Question

Corporations are often criticized as focusing too much on profits and not enough on being socially responsible. Is there a discrepancy between maximizing shareholders’ wealth and being socially responsible? Can you give examples of firms that are socially responsible and how they are being socially responsible?

Answer 1

The growing Corporate Social Responsibility (or CSR, for short) movement competes directly with Milton Friedman’s “the only social responsibility of corporations is to make money” philosophy. However, many corporations go above and beyond their profit motives to examine and improve their social and environmental impacts.In such a business climate, consumers could keep close tabs on corporations and increase the necessity for businesses to become (or at least appear to become) socially responsible companies.

Ben & Jerry’s

This company has a reputation for social responsibility that goes back to its original IPO in 1985. That’s when the Ben & Jerry’s Foundation was created with an initial gift of 50,000 shares and a decision of the company’s Board that 7.5 percent of the company’s pretax profits be allocated to philanthropy.The foundation now awards more than $1.8 million per year to fund community action, social change, sustainability, and other initiatives in the company’s home state of Vermont and throughout the country.

Starbucks

As a company established in the 1970s, Starbucks has always operated with a sensitivity to social responsibility — committed to sustainability and strengthening communities. For example, the company has committed to providing one million coffee trees to farmers as a partner in Conservation International’s “Sustainable Coffee Challenge.” In addition, the company plans to hire 10,000 refugees across 75 countries in the next five years, plus, hire 25,000 veterans by 2025.

Dell

Dell has implemented the 2020 Legacy of Good Plan as their commitment to “drive human progress” through environmental sustainability, addressing community challenges, global supply chain responsibility, hiring diversity, and, ultimately, a dedication to putting more back than they take out.The Net Positive Project goal is, by 2020, to contribute 10x the good that it takes to create and use their technology.

Virgin Atlantic

Virgin Atlantic’s Change is in the Air sustainability initiative has three main pillars: environment, sustainable design and buying, and community investment.Since 2007, they have reduced total aircraft carbon emissions by 22% and have partnered with LanzaTech to develop low carbon fuels for the future. Virgin Holidays donates £200,000 annually to the Brandon Center for Entrepreneurship Caribbean to support young entrepreneurs in Jamaica. In 2016, through onboard collection of spare foreign currency from customers, they raised over £500,000 for charity partner WE.

BMW

Just finished celebrating its 100th year in business, The BMW Group has maintained its rankas one of the world’s most sustainable automotive company as rated in the Dow Jones Sustainability Indexes.This aspect of BMW’s operations is only one of the company’s social responsibility programs, which include education, wellness, and inter-cultural understanding as key tenets of a commitment to “social peace” and “stable economic development”.

Walt Disney Company

Disney, the number one company in the entertainment industry, has been ranked one of the “World’s Most Admired Companies” by Fortune for two years in a row. The company’s social mission is to strengthen communities “by providing hope, happiness, and comfort to kids and families who need it most” and gave more than $400 million to nonprofit organizations in 2016.The company’s “VoluntEARS” program encourages employees to donate time, which has totaled to 2.9 million hours of service since 2012 with a goal of reaching five million hours of employee community service by 2020.

Apple

As one of the world’s leading technology companies, Apple takes its global responsibility seriously. One aspect of its social initiatives is the environment, adopting a mission to “ask less of the planet”.Greenpeace has named Apple the “greenest tech company in the world” for three consecutive years. Not only does the company encourage its IT partners to take full advantage of renewable energy, Apple packaging is now manufactured with 99 percent recycled paper products.

IBM

Citizen IBM embodies the company’s dedication to corporate citizenship. IBM supports a wide range of efforts for education, disaster relief, diversity, economic development, global health, and more. Their approach to corporate citizenship aligns with that of their business — “applied technology, continuous transformation, and sustainable change”.In 2016, The World Community Grid combined the computing power of idle PCs and mobile devices across a worldwide network for an equivalent of 167,000 years of computing time to support projects such as cancer treatment research.