For the past century – from the suppression of company towns on – the nation state has been seen as the sole protector, facilitator and enabler of citizens’ rights. But recently a new actor is entering the arena.
The corporation has always been a political creation, to which the state granted the benefit of limited liability in order to facilitate the accumulation of capital. But this freedom of limited liability placed on the corporation also a set of responsibilities and expectations on the role of the corporation in the society. These relationships and boundaries between business and society have been always changing through time and space. And as it seems, we are just witnessing one of these radical changes.
Corporate Social Responsibility (CSR) has been widely depicted as a business response to the anti-capitalist and anti-corporate campaigns of the 1990s, with which companies were gaining competitive advantage and were lessening the risks of a company’s good reputation by producing the long-solutions for stakeholders (Burchell and Cook, 2006). Moreover, authors have written about CSR as a method for global companies to develop strong links with the local communities; conceptualising CSR as a method for alleviating risk and the threat of damaging publicity; and understanding the process of ‘stakeholder management’ beyond the traditional confines of shareholders and employees.
Nevertheless, CSR should not be understood only as a voluntary philanthropic activity of integrating social and environmental concerns in companies’ business operations and in their interaction with their stakeholders. We believe that CSR of companies needs to be understood in the larger historical and political perspective of whether and in what forms corporations take on social responsibilities (Brammer et al., 2012: 3).
Beginning of a new institution
Historically, the prevailing notion of CSR emerged through the defeat of more institutionalized forms of social solidarity in liberal market economies. Understanding of CSR thus has to be widened to other disciplines such as politics, economics, law and sociology to show that CSR is more than philanthropic voluntary action, but rather a beginning of a new institution that plays an increasingly important role in provision of services in the times a neoliberal economic policies of deregulation and privatisation.
Matten (2005: 10) argues that »at the point where traditional governmental actors fail to be the ‘counterpart’ of citizenship«, corporations enter the arena of citizenship and »partly take over certain functions with regard to the protection, facilitation and enabling of citizen’s rights – formerly an expectation placed solely on the government« (Matten, 2005: 10-11). Within this domain of corporate citizenship (CC), corporation administers certain, but not all, aspect of citizenship to individuals and takes over considerate responsibility for such administration from governments.
Matten (2005) distinguishes between three roles a company can take with regard to the different rights: providing role by supplying or not supplying individuals with social services, enabling role by capacitating or constraining citizens’ civil rights, or channelling role by being an additional conduit for the exercise of individuals’ political rights.
These practices can already be observed in some rural localities where the restructuring of the state and the subsequent incorporation of corporate actors into a ‘diffused’ model of governance has created an institutional void. In these cases, »active and well-resourced mining companies are increasingly recognised as ‘filling the gaps’ in regional planning and service delivery where government activity is weak and community capacity is low« (Morrison et al., 2012).
Good? Or bad?
These activities can have indeed positive impacts on provision of services, economic opportunities and human development – nevertheless, it needs to be noted that corporations taking over vital functions of governments do not take over also the type exact same of accountability. Thus there is an urgent need to further research and understand the changing relationship between society and corporations.
- Brammer, S., Jackson, G., Matten, D. (2012) ‘Corporate Social Responsibility and institutional theory: new perspectives on private governance’. Socio-Economic Review 10: 3–28.
- Burchell, J. and Cook, J. (2006) ‘Confronting the “corporate citizen”: Shaping the discourse of corporate social responsibility.’ International Journal of Sociology and Social Policy 26 (3/4): 121-137.
- Matten, D. and Crane, A. (2005) ‘Corporate Citizenship: Towards an extended theoretical conceptualization’. International Centre for Corporate Social Responsibility Research Paper Series.
- Morrison, T. H., Wilson, C., Bell, M. (2012) ‘The role of private corporations in regional planning and development: Opportunities and challenges for the governance of housing and land use. Journal of Rural Studies 28: 478-489.