Social responsibility by corporations is an interesting idea and it Is the modern equivalent of John D. Rockefeller, oil magnate and philanthropist, who gave dimes to the everyday common people. Big companies exist to make money and so the idea of social responsibility is a valid one but the gestures are so small it compared to profits these companies realise that it could be taken in a negative way.
Company can do well by doing good
The fact is that social responsibility schemes are just a show, the idea that a company can do well by doing good is not unique. It is a technique known as the ‘triple bottom line’ (people, plant, profit), “impact investing” and “sustainability” are all descriptions of corporate initiatives to find solutions.
Michael E. Porter, Professor at Harvard Business School, looked into the problem Milton Friedman, Nobel laureate, had regarding corporations giving away negligible amounts of money to increase their own profits. Porter has been promoting a concept called “shared value” as the solution.
Michael E. Porter and Mark R. Kramer, a consultant and senior fellow in the corporate social responsibility program at the Kennedy School of Government at Harvard, have presented their work in an article published in the Harvard Business Review “Creating Shared Value: How to reinvent Capitalism – and Unleash a Wave of Innovation and Growth.” They champion the concept of ‘shared value’ which is an notion of corporate self interest, in other words greed.
Social problems are market opportunities
Mr Porter has stated that shared value directs too “a more sophisticated form of capitalism” and having the skill in solving issues in societies and communities is central to maximising profit. The reason this concept has grown in strength is because social problems are essentially market opportunities say Porter and Kramer.
According to the duo shared-value is not based on morals, companies will still behave how we all expect them too, instead they say: “It’s about galvanizing companies to exploit the market in addressing social problems. This is not about companies being good or bad.”