Corporate Social Responsibility

Corporate Social Responsibility

by: Kimberly Wylie

Table of Contents

Abstract 2

Introduction 3

Corporate Social Responsibility Overview 3

Why Corporations Participate 4

Examples of Programs in Place  5

References 6

Abstract

The newspaper headlines are littered with corporate scandal news. Boeing Corporation paid a settlement of $10 million in a charge that it had illegally exported satellite-launch technologies. Later, they paid a $15 million settlement charge in an age discrimination suit brought by the EEOC. Merrill Lynch paid $15 million as settlement in its commodities scandal, and $400 million in 1998 as settlement for a suit that it had given reckless investment advice leading to Orange County, California’s bankruptcy. Enron, Arthur Anderson, WorldCom, and more have underscored the problems that are arising due to corporate greed (Kinard, Smith, & Kinard, 2003).

Yet, despite this disturbing trend of corporate mismanagement and greed, another trend is emerging, one of social responsibility. This paper will discuss what corporate social responsibility entails and why corporations are more frequently deciding to participate in these types of programs. Finally, an overview of some of the programs currently in place will be given.

Corporate Social Responsibility

Introduction:

The newspaper headlines are littered with corporate scandal news. Boeing Corporation paid a settlement of $10 million in a charge that it had illegally exported satellite-launch technologies. Later, they paid a $15 million settlement charge in an age discrimination suit brought by the EEOC. Merrill Lynch paid $15 million as settlement in its commodities scandal, and $400 million in 1998 as settlement for a suit that it had given reckless investment advice leading to Orange County, California’s bankruptcy. Enron, Arthur Anderson, WorldCom, and more have underscored the problems that are arising due to corporate greed (Kinard, Smith, & Kinard, 2003). Yet, despite this disturbing trend of corporate mismanagement and greed, another trend is emerging, one of social responsibility. This paper will discuss what corporate social responsibility entails and why corporations are more frequently deciding to participate in these types of programs. Finally, an overview of some of the programs currently in place will be given.

Corporate Social Responsibility Overview:

According to law, corporations are an artificial, legal being that posses a variety of rights, duties and powers, including some of the obligations of a person. The thought that this entity should also have a corporate conscience is not a new one. For more than 70 years, some have believed that corporations have a duty to society and should encourage humane and constructive social policies (Kinard, Smith, & Kinard, 2003). Berle and Means (1932, in Kinard, Smith, & Kinard, 2003) first noted that a new class of managers was acquiring vast amounts of wealth. As such, they believed that with this increased economic fortune came increased social responsibility (Kinard, Smith, & Kinard, 2003). As they owed their wealth to society, they should in turn repay society by contributing to programs that would speak to the public good.

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