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From the President, KLD Research & Analytics Inc.
In response to your News Alert on the subject of the European Commission white paper's avoidance of regulation, I would say that the critique made by Malcolm Guy of EQ Management was excellent.
However, I would quibble with this paragraph: "The Commission's premise that CSR is, by definition, a voluntary activity based on a strong business case, is not a convincing foundation for policy development. In restricting the scope of the white paper to this definition some major legislative and regulatory blind spots emerge, most importantly the role of effective and credible governance. The proposed commitment to commission research on identifying and strengthening the business case is significant and must be viewed as a key ingredient to the non-legislative approach."
Like the "performance" test for socially responsible investing, the "business case" is an insuperable barrier erected by people not interested in seeing CSR succeed. It avoids, neatly, the question of "right or wrong". It also ignores reality.
Could one have devised a "business case" for ending the use of slaves in the American cotton-growing industry before the Civil War? Or at the Tredager Iron Works, the South's major source of iron and steel? Where is the business case today for retailers dropping sweat-shop labor? Or for providing (in the US) defined benefit pension schemes?
There are rights and there are wrongs. Nothing in economics says good business practices in the absence of understanding – and acting on – that fact will result in a more just society. Anyone seriously taken with the "business case" notion should read Adam Smith – both The wealth of nations and The theory of moral sentiments.
As for my rhetorical questions, it might interest you to know that the real-life model for the Thomas Mitchell character in Gone with the wind owned two huge plantations – one cotton, one rice – near Savannah. He was also a Scottish emigrant and a Presbyterian minister who preached every Sunday to his slaves – he owned more than 1,000. By every account, he was a kind, generous man, a beloved father and a fine master. Interested readers might like to see Robert Manson Myers, The children of pride, Yale University Press, 1973.
Peter D. Kinder
In response to your News Alert on the subject of the European Commission white paper's avoidance of regulation, I would say that the critique made by Malcolm Guy of EQ Management was excellent.
However, I would quibble with this paragraph: "The Commission's premise that CSR is, by definition, a voluntary activity based on a strong business case, is not a convincing foundation for policy development. In restricting the scope of the white paper to this definition some major legislative and regulatory blind spots emerge, most importantly the role of effective and credible governance. The proposed commitment to commission research on identifying and strengthening the business case is significant and must be viewed as a key ingredient to the non-legislative approach."
Like the "performance" test for socially responsible investing, the "business case" is an insuperable barrier erected by people not interested in seeing CSR succeed. It avoids, neatly, the question of "right or wrong". It also ignores reality.
Could one have devised a "business case" for ending the use of slaves in the American cotton-growing industry before the Civil War? Or at the Tredager Iron Works, the South's major source of iron and steel? Where is the business case today for retailers dropping sweat-shop labor? Or for providing (in the US) defined benefit pension schemes?
There are rights and there are wrongs. Nothing in economics says good business practices in the absence of understanding – and acting on – that fact will result in a more just society. Anyone seriously taken with the "business case" notion should read Adam Smith – both The wealth of nations and The theory of moral sentiments.
As for my rhetorical questions, it might interest you to know that the real-life model for the Thomas Mitchell character in Gone with the wind owned two huge plantations – one cotton, one rice – near Savannah. He was also a Scottish emigrant and a Presbyterian minister who preached every Sunday to his slaves – he owned more than 1,000. By every account, he was a kind, generous man, a beloved father and a fine master. Interested readers might like to see Robert Manson Myers, The children of pride, Yale University Press, 1973.
Peter D. Kinder
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