I wrote a few years ago that corporate social responsibility (CSR) “is mostly a façade — to divert the public’s eye from corporate misdeeds and corporate welfare.” ((Gary B. Brumback. The Devil’s Marriage: Break Up the Corpocracy or Leave Democracy in the Lurch. Author House, 2011, pp. 144-145.)) Not that there is much of a difference in the meaning of the two nouns, but I write here that CSR is also a charade, the pretending of being socially responsible while being socially irresponsible.
CSR Buzz Word: The “Triple Bottom Line”
The “triple bottom line” has become a fashionable term in corporate circles for CSR. It is strictly a buzz word. It is also a superfluous concept. There are only two bottom lines in accounting for any endeavor, corporate or otherwise. One is the bottom line of behavior. The other is the bottom line of results. The first divides positive behavior (competent, motivated and ethical) from negative behavior (incompetent, unmotivated, and unethical). The second divides positive results (benign) from negative (harmful) results. The merging of these two lines helps to account for success that is ill gotten and for failure despite the very positive behavior that preceded it. A responsible corporation penalizes, not rewards the negative successes and appreciates, not penalizes positive failures.
The Real Meaning of CSR
CSR means (1) staying financially viable, (2) providing socially beneficial products and/or services, (3) without knowingly causing any physical, psychological, financial or ecological harm, (4) without externalizing costs (e.g., job outsourcing, waste disposal), (5) without seeking or depending on “warfare welfare” or other government favors such as corporate personhood recognition, campaign financing, lobbying, subsidies, revolving doors, laissez-faire regulations, or criminal immunity, (6) conducting business ethically and legally, and (7) treating all stakeholders fairly and with dignity. ((Op cit., pp. 135-143.))
The rationale for the first criterion is that a segment of society depends on the corporation for their livelihood. Staying afloat is not just being financially responsible. However, my cliché for those corporations that meet only this criterion is that “beauty is far more than money deep.”
The rationale for rejecting corporations engaged in war profiteering is that a compelling argument can be made – and has been made – that no war is just and that any war is an act of murder. ((Gary B. Brumback. “Can any war be just?”, Cyrano’s Journal, April 9, 2013.)) I realize some people would regard defense contracting to be a patriotic duty, but it is costly and dangerous patriotism (“my country right or wrong” instead of “my country please do no wrong”). I once calculated that a peacetime budget since the end of WWII would have saved over ten trillion dollars, more than enough to meet pressing domestic needs. ((The Devil’s Marriage, p. 141.))
The rationale for the other criteria is that they are hallmarks of the corpocracy. It is far more egregious than just being socially irresponsible. It is directly responsible for America being ranked the worst among industrialized nations on various measures such as income inequality and unemployment; (( C. M. Blow. “Empire at the end of decadence”, The New York Times Online, February 18, 2011.)) for America being the most imperialistic nation on the globe; ((William Blum. America’s deadliest export: Democracy – the truth about US foreign policy and everything else. Zed Books, 2013.)) and for America being vulnerable to continuous blowbacks from drone strikes and other forms of unending, devastating and deadly military aggression done solely for profit and power. ((M. A. Goodman. “The blowback from interventionism”, Consortiumnews.com April 27, 2013.))
CROs and CROA
“CROs” aren’t the countless ones in the farmer’s corn field. There are few CROs actually. I’m not exactly sure how few, maybe somewhere between 50 and 100 (in 2007, the last year I saw figures only 10% of the Fortune 500 had CROs).
Can you imagine being called a CRO, short for Chief Responsibility Officer? Why would a corporation want to pay more just to give the title CRO to someone? CFOs are wondering, too. More than half of CFO’s (short for “Chief Financial Officer”) for whom corporate money really matters, when recently surveyed were lukewarm at best about elevating a corporate member to CRO. ((John Graham. “CFO Survey: Corporate Social Responsibility Lags in U.S., Optimism About U.S. Economy Grows”, Duke Fuqua Newsletter, June 05, 2013.))
CROs know they need to rely on self-promotion. So they now belong to CROA, the Chief Responsibility Officers’ Association. A survey in 2012 of CROs was not too encouraging for their kind: “CR remains a nascent profession lacking the distinct set of professional characteristics; CR field lacks a deliberate career path; and the progress of the corporate responsibility officer (CRO) is continuously evolving.” ((Karina, “The State of the Corporate Responsibility”, CSR Research Digest, April 2012.)) The survey was sponsored incidentally by CROA, and by, get this, the U.S. Chamber of Commerce Business Civic Leadership Center. It’s an arm of one of the wealthiest and most powerful lobbyists for corporate America and hardly a paragon of lobbyist social responsibility. The U.S. Chamber of Commerce is one reason I have been promoting the idea of a U.S. Chamber of Democracy.
