Revenue and Responsibility: A Counterattack against the Corporate 'Social Responsibility' Movement Is Taking Shape

Article excerpt

A counterattack against the corporate `social-responsibility' movement is taking shape.

Like a political debate in which a no-show candidate is represented by an empty chair, the push for "corporate responsibility" has been notable for its lack of opponents. On issues ranging from pollution to pornography, politicians and activists of diverse ideological stripes have pressed the case that companies should balance profits against the broader social good.

Even corporate America has joined the crusade -- and not just companies such as Ben & Jerry's, well-known for promoting environmental and other causes. In the spring, President Clinton met with about 100 business executives to discuss social responsibility and unveil a new "corporate citizenship" award named after the late Commerce Secretary Ron Brown.

Moreover, reinforcing good corporate behavior with legislation is a priority for some policymakers. Sen. Jeff Bingaman, a New Mexico Democrat, seeks to create a category of "A-Corporations" that would receive tax and regulatory rewards for meeting approved standards regarding employee health insurance and other matters. Labor Secretary Robert Reich and congressional Democratic leaders endorse this idea.

Lately, however, vocal criticism of the movement has emerged from a growing circle of conservative researchers and writers. Objections once buried in academic papers -- or whispered behind closed doors in executive suites -- are gaining prominence in books, speeches and op-ed pieces aimed at a broader audience.

"I think the duty of the corporate manager is to stay within the law and deliver profits to shareholders -- and that's pretty much it," says John M. Hood, president of the North Carolina-based John Locke Foundation and author of The Heroic Enterprise: Business and the Common Good, a book that has become a rallying cry for such criticism.

According to Hood, society benefits from a clear division of labor between the private sector and governmental or nonprofit institutions, a distinction the corporate-responsibility movement seeks to blur. Corporations serve the public by finding better and cheaper ways to provide goods and services; plus, they train employees, conserve resources and develop more flexible work arrangements -- precisely because they are focused on profits.

For Hood and other "antiresponsibility" mavens, true corporate misbehavior consists of using force or fraud -- or lobbying for government subsidies or protection against competition. …


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