Draw the line: CSR and eithical humanitarian practice

23 Sep

One thing the corporate world absolutely has going for it is that at the end of the day, everyone in that world knows where their bottom line is.

The bottom line is profit.

Everything else is ultimately subservient to profit. Every pet project. Every initiative. Every innovation. They all fit into a larger profit calculation, and so when those pet projects or those innovative initiatives don’t bear fruit in the form of profit, they get cut. And if those running the show don’t have the good sense to cut those projects which cost the company money, as opposed to generating more of it, raw Darwinism eventually takes over. The bottom line is profit. Cross it and you’re out of business.

Sure, there is messed-up-ness in the corporate world, too. It’s not all a well-oiled profit-making machine. There’s boondoggle and graft and messed up priorities just like in any other sector. But I can guarantee you that whether we’re talking about one individual making a profit while running her or his company into the ground, or a sector within the corporate world raking in the cash while running the economy of an entire nation into the ground, the notion of profit reigns supreme. In the corporate world, regardless of whatever else might be in the mix – motivations, beliefs, distractions, investment, innovations, R&D, vision – the comes a point at which the bills have to be paid and the shareholders have to be paid out. The bottom line is profit.

And this all applies to Corporate Social Responsibility, too. CSR exists precisely because it’s profitable. It is important to be clear on this point: the bottom-line enhancing qualities of CSR are not an afterthought or serendipity or by-products. On the contrary, they’re the entire point. It doesn’t matter whether we’re talking about Philip Morris funding cancer research, Proctor & Gamble making PUR water purification sachets available, TOMS Shoes giving away shoes and glasses and calling it “aid”, or a world of shade and color and nuance and variation among all of those, CSR is about that bottom line, profit. I think we can all very safely assume that Corporate Social Responsibility investments would stop existing tomorrow if they weren’t profitable.

I’m not saying this is either good or bad. It just is.

What it means for humanitarians, though, is that we come to the CSR conversation with a very distinct disadvantage: we don’t have a bottom line. At least not one that is as clear and tangible as profit, and certainly not one that is universally acknowledged in the humanitarian world. We have some generalized notions about humanitarian ethics in the broader context, and some vague, squishy ideas about what’s good and bad, right and wrong when it comes to “partnering” with corporations. But we don’t have a humanitarian equivalent to “profit” in the corporate world. We don’t have a universal, grounding principle against which every initiative, opportunity, or “potential for collaboration with the corporate sector” can be held up against to show us clearly, “yes, this is legitimate humanitarian relief or development, this is acceptable”, or, “no, we need to leave this one on the table.”

The humanitarian world lacks a clear line beyond which negotiations with a donor, any donor, corporate or other, are terminated categorically on the basis of principle. This is a line that we desperately need to draw, and draw soon. We need to figure out what we’ll do and what we won’t. And not in the 35,000 ft. “We shall respect culture and custom” sense, but in the sea-level, “to what extent can we ethically enable market penetration of [PRODUCT X by CORPORATION A] in communities where we work in the name of ‘relief’ or ‘development'” sense.  Corporate Social Responsibility is not going away, and we have a responsibility to inject values and parameters other than profit into the calculus.

We have to draw the line.

11 Responses to “Draw the line: CSR and eithical humanitarian practice”

  1. solemu 23 September, 2011 at 2:12 pm #

    Great one J! Congrats on the first Aid Blog Forum. Unfortunately I didn’t have time this week to participate, but I hope to do it soon🙂
    I have a similar vision to yours, after experiencing some CSR first hand. But I have to say that your last paragraph HAS the answer to it: the NGOs or aid organizations need to have a position. And I don’t mean only a position to CSR, but a position from which to negotiate funding with donors. I was lucky enough to see the power of good negotiation from colleagues on that front, and if the organisation has some clear negotiables and non-negotiables from the onset of the discussions, the power relations can be leverages a bit.
    Keep up the great infusion of energy into the aid blogosphere🙂

  2. Nathan Yaffe 23 September, 2011 at 2:26 pm #

    Your post makes me think of a recent psych experiment, which I think you may find interesting.

