The State of Corporate Responsibility – The Black Policy Institute

07. Jan

Young Peoples Advisory Board

Written by Elijah Amoako, Policy Advisor of the Young People Advisory Board

Various corporate communications & HR departments within companies focus on the importance of Corporate Social Responsibility (CSR), without truly understanding what it means. Corporate Responsibility is about the strategies undertaken by companies to take an active and positive social role in the world around them. Starting with a clearly defined view on what is right and wrong, companies will make their best efforts to initiate the former in all stages of production for businesses.

If that is the dream, what is the reality? Global economic uncertainty, anti-trust concerns (collusion/price fixing), and unreliable CSR data has divided opinions on the state of corporate social responsibility. It has notably been used more as a marketing tactic, than a business operation principle. The initiatives set up by private companies often are for publicity purposes, with the actual intended value added much smaller than the advertised version. Companies have been only socially responsible when the cameras are on and when the world is watching. Some examples of this are:

Environmental Exploitation: Through measures such as deforestation & pollution companies are meant to curb business practices to contribute to climate change reform but many fail to do so. “In Plachimada, Kerala, Coca-Cola extracted 1.5 million liters of deep well water, which they bottled and sold under the names Dasani and BonAqua. The groundwater was severely depleted, affecting thousands of communities with water shortages and destroying agricultural activity. As a result, the remaining water became contaminated with high chloride and bacteria levels, leading to scabs, eye problems, and stomach aches in the local population.”

Labour Exploitation: Firms have repeatedly been caught engaging in the employment of underage workers and paying below minimum wage for services. “In the year 2000, 2,000 African-American employees in the U.S. sued the Coca Cola for race-based disparities in pay and promotions.”

Unethical Marketing Practices: Companies have launched misleading advertisements regarding the qualities and benefits of a product or service. “Coca-Cola’s anti-obesity advertisement made false claims by saying Diet Coke is a treatment for obesity (Gary, 2015). The company’s deceptive packaging by labelling drinks as ‘diet’ misled consumers.”

Human Rights Violations: Organisations have operated in regions where it is known that human rights are violated, especially during pre or post war periods. “Between 1989 and 2002, eight union leaders from Coca-Cola bottling plants in Colombia were killed after protesting the company’s labour practices. Hundreds of other Coca-Cola workers who have joined or considered joining the Colombian union SINALTRAINAL have been kidnapped, tortured, and detained by paramilitaries who are hired to intimidate workers to prevent them from unionizing.”

Coca Cola Sources:

Recently there has been an increase in the development of socially responsible action measures to address these issues. Companies prioritise the perception of:

What they do and do not support.
Where they donate their time & money.
Their current intentions in improving Diversity & Inclusion.

There has been an increase in performative social responsibility frameworks that explain CSR initiatives rather than achieving them. At present, comprehensive CSR arguments now highlight the importance of these measures, instead of tangible policies being put in place. With statistical data showing improvements over time. This sets a dangerous precedent. Shifting the narrative from an actual focus to theoretical analysis, birthing a widespread feeling of neglect in the work environment. A 2019 survey by Futerra and the Public Relations and Communications Association (PRCA) found that 58% of consumers in the UK were unsure about or sceptical of company claims about their positive impact on the environment. Targeted groups of CSR causes, repeatedly noticed these common features:

Greenwashing: Companies that provide falsified claims to environmentally friendly commitments without making substantial changes in their actual operations.
PR Stunts: Firms engaging in CSR for the sole intention of enhancing their reputation, rather than making an authentic commitment to social and environmental responsibility.
Diverting Attention: CSR may be seen to distract consumers from other issues, such as labour disputes / environmental violations. Resources could be better allocated elsewhere, such as improving employee benefits or investing in research and development. The concern is that companies knowingly prioritise image-building over addressing internal issues.
Lack of Accountability: CSR initiatives are often voluntary, with companies not facing consequences for failing to meet their stated goals. Without strict accountability measures, there is a strong risk that companies may not follow through on their commitments.

In conclusion, it is imperative to note negative perceptions do not apply universally, and many companies are genuinely committed to responsible business practices. Companies that demonstrate transparency, accountability, and a sincere commitment to addressing social and environmental issues are more likely to be positively received by stakeholders. However, the waters aren’t clear, and we have a long way to go before we can sift the wheat from the chaff.

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