In response to AUGUST 23, 2010 WSJ
“The Case Against Corporate Social Responsibility”
The idea that companies have a duty to address social ills is not just flawed, argues Aneel Karnani. It also makes it more likely that we’ll ignore the real solutions to these problems.
Response from B Shotton LiftOFF Leadership:
The author makes some good technical, analytical and academic points about the responsibility executives have to profitability.
However there is something missing in this piece and it is the writer’s sense of the role of business in the grand scheme of humanity. The statement ” Companies that simply do everything they can to boost profits will end up increasing social welfare.” is just not true. It depends on how profits are distributed and what happens with those distributions. The argument that more money in the hands of the already wealthy is a primary engine of the economy doesn’t hold true either.
I believe that there is a fundamental need for leadership to balance economic value with human value; when profit becomes the primary reason for existence at the expense of the environment, without regard to the consequences of financially driven decisions on the lives of people and communities, then profit is not king as it inflicts suffering and degradation on society.
I also believe that this discussion needs to include integrity and the degree to which we value mankind when we determine how we will measure our leaders and how we will define success.
I am not espousing a disregard for profitability; obviously there is no business/no jobs without it. What I am espousing is that businesses/leaders are measured not on profitability alone but also on the consequences their product & services have on humanity and its environment.
I do believe that conversation alone, activists, government, self control…all have some impact on social responsibility but being good business minded people we also know that leaders need to be measured and exchanges want measurements and CEO’s want metrics.
I think what is needed is a measurement that is integrated into financial and corporate reporting that is an indicator of the impact the organization is having on the human and societal side of the equation…I call it VOP, the Value of People .This indicator is in the idea stage/ not developed but I believe that it can be with the right professionals involved.
The answer to the promise of a mix of profit and people, fiscal and social responsibility is to elevate the latter into the science of business, give it a name and give it a measure…let it be held up for discussion.
Its all about balance.
Betty Shotton
CEO LiftOFF Leadership
www.liftoffleadership.com
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