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Are businesses mad dogs that must be controlled?

Date: 2 Mar 2014

Sometimes I think we've moved on from the stale business good-or-bad debates of the last couple of decades. There are more business - NGO partnerships taking place, even with formerly controversial companies such as Asia Pulp & Paper. But the ideological tensions remain - and it's not as thought the problems feeding them are going to go away any time soon.

Every now and then this leads certain NGOs to attack the concept of CSR as being part of a global business conspiracy to dominate the world. That sounds like an overstatement for effect on my part, but not really.

The latest salvo comes from War on Want, whose Executive Director John Hilary has a new book titled 'The Poverty of Capitalism' in which he sees corporate social responsibility and the recently popularised term "shared value" as enabling companies to appropriate key roles of the state in order to trick governments into allowing them to rapaciously expand across the world.

This isn't, of course, a new notion. It summarises perfectly well the beliefs of a number of the key movers in the 1990s anti-capitalism riots. I still recall vividly when the film The Corporation was released in 2003, being asked to speak at its premier screening in London alongside a panel of seven other speakers.

After the film had concluded, each speaker in turn got up to praise the film's wisdom, and to call for companies to be brought to heel. The contention of The Corporation is that companies, in how they behave, exhibit similar tendencies to those we would associate with a human psychopath. It needed to be controlled like a mad dog.

Once it got to my turn, I figured I had nothing to lose. If I was going to go down to a baying mob, might as well enjoy it. So I attacked the premise of the film, pointed out that the self-same characteristics also described the nation state - the principal unchallenged unit of global identity and organisation, and quoted Gandhi's view that what we faced were common problems, and they would either be common solutions or there wouldn't be solutions.

In the event, there was no baying mob. A whole bunch of people came up to me afterwards to thank me for providing sorely needed balance, because they - as business people who wanted their business to be forces for good in the world - had been sitting there feeling incredibly miserable. Which is surprising for rapacious mad dogs, but there you go.

Hilary's book shows how little has actually changed in thinking on that side of the debate. In his introduction he describes CSR as having been "originally developed as a means to deflect public criticism and see off the threat of external regulation" and says that it has gone on to be "developed into an offensive initiative through which to expand the reach of transnational corporations into new areas of the global economy, and to roll back the frontiers of the state.

Crikey. That would make me, as a supporter of CSR, something of an evildoer, I guess. I never realised. I need to get some suitably menacing mirrored sunglasses.

But of course it is nonsense. For a start, it is completely factually inaccurate to suggest that CSR was developed "to deflect public criticism". For a start, significant developments in the evolution of CSR were about businesses being engaged by governments to help address common problems, as happened in the UK when businesses were asked to play their part in inner city regeneration, leading to the creation of Business in the Community.

Certainly, individual companies were often spurred on to change when something went very publicly wrong and they faced criticism and / or campaigns. But for many of those companies the change that resulted was pretty far reaching and innovative - hardly the stuff of public relations stunts and veneers.

But, as far as the campaigners are concerned, any company that has had a scandal, or has been the target of NGO criticism, is by definition an irresponsible business. Hilary points at the Ethical Corporation Responsible Business Summit conferences (which I have historically been a part of - there's that wicked streak again) hosting such corporate speakers as Coca Cola, McDonald's, BAE, BAT, Tesco, Shell etc etc - and of course since all of those companies have been accused of stuff in the past, what a nonsense it is to have them at all at a CSR conference.

The fact that the biggest, most global, most criticised companies are also likely to be amongst the first ones to look at themselves in the mirror seems to escape Hilary. When the criticism has had some validity, surely it's a good thing that the companies correct what is being done, and in so doing learn things that would be worth sharing with others. And even when the critiques didn't have validity (such as with Greenpeace's historic campaign against Shell over the Brent Spar - where it was shown after the event the company's solution had indeed been the best environmental option, and Greenpeace apologised for getting some of its facts wrong) the shock of losing the public debate led the companies concerned to look at what they needed to change.

But if CSR was just a public relations veneer, it wouldn't have merited more than a few caustic mentions I expect. But Hilary goes much further. CSR is a mechanism for "expanding the reach of capital and appropriating key roles of the state as lead economic agent and adjudicator of power relations."

The evidence for this is slight. Hilary retreads old ground, bemoaning that attempts to create binding rules to govern global corporations (the UN Code of Conduct on Transnational Corporations in the 1970s) failed to get sufficient support (and it is easy to darkly hint that this was all down to companies pulling strings, as opposed to governments across the world failing to accept the principle of global governance, which they tend not to when push comes to shove). And this, of course, led to this dreadful principle of voluntarism. If governments can't agree on binding rules, then at least companies should voluntarily seek to do the right thing, not the wrong thing. How wicked.

Even more wicked, apparently, is the fact that "CSR has been redefined as a central business opportunity rather than as a restriction on, or adjunct to, a company's core operations." Whilst you or I might see that as a good thing - aiming to harness the things that make business powerful and put them in the role of supporting sustainable development by finding ways to do this that go with the grain rather than against it - Hilary decides that the real agenda here is to act as a trojan horse to get transnational corporations into developing countries.

The thing that gives this perspective away is its requirement - in order for its world view to make sense - that the 'enemy', business, has been developing all these measures with a cynical intent to expand power and exploit the earth and all its people. Anyone that has been present at the development of many of the key initiatives that Hilary critically namechecks will know that to be nonsense.

Frankly, any perspective that depends upon "us" being the voices of reason and goodness and "them" as being the selfish grasping forces of nastiness is one that should be regarded with intense suspicion. Because people are people. When nations have gone to war with other nations, demonising the enemy was always part of the process to enable people to fight. But once war was finished, we rediscovered that we were still essentially the same.

Or to put it another way, in the words of Mark Achbar, director of the film The Corporation: ""Not that I ever doubted the overall purpose of what we were doing, or the message of the film, but when we started talking to a lot of these people who I thought would be these typical suits... I don't know, whether it's my naivete in some way, but I got a sense of them as real human beings. I could understand their point of view, and to be quite honest, that really surprised me.”

Really? Real human beings with a valid point of view? Whoever would have thought it possible.

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