Corporate Social Responsibility: Reconciling the Extremes
This paper deals with the issue of corporate social responsibility (CSR), which has become an important and much debated issue in business ethics. CSR can be understood as a set of obligations or responsibilities that lie beyond the economic and legal obligations of corporations. There are two dominant and competing views of CSR: 1) the Shareholder Value Model (SVM) that proclaims that corporations are socially and morally obligated only to the problems and interests of its shareholders; and 2) the Normative Stakeholder View (NSV) that professes that corporations are socially and morally obliged to secure the interests of almost all people or groups of society who have a stake in it. This paper argues that whereas SVM is too narrow a conception of CSR, NSV is much too wide in scope. Both conceptions are unsatisfactory on account of being inordinately proportioned in fixing the ‘quantum’ of responsibility. Hence, an attempt is made to strike a reasonable balance between these two extremes, for which it is suggested that we need to identify a ‘bottom line’ that determines the minimal corporate moral responsibility to society. It is expected that, once this bottom line or minimal level of responsibility is satisfactorily arrived at, we can then think in the ‘upward’ direction of identifying the optimum level of CSR. The guiding principles in the search for optimal CSR are the clear necessity of profit-making by corporations on the one hand, and the equally clear desirability of a social order that sustains them and also contributes to their proper sustenance. The Common Minimum Mutual Responsibility view is developed, focusing on the mutual responsibility relations of corporations and society. Besides, it is emphasized that social responsibility must not be misunderstood as matter merely concerned with social marketing and corporate gains.
Keywords: Shareholder Value Model, Normative Stakeholder View, Extended Agency View, Common Minimum Mutual Responsibility View
Kumar Nirbhay Mishra
Research Scholar, Department of Humanities and Social Sciences, Indian Institute of Technology