Paul Holmes 09 Dec 2002 // 12:00AM GMT
Most books about corporate social responsibility fall into one of two categories. The first category consists of books written by activists, most of which assume that business is incorrigibly irresponsible and must be reined in by external agency. The second category consists of books written by academics (or occasionally by eccentric entrepreneurs) who seem to believe that doing good is its own reward—a perspective that shareholders have yet to embrace.
In his book The Civil Corporation, Copenhagen Business School professor Simon Zadek acknowledges the skepticism about CSR in the business community, recalling a boardroom presentation to an insurance company during which “I was accused, only half in jest, of being either a communist or a Christian evangelist.”
The arguments he sets out in The Civil Corporation ought to dispel such misperceptions. Zadek eschews angry anti-business rants and lofty idealism, instead making a relentlessly pragmatic argument for greater community involvement and a promising blueprint for companies that want to adjust to recent and impending changes in the business environment.
Zadek tackles several issues that other books on the subject ignore or skate over in perfunctory manner: the somewhat tenuous relationship between social responsibility and financial performance; the issue of trust, and how difficult it is for companies to earn credibility even when they do the right thing; the challenge of measuring the impact of CSR activities in a way that resonates with senior management and with shareholders.
He also makes it clear that companies need to manage expectations, to focus on what they can do practically, given the overall context in which their business operates. Says Zadek, “Whether and how a corporation acts within its degrees of freedom must be the test of responsibility, and indeed the basis on which management decisions are framed. These are the fundamentals of a civil corporation. A corporation that is said to be civil is understood here as one that takes full advantage of opportunities for learning and action in building social and environmental objectives into its core business by effectively developing its internal values and competencies.”
Throughout The Civil Corporation, Zadek makes a compelling case that in the new knowledge economy, companies will ignore changing public expectations at their peril. And he provides a wealth of practical advice that ought to help companies overcome their own resistance to investing in CSR, and negotiate the minefield of activist and public opinion.