Argument for and Against CSR
Corporate Social Responsibility (CSR) is one of the strongly debated topics in the world today, especially with regard to its benefits and costs to investors, customers, and the public. Supporters of CSR argue that businesses have the responsibility of trying to solve social problems and ills facing the society. In the contrary, the opponents of CSR maintain that the only aim of any business is to maximize the wealth of shareholders and investors. Therefore, the paper focuses on the strongest arguments for and against CSR (Carroll & Shabana, 2010).
The strongest argument for CSR is that it ensures the long-term success of a business mainly because it improves the relationship between a firm and other stakeholders such as customers, suppliers, and the public (Carroll & Shabana, 2010). By providing for the needs of stakeholders, a corporation is able to realize long-term and sustainable success. It will be able to gain more customers, investors, acquire talented employees and be able to easily access the money market due to the positive public image. Consequently, CSR can help a firm to enhance its productivity and performance, especially due to an increase in sales volume and highly productive employees. For instance, Coca Cola has been dominating the food and beverage industry for years due to its CSR programs.
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On the other hand, the strongest argument against CSR is that it violates profit maximization, which is the primary objective of any business. Businesses are always owned by shareholders who expect maximum profits. Therefore, money spent by managers on CSR is a theft to shareholders. At the same time, CSR deprives shareholders their property right. In addition, a corporation can be more socially responsible when they strictly adhere to their economic interest and leave social activities to other social institutions in the society. For example, due to the pressure to reduce environmental pollution, many companies in the automotive industry are facing financial challenges (Martinuzzi et al ., 2011).
References
Martinuzzi, A., Kudlak, R., Faber, C., & Wiman, A. (2011). CSR activities and impacts of the automotive sector. Res Inst Manag Sustain RIMAS Vienna Univ Econ Bus Franz Klein Gasse , 1-1190.
Carroll, A. B., & Shabana, K. M. (2010). The business case for corporate social responsibility: A review of concepts, research, and practice. International journal of management reviews , 12 (1), 85-105.
