Corporate Social Responsibility and Philanthropy: The Missing Link

Abstract

The notion of “corporate social responsibility” has been developed by academic literature for decades. National governments, international organizations and researchers gave a number of definitions of “socially responsible” corporations. In the meantime, the process of economic globalization brought forth corporations as autonomous legal entities and the debate became even more complex due to the concept of “corporate citizenship”. Despite a multifaceted theoretical background, there was a common idea: corporations have (or should have) a role in the development of society. Scholars thus began to question the idea that managers should only consider shareholders’ interest when managing the company. The Berle-Dodd controversy rose once again and the paradigm of shareholder value was put under scrutiny. A number of alternative models were developed (the enlightened shareholder value or long-term production theory, the team production theory), and they all tackled a common problem: how much should managers take into consideration other stakeholders’ interests? Among these stakeholders there are those entitled to social rights, ecological rights and human rights: as such, the debate on CSR strongly intertwined itself with that on stakeholders’ interests. In its first part, the paper will examine how the aforementioned debate impacted on national and international legislation, as well as corporate codes of ethics (non-binding list of rules that corporations declare to adhere to), in order to assert the current normative framework of CSR standards. In the context of the actual immigration crisis, fulfilling refugees’ rights is a most urgent social issue, involving all of us on a global level. Since government are struggling with both practical and political issues, many have advocated for an intervention by private companies, although it is unclear how this should happen. Since, in principle, humanitarian assistance by corporations is considered a philanthropic activity, in the second part his paper will try to assert if philanthropic activities are considered part of a “socially responsible” conduct by: 1) the academic debate on CSR; 2) national and international legislations; 3) multinational corporations (examining both their activities and codes of ethics). A brief case study on how multinational corporations responded to the refugee crisis will also be conducted, in order to better understand what place philanthropic activities have in the CSR debate.The paper concludes that, while certain definitions of CSR encompass philanthropic activities (from both an academic and a legislative point of view), corporations have implemented a concept of CSR that only consider the interests of parties related to the company (directly or indirectly). In light of the rising necessity for global humanitarian assistance, the paper ultimately suggests that it’s time for the debate to receive a broader definition of socially responsible conducts, in order to develop a new concept of corporate social responsibility that is grounded on what corporations are actually capable of doing.