Critical Assesment of CSR in Global Development World)

Setting New Agendas: Critical Perspectives on Corporate Social Responsibility in the Developing
World
Author(s): Michael Blowfield and Jedrzej George Frynas
Source: International Affairs (Royal Institute of International Affairs 1944-), Vol. 81, No. 3,
Critical Perspectives on Corporate Social Responsibility (May, 2005), pp. 499-513
Published by: Wiley on behalf of the Royal Institute of International Affairs
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newagendas:critical
Setting
perspectives
inthe
Social Responsibility
on Corporate
world
developing
MICHAEL BLOWFIELD AND JEDRZEJGEORGE FRYNAS
The themeof thisspecialissueis CorporateSocial Responsibility(CSR) in the

developingworld, and the need formore criticalperspectivesto understand
what CSR does and could mean forthe poor and marginalizedin developing
countries.Numerous claimshave been made about the contributionCSR can
make to poverty alleviation and other development goals. However, the
contributorsto this issue have reached the conclusion that currentCSR
approaches do not warrantsuch claims. Their work shows the need for a
criticalapproach to the strengthsand limitationsof CSR, one that poses
questionsthathithertohave been unasked or neglected.In this editorialwe
outline what such a criticalagenda mightlook like, drawingon the work of
our fellow contributorsand the many others who have been invited to
comment.
A criticalagenda is needed because many policy-makerssee businessas
importantin meeting developmentchallenges:not just those of economic
growth,but also in areassuch as combatingHIV/AIDS, reducingpovertyand
buildinghuman capital.Moreover, government,civil societyand businessall
to some extentsee CSR as a bridge connectingthe arenas of businessand
discussCSR programmesin termsof theircondevelopment,and increasingly
tributionto development.Implicitin thisview is thatdevelopingeconomies
are differentfrom developed ones, and require particularattention.This
broadlycomplementsthe premise of internationaldevelopmenttheorythat
in the
there are unique aspects to issues such as povertyand sustainability
solutionsfromthose thatmightbe
developing world that demand different
in
economies.
as manyof thearticlesin this
However,
implemented developed
This special issue is the culminationof an innovativecollaborationamong the contributors,Copenhagen
Business School and Chatham House. The contributorsfirstpresentedtheirwork in November 2003 at
a workshop convened by the Copenhagen Business School when the need fora criticalagenda became
clear. Revised papers and a draftof thiseditorialwere presentedat a second workshop and a one-day
conferencein August 2004. The papers were then presentedforexternalreview at a meetingof
held at Chatham House in January2005. We
business,civil societyand governmentrepresentatives
would like to thankall who participatedin these eventsfortheircontributions,and especiallyPeter
Lund-Thomsen and Michael Nielsen forinitiatingand sustainingthisinitiative.
International Affairs8I, 3 (2005)
499-5I3
MichaelBlowfield
andJedrzejGeorgeFrynas
issue make plain, the challengesof developmentare complex. Therefore,to
understandthe relationshipbetween CSR and developmentwe need to go
beyondtheissuesidentifiedwithinthefieldof CSR itself,and look at how that
fieldis helpingbusinessdevelop and addressthe centralissuesidentifiedby the
international
developmentcommunity.
In orderto understandthe potentialand limitationsof CSR's contribution,
we need firstto have a workingunderstandingof what we mean by CSR;
accordingly,in the nextsectionof thiseditorialwe providea shortoverviewof
how CSR is defined.We then examine the variouscriticismsmade of CSR,
context.On the
and considerwhethertheyare valid in a developing-country
basisof the articlesin thisspecialissue,we exploreseveralwaysin which CSR
affectsinternationaldevelopment,and ask what we know and need to know
about how the ideas,normsand values thatunderpinCSR theoryand practice
relateto developmentalgoals. We make no apology forthe factthatwe raise
manyquestionsto which we do not have answers;however,we conclude with
and researchersmight
some next stepsthatpolicy-makers,CSR practitioners
usefullyconsider.
