Ben O'Neil explores how the doctrine of corporate social responsibility has changed corporate strategies to focus on "stakeholders" rather than the interest of shareholders in this intriguing article:
While already deeply entrenched in government decision-making, consultation and submission to the interests of various "stakeholders" is also becoming more and more common in the business world under the influence of the doctrine of corporate social responsibility (CSR). Weary of the relentless pursuit of profit and the daunting task of satisfying both shareholders and customers, corporate managers are falling all over themselves to emulate the methods of their bureaucratic cousins.
The doctrine of corporate social responsibility is an amorphous one. The name clearly implies some responsibility that the corporation owes to society at large. But what is this responsibility? According to the World Business Council for Sustainable Development, corporate social responsibility is "the commitment of business to contribute to sustainable economic development, working with employees, their families, the local community and society at large to improve their quality of life." Other influential agencies such as the International Finance Corporation define corporate social responsibility in almost identical terms.
This commitment to improving the quality of life of society at large is not merely confined to providing useful goods and services at a price that is agreeable to all those who choose to buy them, nor to providing employment on terms that are agreeable to all those who accept. After all, businesses already do this, and it benefits society greatly. Rather, the common element in most current expositions of the doctrine of corporate social responsibility is that it requires corporate managers to sacrifice profits to the interests of a wide array of "stakeholders" who are affected by the conduct of the corporation. According to the World Business Council for Sustainable Development, "CSR means more than promulgating a company's own values and principles. It also depends on understanding the values and principles of those who have a stake in its operations."
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