Tuesday, August 24, 2010

It is sometimes good to read bad articles

It is sometimes good to read bad articles, it allows you to understand how other people are thinking. Here is one about "The Case Against Corporate Social Responsibility". The argumentation of this paper is quiet amazing. Here are some quotes from that article:
"Companies that simply do everything they can to boost profits will end up increasing social welfare. In circumstances in which profits and social welfare are in direct opposition, an appeal to corporate social responsibility will almost always be ineffective, because executives are unlikely to act voluntarily in the public interest and against shareholder interests."

How can we possibly imagine that corporations have no social responsibility and should only be driven by profit? Ask the people in the Gulf about BP social responsibility!

In Africa, they seem to be ahead of us in that regard. Social programs are an important element of corporations doing business in Africa. As an example, look at MTN social program in Nigeria .

In a recent panel organized by McKinsey about "Can Africa continue to grow?", one of the participants said: "The last point is that companies have to also understand that, in order for them to have a license to operate in Africa, they have to earn that license, not from the governments but from the consumers. And that license means that you’re doing things that support socioeconomic development in Africa. You have a role in doing things to support the improvement of the standard of living of Africans. It means that you have to invest in the communities in which you do business, be it in building plants, creating jobs, providing skills, providing business opportunities." I can't agree more, and this should be valid for any country, not only in emerging markets.

The best advocate for Social Business is Muhammad Yunus the 2006 Peace Nobel Prize recipient who brilliantly described the concept in his book:
In that book he makes the case for a new form of Capitalism: Social Business that would coexist with the current profit based model.

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