Corporate Social Responsibility (CSR) is a form of self-governance which may be integrated within a business model to ensure the company complies with the spirit of the law, moral standards, and international norms. However, the above definition is increasingly considered the bare minimum requirement for a company – it has become institutionalised. Nowadays, the term CSR is now more generally used to refer to the actions a company takes to further some social cause, beyond their legal obligations and the commercial interests of the firm. The term became popular in the 1960s, when the powerful counterculture movement began to question the integrity of the corporate world, and demand that it begin to act for the good of society.
There has been much debate about the good an understanding of corporate social responsibility has done. Its proponents argue that corporations make more long term profits by taking a balanced perspective on global issues, and may indirectly benefit from the good PR of helping causes. Naysayers take a different view, saying that it does not fit the economic role of businesses, which is to make money for their shareholders. A recent study by McWilliems and Siegel in Strategic Management Journalism compared econometric studies of the relationship between a firm’s spend on CSR and their overall financial performance, and found that it has a neutral impact.
Some have argued that CSR just papers over the cracks in a company’s conscience, allowing for empty promises to be made in marketing copy. Others take an even more sinister view, suggesting that governments use it as a method of control and surveillance over large and powerful multinational corporations.