Richard Branson,
founder of Virgin Atlantic and a myriad of other companies, sees a natural
extension or follow-through from the pro-democracy protests in the Middle East
and North Africa to more corporate social responsibility. As much as I would
like to think that the twenty-first century proffers a new world, I think we
have to acknowledge the weight of the political, economic and social strictures
that we have uncritically inherited.
According to USA
Today, “Branson says it took him seven years to realize businesses are part of
the problem as they focus narrowly on profit and exhaust natural resources.
Now, he believes the world has changed in the last several months, with
revolutions in the Middle East, the earthquake and tsunami in Japan, riots in
London, famine in East Africa, and debt crises around the world. He quotes the
band REM: "It's the end of the world as we know it … and I feel
fine." Seven
years? Branson has been thinking on all cylinders. Even if businesses
are not part of the problem, the default of business is to make profit by
turning resources into products to be consumed. This is the raison d’etre (i.e.,
the reason for being) of the modern corporation. Viewing its inherent function,
as per its design, as part of “the problem” may simply be due to the sheer
magnitude of a large corporation’s operations. In other words, a large foot is
apt to leave a large footprint.
Moreover, changes in
government, protests, natural disasters and a systemic overreliance on
debt-financing by governments do not necessarily mean the end of the world as
we know it. I wish this were so, but people in power have a nasty habit of
retaining it, even if under subterfuges if necessary. For example, the military
rule in Egypt at least as of the beginning of 2012 may put the “revolution” in
2011 in perspective. That is to say, the old guys are still in charge, so how
much of a revolution was it? Furthermore, it would be naïve to believe that the
corrupt relationship between business and government in Japan has been expunged
by the post-tsunami clean-up. It is doubtful, for example, that TEPCO has been
born-again as if baptized by the tsunami.
The larger point
Branson is making in his statement is that corporations will no longer be part
of the problem because the world as we know it is no more. He cites several
instances of corporate social responsibility to make his point. However, the
business of business is still to make money, and much of CSR is still
essentially marketing writ large. Without changing the design in
corporate law, it is foolhardy to believe in a brave new world of corporate
capitalism. It is at the very least a stretch to assume that pro-democracy
protests or changes in government will somehow convince business executives to
engage in CSR. Even in terms of corporate or “stakeholder” democracy, the
linkage is tenuous because the expectation that governments should be
democratic does not extend to corporations because the two are typically viewed
as different domains. So to Branson, I would say, nice job with your companies
and even on CSR, but let’s not get carried away on some jet to nirvana. As much
as we would like to see the world remade rather than carrying on with baggage
from the twentieth-century, we would get further toward this goal by keeping
our legs on the ground.
Source:
Kathryn Caravan, “Branson’s
‘Screw Business As Usual’ Has High Points,” USA Today,
January 23, 2012.
