The article in the url below from the early quarantine days of the COVID-19 pandemic accurately captures much of what is wrong with current understandings of CSR/sustainability by companies (and the business journalists that cover them):
"Today, every occupant of every C-suite is trying to figure out what they're willing to throw overboard as the economic storm spawned by the pandemic is swamping their ships. Businesses that were planning to save the world are now simply saving themselves."
First of all, of course, "saving the world" is not what CSR/sustainability means in any kind of practical sense, firm-by-firm. Of course, there is an aggregate effect (which is yet to be net-positive), but each firm intends primarily to take care of its own operations (and, hopefully, clean up after itself).
Second, it is wrong to talk about corporations as "saving themselves," as if they are somehow independent from the society in which they are based. Firms and societies are one and the same, inseparable, and it is really quite ignorant to conceive of them as anything else. We do not live in a them and us world, where the corporations are the 'them' and we are the 'us.' Last time I checked, corporations are constituted by people who live in societies, are consumers, read newspapers, vote for politicians, and so on. We are all stakeholders and, together, we are all corporations.
Third, and most importantly, it is not possible to "throw overboard" something that is integral to a firm's business. Whether in a global lockdown or the 'normal' business cycle (whatever that now means), the goal for any organization is always the same – to create value for its broad set of stakeholders. If that is done, then the organization will thrive. If it is not done, however, or if a minority of stakeholders is privileged at the expense of the majority then, eventually, the organization will go away because it is no longer creating sufficient value for society. So, while the nature of the 'value' for stakeholders will shift, whether prompted by a global pandemic or simply the natural evolution of norms and expectations, the fact that organizations need to identify that value and create it for their stakeholders will always be the same. That is what 'responsible' behavior looks like for a corporation, whatever the age in which it is operating:
"When the financial crisis hit in 2008, companies again went into survival mode. … As the economy roared back, CSR became chic. Investors like BlackRock Inc. pushed for more sustainable practices. Retailers and restaurants reduced waste because customers were willing to pay for greener options."
The analysis is wrong, but the last sentence holds the key. It is not about trends; it is about stakeholder value creation. If sustainability is something that stakeholders value and are willing to support, then that is what firms will do and those that are best at it will be rewarded the most for their actions.
Take care
David
David Chandler
© Sage Publications, 2020
Instructor Teaching and Student Study Site: https://study.sagepub.com/chandler5e
Strategic CSR Simulation: http://www.strategiccsrsim.com/
The library of CSR Newsletters are archived at: https://strategiccsr-sage.blogspot.com/
Sustainability Is The First Thing to Go
By John D. Stoll
May 2-3, 2020
The Wall Street Journal
Late Edition – Final
B5
