Corporate Social Responsibility: Now and Then
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With the recent corporate scandals involving such companies as Enron and Martha Stewart, the concept of corporate social responsibility (CSR) has once again made its way to the forefront of contemporary management ideologies. However, CSR itself is not a new concept. In fact, societies as far back as the Ancient Mesopotamians (circa 1700 BC) incorporated CSR in their businesses. “King Hammurabi introduced a code in which builders, innkeepers or farmers were put to death if their negligence caused the deaths of others, or major inconvenience to local citizens.” With each new “Enron” managers of similar corporations are suddenly placed in the spotlight, causing plans to be put into action to create a more socially responsible company. Look in an annual report put out by any corporation and you will generally find an entire section, often called a “CSR Report,” detailing how that corporation is continually striving to improve their CSR. So the question arises, are present corporations more or less socially responsible than the corporations of the past? Has implementing good CSR become a necessity for managers of todays corporations?
Milton Hershey is a prime example of someone who wholeheartedly believed in the concept of CSR. Upon building his chocolate manufacturing plant in Pennsylvania, Hershey built a school to support orphaned children, which still stands as the largest pre-K through 12th grade school in the United States. During the Depression, Hershey kept men employed with the construction of hotels, office buildings, and a sports arena. It was said of Milton Hershey that “[h]is personal convictions about the obligations of wealth and the quality of life in the town he founded have made the company, community, and school a living legacy” (Wolfe,
One point to make is that while corporations of the past were sincere about being socially responsible, it can not be said that all of them, or even most of them practiced CSR. In fact, more corporations today have worked CSR into their businesses. Mostly any large corporation has picked up on the ideas of CSR and realized that most consumers tend to frown upon companies that are not socially responsible and choose instead to purchase goods from companies with a more CSR-minded business structure. But are these CSR practices just sugarcoating these corporations? Enron, before their recent scandal caused by CEO Kenneth Lay, was at the forefront of CSR. This makes one wonder, could it all be a window dressing? How could a corporation such as Enron, which placed such emphasis on being socially responsible to its community (which involved its shareholders and employees), turn out to be one of the most corrupt corporations in history?
The roots were bad. No matter how beautiful a trees plumage and flowers – no matter how strong its branches – if the roots are rotten the tree will die. In Enrons case, Kenneth Lays morality leaves something to be desired, even though his employees were taught all along to buy into this whole CSR thing. Senior management can put into action all the plans in the world to implement better CSR within their corporations, but if they themselves do not practice social responsibility there is no hope for their company to become more socially responsible. For example, say a large automotive manufacturer has recently decided to become more socially-conscious, but its plant manager has continually ordered the waste oil of that day to be dumped into the river behind the plant. Since the executives have no idea this has been happening, they do not provide the manager with any increased budget to properly dispose of the waste oil. Not wanting to lose his job he turns the other cheek as his employees continue to dispose of the oil as before. Whos responsible here? Is it the plant managers responsibility to tell the executives what hes been doing with the oil and that he would require more money to properly dispose of it, or is it the executives fault for not thoroughly inspecting their plants processes? My point is that without the proper implementation, an actual transformation in the way a company is run, CSR means nothing.
It is not my intention or purpose to dispel the notion that there are companies in existence that really and genuinely care about their employees,