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The idea of corporate social responsibility has failed to help create the good society. Long seen by academics and managers alike as the missing link in capitalism, the concept of corporate social responsibility has not delivered on its promise. Furthermore, it has become a barrier to meaningful conversations about corporations and the good life. Corporate social responsibility, in all of its many masks, has outlived its rather limited useful life, and we call for its immediate demise.
The purpose of this article is to suggest some reasons as to why the concept of corporate social responsibility should be abandoned. And, we offer an alternative: an ongoing conversation about corporations and the good life.
Such an alternative conversation needs to be centrally connected to other conversations about how we human beings can live. In particular, we suggest that reconceptualizing the corporation as a network of relationships makes possible a social world in which "caring" has primary significance. In addition, we suggest a whole host of different metaphors that can be developed once we drop the search for corporate social responsibility.
Understanding our "responsibilities" does not enable us to create new forms of economic and social life. In fact, we suggest that it gets in the way. We believe that managers and business school professors need to return to some more basic questions about the nature of the human self and the communities we are capable of creating.
CORPORATE SOCIAL RESPONSIBILITY
IS NOT A USEFUL IDEA
The purpose of this section is to give seven reasons (summarized in Figure 1) why we should give up the idea of corporate social responsibility. We draw on our experience of some years in helping managers think about these ideas, as well as our reading of the management literature on this and other subjects. We have to confess that after years of trying to make sense of this idea we have come full circle to agree with Milton Friedman that the concept of corporate social responsibility is a dangerous idea. We have slightly different reasons for our conclusions.
The History of Corporate Social
Responsibility Is a History of Economics(1)
The idea of corporate social responsibility has its roots in the writings of Andrew Carnegie and others. Carnegie, founder of U.S. Steel, articulated two principles he believed were necessary for capitalism to work. First, the charity principle required more fortunate members of society to assist its less fortunate members, including the unemployed, the disabled, the sick, and the elderly. These "have nots" could be assisted either directly or indirectly, through such institutions as churches, settlement houses, and other community groups. Second, the stewardship principle required businesses and wealthy individuals to see themselves as the stewards, or caretakers, of their property. Carnegie's view was that the rich hold their money "in trust" for the rest of society. Holding it in trust for society as a whole, they can use it for any purpose society deems legitimate. However, it is also a function of business to multiply society's wealth by increasing its own through prudent investments of the resources that it is caretaking.
These ideas gained wide acceptance over the years. Coupled with the threat of government intervention and regulation, they helped form the expectation that corporations add social needs and concerns to their economic purpose. But fulfilling the economic purpose was seen as the primary task of the corporation, and was so recognized by the law of corporations for many years.
Milton Friedman's Argument Led to More
Theories About the Essentially Economic
Role of the Corporation
Milton Friedman's now-famous argument is that corporations should pursue their economic self interest, and that any attempt to promote corporate social responsibility, however it might be defined, amounts to moral wrong. Friedman questioned the logic of corporate social responsibility as it had developed. He insisted that in a democratic society, government was the only legitimate vehicle for addressing social …