Whatis CSR?
is a recentterm,a preoccupationwith
While 'corporatesocial responsibility'
businessethicsand the social dimensionsof businessactivityhas been around
for a verylong time. Businesspracticesbased on moral principlesand 'conwesternthinkerssuch as Cicero
trolledgreed'were advocatedby pre-Christian
in thefirst
suchas India'sKautilya
BC
and
their
non-western
century
counterparts
in the fourthcenturyBC; Islam and the medieval ChristianChurch publicly
condemned certainbusinesspractices,notablyusury.The modernprecursors
of CSR can be tracedback to nineteenth-century
produced
boycottsoffoodstuffs
such as Cadbury and
with slave labour, the moral vision of entrepreneurs
Marks,and theNurembergwar crimestrialsaftertheSecond WorldWar, which
saw the directorsof the GermanfirmI. G. Farbenfoundguiltyof massmurder
and usingslavelabour.2From a historicalperspective,then,CSR is simplythe
of earlierdebateson the role of businessin society.What is
latestmanifestation
new, accordingto Fabig and Boele, is that'today'sdebatesare conductedat the
of development,
environment
and humanrights,
and aremoreglobal
intersection
in outlook thanearlierin this[thetwentieth]centuryor even in the I96os'.3
There is no agreementamong observerson why the concept of CSR has
risento prominencein recenthistory,or on the definitionof what companies
2
Joanne B. Ciulla, 'Why is businesstalkingabout ethics?Reflectionson foreignconversations',California

Review34: I, I991, pp. 67-86; Scott Pegg, 'An emergingmarketforthe new millennium:
Management
transnationalcorporationsand human rights',inJedrzej George Frynasand Scott Pegg, eds,
and humanrights
Transnational
(London: Palgrave,2003); R. C. Sekhar,Ethicalchoicesin
corporations
business(Delhi: Response Books, 2002).
3 Heike
Fabig and Richard Boele, 'The changingnatureof NGO activityin a globalizingworld: pushing
the corporateresponsibilityagenda', IDS Bulletin30: 3, I999, p. 63.
500
Settingnewagendas
shouldbe responsible
forandhow. As MichaelBlowfieldarguesin thisissue,
thereare discernible
commonelementsto managingCSR, and thesesigniinfluencehow companiesview theirresponsibilities.
However,this
ficantly
different
does not stopCSR frombeinginterpreted
differently
by
people.It
can,forexample,meandifferent
thingsto practitioners
seekingto implement
andto researchers
to establish
CSR as a discipline;
CSR insidecompanies
trying
it can alsomeandifferent
thingsto NGOs and to companies.Althoughthese
differences
arean inevitable
andpotentially
fruitful
elementoftheinnovation
not leastto companymanagers
who might
process,theycan be frustrating,
prefera boundedconceptsimilarto qualitycontrolor financial
accounting.
findthemselves
withissuesas diverseas animal
Instead,managers
wrestling
environmental
rights,
corporategovernance,
management,
corporate
philanlabourrights
and community
stakeholder
management,
thropy,
development.
To complicatematters
thevocabulary
of business-society
debatesis
further,
beingexpandedto includenewtermssuchas corporate
accountability,
socially
and sustainabledevelopment,aimed variouslyat
responsibleinvestment
or complementing
theCSR concept.
redefining
replacing,
andindividuals
canalsochangetheirinterpretations
ofCSR. For
Institutions
theWorldBusinessCouncilforSustainable
instance,
Development(WBCSD)
haschangeditsdefinition
overtime.Initially
to CSR as 'the
(I998), itreferred
commitment
to
continuing
by businessto behave ethicallyand contribute
the
economicdevelopment
whileimproving qualityoflifeof theworkforce
and theirfamilies
as well as ofthelocal community
and societyat large'.But
thatdefinition
waslaterchanged(2002) to 'thecommitmentofbusiness
to contribute
to sustainable
economicdevelopment,
with
their
working
employees,
thelocalcommunity
andsociety
theirquality
atlargetoimprove
oflife'.
families,
CSR as culture
One wayoflookingatCSR is in terms
ofitscultural
thebelief,
roots,reflecting
fromMax Weberto CharlesTurner,thatcultureaffects
by writers
expressed
While notionsof corporateresponsibility
are not unique to the
capitalism.