The CR Magazine
CR Magazine is published by SharedXpertise Media, LLC. Its aim is to “provide senior executives with unparalleled learning, meeting, and networking experiences on corporate responsibility, human resources and financial management.” In a press release CR Magazine’s publisher boasted about how its annual list of the “100 Best Corporate Citizens” is widely watched and “as a result, making the List is worth millions or even billions in increased shareholder and brand value.” ((Christine Arena, “Corporate social responsibility rankings can be a powerful tool for companies. But there are concerns about how they are compiled”, Christian Science Monitor, March 17, 2010.))
So CR Magazine is all about money hustling and hype. Shareholders aren’t liable for corporate criminality and even benefit from it. Brand value is hyped by advertising and marketing blitzes. I doubt if CR Magazine has any credibility at all to critics of America’s corporations, especially if they know that Monsanto, for example, is on CR’s 2013 list and for the fourth time. ((“CR’s 100 Best Corporate Citizens 2013“))
Monsanto? Really?
Mike Adams, chief contributor and editor of NaturalNews.com, says that “MonSatan—is now the No. 1 most hated corporation in America—and the destructive force behind the lobbying of the USDA, FDA, scientists and politicians that have all betrayed the American people—.” ((Mike Adams, “The GMO Debate is Over; GM Crops Must be Immediately Outlawed; Monsanto Halted from Threatening Humanity”, OpEdNews.com, September 22, 2012.)) In 2011 Monsanto was voted the “Most Evil Corporation” by readers of NaturalNews. ((Robyn Griggs Lawrence. “Is Monsanto the World’s Most Evil Corporation?” Mother Earth News, January 13, 2011.)) And in 2012 Monsanto was the winner in Corporate Accountability International’s poll for its “Corporate Hall of Shame” award for “mass producing toxic chemicals, aggressively running small farms out of business, and recklessly promoting genetically engineered seeds that exacerbate food scarcity globally – again.” ((“Corporate Accountability International”, Corporate Hall of Shame, 2012))
Meanwhile, over two million people have marched against Monsanto in hundreds of cities in over 50 countries, and Hungary is doing what US should be doing, burn all acreage of crops planted with Monsanto genetically modified seeds.
So much for CR Magazine’s journalistic credibility
CSR: All or None and Proving it with Three Case Studies
A lawyer turned ethicist, Michael Josephson, searched different cultures throughout history looking for universal moral values. ((M. Josephson. “Teaching ethical decision-making and principled reasoning. Ethics: Easier Said than Done”, 1988, 1, 27-33.)) He found them. One was “responsibility.” It is thus an absolute moral value, not a relative one. This means in turn that a corporation can’t be socially responsible on some things, but not on others and still be called a socially responsible corporation.
Two academicians, however, would disagree with my reasoning. They picked three corporations to illustrate their concept of “embedded” corporate social responsibility. The three were GE, IBM, and Intel. You may or may not have formed your own impressions of how these corporations conduct their business, but let’s hear first from the academicians and then take a look at reality. (( H. Aguinis & A. Glavas. “Embedded versus peripheral corporate social responsibility: Psychological foundations. Industrial and Organizational Psychology: Perspectives on Science and Practice”, in press, 2013.)), ((Gary Brumback. “When the ivory tower gets toppled by reality: The case of corporate social responsibility research.” Industrial and Organizational Psychology: Perspectives on Science and Practice, in press, 2013.))
1. GE
The academicians picked GE because of its “ecomagination” program that “represents GE’s commitment to imagine and build innovative answers to today’s environmental problems while driving economic growth” and because of GE’s commitment to recruit employees “driven towards a higher purpose.”
Now, GE is a huge corporation and the embedded pieces are just that, pieces. Let’s look at the larger reality of this corporation.
