What Is Wrong with Making Profits?

Abstract

Over 50 years passed since Friedman’s famous doctrine that only individuals but not businesses have an obligation to be socially responsible. In the meantime, the concept of corporate social responsibility became a centerpiece of modern business ethics. It is undisputed that the license to operate requires businesses to be in line with society’s norms. Today, society expects from enterprises to meet their social responsibilities. Therefore, businesses need to measure their corporate social performance. With accurate measures, transparency increases, and information asymmetries shrink. Nevertheless, I argue that Friedman’s arguments are still valid, and, in the end, the most important corporate social responsibility is to increase long-run profits. This is no contradiction, however, as transparent reports on businesses’ activities serve profitability. I provide strong theoretical arguments for my standpoint based on a narrative approach.