The article in the url link below outlines a new idea to standardize and certify a firm’s degree of environmental and social responsibility (Issues: Auditing CSR, p94):
“… a company that seeks certification to become a B Corporation (the B stands for “beneficial”) is required to amend its articles of incorporation to say that managers must consider the interests of not just shareholders, but also employees, the community, and the environment. Companies are also ranked on their answers to a survey of more than 100 questions, covering topics that include the company’s policies on the environment, philanthropy, diversity, and transparency.”
In introducing yet another CSR evaluation standard, however, I am suspicious of the definition this organization uses in determining what constitutes social value:
“A new nonprofit organization called B Lab is hoping to address this challenge by creating a set of strict standards to protect companies and consumers that seek to work for the greater good.”
Surely, all firms that remain in business are adding some value somewhere. The net effect might be negative, but it is important to recognize sales, profits, number of jobs created, amount of taxes paid, etc., etc., as part of a firm’s social responsibility profile. Some CSR advocates will just write this off as a “bare minimum”—i.e., all firms must pay taxes. But, in fact, many firms avoid taxes by registering offshore, and some pay much more in taxes than others (Issues: Patriotism, p258). I think attempts to evaluate social value need to incorporate basic operational issues such as these, as much as they incorporate sexier issues such as the amount of carbon off-setting a firm does (which, after all, usually only involves the firm writing a check).
Take care
Dave
Bill Werther & David Chandler
Strategic Corporate Social Responsibility
© Sage Publications, 2006
http://www.sagepub.com/Werther
New Certification Scheme Aims to Protect Socially Responsible Companies
By Alana Herro
The Worldwatch Institute
January 3, 2008
http://www.enn.com/business/article/28575
Alana Herro of the Worldwatch Institute reports on a new nonprofit organization called B Lab that will approach the challenge of maintaining the integrity of socially conscious businesses that become so successful that they are bought out by larger conglomerates.