West, the mostpublicizedapproachesto CSR todaymay be regardedas
sincetherediscovery
of'social'concernsofbusiness
Anglo-Saxon,
specifically
in Anglo-Saxoncountries
stemsfroma morerigiddivisionbetween'social'
and 'economic'affairs
andthestress
on individualistic-rather
thancommunitarian-values.Continental
societies
European,AsianorAfrican
maynothave
thetermCSR in theirvocabularies,
yetsomeofthesesocieties
mayhavehada
social contractwherebybusinesshas social obligationsto
longstanding
or widersociety,
suchas existsinJapan.4
employees
4 CharlesH. Turnerand FonsTrompenaars,
Thesevencultures
valuesystemsfor
wealth
in
ofcapitalism:
creating
theUnited
Sweden
andtheNetherlands
States,
Britain,
France,
Japan,Germany,
(New York:Doubleday,
1993), ch. 8.
501
MichaelBlowfield
While the originsof thecurrentCSR conceptmayhave been Anglo-Saxon,
the meaningof CSR can differfromone societyto another.When asked by
the WBCSD what CSR means to them, people from differentcountries
issueswere stressedin
issues:forinstance,environmental
emphasizeddifferent
Thailand, while Ghanaians stressedempoweringlocal communities.5At the
same time, the ethical concernsof businessmanagersdifferamong nations,6
and managersin multinationalcompanies can find themselvesjuggling the
These differences
perhapscontraryexpectationsof theirlocal and head offices.7
renderanycommon or comprehensivedefinitionofwhat constitutes
corporate
elusive, especiallywhen new initiativesseem to be continually
responsibility
emerging.
togovernment
CSR as an alternative
featureof CSR is the
For many proponentsand critics,a key distinguishing
voluntarynatureof the initiativescompaniesundertakein itsname, in contrast
used to governbusiness.8Few
mechanismshistorically
to the formalregulatory
hold thatbusinessshouldnotbe legallyaccountable,but in certaincircumstances
a voluntaryapproachto regulatingbusinessbehaviourmightbe beneficial.For
instance,where thereis a strongsystemof governance,voluntaryapproaches
withouttheneed fornew
mightbe a way of extendingcompanyaccountability
to act responsibly
business
approachencouraging
legislation-a complementary
to theruleoflaw. Equally,wheretheruleoflaw is weak,
but not an alternative
voluntaryapproaches can encourage multinationalcompanies to introduce
higherlevels of performancethanthoserequiredforlocal legal compliance.
as partof a wider revisitingof the
'VoluntaryCSR' can also be interpreted
role of government,and an increasingfocus on enabling legislationthat
encouragescertainbehavioursratherthan simplyattemptingto codifyevery
detailof compliance.Examplesinclude the UK Pension Fund Act 2000 or the
FrenchEconomic RegulationsAct 200I, both of which requirecompaniesto
to definewhat thatmeans.
reporton CSR withoutattempting
the broad idea of 'voluntary'mechanismsto regulate
However interpreted,
businessbehaviouris winningsupportfrompolicy-makersin nationalgovernmentsand intergovernmental
organizations,underpinnedby the assumption
that firmsare capable of policing themselvesin the absence of binding
and nationallaw to regulatecorporatebehaviour.The European
international
Commission'sGreen Paper ofJuly2001 definedCSR as 'a concept whereby
socialresponsibility:
WorldBusinessCouncilforSustainable
making
goodbusiness
Development,
Corporate
sense(Geneva:WBCSD, 2000).
6
ethicsandcorporate
TerenceJackson,
of
comparison',
policy:a cross-cultural
'Management
Journal
Studies
Management
37: 3, 2003, pp. 349-69.
7 JohnStopford
market
shares
Rivalstates,
rival
andSusanStrange,
(Cambridge:
forworld
competition
firms:
5
Cambridge UniversityPress, I991).
8 K. Andrews,
Business
be mademoral?',Harvard
'Can thebestcorporations
Review,
May-June1973,pp.
socialresponsibility
themask:thereal
Aid,
Aid,Behind
(London:Christian
57-64;Christian
faceofcorporate
20 Jan.2005.
in TheEconomist,
criticalarticles
published
2004). See alsothesetoflargely
502
Settingnewagendas
companies integratesocial and environmentalconcerns in their business
on a voluntarybasis'.
