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The Market for Virtue

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The Market for Virtue

The Potential And Limits Of Corporate Social Responsibility

Brookings Institution Press,

15 min read
10 take-aways
Audio & text

What's inside?

Can the corporate social responsibility movement really create both change and profit? Or is change up to government?

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Editorial Rating

8

Qualities

  • Innovative

Recommendation

Support for corporate social responsibility (CSR) has never been stronger. However, while most books concentrate on CSR's benefits in terms of increased sales and enhanced brands, David Vogel questions these theories. He thoroughly examines the "market for virtue" from every angle. He explores the demand for responsible products, practices and investments, and finds it wanting. Vogel looks at how corporations respond to public pressure, usually with voluntary codes of conduct. He concludes that the codes work within limits, but believes that ultimately government regulation, not CSR, will bring about substantial change. Some readers will find his thorough analysis fascinating, though others may think it is too academic. getAbstract recommends this book to anyone who has readily accepted the CSR advocates' argument that doing good is always good for business, and to those who want to do good – or see good done – with or without profit.

Summary

Why Act Responsibly?

Companies choose to behave responsibly even when they are not legally required to do so for various reasons, which could be strategic, defensive, or humane and philanthropic. Some corporate social responsibility (CSR) programs have demonstrably improved working conditions, protected the environment and abetted social causes. Market forces that affect CSR (whether they promote or hamper it) include boycotts, investor pressure, consumer demand for responsibly manufactured products, top-tier management's values, and challenges from nongovernmental organizations (NGOs).

Much of the work that corporate responsibility programs now accomplish received more attention from government regulators decades ago than it does today. Civil regulation enjoyed unprecedented growth in the 1960s and 1970s. The strategies that developed then included, "voluntary codes of conduct, social audits, public interest proxy resolutions, social investment funds, and assessments and rankings of corporate social and environmental performance." But, by the 1990s, government regulation could no longer effectively control or monitor the practices of international companies, so CSR...

About the Author

David Vogel is a professor at the Haas School of Business at the University of California, Berkeley, and editor of the California Management Review. His other books include Trading Up: Consumer and Environmental Regulation in a Global Economy and Kindred Strangers: The Uneasy Relationship between Politics and Business.

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