Friday, May 27, 2005

Corporate Responsibility and Competitiveness

The business case for Corporate Social Responsibility has been debated for many years. In a survey of the subject, Roger Cowe from Royal Dutch/Shell Group finds that while links to national and regional competitiveness are less clear, governments and think tanks are enthusiastic about the idea.

It looks like a no-brainer: if there is a business case for corporate social responsibility and enough companies take it up, that will make whole economies more competitive – so governments should be encouraging corporate social responsibility in pursuit of national economic strategies. But brains are needed.

Quite apart from the “ifs” in this argument, there are plenty of uncertainties:

  1. Does the case for corporate social responsibility apply to all kinds of company?
  2. Can benefits aggregate across an economy or is it a zero-sum game?
  3. Does it introduce inefficiencies when scaled up to the level of the economy as a whole, as classical economics would argue?

It is increasingly common to talk about the triple bottom line at the level of the economy rather than the firm. Read on...