The End of Corporate Social Responsibility
Jim Gilmore and Joe Pine are the authors of Authenticity: What Consumers Really Want
In 2008, companies will abandon their much-hyped reliance on those Corporate Social Responsibility initiatives that seem focused more on getting social and political activists off their backs or drawing in customers than on doing any real good.
Watch in 2008 for those corporations abandoning existing CSR programs to outnumber those who introduce new ones. In an age when consumers factor in authenticity as a primary concern in the purchase of most any good, service, or experience, CSR will be seen for the sham that it is. Consumers will increasingly flock to enterprises that offer transformational change as the very substance of its offerings -- be it in the form of vocational tourism, personal interventions, or even narcithropic giving -- and reject initiatives that merely front as the means to sell more wares. Consumer dollars will flow less to promotional programs like (PRODUCT)Red and more to fully dedicated ventures like micro-lending site kiva.org.
In such times, businesses would be wise to stop giving a portion of revenues away to token causes, and instead start creating new businesses that explicitly charge consumers to help them help others. There is money to be made, unapologetically, in connecting individual consumers with worthwhile causes and thereby helping them make the aspirations of those causes become reality. Indeed, Individual Social Responsibility is an untapped market to be served in the coming year.
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Sirs,
Warm commendations for the forthright manner in which you have demolished the myth of CSR. For many years, CSR has been used as a facade for getting away with what would otherwise be unethical practices. In recent times, CSR has almost become synonymous with some kind of philonthropy - provide used computers to schools, potable water to a village (the well goes dry during summer and there is no one around to do anything about it), and similar gestures that can be summarized in one word - "tokenism."
Like you, I have been advocating Individual Social Responsibility to students. Even small, constructive action taken at the individual level can and does have a ripple effect that is more profound than most CSR initiatives. Thousands of individuals have benefitted from the micro-finance scheme in Bangladesh - for which the brain behind the scheme was awarded the Nobel Prize as well. Organizations would do well to move away from charity and encourage entrepreneurship, however small, among the poor and deprived sections of society. Maintaining a public park or a traffic island may provide an organization with visibility but to equate such actions with CSR is an insult to the collective wisdom of humankind.
I wish you a New Year full of happiness and peace, and look forward to more posts that challenge established convention.
Warm regards
- Posted by B V Krishnamurthy
December 27, 2007 3:16 AM
Jim Gilmore and Joe Pine have in my view mistaken the pretence of Corporate Social Responsibility for the substance, and then quite reasonably criticised the pretence. A focus "on getting social and political activists off their backs or drawing in customers" is not Corporate Social Responsibility. Similarly, B V Krishnamurthy's claim that "CSR has been used as a facade for getting away with what would otherwise be unethical practices" is beside the point, merely asserting that some companies are prepared to behave hypocritically, the very opposite of CSR.
The fact that some companies will pay lip service to CSR for bottom-line benefits does not deny the importance of the good corporate citizenship that forms the basis of Corporate Social Responsibility. Just as society depends on generally accepted standards of good citizenship, beyond legal compliance, from individuals to underwrite community well-being, so society also reasonably expects good citizenship from its corporate citizens.
- Posted by Peter Johnstone
December 28, 2007 1:08 AM
The social responsibility as rightly said shall start from the individual and inhouse steps.The vision and mission statement and the objectives of the corporates shall have a place to social concern in all the pursuits.Mere productivity and profitability shall not over ride the work force agenda.The social and ethical concerns shall be deeply imbibed in the organisational culture and work standards .The qulity effort,customer service,ecological compliance and welfare of the workforce are basic social and environmental concepts that corporates can practice before embarking on out side help.The legal and tax compliance goes a long way in supporting the state for better mobilisation of funds towards its social obligations.If at all, any corpotate additionally desires to contribute he can do so constructively in the field of health and education.Mere eyewash policies and promotional aspects wont serve any purpose.
- Posted by Nagendrakumar
January 2, 2008 2:43 AM
Most CSR come with a public relation campaign for corporation image building. Very few companies, devoting into community interest, will keep quite silent in front of medias. Though I do belive there are. But the "show-off" is hard to be called "tokenism". As a company, product or service really matters, so does the reputation and imagery. CSR is just a channel for marketing the positiveness of a company to attract people attention, to build healthy image, to ensure customers' likeness and in the end to charge premium price. The CSR should and would not be ended as long as the outcome is bigger than its expense.