According to an organization that monitors corporations, GE “has a lengthy record of criminal, civil, political and ethical transgressions, some of them shocking in disregard for the integrity of human beings.” ((Multinational Monitor. “The case against General Electric”, Corporate Watch, August 1, 2010.)) While this source is more than 10 years old, there is plenty of recent evidence that GE remains far from perfect. It is a “heavy hitter” in political campaign contributions and a “top spender” in lobbying. ((Open Secrets. “General Electric Profile Summary“, 2013)) It mooched over three quarter of a billion dollars in government grants just for the year 2012. ((Influence Explorer. General Electric, 2013)) It escapes taxes. ((S. Kim. “Report: 26 U.S. companies not paying federal income tax”, ABC News April 11, 2012.)) The executive director of Alliance for American Manufacturing contends that one “would have difficulty finding a company that has outsourced more jobs and closed more American factories than GE (so much for its recruitment program).” ((S. Paul. “Should GE’s Jeffrey Immelt really be leading our job creation strategy?” HuffPost, January 21, 2011.)) GE is among the five top air polluters and has been dragging its feet for decades in cleaning up the Hudson River polluted by over one million pounds of carcinogenic PCBs dumped by the corporation (so much for its ecoimagination). ((J. K. Boyce & M. Ash. “The toxic 100: Top corporate air polluters identified”, Truthout, August 17, 2012.)), ((T. Catts & F. Klopott. F. “GE in N.Y. talks to widen Hudson River pollution cleanup”, Bloomberg News, May 1, 2013.)) Finally, GE is a major defense contractor. ((Aerospace and Defense Intelligence Report. Top-100 defense contractors U.S. Department of Defense Fiscal Year 2013))
What’s your overall impression of GE?
2. IBM
IBM was picked because of its “Smarter Planet Program” and because over 300,000 employees were involved in developing “values statements” for the corporation.
Like GE, IBM is a huge corporation and these embedded pieces are just that, pieces, whatever their own merits might be. Let’s look at the larger reality of this corporation.
IBM has a long history of social irresponsibility and worse. It was still profiting from its business with Hitler’s regime after other American corporations had severed their business ties. ((E. Black. IBM and the Holocaust: The strategic alliance between Nazi Germany and America’s most powerful corporation, Dialog Press; Expanded edition, 2012.)) IBM has expanded and tightened, not severed its ties with America’s regimes over the years. It is a big defense contractor. ((“Aerospace and Defense Intelligence Report”, Ibid.)) It is a major contributor to political campaigns and a major lobbyist. ((Influence Explorer, IBM, 2013)) It is a tax avoider and a “corporate welfare queen.” ((R. Longley. “Major Corporations Escaping Taxes“, June 6, 2011.)), ((Washington’s Blog. Cutting corporate welfare queens off from the dole would be the best way to cut the debt, March 13, 2013. )) It cuts scores of jobs and outsources others, which is one of several reasons for its troubled employee relations (so much for its values statements). (( P. McDougall. “IBM cuts more than 250 U.S. jobs”, InformationWeek, February 27, 2012.)), ((Communication Workers of America. Articles archive. Alliance@IBM, March 12, 2013.))
What is your overall impression of IBM?
3. Intel
Intel was picked because of its environmentally friendly multi-billion dollar factories called “Fabs” and because its financial goals and individual compensation are tied to the implementation of CSR.
Let’s set aside those two pieces, whatever their own merits might be, and look now at the rest of Intel.
A mostly critical expose was written of its leadership, business practices and employee relations during the tenure of the allegedly despotic CEO Andrew Grove, who helped get the company started. ((T. Jackson. Inside Intel: Andy Grove and the rise of the world’s most powerful chip company, Plume, 1998.)) While he has since stepped down he still is involved in company matters. Intel is a big campaign contributor and lobbyist. ((Influence Explorer. Intel. 2013. )) It is a “corporate welfare queen.” ((N. Solomon. “Corporate welfare: A media issue at last?” The Progress Report, May 10, 2013.)) It is a “top ten outsourcer.” ((R. Fulks. “Facts and Figures on Outsourcing“, May 8, 2013 )) It is a frequent plaintiff in lawsuits. ((Associated Press. “Intel antitrust lawsuit ends with $6.5 million payout”, Huffington Post, February 9. 2012; FaceIntel. What Intel doesn’t want the world to know: Examples of some employee lawsuits, May 8, 2013.)) It is not listed as a major defense contractor but military, national security and space operations would probably be crippled if they could not depend on Intel’s high performance computer chips.
What is your overall impression of Intel?
Closing Remarks
However exemplary the two academicians think the three corporations’ “embedded” CSR programs are they cannot begin to compensate for, or whitewash away, all of the accumulating actual and potential harm being done to humanity by these corporations. Moreover, I have never seen any reports of the three corporations or any of the rest of their kind clamoring for the end of corporate welfare, including warfare welfare; criminal immunity; or laissez-fare regulations.
I only singled out GE, IBM and Intel because the two academicians put the spotlight on them and I wanted to enlarge the spotlight. These three corporations are certainly not unique in falling short of meeting my seven criteria. I would be absolutely dumbfounded if anyone could identify a public corporation that meets all of the seven criteria.
The third and last essay in this series will discuss all the rest of the programs and departments that amount to corporate charades. Can you guess what they are?