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MODERN BUSINESSnews that crowds out the bad. Large corporations are going to get a
certain amount of press and awkward questions each day—better
that press and those questions be about CSR than, say, worker safe-
ty or GMOs. For example, in 2018 when Johnson & Johnson was
accused of knowingly selling baby powder with harmful levels of
asbestos, Harvard professor Bill George wrote a stirring defense of
the company, focusing not on the merits of the claim, but on J&J’s
“Our Credo,” a commitment to integrity and customers written in
1943 (and likely the first CSR document ever produced.)
Still, not everyone is convinced. There are many who adhere
to the late economist Milton Friedman’s argument that the sole
purpose of the corporation is to make more money for share-
holders, who can then choose for themselves whether or not they
want to save the world.
Judith Samuelson, vice president of Aspen Institute and founder
of their Business and Society Program, who’s worked with many of
the companies currently leading the way in CSR, says, “The share-
holder primacy viewpoint hasn’t gone away. And even if attitudes
have changed, measures haven’t. Many executives, including CEO’s,
are still paid in stock, and those who manage portfolios for institu-
tional investors are still bonused on the value of those portfolios.”
Samuelson worries that “Companies may think these (current)
programs are enough and not make fundamental change.” Kash-
ner is more optimistic. She cites work that says large public com-
panies are increasingly incorporating CSR metrics into executive
compensation contracts.
Those who oppose CSR programs argue that trying to do two
things at once, like making a profit and serving society, will de-
stroy the effectiveness of companies.
Samuelson scoffs at this. “Of course companies can do more
than one thing. Public companies have to manage multiple ob-
jectives all the time. No public company in the world would last
a week if the only people they cared about were shareholders.
What about customers? Employees?”
She believes that CSR really boils down to responsible decision
making, doing what it takes for companies to succeed in the long
term. Whatever, CSR is here to stay. It’s become part of the fabric
of investing, company operations, and business school curricula.
It’s now being tracked and measured, and in business, what
gets measured gets done.ƠHill, a Newsweek contributor, is an author and former C-suiter.BETTER BUSINESSThe late economist Milton
Friedman, pictured right, might not be pleased.
But companies like Pepsi, BP (here, the subject
of protests by Greenpeace activists over oil
drilling in the North Sea), and Campbell Soup
have concerns that go beyond shareholders.