The 1989 Exxon Valdez oil spill gave rise to the corporate social responsibility movement. The BP oil disaster may mark its collapse.
Over the past two decades, many organizations and investors have conducted an experiment in corporate behavior modification. An array of well-intentioned organizations promoted the idea that large corporations could be made to do the right thing, by urging them to sign voluntary codes of conduct and adopt other seemingly enlightened policies on environmental and social issues.
At first, management met this movement with resistance, but big business soon realized the advantages of projecting an ethical image--so much so that corporate social responsibility (known widely as CSR) is now used as a selling point by many firms. Chevron's "Will You Join Us" ad campaign, for example, apparently tries to convey the oil giant as a key player in global efforts to save the Earth.
Businesses found that a socially responsible image could serve as a buffer against aggressive regulation. While CSR proponents in the nonprofit sector didn't pursue a deregulatory agenda, the image of virtuous companies conveyed the message that strong government intervention was unnecessary. CSR dovetails with the efforts of corporations and their allies to undermine formal oversight of business activities. This is what General Electric was up to when it ran its "Ecoimagination" ads while lobbying to weaken air pollution rules governing the locomotives it makes.
Recent events make it clear that a commitment to CSR can be too cosmetic. The corporation at the center of the Gulf oil disaster, BP, promoted itself as being socially responsible for many years. A decade ago it adopted a sunburst logo, acknowledged that global warming was a problem, and claimed to be going "beyond petroleum" by investing (modestly) in renewable energy sources. What did all that social responsibility mean if the corporation could still, as the emerging evidence suggests, cut corners on safety in one of its riskiest activities--deepwater drilling?
BP is hardly unique in violating its self-professed "high standards." This year has also seen the moral implosion of Toyota, another darling of the CSR world. Only months after the Prius producer was chosen by the Ethisphere Institute as one of "the world's most ethical companies," it was found that Toyota had failed to notify regulators or the public about its defective gas pedals.
Goldman Sachs, widely despised these days for unscrupulous behavior during the financial meltdown, was a CSR pioneer in the investment banking world. In 2005 it was the first Wall Street firm to adopt a comprehensive environmental policy (after being pressured by grassroots organizations to do so), and it established a think tank on environmental markets.
When the members of a corporate rogues' gallery all profess to be socially responsible, the concept becomes meaningless. The best that can be said is that these corporations may behave well in some respects while screwing up royally in others--the way that Wal-Mart is supposedly in the forefront of environmental reform while retaining its Neanderthal labor policies. Selective ethics are no more tolerable for corporations than they are for people.
BP must come clean, both literally and figuratively. The $20 billion escrow fund is a good start, but the corporation must also provide a full accounting of what went wrong in the Gulf and what it will do to improve safety conditions in all its operations. You can let BP know that true corporate social responsibility means more than cheery logos, catchy slogans, and token gestures by taking action today at StopCorporateAbuse.org/HallOfShame.