables success in the future. This review and the model provide the foundation of a theory of paradox.
1,675 citations
TL;DR: A review of the literature shows that there are a growing number of publications from various disciplines that propose a politicized concept of corporate social responsibility as mentioned in this paper, and that many business firms have started to assume social and political responsibilities that go beyond legal requirements and fill the regulatory vacuum in global governance.
Abstract: Scholars in management and economics widely share the assumption that business firms focus on profits only, while it is the task of the state system to provide public goods. In this view business firms are conceived of as economic actors, and governments and their state agencies are considered the only political actors. We suggest that, under the conditions of globalization, the strict division of labour between private business and nation-state governance does not hold any more. Many business firms have started to assume social and political responsibilities that go beyond legal requirements and fill the regulatory vacuum in global governance. Our review of the literature shows that there are a growing number of publications from various disciplines that propose a politicized concept of corporate social responsibility. We consider the implications of this new perspective for theorizing about the business firm, governance, and democracy.
1,570 citations
TL;DR: In this article, the authors argue that research on the business case for corporate social responsibility must account for the path-dependent nature of firm-stakeholder relations, and develop the construct of stakeholder influence capacity to fill this void.
Abstract: I argue that research on the business case for corporate social responsibility must account for the path-dependent nature of firm-stakeholder relations, and I develop the construct of stakeholder influence capacity to fill this void. This construct helps explain why the effects of corporate social responsibility on corporate financial performance vary across firms and time. I develop a set of propositions to aid future research on the contingencies that produce variable financial returns to investment in corporate social responsibility.
1,437 citations
References
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