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The Forum > Article Comments > Don't write off corporate social responsibility - we need it > Comments

Don't write off corporate social responsibility - we need it : Comments

By Kel Dummett, published 16/12/2004

Kel Dummett argues that CSR laws are necessary to keep corporations honest

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Mr Dummett's article raises some important points on the need to retain currency in the debate on CSR. Two critical points however jump out at me in this article. It is disturbing to see such notable economists advocating in public forums for the continuation of the compliance culture in the CSR debate. This is not corporate responsibility but rather buck passing on the part of corporates. Responsibility thereafter becomes something only generated by the winds of political change and the forces that sit behind new legislation. Usually of a conservative and pro-corporate bent. Corporations also know that they are able to apply their expansive funds to lobbying against and delaying difficult legislation. Economists should be pushing Corporations to adopt a pro-active stance rather than a compliance stance in this debate. This false base stems from a narrow view of the sources of prosperity and a very static view of competition.

The second critical point lies behind the analysis made by Dummett after several interviews with Corporate leaders from "some of the world's biggest multinational corporations" that the Corporation wants to see more legislative controls in place. But of course they would say this, it's a 'socially responsible' thing to say and Dummett's work falls foul of the classic problem of interviewing CEOs on CSR - social desirability bias.

Further on this point, John Hewson's quoted statement that a regulatory framework tends to encourage corporates to perform better on CSR, is complete fallacy. This is unsubstantiated wisdom. The European compliance culture does not drive CSR, the pressures of space and the voices of the employees of these corporations do. There is also not a single, reliable database that is able to assess the true performance of the world's major corporations on their CSR performance. Dummett's article misses the mark somewhat and unsatisfactorily advocates for the old fashioned and outdated modus of pro-compliance rather than the more enlightened pro-active.
Posted by Audrey, Tuesday, 21 December 2004 11:09:06 AM
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