Corporate Social Responsibility priority? Increase profits...

This of course was the view most famously expressed by one of the 20th century’s most important economists, Milton Friedman. A battle has since raged between those like Friedman who think that “the social responsibility of business is to increase its profits” and other groups taking a wider view, including many top firms (and the UK parliament in 2006 who passed the Companies Act).

Don’t dismiss the Friedman point of view, which has caught out many firms (like Unilever) or pressure groups (like Oxfam) who assumed that the pursuit of profit must be evil.

Here’s a snip from an earlier, more detailed blog which picked up on this point:

“In 2004-05 poverty relief agency and the Anglo-Dutch consumer-goods company, jointly conducted a detailed study of the economic impact of Unilever’s operations in Indonesia. The conclusions were eye-opening, especially for Oxfam. Unilever in Indonesia supported the equivalent of 300,000 full-time jobs across its entire business, created a total value of at least $630m and contributed $130m a year in taxes to the Indonesian government. The lesson for firms is that they have been far too defensive about their contribution to society. If efforts to do good become a distraction from the core business they may actually be downright irresponsible. After all, a socially conscious but bankrupt business is no good to anyone.”

The Economist has recently reported the results of an international survey judging the extent to which people agree with this viewpoint.