Transparency in social reporting requires companies to acknowledge the bad as well as the good, argues Adrian Henriques
At a conference just before the invasion of Iraq I asked the question ‘What is the corporate responsibility of a company in a time of war?’.
The panel of eminent business people responding acknowledged that it was a significant question, but they did not have an answer. This is strange because for ordinary citizens, the corresponding question (‘What is my responsibility in a time of war?’) was in one form or another a topic of very lively debate at every level of society.
Is it reasonable to talk about companies in the language in which individual responsibilities are discussed? Or is it taking an analogy too far? Aren’t companies merely legal fictions? Yet if so, they are some of the most powerful fictions on the planet.
There are many pointers to the reality of the fiction. Companies in most jurisdictions are legal persons; they have places of residence; they occasionally have a vote – for example in the City of London; at least in Europe they have human rights under the law, and in the US the Kasky v Nike debate has revolved around whether they also have free speech under the constitution.
So while corporate social responsibility and corporate citizenship practice borrow freely from the elevated discourse of ethics, it cannot escape the grittier language of moral debate. If corporate citizenship is to be more than the cuddly offspring of campaigning and community good works, then issues of right and wrong have to be addressed. Of course it is rather easier to address the issue of being right than of being wrong. It is easier to claim responsibility for an impressive community project than to acknowledge that you have blighted lives, perhaps through some accident.
One consequence of imbalanced accounts of company activities is that social reports are seen as ‘merely PR’. If major statements of a company’s responsibilities are one-sided, then all its statements lose credibility.
What seems to be happening is that companies are attempting to be entirely ‘good’. So where does all the bad go? It is largely projected onto others: campaigners, extremists, dreamers. The result is a polarization of opinion. Conflict becomes more likely. Campaigning non-governmental organizations may re-double their efforts to embarrass companies. The recent Friends of the Earth social report written ‘on behalf’ of Shell illustrates this point.
It is easier to fight than to acknowledge that part of the blame for a situation is one’s own fault. Yet from selling arms to supporting a just cause, every company has reason to be involved in such debates. Or will they claim the right to be silent?
Adrian Henriques is professor of corporate social responsibility at Middlesex University in the UK, and director of Just Assurance, a social auditing organization. [email protected]