Any company is the shadow of the man who leads it. Most of them these days have self interest as a prime objective, not the company. hence the decline in morality, which educationally is already on the decline. What other way is there then to legislate, let's pray politicians know what morality is about.
JV

I find the way the article is framed rather misleading. Of course it is easy to find examples where compliance alone does not produce desireable outcomes. This is the area where pressure from stakeholders can and will make a difference. But that's not a sufficient argument against tougher laws.

For example, voluntary action by responsible corporations or local activism is not going to achieve the same level of environmental otucomes as the recent 'polluter pays' directive of the EU. Creating a legal principle that runs counter to the corporate desire to externalise costs by cutting corners is a powerful deterrant, especially when it applies across 25 countries.

Further, laws that actually level the playing field with respect to costs that are likely to be externalised by companies are also more effective than voluntary action. If, for example, all leases for industrial land have to stipulate that the land at lease expiry is to be handed back in equal or better condition than at lease start, we would be much less likely to be left with hectares of polluted wasteland, like at the old BHP site in Newcastle.

Planius

Thanks for the comment and you make a valid point. Certainly, legislation plays an important role in achieving the goals of environmental protection and social welfare. The range between corporates that lead in CSR and corporates that deliberately subvert laws and externalise social and environmental considerations is large. Laws can level the playing field. But your claim that "voluntary action by responsible corporations or local activism is not going to achieve the same level of environmental outcomes as the recent 'polluter pays' directive of the EU" is spurious at best.

The article is not anti-legislation. It argues for the internalisation of social and environmental requirements by the corporation as a means of attaining 'responsibility' rather than externalising and forcing governments and stakeholders to pick up the pieces. Because the last word in CSR is responsibility. And not 'C' for compliance. But the key point here, is that corporations are missing out on significant competitive advantage by adopting a compliance mentality.

But credit where credit is due, Harvard Professor Michael Porter expresses this well with "Companies do not function in isolation from the society around them. In fact, their ability to compete depends heavily on the circumstances of the locations where they operate."

Its from a useful article in the Harvard Business Review (2002) titled "The competitive advantage of corporate philanthropy". Porter also argues against 'cause-marketing' examples of corporate philanthropy. It's inefficient and generates mistrust.