- Posted by Frank
January 2, 2008 11:45 PM
The End of Corporate Social Responsibility
I sure hate to comment on this but the truth is whether it is the vendor or the customer.
Sir.
No1
I do not agree that you can please all the customers no matter whet you do and how hard you try. I have the motto I am stuck with. There is no free lunch. This is stupid me. Here is what happens. A seller comes to me, throws down all the specifications of the product trying his best to keep his sweat under the control. Inevitably, I out my habit, tell him, “Have you been to the fish mongers. He tells you his fish is the fresh and comes from the Mediterranean seas, just landed by DHL. The next has the same story except his is still fishy. He has the fish flown from Alaska where there is ice and the surety of no damage to the eyes of the shine on the fish to tell me that these fish are fresh. All have the story. Do I buy the story with cash I have and strict order of the wife, the ministry of home affairs to buy that is cheap, edible today even if the fish came by boat from India? How do I tell the fish mongers this? I pass off the best offer and end up buying the sardines from the grocery shop owned by the Bengali from Bangladesh.”
Are you like him?
No2
Having stated the above in a small doze, I come to the big picture. The times have changed. The Berlin Wall has crumbled. The East Germans are now in West Germany trying to compete with then the best brains of the yesteryears who created the VW , Benz, Audi, Medicines from Bayer, etc The guys look at one another with suspicions. Don’t they. I mean there is still a gap of the trespass. Sure, it has to be. If the Scots want the Brits to stay a little distance and the Putin’s friends from Russia wants the other Russians away from the brothers of Russia, The untouchables away from the elite in the mother India, and Kenya Kikuyu fight with Lous for the independent they fought once together in 1960 gaining the freedom from the yolk of the British Raj.
The suspicion lurks with the buyers also. They have preferences. They the patriotic syndromes or at least they will show this in public. It may not be truth. Come up. If I am buying in Kenya today, I will buy the Kibaki brand, Kikuyu. I will wait until the Odinga comes to the seat. I will chuck out the Kibaki era product to make the shelve filled with Raila Odinga’s era product. I want to stay in the system. I want to them to know I am using their product. I need their friendships. To hell with the brand, to hell with the price, to hell with where the product comes from. If the top shot or my boss likes the product, do you seriously think I will choose other brand?
Yes, I will be honest on one issue. If my boss has a Toyota and I have Benz, I will park this far and go the office by taxi.
Where is the sales strategy here?
The main issue is the money in the wallet, the politics, my friends say so, my wife using this, my son who is rebellious, his choice, my daughter’s lipstick lead filled with Chinese toxic(she loves this, why improve her, I live on her income attitude), and lastly the availability when I want this. Prompt is the word. The real time is the norm. You fail; you sell me nothing but hot air. In addition, with the global warming I will refuse that too.
I thank you
Firozali A Mulla MBA PhD
P.O.Box 6044
Dar-Es-Salaam
Tanzania
East Africa
- Posted by Firozali A Mulla MBA PhD
January 6, 2008 5:09 PM
It is highly imperative at this point in the world's civilisation to understand that CSR needs not draw in profit to the corporates.In the first instance,continued existence of every business concern is hinged on the level of patronage from the society and thus it is morally binding on organisations to give back to the society a little of what they have taken from it.The responsibilty to identify genuine concern for the society from corporate organisations lies with the society itself.Organisations who gives scholarships to first class students in their final year with the intent of tapping their talent upon graduation differs from another who provides portable health care services to the indigent members of a rural community.CSR activities should be scrutinized by the society to know which organisations is truly interested in giving back a little from what it has benefited from the society.
- Posted by Mustapha Omotayo
January 10, 2008 3:57 PM
In my opinion it is imposible to say that CSR will be abandoned by Corporates in 2008 if we all have a proper understanding of globalization and also understand the fact that CSR was not created, it evolved out of societal trends. It was basically in response to the activities of Corporate Organizations. The society or social system designed for itself a means of checks and balances through which certain negative activities from corporate organizations could be put into proper perspective and checked. These activities we understand have far reaching effects on the society at large even though it enriches the bottom lines its effect on the long run can be more injurious than its short term benefits.