operationsand in theirinteractionwiththeirstakeholders
Yet this perspectiveon CSR is not shared by everyone,and there are
reservationsabout the emphasis on voluntarism.Indeed, many 'voluntary'
initiativesalso have a 'mandatory'aspect, and there are alreadymany intersectionsbetween CSR and the law, includingactualnew legislation(as passed
by Ghana to require logging companies to secure a Social Responsibility
Agreementwith customarylandowners)as well as legal aspectsto some CSR
initiatives(as when a code of conductby a multinationalfirmis incorporated
into a contractwitha supplier,becominglegallybinding).9EffectiveCSR may
well requiregood government(e.g. to draftregionaldevelopmentplans),and
some policy-makerssee CSR as a stepping-stonetowardslegal codification.
forexample,have arguedthatCSR can be a usefulstep on
World Bank staff,
the way to betternationallegislationin countriesthathave failedto enforce
theirlaws.I? Therefore,importantas voluntaryism
maybe, it is not necessarily
appropriateto see it as the lowest common denominatorof CSR.
term
CSR as an umbrella
It willbe apparentfromtheabove discussionthatCSR is not thehomogeneous,
coherentconceptthatit is oftenpresentedas being. Indeed, one concernis that
the use of the termCSR has become so broad as to allow people to interpret
and adopt it for many differentpurposes. This vagueness restrictsCSR's
usefulnessboth as an analyticaltool and as a guide fordecision-makers.The
variouscontributors
to thisspecialissue have different
of what
understandings
CSR represents
and, ratherthanoffering
yetanotherdefinitionat the start,we
have leftit to them to set out what theyeach mean by CSR in theirarticles.
But theirviews are not entirelydisparate,and, ratherthan looking for an
inclusivedefinition,
it maybe more usefulto thinkof CSR as an umbrellaterm
fora varietyof theoriesand practicesall of which recognizethe following:(a)
thatcompanieshave a responsibility
fortheirimpacton societyand the natural
sometimes
environment,
beyond legal compliance and the liability of
forthebehaviourof others
individuals;(b) thatcompanieshave a responsibility
with whom theydo business(e.g. withinsupplychains); and (c) thatbusiness
needs to manage its relationshipwith wider society,whetherfor reasonsof
commercialviabilityor to add value to society.
Some of the ambiguityabout CSR arisesbecause the termhas been used to
referboth to a researchagenda and to corporatepractice.In thisspecial issue
we are concernedwithboth,but we primarily
hope to advance a new research
9 HalinaWard,Legalissues
incorporate
Institute
forEnvironment
and
(London:International
citizenship
io
Development,
2003).
MichaelKleinandTim Harford,
whenwillvoluntary
'Corporateresponsibility:
reputation
building
PublicPolicy
DC, accessedat http://rru.worldbank.org/
improvestandards?',
Journal,
Washington
accessedI5 Feb. 2005.
PublicPolicyJournal/Summary.aspx?id=27I,
503
MichaelBlowfield
agenda and a debate on the business-societyrelationship.We feel that the
currentresearchagenda on CSR lackssystematic
rigourand failsto tacklekey
is
a
broad
while
CSR
At
the
same
church,the researchquestime,
questions.
narrow.For example,in businessschoolsmuch of
tionstendto be surprisingly
the researchon CSR focuseson issuesrelatedto the stakeholderview of the
Even withinsuch
firmand thepotentialcontributionof CSR to profitability."
researchagenda,moreover,vitalquestionsare not being asked. For
a restricted
example, while dozens of studieshave investigatedthe correlationbetween
a key causal question remains
firms'social commitmentand profitability,
or does
unanswered: does social commitmentdrive a firm'sprofitability,
in
initiatives?
firm
invest
social
the
to
allow
profitability
A particularconcern of this special issue is to stimulatemore profound
development.When CSR
questionsrelatedto therole of CSR in international
of the initialwork was
in
most
the
a
distinct
field
as
early I990s,
emerged
focusedon developed economies or the adoption of universalnormssuch as
basic workers'rights.Althoughtherewere initiatives-suchas thosefromthe
fairtrademovement-that were specificto the developingworld,by the time
whetherCSR could
empiricalstudiesstartedto be commissionedto investigate
benefitthe poor and marginalized,'2certainconventionsand orthodoxieshad
alreadybeen established.Consequently,researchinto CSR and development
has tended to be normative,based on issuesand approachesthatare takenfor
granted.As we discussbelow, thisleaves unasked importantquestionsabout
the structuralbiases of CSR, and means that the ways in which ideology
informsand influencesthe possibilitiesof CSR are eitherunacknowledgedor
regardedas unproblematic.Yet, as can be inferredfrom the discussionof
ideas about
voluntarismabove, thereare strongideationalelementsto different
CSR, and what we mean by CSR and itsconsequencesforthe role of business
in development will differsignificantly
depending on whether the goals,
and agentsof CSR conformwith,forinstance,social democratic,
instruments
libertarianor neo-conservativedevelopmentagendas.These differing
agendas
are likelyto affectnot onlywhatvaluesare promoted,but also theway CSR is
implemented.
