The three orthos of CSR

Citation

Kakabadse, N. (2007), "The three orthos of CSR", Corporate Governance, Vol. 7 No. 1. https://doi.org/10.1108/cg.2007.26807aaa.001

The three orthos of CSR

In September 2003 at the European Academy of Business in Society’s (EABiS) 2nd Colloquium at the Copenhagen Business School, Michael Porter in his keynote speech on the role of corporate philanthropy, declared that the field of “corporate social responsibility (CSR) has become a religion filled with priests” (Morsing, 2003, p. 72). He provoked strong reaction from an audience of mainly European academics and business managers. The intimation was that CSR exists because it does; there is little need for evidence or theory.

In fact, the Porter statement has drawn on one of the most powerful theoretical platforms, orthodoxy.

Coming into prominence with the advent of Christianity in the Greek-speaking world, the term orthodoxy is derived from ortho (“right”, “correct”) and doxa (“thought”, “teaching”), typically used to refer to correct theological or doctrinal observance of religion, more often than not determined by some overseeing body. The Christian debate about “correct belief” has raged for centuries opposing all other heterodoxy (”other teaching”). At times of extreme orthodoxy, those who deviated from the held belief were considered as professing a false doctrine and were labelled heretics.

Porter’s implicit challenge of European CSR orthodoxy induced a collective reaction of violation of the “correct belief”, in effect a form of abandonment of the “CSR faith” (Morsing, 2003). Porter seemingly drew on another powerful Greek theory, that of Apostasy (Greek for “defection” or “revolt”), and in so doing allowed for schism (from the Greek word skhísma or “to split”) to emerge in the CSR movement. Yet, not all in the EABiS audience in Copenhagen were united in their condemnation of Porter. For some, inspired by his comment, visible support of him accompanied defiance of “this ghastly CSR thing.”

Perhaps unwittingly Porter entered into a debate of CSR orthodoxy, in effect a healthy, open and robust discourse of what exactly constitutes socially responsible business practice. In pursuit of such debate, the first stage of understanding is that of orthodoxy, typified by wide ranging and broad reaching CSR meanings and definitions (Kakabadse et al., 2005). At this early stage, agreement on who are the organisation’s main stakeholders is difficult to reach, let alone how they should be treated. Research shows that organisations” motives to participate in CSR range from strategic to altruistic depending on sectoral, regional, organisational and idiosyncratic context. Commitment to the CSR agenda varies from considerable resistance, through what some call “pseudo compliance”, “green wash”, “public relations exercise” to genuine commitment. At this stage, even the most altruistic of ideas can be lost in everyday practice where meaning-making depends on patterns and policies deeply embedded in the organisation. The adoption of CSR principles faces many challenges, not only external to the organisation, but also internal ones such as changing ways of workings, redefining work structures and the rethinking of stakeholder relations.

One thing for sure, the agencies that promote CSR, such as Business for Social Responsibility (BSR, 2006) and the Coalition for Environmentally Responsible Economy (CERES, 2006), have become ever more vocal and the literature available has grown considerably. Despite the fact that the literature tends to focus on the larger corporation through notions of “corporate citizenship”, and less so on other forms of organisations such as SEMs, Non-governmental organisations (NGOs) and public bodies including government, the informal networks and alliances between business, community groups, trade unions, UN agencies, ILO (2006), environmental activists and academics, have mushroomed. The movement to date has examined globalisation, regulatory reinforcement and incentives for CSR adoption. A wide range of instruments that articulate CSR goals, provide measurement and benchmarks and set CSR performance standards are now freely and cheaply available. Prescriptions for CSR practice are entering the domain attending to issues as environmental and ecological sustainability; the well being of local communities; the determination of employees’, suppliers’, competitors’ and customers’ rights; transparent, legal and honest accountability and global citizenship impact. The emergence of prescription is not without reason as research shows that voluntary implementation of CSR is not promising. Despite good intention from the top, CSR remains poorly understood and appreciated from management below. One reason is lack of reinforcement through operational protocols or reward systems. Another reason perceived by both senior and middle management is CSR’s costly and time consuming nature. In this way, CSR is isolated from core business goals (Willard, 2005; Kakabadse and Kakabadse, 2007). CSR policies to date still tend to be more comprehensive on paper than they are in actual practice (Joyner and Payne, 2002; Kakabadse and Kakabadse, 2007).