Giving back to the society in most developing countries is no longer just an add on, it is an expectation. And until developing nations start to demand the rightful benefits that should be derived from taxation then it remains part and parcel of the corporations responsibility. Though we may argue that it is not right but historical events stand to do justice to the fact this is no longer the time nor the season to begin to argue about rights. Reality shows that great wealth has been amassed in some of these regions or countries without corresponding development.
How does CSR run, not only in giving back to some chaitable course or community program but ensuring that business practices are carried out responsibly, for instance child labour issues, human rights issues, environmental issues, governance issues, product quality issues etc. The reason why it - CSR will continue to burn brightly is because of these reasons and more, if a report of child labour practice in developing countries get out, the activists will pick on it and it will in turn have a global effect on reputation, share prices etc, thank God for such activists - we have had several success stories where we now have major corporations running their business responsibly and the society is happier for it.
As to them paying lip service, l belong to the win win school, l will not advocate for businesses to give back just cos some group of stakeholders say they should, l would personally advocate for them to give back because it makes good business sense. Don't forget these are businesses that are run to make a profit, they are not charitable organizations and quite frankly they would not give if it didn't make any business sense, would anybody?
- Posted by Aderonke
January 14, 2008 3:35 PM
In my opinion it is imposible to say that CSR will be abandoned by Corporates in 2008 if we all have a proper understanding of globalization and also understand the fact that CSR was not created, it evolved out of societal trends. It was basically in response to the activities of Corporate Organizations. The society or social system designed for itself a means of checks and balances through which certain negative activities from corporate organizations could be put into proper perspective and checked. These activities we understand have far reaching effects on the society at large even though it enriches the bottom lines its effect on the long run can be more injurious than its short term benefits.
Giving back to the society in most developing countries is no longer just an add on, it is an expectation. And until developing nations start to demand the rightful benefits that should be derived from taxation then it remains part and parcel of the corporations responsibility. Though we may argue that it is not right but historical events stand to do justice to the fact this is no longer the time nor the season to begin to argue about rights. Reality shows that great wealth has been amassed in some of these regions or countries without corresponding development.
How does CSR run, not only in giving back to some chaitable course or community program but ensuring that business practices are carried out responsibly, for instance child labour issues, human rights issues, environmental issues, governance issues, product quality issues etc. The reason why it - CSR will continue to burn brightly is because of these reasons and more, if a report of child labour practice in developing countries get out, the activists will pick on it and it will in turn have a global effect on reputation, share prices etc, thank God for such activists - we have had several success stories where we now have major corporations running their business responsibly and the society is happier for it.
As to them paying lip service, l belong to the win win school, l will not advocate for businesses to give back just cos some group of stakeholders say they should, l would personally advocate for them to give back because it makes good business sense. Don't forget these are businesses that are run to make a profit, they are not charitable organizations and quite frankly they would not give if it didn't make any business sense, would anybody?
- Posted by Aderonke
January 14, 2008 3:37 PM
Holding CSR initiatives as sham based on the assumption that they do not meet the social responsibility-aspirations of the customers is valid and there is one more angle to it. Social Responsbility initiatives are undertaken often for the pleasant feelings they create in the CEO and the board of directors besides the aura created around the corporation concerned.
Notwithstanding this reality a fundamental notion in business is that every penny invested should be a good investment in terms of ROI. Therefore, no way for free lunch. Similarly the instinct to be of healp to fellow citizens is univesally present.Therefore, the customer looking at the business as a means of dousing this instinct can not be wished away.
How to reconcile? One idea is that the business which invests considerable wealth in CSR initiatives should design their programs in such a way that the outcome of such programs come back to the corporation as a return on the investment. For example, unemployment which is so rampent in India is not principally because of want of enough jobs but because of unemployability of its graduates and technically qualified persons. CSR initiatives consisting of short term and compressed programs will make them employable and sheerly out of gratitude several of them will join the corporation concerned.A good return on investment is it not? Another current problem of India is developing special economic zones for accelerating business. Here the SEZ operators expect the farmers who are forced to loose their land to be satisfied with the doles they give in the form of hospitals and schools and other such rehabilitation measures. These goodies are not sufficient and the agitating farmers are seen as reactionaries.State Governments in a democracy is helpless. A good business propositon will be the farmers should be rehabilitated in a scientific manner by returning a portion of their land in a developed condition and train them to take up modern agricultural practices like green house farming.We have a classic aged more than Bible called as Thirukkuralin our mother tongue Tamil. One of the couplets of this classic goes like this:
• The rich, who poor men’s ruinous hunger cure,
Their wealth’s good investment ensure.