    Excerpt from write-up:

    —-

    “The vice-president of a company went to the chairman of the board and said, ‘We are thinking of starting a new program. It will help us increase profits, but it will also harm the environment.’ The chairman of the board answered, ‘I don’t care at all about harming the environment. I just want to make as much profit as I can. Let’s start the new program.’ They started the new program. Sure enough, the environment was harmed.”

    He then asked his participants, “Did the Chairman intentionally harm the environment?”. The vast majority — around 82% — said yes, he did.

    Meanwhile, the other half of participants read exactly the same passage, but with the word ‘harm’ replaced with ‘help’, and then had them answer the question, “Did the Chairman intentionally help the environment?” Now most people (77%) said no, he did not.

    (source: http://philosopherinthemirror.wordpress.com/2011/06/24/the-anatomy-of-intentional-action/)

    —-

    So, there’s a demonstrated impulse to interpret business efforts that generate positive externalities in a cynical way. In my view, CSR is essentially a marketing campaign to overcome that.

    That’s fine; businesses have found another way to make money – that’s their job. But, for humanitarians to really get down to answering those sea-level questions you discussed, I think we need to collectively overcome our impulse to see businesses as either moral or immoral. Businesses or usually amoral, with others being the exception.

    I don’t think us humanitarian-minded folk are typically good at overcoming that moralistic impulse though…..

  3. J. 26 September, 2011 at 6:22 am #

    Solemu – hey, thanks! Hope to see your entries in future editions of the Aid Blog Forum!

    Nathan – Thanks for commenting. Sure, many humanitarian aid/development types are predisposed to cynicism when it comes to for-profit sector involvement in aid, myself absolutely included (despite a small token gesture in the direction of not total cynicism in this post). Maybe it’s something for us to work on… or maybe not?

    I think we need to not lose our grip on the fact that profit for one always always always means a loss for another. Even kids selling lemonade by the side of the road eventually come to understand that by definition, they cannot profit unless they take more than they invest. If one person profits, then someone else invariably loses. Which means that in a for-profit paradigm, taken to its extreme logical conclusion, there is no “everybody wins” scenario. There comes a point when win-win is simply not possible.

    So, some very “good” and “ethical” and “altruistic” and “well-meaning” individuals in the corporate world notwithstanding – and I absolutely believe that there are many such people – Corporate Social Responsibility initiatives will always stop short of loss. Profit is the bottom line. Let’s just hope that those people CSR claims to help actually do get helped before the CSR program helping them moves over onto the ‘debit’ column…

    I wouldn’t see this as cynicism, but rather as simply being in a state of awareness about how the world works.🙂

    • Marc 28 September, 2011 at 12:50 am #

      J, I don’t lack in cynicism regarding CSR, but I think you take it too far if you reduce it to an equation where the fact of somebody earning a profit invariably means somebody else loses. The kid selling lemonade receives cash. The thirsty customer has her thirst quenched. They both profit, don’t they? I mean, a really really thirsty person — like when you come in from two hours in a car in Sudan — might think the lemonade was worth triple the price.

      I’m 100% certain that profit makes an inherently poor motivator when applied to the delivery of social goods, particularly humanitarian aid. And I’m just as certain CSR is done for profit. But I don’t want to encourage a world in which we measure win/loss or prosperity/loss solely by watching the direction of cash, and that’s what you imply.

      • J. 30 September, 2011 at 2:07 pm #

        Marc –

        Okay, for the sake of argument, we both admit to a certain amount of cynicism. So, if I do take it too far, then in your view how far is far enough? And I ask sincerely, by the way. I actually do want to know what you think on this issue.

        Your ‘really thirsty person’ example raises an interesting point for me: I’m not sure that ‘what the market will bear’ is quite the same thing as the consumer also profiting from the transaction. Anyway, curious to hear your thoughts…

  4. Alex Merkovic-Orenstein 26 September, 2011 at 8:07 am #

    Interesting article from IRIN on this, actually.

    http://www.irinnews.org/report.aspx?ReportID=93710

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