"Getting Smart At Being Good"

From Time Magazine

The rapid growth and mainstreaming of corporate social responsibility (CSR) in corporate America was recently underscored by Wal-Mart's announcement that it would offer employees better medical benefits, invest $500 million annually in energy efficiency, and slash its solid waste and greenhouse-gas emissions.

While much of the business culture has publicly embraced the notion that CSR is good for business, there remain some critics, such as Cypress Semiconductor CEO T.J. Rodgers, who maintain that shareholders entrust managers solely to maximize long-term returns. Rodgers has been an important part of the debate over CSR in the past decade, including having recently joined Milton Friedman and Whole Foods Market CEO John Mackey to debate the issue in Reason magazine. Whereas Rodgers assailed the notions behind CSR, Mackey--himself an avowed libertarian--argued that his approach brought Whole Foods' investors much more wealth than the approach used by Cypress, which in fact saw losses for three years before turning a small profit in 2004.

The business argument behind CSR is also articulated by Nike's vice president for corporate responsibility, Hannah Jones, who says, "Don't do it as a reputation-management tool. Do it because it genuinely contributes to your business strategy." This means not only working to protect the brand, as Nike has done after long being the subject of protests, but also attempting to secure the future--as in the case of corporations' response to AIDS, a disease that Trevor Neilsen of the Global Business Coalition Against HIV/AIDS says "is like a laser-guided missile targeting the most productive segments of our economies and societies."Proponents also say that CSR can help cultivate new markets, pointing for example to Crest's gains in the Hispanic market after beginning a national dental-health program for underserved children. Other benefits from CSR, according to proponents, include the ability to raise standards and to serve as an inspiration to the work force.