Curing hunger on a permanent basis is greatest of all capablities and mutually benefitting out of it is a good business sense.
With regards
R.Venkatachalam
- Posted by R.Venkatachalam
January 22, 2008 10:19 AM
While I agree that many corporations flout CSR as merely an instrument to drive profit (as I argue in my Master's thesis), I agree with an aforementioned comment that you are mistaking CSR's pretense with its actual aims or substance.
Individual social responsibility should not be relied upon as the only way forward. In a work environment simmering in opportunistic behavior and greed, the socially responsible individual will often be left on the wayside. Furthermore, our corporate roles often define and demand certain behavior that we may not agree with in our other roles. Thus, there is a lack of integrity between our roles and we need the institutions to promote this integrity as much as we do individually.
It is the actual aim of CSR, according to some, to line up corporate aims with the common goals of society. Corporates that use CSR to sell themselves are all the more shameful and are not contributing to the actual substance in which CSR aims to promote. I am not quick to say we should give up on CSR as the result of a few bad apples but we should individually demand more accountability in these corporate schemes to advance the bottom line.
- Posted by Beth Voigt
February 5, 2008 2:49 PM
Seen from Europe (Luxemburg), having a blog concerning Marketing & CSR (RSE in French), I'd like to give you my point of view.
About your "than on doing any real good".
I really don’t know about certifications in the USA, who are not existing for the moment I guess (like the building of ISO 26000 certification in Europe) but the fact is that CSR is a voluntarily action done by companies, and that nobody can say now of something well done is, with efficiency, or not. It’s a fact that some actions can be undertook for CSR with a direct visible effect (like employees and they security, or helping a local association), some other actions will need time like environment who can be helped locally. Companies have to think globally and act locally. But do you really think that a company is motivated to do something for the environment when the American government is not signing the Kyoto acts, THE SIGN that the world is in emergency?
About your "introducing new ones".
NEW program will not say other kind of program. Do you know the wheel of Deming : Plan, Do, Check and Act (by Acting it means IMPROVE, DOING BETTER, in CSR of course).
About your "micro site".
Hopefully is CSR more than consumer alone (who will keep the most important role in the B to C by the way). What about other stakeholders?
About your "of those causes become reality".
De difference between Cause Related Marketing and CSR is that CRM is clearly a commercial action limited in the time. About CSR, we have problems in the world (who have to be solved) like environment, poverty, energy, famine threat …
About your "Indeed, Individual Social Responsibility is an untapped market to be served in the coming year".
Right. CSR begins with yourself. Volontary of course.
Kind regards.
Eric Feront, Luxemburg
www.nfpconsulting.org
(Blog : http://marketingetrse.blogspot.com)
- Posted by Eric Feront
February 21, 2008 3:43 AM
Dear Sirs
With all respects,
I think that you are totally wrong.The question you asked is not the only one . It is not only want the consumer want, however: What does the market want? what the consumer is? and does it will pay longer to be irresponsible?
POrter said that "CSR is a religion with too many priests". He was right. CSR is an affective concept. But one thing we have learned if that any marketing action has effects.
Uncontrolled effects. So once the mind is stretch to an idea , no way to go back.
As we are now leaving in a world of networks , CSR in speeches, I agree , is spreading through all kinds of networks. It will be always rogue CEO or irresponsible corporations .
But if you look from an economic point of view and too be short : the markets now do not want to pay an extra assurance or to take any risk in business about reputation, they will not support any longer irresponsible practices. It will take only a few years. Markets, people and politics are ready. Not all. But enough.
Second assurances prices, turnover of the best qualified workers,and a 25% more efficiency in corporations with motivated workers , if enough to be "responsible"in practices not only speech. Third we do not speak about charity but only from a selfish point of view.CSR started badly because Corporations were doing it to preserve capital. Today it will work because of a dominant need. Especially with the rise of China and India that need stability. So it spread through networks, institutions and people. It is not efficient yet.
