Who really needs social responsiblity?

Earlier this year we saw the rise of the Occupy movement play out on all media outlets. People were upset. Businesses were not being socially responsible and the general population had finally had enough. The question we are left with is, do we really expect businesses to maintain their social responsibility despite the possible loss of profits?

There are a lot of companies that balance profit with corporate social responsibility such as Toms, Burt’s Bees, Starbucks, and Whole foods. The only thing is most of these companies were created with social responsibility in mind.  An article in The Wall Street Journal published in June 2012, talks about the case against social responsibility. This take on the subject was very interesting as usually people are for corporate social responsibility and not against it.

Karnani writes about how profits will be effected with the increase of social responsibility and how sometimes, the profits are more important. I found this interesting because we expect companies to do good for the people they serve but how do we expect to do this? In order to illustrate this point let’s take a look at Wal-Mart. Wal-Mart is a big corporation yet they have had quite a few problems with corporate social responsibility. Wal-Mart has been sued by its own employees, unions and activist organizations. As the general public, we learn about these issues on the news, through friends and even through employees as we stand in the checkout line. So, knowing that the company is not treating people the way we want them to, as customers, what can we do? Stop shopping there. It is as simple as that. Stop shopping at Wal-Mart. If enough people stopped shopping at the local stores, profits may be influenced and Wal-Mart would have to change their ways in order to increase profits again. Will this happen? No. We like our sales. 

This brings in to light, who do we blame for a lack of corporate social responsibility? The company or the customers themselves? 

Karnani states that companies know the areas they need to change and choose not to change them because of  the effect on profits. Ultimately profits are the main issue at stake. With increased social responsibility there are sometimes decreased profits.  If profits continue to decrease, there will not be a need for social responsibility because there won’t be a company. Another angle to look at is how important is social responsibility? Do consumers research companies prior to making purchases? For example, last year I decided to live a vegetarian lifestyle and eventually progress to veganism. I began researching products that did not test on animals and did not use animal products. The companies that produce items that fit my new lifestyle were expensive. This might make me look bad, but I decided against the full on vegetarian lifestyle because I was not willing to pay more. This is the deal people get. If you want increased social responsibility then expect increased prices. Sometimes people are willing to ignore the lack of social responsibility in order to keep the prices they are comfortable with, just like the Wal-Mart situation.

Karnani suggests government regulation but the public does not really support government interference with companies, hence the Occupy movement. So while the Occupy movement brought these issues in to focus, how many of those protestors were willing to pay more if the companies changed their ways? How many of us are willing to pay more for increased social responsibility? Are you?

Karnani, A. (2012, June 14). The case against corporate social responsibility. Retrieved from http://online.wsj.com/article/SB10001424052748703338004575230112664504890.html