John Morrison argues that CSR has had its day, and must be replaced with a more inclusive understanding of businesses’ role in society.
“The King is Dead, Long Live the King!”
The end of Corporate Social Responsibility (CSR) has been prophesied many times from the perspective of business thinkers (e.g. Michael Porter) to human rights activists (e.g. Anita Roddick). Possibly the most eloquent was Sir Geoffrey Chandler, the businessman turned activist, who despised the term even as it was being born in the 1990s – but not enough people listened.
At its best, CSR is a distraction, meaning everything to everyone, and too little to anyone. At its worst, CSR is a fundamental misunderstanding of the true relationship between business and society. This is not to deny that some very good work has been undertaken under the CSR umbrella. My intention here is not to criticise the good work done, but more to criticise the umbrella. Some of the strongest anti-CSR sentiments I have heard come not from government or NGOs, but from business itself.
For too long the European Union laboured under the straightjacket that CSR had to be by definition “voluntary” – so that all the “mandatory” requirements on business that had a social impact (e.g. health and safety, equal opportunities, anti-corruption) could not be seen as “corporate – social – responsibility’; an oxymoron that would fit well within “Alice in Wonderland”. It is lucky that the European Union changed its CSR definition in 2011, before the 2013 Rana Plaza Factory collapse in Bangladesh (and the death of over 1,100 workers) reminded us why basic health and safety needed to be included in so-called “CSR audits”. It makes no sense to split the mandatory and the voluntary when it comes to basic human rights, particularly as there is no level playing field of enforcement around the world. Professor John Ruggie, the then United Nations Special Representative on Business and Human Rights, deserves much of the credit for this wake up call.
If I sound a little angry and frustrated, it is because I am. In our societies, the breakdown of trust between elected (and non-elected) governments and their peoples, the complexity of global supply chains which still externalize true social cost, the timidity of elected leaders and the indifference of consumers and investors leave us at a dangerous time in history.
All over the world, charismatic populist politicians offering simplistic solutions to complex problems make the world a more uncertain place for its people, but also for business. If there were ever a business case for human rights, it is now. CSR will not help us at all with the awareness and collective action that are needed. Human rights, whilst often perceived as a toxic political subject for many politicians (despite their often favourable private views), are an unavoidable issue if we wish to reap the benefits of sustainable globalisation.
What is needed is a re-focus on the social contract thinking of the past 300 years – started by the likes of Hobbes, Locke, Rousseau and Kant, but arguably revitalised by a number of thinkers over recent years. In the same way that democracy alone will not secure the social contract between elected leaders and their people, CSR will not secure social license for business in society.
At a minimum, businesses must not exploit weaknesses in the pre-existing social contract in society, riven by the effects of rapid globalisation, conflict, corruption or poverty, in return for a quick buck. Laws should prevent them from doing so, and if these need to be international laws with extra-territorial effect, then so be it. But business can do much more than this. If it understands its place in the social contract, business can strengthen good governance and raise the capacity of citizens to hold their governments (and businesses) to account. This is not turkeys looking forward to Christmas, but rather businesses understanding that sustainable societies mean sustainable marketplaces.
So perhaps the end of CSR would be a good thing, or at least the end of the type of CSR that is not core to the business model, on the one hand, and that is not accountable to society itself, on the other. At a minimum, a tighter definition that brings in government, law and social contract thinking into the many weary definitions of CSR around the world would help. We need something much bolder, more legitimate and with a sharper edge – fit to tackle some of the challenges of the years and decades ahead.
As already stated, the people I have found that hate the concept of CSR are some of those in companies that have CSR in their job titles. I guess some of you reading this article will fall into this category. If you do, liberate yourself. The Emperor has no clothes! And forget about the King!
Business deserves better than old-style CSR. So does society.
John Morrison is the author of “The Social License: How to keep your organization legitimate” (Palgrave MacMillan) (johnmorrisonbooks.com). He is also Executive Director of the Institute for Human Rights and Business (www.ihrb.org). This article was written in his private capacity and does not necessarily represent the views of IHRB.