Think Tank
Dr. Eleanor O’Higgins UCD Michael Smurfit Graduate Business School
Responsibility – an option or an obligation?
WRITER: Dr. Eleanor O’Higgins UCD Michael Smurfit Graduate Business School
What Is CSR and What is It Not? In the EU, CSR is defined as involving “companies integrating social and environmental concerns into their business operations and their interaction with stakeholders on a voluntary basis”. This definition rightly places CSR as inherent to the way a company does business. The company recognises its responsibilities to its constituencies/stakeholders – customers, employees, the environment and society in general. For genuine CSR, core components of accountability, sustainability, human development, value creation and honesty are underpinned by integrity that combines all these elements in everyday corporate conduct – not a superficial public relations add-on.
| 52 |
The notion of voluntarism in the EU definition of CSR is questionable, suggesting that behaving responsibly is an optional “extra”, not obligatory. Equally, the “business case” for CSR implies that a company will reap profits if it behaves decently. This indicates that companies are not required to act responsibly unless there is a financial payoff. Shouldn’t all companies be expected to be intrinsically responsible? Of course, the most desirable state of affairs is that businesses that behave honourably also do well economically. CSR is non-compliant w it h var ious international standards and protocols that have proliferated as par t of the “CSR industr y”. Such compliance consists of following processes blindly that have been set in a one-size-fits manner by various self-appointed NGOs. Likewise, a high ranking on CSR lists which rate companies from afar on prepared economic, social and governance inventories is not a valid sign of responsibility. Finally, CSR is not philanthropy. Large donations to worthy causes are not equivalent to being socially responsible, especially if it ends up being compensated for through lower wages for employees, or higher prices to customers, or lower taxes paid. It is generally accepted that CSR is how you make your money, not how you give it away.