In today’s eco-friendly society, much of the global population is driven towards using ethical businesses to make a difference to some of the major world issues.
(If you are not already familiar with Corporate Social Responsibility (CSR), there is a glossary at the end of this article with some key definitions.)
Why are Companies Favouring Ethical Business?
An example of a clear drive for social change would be when Cadbury changed their cocoa bean to a Fairtrade supplier because consumers demanded it. However, how do we know that this instance of CSR isn’t anything more than window-dressing to gain more customers and drive profits? Did Cadbury become more ethical because they wanted to, or did they do so to avoid losing customers?
To find a simple answer, we only really need to look at how Lush made a turnover of £995 million in 2017. Knowing this, is questioning the motives of big corporations even worthwhile? Companies in the cosmetics and toiletries industries use ethical practice as their unique selling point, but let’s face it: the main aim for a company is to make profit, which is most easily achieved by building a positive brand image.
A Kantian perspective
If we approach the issue with a Kantian perspective, a business only accepts a CSR by their own volition, so that the government doesn’t force them to by imposing strict, potentially profit-harming laws (e.g. having a more ethical supply chain). Businesses only want to become ethical to improve profits and don’t strictly care how ethical they are; everything they do is in the interest of keeping their autonomy and their profits.
The Principle of Utility
If one was to take a Principle of Utility approach to the debate, Jeremy Bentham would argue that upholding CSR is just a marketing strategy. However, this doesn’t really matter if the marketing ploy is making a large portion of consumers happy, which turns the argument into a matter of Utilitarianism. Knowing that you’re buying an ethical product from an ethical company doesn’t matter, regardless of how much the company is earning as a result; all that matters in this instance is that the company are making most people happy.
On the contrary, Carl Popper argues that we have to focus on the pain caused by forced ethical consumerism. CSR is a westernised ideology, and by forcing it on Eastern countries, it can cause pain, such as indigenous cultural values being ignored.
Ultimately though, times are changing, meaning that it no longer seems appropriate for businesses to only pursue profit without considering environmental factors (or indeed the socio-economic impact on low-income countries). Whether you think that CSR is nothing more than window-dressing to gain more customers and increase profits, is up to you.
What do you believe?
Corporate Social Responsibility: A type of regulation put on international businesses to insure they stay ethical in their practices as a business.
Window-Dressing: A misleading way of presenting something to create a desired/controlled impression. In the case of business, it is being ethical through genuine desire.
Kantian Ethics: A duty-fuelled ethical theory proposed by German philosopher Emmanuel Kant. This is the idea that people should act in according to their duty and good will.
The Principle of Utility: An ethical theory that states to produce the greatest amount of happiness.
Utilitarianism: An ethical theory proposed by English philosopher Jeremy Bentham that sets out to produce the “greatest amount of happiness for the greatest number.”
Negative Utilitarianism: Proposed by Australian philosopher Carl Popper that states we should try to reduce the amount of suffering in the world because it’s easier than trying to increase the happiness in the world, which is a subjective concept.