ofCSR
Criticisms
Along with the greaterattentionpaid to the role of businessin developing
economies since the I98os have come frequentcomplaintsthat companies
conditionsof such countries.In thislight,
exploitthe social and environmental
effortsintended to tackle corporateabuses with the backing of companies
both companies
themselvesshouldbe welcomed. CSR is proposedas benefiting
"
12
For a review see Joshua D. Margolis and JamesP. Walsh, 'Misery loves companies: rethinkingsocial
ScienceQuarterly
initiativesby business',Administrative
48: 2, 2003, pp. 268-305.
See e.g. Natural Resources and Ethical Trade Programme,'Ethical tradeand sustainablerural
can we make?(London:
whatcontribution
livelihoods', in Diane Carney, ed., Sustainablerurallivelihoods:
DepartmentforInternationalDevelopment, I998).
504
Settingnewagendas
and the societiesin which theyoperate.It is presentedas a universalgood that
sectionsof the politicalspectrum.Moreover, in
can be embracedby different
the context of internationaldevelopment and poverty alleviation,CSR is
recommendedas beneficialto both the North and the South, contributing
to universalhuman rights,equityand economic growth.
simultaneously
The contributorsto this special issue embrace the multiplepotentialsof
CSR, yet each of themhas concernsboth about CSR in its currentformand
about itsimplicationsforinternational
development.These concernswere not
the startingpoint of theiranalyses,but ratherthe resultof discussionsamong
methods and disciplines
the contributors;nonetheless,despite the different
representedhere,those concernshave much in common.
Criticismof CSR is by no means unique to the authorsgatheredhere. In
to CSR, and the politiciansand
additionto the manycompaniesstillresistant
academicswho see it as a barrierto trade,civil societyadvocatesare increasinglyquestioningits benefits.Broadly speaking,most criticismfallsinto two
camps: one could be characterizedas the 'CSR is bad capitalism'school,13the
otheras 'weak CSR is bad development'school.14
The 'CSR is bad capitalism'school, associated with traditionalbusiness
managementtheory,echoes Milton Friedman'sfamousstatementthatthereis
of business:to use its resourcesand engage in
'only one social responsibility
activitiesdesignedto increaseitsprofits'.5 Accordingto thisview, CSR is inherobjectives,
entlymisguidedin principle.By pursuingsocial and environmental
lowerprofits.
hurtshareholders
firmsmayultimately
Furthermore,
by generating
firmsare said to lack the expertiseto engage in solving social problems.
Nonetheless,businessscholarshave triedto reconcileprofit-maximizing
objectiveswith social objectivesby suggestingthatCSR can lead to higherlongtermprofitability.
Margolisand Walshfoundthat,between1972and 2002, at least
betweensociallyresponstudiesexaminedtherelationship
127 publishedempirical
sible behaviouron the partof companiesand theirfinancialperformance,the
betweenthetwo variables.'6
majorityof thempointingto a positiverelationship
The 'weak CSR is bad development'school, associatedwith civil society
organizationsand criticsof businessbehaviour,arguesthatcompaniesshould
take responsibility
forthe broaderimpactsof businessactivity,but thatcurrent
CSR practiceis simplyinadequateforthispurpose.Accordingto thisview, the
I3
14
ofsocialresponsibility',
Business
Review36: 5, I958,pp.