Yet despite obstacles, prescription is becoming more evident and mainly in the helpful form of comment such as, “look this CSR works.” With the emergence of prescription, we seem to be moving from Porter’s challenge to CSR orthodoxy, to stage 2, that of orthopraxi (from the Greek words orthos, meaning “correct” and praxis, meaning “doing”, “acting”). Less concerned with precise definition or true belief in that observance of CSR principles and teachings will bring the individual back to correct CSR, serious exploration of the reality of CSR adoption is hitting the trade and academic journals. The debate is moving from what could be to what should be! The very fact that some of the world’s largest pension funds are boycotting corporations that they view as condoning “serious and systematic” abuses of human and employment rights (Macalister, 2006) confirms that the transition from orthodoxy or orthopraxi, namely the move from CSR stage 1 to stage 2.

One sign that the CSR transition to stage 2 is seriously underway is that doing is now being positioned as more important than definition. One of the most powerful beliefs that has survived the rigours of time, Judaism, is less concerned with precise definition of “correct belief” (orthodoxy) taking as axiomatic belief in God, but more concerned with correct practice. The mitzvah, or divine commandment, ranging from “love your neighbour as yourself” to minutia of religious ritual, the orientation is towards orthopraxi. True belief is realised through observance of 613 mitzvot of which 365 are negative (prohibitions) commandments of what a person should not do and 248 are positive (obligations) that a person should do. Even if the individual feels that their belief is weak, even one observance can bring them back to the fold (Kaplan, 1979, p. 14).

The strained argument over what is right is subsumed by a general commitment to reasonable and ethical action, supported by consistency of practice. Observation suggests that CSR is entering the second stage of its development (Kakabadse and Kakabadse, 2007). Interesting challenges await such as the shifting of energy sources from fossil based fuels, such as coal, oil and gas, to alternative energies intermingling solar power, water, wind and other renewable sources; reducing toxic effluent; restoring the health of society and ecosystems and reducing the negative impact of the production “footprint” (amount of land required to produce the resources).

Assuming CSR praxis becomes embedded, what of the future? Is there a stage 3? The answer is yes, a third level of CSR development is to follow, orthocracy (from the Greek ortho or “correct” and cracy meaning “form of government”, or a “state”, from kratein, meaning “to rule”). Orthocracy, in effect, correct CSR governance, is still far away. On a much broader basis, the debate on orthocracy and its relationship with democracy is still in its infancy. Sicker (2003) postulates that orthocracy as a concept of the structure and purpose of the state is superior to that of democracy. The hypothesis put forward is that orthocracy will become the fundamental pillar of society by the late twenty-first century. The current widespread adoption of substantive democracy as the current best conceivable means for reaching universal responsible statehood is considered by Sicker (2003) to be subsumed by orthocracy as the next step of the relationship of the state to its constituents. Orthocracy raises the debate of the rights and obligations of the state, and whether that relationship is defined entirely by the state or whether its constituents are endowed with natural rights independent of the state that the state must take into account in asserting its authority. In the hierarchy of social values, Sicker (2003) argues that equality will take precedence over liberty. The reason is that right to individual liberty undermines equality. For those with resources at hand, their exercise of individual liberty places others in an unequal, and for many, disadvantageous position. It is at this point that CSR will come into its own, as institutional and social responsibility are woven into the fabric and future of the state.

Thus, there are three stages of CSR, orthodoxy, orthopraxi and orthocracy. We are probably just into orthopraxi, but knowing what is to come provides the motivation and drive to examine and appropriately embed praxis so deep that it emerges as a prime structure of society.

Nada Kakabadse and Andrew Kakabadse