The greatest challenge we face as a society is how best to utilize the limited resources we have on the planet. In other words, given the fixed set of (scarce and valuable) resources available to us (unless Elon Musk hurries up and finds a way to get us to Mars), how can we best allocate them to achieve optimal outcomes? This, in essence, is the challenge that economics exists to address. Although the field has had mixed results to date, clearly market forces are a better solution than anything else we have invented. Not perfect by any means (and the advent of behavioral economics has moved us forward considerably) but, nevertheless, the best option we have at present.
In many ways, this is the same question that the CSR debate seeks to address (although it is rarely framed this way), which is why it is so important to incorporate what we have learned from economic theory and human psychology into the models we use to analyze economic exchange and develop possible reforms or (alternative) solutions.
The fundamental answer proposed by Strategic CSR is a form of empowered stakeholder theory, where stakeholders act according to their true values/ethics/morals to hold firms to account for their actions – rewarding behavior they support and punishing behavior they oppose. It is important to understand that this model does not rely solely on consumers, but on all stakeholders in terms of their interactions with the firm (e.g., employees deciding where to work, suppliers deciding which firms to supply, government deciding what to regulate, journalists deciding which stories to cover, etc.). While these stakeholder decisions often occur subconsciously (and/or ignorantly), Strategic CSR encourages them to be more conscious. The more we are informed and consciously interacting with firms, the more they will do exactly what we (collectively) want them to do.
As I often say to my students, we get the firms we deserve in the same way that we get the politicians we deserve. The key is to create these outcomes consciously, rather than subconsciously. If we do this, we are less likely to be surprised/disappointed by the reality that surrounds us.
Over the winter break, I plan to think more about this. If anyone has any ideas/thoughts, I would love to hear them.
Take care
David
David Chandler
© Sage Publications, 2020
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