See e.g. TheodoreLevitt,'The dangers
Harvard
ofChicagoPress,1962);David
(Chicago:University
Capitalism
41-50;MiltonFriedman,
andfreedom
ofEconomic
notions
Henderson,
Misguided
ofcorporate
virtues:false
(London:Institute
Affairs,2002); 'Two-faced capitalism',The Economist,
24 Jan. 2004, available at www.Economist.com.
See e.g. Christian

'A
Catherine
Dolan andAnneTallontire,
Barrientos,
Aid,Behindthemask;Stephanie
valuechainapproach
World
tocodesofconductinAfrican
horticulture',
Development
gendered
31: 9, 2003,
and boardrooms:
a contemporary
pp. 15I 1-27; Jem Bendell, Barricades
history
accountability
ofthecorporate
I5
I6
BusinessandSocietyProgramme
movement,
Technology,
Paper13 (Geneva:UnitedNationsResearch
Institute
forSocialDevelopment,
nonJune2004);Dara O'Rourke,'Outsourcing
regulation:
andmonitoring',Policy
Studies
governmentalsystemsof labor standards
Journal3 I: I, 2003, pp. 1-29.
Friedman, Capitalism
andfreedom,
p. 133.
MargolisandWalsh,'Miserylovescompanies'.
505
MichaelBlowfield
planning and implementationof social programmesby firmsis generally
deficient,althoughthe evidence is oftendrawnfromthe worstabuses,which
Many of thesecriticsconsiderthe
maynot be a fairtestof CSR's effectiveness.
provisionof social justice the domain of stateregulationor argue that,at a
minimum,the statehas an obligationto monitorcorporatesocial programmes.
They point out that-in the absence of state involvement and proper
monitoring-CSR initiativessuch as corporatecodes of conduct tend to lack
acrossfirmsand industries,and thatthereare few,if
precisionand uniformity
any, sanctions for non-compliance. Nonetheless, it should be noted that
thisschool treatsCSR as capable
of CSR can be strident,
althoughitscriticisms
or betterconstructed
of reform,forinstancethroughimprovedpartnerships,
and implementedcodes of conduct.'7
Two othercriticalschools should be acknowledged:one thatdisputesthat
capitalismcan make any contributionto social and environmental
justice,'8
and another that views CSR as nothing more than good capitalismand
thereforenot worththinkingabout in itsown right.'9
All of these critiqueshave somethingto offerin termsof understanding
in analysingthe actualimpact
effort
CSR, but theyhave not investedsufficient
of CSR on thoseit claimsto benefit.Indeed, one of the common concernsof
the authorsin thisspecialissueis thatdogmaticpositionsare being takenabout
what is rightand wrong on the basiswhat amountsto littlemore thanad hoc
case-studyevidence. Beyond this,we are concernedthatCSR is becoming a
fieldof passionatelyfeltanswersand too manyunaskedquestions.What unites
in thisspecialissue is the searchforthe rightquestionsto be
the contributions
in
the
first
asking
place. These questionscan be broadlydividedinto fourareas:
the meaningof CSR fordevelopingcountries,itsrelationshipto international
governance,its analyticallimitations,and the consequences of thinkingin
termsof the businesscase forCSR.
WhatCSRmeanstodeveloping
economies
Some (includingsome of the contributorshere) would argue thatCSR is a
work in progressand that, ratherthan condemning the good for being
imperfect,we should examine the processesunder way and explore whether
theyare likelyto fulfiltheirpromise.Yet the factis thatwe know verylittle
about the impactof CSR initiativesin developingcountries,and what we do
17 Steve
Waddell, 'Complementaryresources:the win-win rationaleforpartnershipwith NGOs', in Jem

Bendell, ed., Termsforendearment:
business,NGOs and sustainabledevelopment
(Sheffield:Greenleaf,2000);
Alex Wawryk, 'Regulating transnationalcorporationsthroughcorporatecodes of conduct', in Frynas
and Pegg, Transnational
and humanrights.
corporations
thecorporate
i8 See e.g. Marjorie Kelly, The divineright
ofcapital:dethroning
(San Francisco: Berrettaristocracy
Koehler, 200I).
i9 See e.g. Tom Sorell and John Hendry, Businessethics(Oxford: Butterworth-Heinemann,I994); Richard
E. Freeman and David Reed, 'Stockholdersand stakeholders:a new perspectiveon corporate
Review25: 3, I983, pp. 88-Io6; Richard E. Freeman, Strategic
governance', CaliforniaManagement
a stakeholder
management:
approach(Boston: Pitman, 2004).
