Milton Friedman takes the position that corporations cannot be socially responsible, only people can have responsibilities. In continuing with this thought, he then suggest that social responsibility is then directed at the corporate executive of a business, not the business as a whole. The corporate executive has primary responsibility to his employers to conduct business as they see fit, and manage the business to create the most profit while following the “basic rules of society”.
Governments, activists, and the media have become adept at holding companies to account for the social consequences of their actions. In response, corporate social responsibility has emerged as an inescapable priority for business leaders in every country.
In recent years business has been criticized as a major cause of social, environmental, and economic problems. Companies are widely thought to be prospering at the expense of their communities. Trust in business has fallen to new lows, leading government officials to set policies that undermine competitiveness and sap economic growth. Business is caught in a vicious circle. A big part of the problem lies with companies themselves, which remain trapped in an outdated approach to value creation.
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O'Mara-Shimek, Guillén & Bañón (2015). Approaching virtuousness through organizational ethical quality: toward a moral corporate social responsibility. Business Ethics: A European Review, 24 (S2), S144-S155.
Corporate social responsibility now represents an essential part of the business conversation. Most companies have to consider how to achieve the maximum benefit from the resources available for social projects at the same time as continuing to boost shareholder value. Moreover, research reveals how collaborative social initiatives (CSIs)—a form of engagement in which firms provide ongoing and sustained commitments to a social project or issue—generate the best blend of social and strategic impact for firms. Five principles of successful CSIs are presented.
Pearce, J. A., II, & Doh, J. P. (2005). The High Impact of Collaborative Social Initiatives. MIT Sloan Management Review, 46(3), 30–39.