However Every day show that Capitalism is not working. But Capitalism is like Schumpeter described able to reborn from ashes . CSR is the next stepof the Capitalism. If we can make more money by doing good , it be will done.
To finish, consumers are short mind indeed but they are also concerned more and more both side as activist and as a prey for irresponsible capitalism
So let's wait. Sorry I am French Scholar and of cours I do work on CSR but not only.
Regards
- Posted by valerie paone
March 1, 2008 3:45 PM
Eminent scholar sirs,
in as much as you are authorities in your own way that never affords the right of misleading the world on the concept of CSR.
It is a concept to be viewed with both fore and hind sights and even commonsensically too; considering the fact that business is an integral part of the society and as matter of fact owes it the responsibility of making it good in remedy of what the quest for profit making has turn the society to.
Without CSR business and profitability stands a pending grave danger, because business will grow to the point of desttoying itself and the entire society within which it operetes.
- Posted by Kay Hambolu
March 17, 2008 6:03 PM
Hi,
This coment is specifically addressed to Harvard Business School.
End of Corporate Social Responsibility discussion at your website, the link below, has prompted me to wirte this.
http://conversationstarter.hbsp.com/2007/12/the_end_of_corporate_social_re.html
The observation here is very interesting and need further discussion and implementation methodologies even though it has purpose oriented.
Here is a proposal and request to Harvard Business School Team – if you find a proposal or an idea that will change the world for better, be it in leadership qualities among youth and corporate responsibility that directly benefits people and society and their own commercial goals worldwide, how much and what kind of endorsement or support your team could give to them? I have the way to achieve this, and is difficult to filter through lip services – because this lip service batch is so thick and dense no scientist even want to break it because the society is so condensed with lip service.
Gana.
- Posted by Gana
March 24, 2008 12:51 PM
Best regards from Rio, Brazil
Well, I respect all points presented on this issue and believe they are all very coherent.
I could find in many parts of the comments that we are aware of the dangers hidden in the bad use of the CSR in a form of pretended good actions. We particularly feel that on the skin here in my country when we read the bank financial reports on the papers, wacthing the rich bankers and stockholders laugh at our misery life of poor mortals. On the other hand, the banks are the first to publish their social program results and they are on tv and midia sources sending out news from "a wonderful world". Politicians are getting internationally famous for their practice and taste for curruption. How can such institutions be so ambiguous in the way they treat the population? I firmly agree with some of you when you claim the individual actions: we are fed up of being treated like numbers in a bank account, watch people starving, homeless; the cases of Dengue(transmitted by a MOSQUITO!)in the 21st century, lack of job, water,the destruction of the environment and, many other social irresponsibilities! We all know that the issue of CSR is important as a starting point for real changes no matter if it takes a bit long. Let´s spread it and watch it closely because abandoning is the evil for all issues.
Faithfuly, Regina Ramalho
- Posted by Regina Ramalho
March 26, 2008 7:38 PM
Greenwashing under the guise of CSR will die in 2008, as it's a proven liability to brand value. Genuine CSR will increase to the degree that corporate leadership consciousness is increased with respect to its effects on their economic, social and environmental bottom lines - the only credible measures of brand value in this increasingly interconnected activist society. Corporations that drop their CSR initiatives become even more vulnerable prey. Those that re-design the CSR initiatives to be truly meaningful to all stakeholders will become more viable than even.
- Posted by Harrison Quigley
March 26, 2008 9:31 PM
For sure trhere will be the end of Corporate Social responsibility if nations will not move from soft law to hard las which will enforce CSR implementation.
There must be a clear legislations which will guide the operation of business activities and implementation of CSR.
- Posted by Robert Shirima
April 3, 2008 10:11 AM
Thank you all presenters. I find all points good. My concerns is what has presented by Robert shirima, that CSR implementation will succeeed only and only if nations will enact laws which enforce companies operating business to be binded with. It should click in our mind that many companies are there for profit making.
developing countries are in danger to meet the end of CSR if quick measures will not be taken.
- Posted by Elezer Kinamboi
April 3, 2008 10:34 AM
If poverty eradication and alleviating the burden of disease in some amongst the poorest of the poor is part of a firms CSR program then I would not call it lip service. Any firm needs healthier and wealthier consumers of its products.
Larry, Nairobi
May 1, 2008
- Posted by Larry KIMANI
May 1, 2008 2:39 PM