506
Settingnewagendas
know raisesquestionsabout both the efficiencyof CSR approachesand the
tangiblebenefitsforthe poor and marginalized,as the articlesby Fig, Frynas,
Lund-Thomsen and Nielsen demonstrate.
Jenkins'sarticlepointsout some of
the dangersof viewingthe impactofbusinesson developmentsolelythrougha
of
CSR lens,and it is certainlytruethatmanyof the traditionalresponsibilities
business,such as payingtaxesand creatingjobs, are not normallyconsideredin
discussionsof CSR. As Newell putsit, the mostwe can confidently
sayabout
CSR's impact at the presenttime is that it benefitssome people and some
companiesin some situations.
To the extent that thought is being given to the consequences (both
theoreticaland actual)of CSR forthe developingworld,thistendsto be at the
micro level, looking at what particularcompanies or initiativesare doing.
There has been some theoreticalwork on the relationshipbetween CSR and
nationalcompetitiveadvantagethatcan be extendedto developingcountries,20
but do we know enough about big-pictureissuessuch as theeffectofsocial and
environmentalstandardson foreigndirectinvestmentand trade?Some major
developmentchallenges,such as HIV/AIDS, are partof CSR discussions,not
but thishas not yet resultedin
least because theyaffectcompany efficiency,
like
concentrated
campaigns,and we do
intercompany/interindustry
anything
not know where the tippingpoint is between isolatedand concertedaction.
The success of CSR initiativesis oftenlinked to stakeholderdialogue and
stakeholderengagement,ideas thatoccur repeatedlyin discussionsofbestCSR
of business,
practice.Stakeholderengagementbringstogetherrepresentatives
and addressaspectsof
and public sectorsin orderto identify
non-governmental
corporate responsibility,and has the added advantage that it has gained
As withmany
legitimacyamong both businessand developmentpractitioners.
elementsof CSR practice,it is representedas being ideationallyneutral.But
stakeholderengagementpresentsparticularchallengesin a developing-country
values
contextwherefactorssuch as language,culture,educationand pluralistic
can all affectthe processof negotiationand decision-making.In addition,we
need to considerwhethersome of those thoughtof as stakeholders,such as
workersand local communities,can participatedirectlyor are dependenton
theservicesofproxiessuch as tradeunionsand NGOs. Iftheformeris the case,
are the voices of those known to have littleinfluencebeing heard?If it is the
latter,are the issuesraisedreallythe prioritiesof the poor and marginalized,or
ratherthose thathave the most resonancewith the civil societyorganizations
and theirfunders?
in theclothingindustry
and smallFor instance,homeworkers
holderfarmers
were fora long timeoverlookedby ethicalsourcinginitiatives,21
20
21
andthecompetitive
TraceySwiftandSimonZadek,Corporate
advantage
(London:
responsibility
ofnations
ofSocialandEthicalAccountability
Institute
withtheCopenhagenCentre,2002).
See e.g.JedrzejGeorgeFrynas,
'The transnational
in SouthandSouth-East
Asia',in
garment
industry
andPegg,Transnational
andhuman
'Ethicalsupply
Frynas
corporations
rights,
p. I67; MichaelE. Blowfield,
chains in the cocoa, coffeeand tea industries',GreenerManagement
International
43, Autumn 2004, pp.
'Homeworkers
in globalsupplychains',Greener
International
Management
15-24; Dena Freeman,
43,
Autumn 2004, pp. 107-I8.
507
MichaelBlowfield
and the priorityissues for workforcesdominatedby women have not been
Such examplesindicatethatcivilsocietyorganizaaddressedin theseinitiatives.22
tionsare less likelyto pressfirmsforimprovementsto the workingconditions
of groups thatare eithernot a priorityforthese organizationsor simplynot
recognized.The question of who getsrepresentedis not merelyan academic
nicety,but has profoundimplicationsforthe well-beingof certainmembersof
societyin developingcountries.
Those groupswhose issuesare not taken up by civil societyorganizations
may also be ignored by firmssince they are not considered'primarystakeholders'.Unlike organizedlabour,homeworkerswill rarelypresenta threatto
a firm'sproductivity,
nor is the firm'sdependence on themlikelyto be high.
