August 06, 2008
Corporate Social Responsibility Throwdown at the Economist
By Natasha Yurk, Breakthrough Generation Fellow
For the past week, The Economist's online readers have been engaged in a debate over Corporate Social Responsibility (CSR) and sustainability as part of the Debate Hall series. The proposition is "This house believes that without outside pressure, corporations will not take meaningful action on sustainability." Pro and con speakers are industry professionals, users are invited to vote and comment on the debate, and Breakthrough Institute founders Ted Nordhaus and Michael Shellenberger contributed their own two-cents as guest participants.
Arguing for the Pro is Mindy Lubber, President of Ceres, a coalition of investors and environmental leaders working to improve environmental CSR. She points out the many times that corporations have failed to adopt sustainable practices--all in the absence of outside pressure. On the other hand, according to Lubbers, outside actors have successfully pressured companies to do more than buy carbon credits, but to take steps like building energy efficient factories. The utility TXU is one specific case that Lubber cites.
Con speaker Björn Stigson is President of the World Business Council for Sustainable Development. He takes a more abstract position than Lubber, arguing that outside actors do not exist (for all intents and purposes), as corporations are constantly trying to appease consumers. Because it is impossible to determine an exact motivation for corporate policies, it can be assumed that discrete pressure and lobbying is unnecessary for CSR to emerge. Stigson also points out the resolution's inherent flaw, which is that outside pressure may contribute to CSR, but government policy is the real issue at hand. Ultimately, activism is usually aimed at the biggest brands rather than the biggest polluters; but policies have the capacity to foster energy efficiency while garnering widespread public support. He concludes that:
We believe that the proposition is not completely wrong, but it is a long way from telling the whole story. We would say that meaningful action on sustainability can only be achieved if individuals, governments, business and civil society work together and maintain pressure on each other.
While Nordhaus and Shellenberger are not technically speakers in the debate, their guest participant comments both settle the discussion and shed some new light. Have activists lobbied for environmental CSR? Certainly. Wal-Mart provides a recent example. But companies have also adopted sustainable practices on their own volition. The result is that there is no "winner" in this debate because both scenarios have occurred and will occur in the future. Such is the problem with debates over statements of fact: examples and counter-examples are readily available for both sides, so the burden of proof is simply unattainable for either of them.
Rather than settle for this outcome, however, Nordhaus and Shellenberger comment on what the debate should have been about. Corporations do play a role in clean energy practices, but the government and societal commitment to clean energy matters much more. Governments are the actors that can establish clean energy and CSR as norms. They can subsidize, legalize and prohibit. Corporations are key for providing publicity for and innovation in sustainability, but they are not self-sufficient when it comes to determining their day-to-day operations. So, note to activists: a new type of government social responsibility (you could say GSR) is the route to broad change.
Readers are invited to make their own comments on The Economist's message boards. The debate closes Friday, June 27.