“A corporation is the property of its stockholders...its interests are the interests of its stockholders.” Milton Friedman
Milton Friedman has always been a major opponent to CSR practice saying that the argument that business should actively seek to do good without self-interest in mind “preached pure and unadulterated socialism.”
Although, Friedman ‘argument is relevant. Globalization and the information revolution have changed the nature of the relationship consumers have with companies. In fact, “private” corporation are now seen as being public. Corporations and brands have now a personality and more than a product, consumers buy a personality they like.
Some believe that CSR has its roots in philanthropy, but call me a skeptic if you want because I think that CSR is just a stunt used by PR professionals for crisis management and reputation management.
Two examples that I think will prove my point: Nike and Microsoft.
After being accused of using child labor in its factories, Nike sat up a CSR department to turn around public opinion. It is said that nowadays Nike is one of the global leader when it comes to improving labor standards in developing countries. However, NGOs are still arguing that workers in Nike factories receive “poverty wages” that do not allow them to live decently. Moreover, Nike has recently had problems when closing two of its factories in Honduras.
My second example is Microsoft. Microsoft has a CSR department; however Bill along with his wife created a foundation named the Bill&Melinda gates foundation.
My question is the following, if CSR is some kind of philanthropy. Why would there be a distinction between the Microsoft CSR department and Bill Gates foundation?
