For a very long period of time, the corporate social responsibility (CSR) has been well thought-out as a trend that arrived when a certain generation entered the workforce and become a stronger consumer existence in corporate America. In the society, business has been playing a big role which has triggered so many companies to subscribe into ways of minimizing the need for CSR or for methods to turn social responsibility in to a factor of making profits. Some people believes that CSR is an interruption that cease businesses performing to their prospective which cripple the economy while others believes that an effective CSR policy together with competent business strategy and efficient marketing could help a business grows to a bigger profits which can also benefits the society as well. One of the architects against the corporate social responsibility movement is Milton Friedman and his writing is considered by many as the seminal piece of work. This paper tries to endeavor some of the Milton Friedman’s quotes and how they have affected us economically.
Milton Friedman had a general principle that only people can have responsibilities, not businesses, and it is also the primary responsibility for the employers to make sure that their employees meet their desire of making profits. Milton Friedman knew well that an individual can have perceived responsibility in areas away from their business: According to Friedman “If we wish we can refer to some of these, responsibilities as social responsibilities. But in this case respect he is acting as a principal not an agent; he is spending his own money or time and energy he has contracted to devote to their purpose. If these are social responsibilities they are social responsibilities of the individual, not the business”. M r Friedman’s technique is to de-assemble the image of businesses in to individual businessmen and to as an alternative present them as what he believes they are and that is group of individual who are just paid to work at the request of the owners. Therefore, the employees should only be concerned as to their responsibility of creating profits for the owners and not whether their role in the firm is benefiting the entire society or not; this is solely done through motivation.
Even though i would agree that there is an amount of truth and sense in this case, I cannot help believe that his understanding of CSR is somehow too small, paying attention purely on the business and its role in the free market and has become most definitely outdated for the current culture. Friedman make convincing points during his deconstruction of the image of a business; however he forgets the main attribute that the will of the general public is the strength of the CSR. (Mulerat 2010).
It is clear that whoever believes in corporate social responsibility as the sole strategy also believes in the profitability espoused by Mr. Milton Friedman. And the best strategy to ensure profitability through a CSR strategy is only marketing. Unfortunately for Mr. Friedman, the CSR is old enough to no longer be considered a tendency but a fully-fledged strategy essential to business that wishes to succeed in the modern socio economic environment. Where it is widely believed that some economists like Karl Marx has failed to impress by discounting the natural human character of greed, Mr. Milton seem to have low-priced the natural need to survive by sticking with the group. If at all Mr. Friedman understood that, maybe he could have explored the chances that CSR presented in helping a company generate solution to social issues without affecting its profits performance.
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Edward Elgar.Bottom of Form
Horrigan, B. (2010). Corporate social responsibility in the 21st century: Debates, models and practices across government, law and business. Cheltenham, U.K:
Mullerat, R. (2010). International corporate social responsibility: The role of corporations in the economic order of the 21st century. Alphen an den Rijn: Kluwer Law International.
Shin, K.-Y. (2014). Corporate social responsibility reporting in China.
