Number One Rule of CSR: "Do No Harm"

In an otherwise intelligent analysis of social responsibility--he points out that business leaders have almost unanimously rejected the Freidmanesque view and says the new emphasis on sustainability has the potential to "produce the happy marriage between profitability and a clearer conscience that champions of corporate responsibility have long sought"--FT columnist Michael Skapinker makes one bizarre observation.

Toward the end of his column, he argues that "companies committed both to traditional corporate responsibility and sustainability can still fail." I don't deny that its possible for such companies to fail; anything is possible. The bizarre part is that Skapinker tries to justify his assertion by pointing to Enron and BP.

Enron, he points out "was a benefactor to its home city of Houston," while BP "promised a sustainable future beyond carbon."

It requires a pretty narrow definition of corporate responsibility to apply the term to a company that made a few charitable donations while committing fraud on a massive scale, and a pretty superficial definition of sustainability to a company that promised investment in renewables while lobbying against environmental regulation and systematically failing to adhere to any limited regulations that remained in place.

Neither Enron nor BP provides any evidence that a genuine commitment to responsibility or sustainability carries any risk. Rather, they demonstrate that business observers and reporters are easily fooled by superficial commitments unmatched by any genuine change in behavior, and that such cosmetic approaches to CSR are almost always doomed to failure. (And further, that a company that overstates its record in this area will be more severely punished than a company that makes more modest claims.)

The most significant guiding principle of CSR should be the same as the guiding principle of medicine: "First, do no harm." Neither Enron nor BP seemed to understand this.