Ironically,a firm'scommitmentto CSR can actuallylead to thesemarginalized
groupsbeing seen as a threatto the company'sclaim to responsibleoperation.
Some majorsportinggoods companies,forinstance,have reducedthe amount
of outsourcingto smallerproducersin partbecause it is difficult
to monitor
thosefacilities.23
Since inclusionin or exclusionfromstakeholderstatusis not
based on eitherlegal rightsor moralobligations,a stakeholder'srecognitionis
contingentupon the business case for that recognition.Consequently,the
well-beingof some groupsin developingcountriesmaybe jeopardized by the
verypursuitof CSR.
Beyond the question of inclusionor exclusion of certaingroupsor issues,
neitherCSR theorynor its practiceadequatelyaddressesquestionsabout the
relationshipbetween companies and others.For example, should the stakeholder relationshipbe based on accountability,disclosure,claim or entitlement?Can the concernsof societyabout businessbe disaggregated
intotypically
stakeholdergroups?How and by whom are competing
single-issue-oriented
claims by those groups to be addressed?As thingsstand,CSR promotesan
of which clearlydepends on how power is located
approachthe effectiveness
and exerted,and yet the insightsof power relationstheoryhave not been
widelyused in the CSR context.
CSRandgovernance
We noted above thatvoluntarismis one recurringfeatureof contemporary
CSR, and in the context of internationaldevelopment one of the most
importantsets of questionsis about how CSR relatesto changingmodels of
nationaland international
advocatedas a means
governance.CSR is frequently
of fillinggaps in governancethathave arisenwith the accelerationof liberal
economic globalization.But should CSR be regardedas a stopgap measure
while ways are soughtto give social and environmental
issuesa similardegree
22
23
Barrientos
et al., 'A gendered
valuechainapproachto codesofconduct'.
MichaelE. Blowfield,
andvoluntary
laborcodesin thecontextof
'Corporateresponsibility
andlaborin developing
at theconference
on Globalization
and
countries',
globalization
paperpresented
LaboratBrownUniversity,
WatsonInstitute
forInternational
Studies,Dec. 2004.
508
newagendas
Setting
of international
protectionto thatenjoyedby capitaland intellectualproperty?
a
Is it stepping-stoneon the path to betternationalregulationin developing
countries?Or is it partof a longer-term
projectforovercomingtheweaknesses
of territorially
prescribedjudicial and welfaremechanisms,thatis, addressing
the limitationsof the nation-statein regulatinga global economy?
We are concernedthatsuch questionsare not being widelyasked at a time
when CSR is presentedby some as a means of exercisingcontrol over the
behaviour of business without resort to formaljurisprudence. The UK's
Developmenthas statedthat'international
DepartmentforInternational
legally
binding frameworksfor multinationalcompanies may divertattentionand
and towardslegal
energyaway fromencouragingcorporatesocial responsibility
initiatives
such
as
the
on
While
King Report
Corporate Governprocess'.24
ance in South Africasuggestthatdevelopingcountriesmightnot object to this
trend,the view expressedby DFID is not dissimilarto thatof variousbusiness
leaders and businesswriterswho advocate CSR as a means of reducingthe
need forformalregulation.As Freemanand Reed, pioneersofbusiness-centred
stakeholdertheory,state: 'If this task of stakeholdermanagementis done
properly,much of the air is let out of criticswho argue thatthe corporation
mustbe democratisedin termsof increaseddirectcitizenparticipation.'25
Yet,
even as these prescriptionsare made, there is scant discussion of the
implicationsof a shifttowardsa new regulatoryregime for the developing
world and indeed international
developmentpolicy.
It is not thatnew approachesfailto put demandson companies:corporateled bodies such as the WBCSD seek to improve the effectiveness
of CSR
organizationssuch as the World Bank
practicewithinfirms,and international
and the United Nations have emphasized the need to build corporateand
developing-country
governmentcapacityto engage in CSR.26 But how can
this be achieved if the underlyingdimensionsof CSR are not made clear?
What are the implicationsof voluntarismforthe developingworld?
At the same time,NGO appeals formore internationalregulationseem to
ignore the many historical failures of formal regulatoryapproaches to
international
social and environmental
justice. Certainlyit seemsto make sense
to explorefurther
the role of nationallegislationand enforcement,
even though
some companieswith a statedcommitmentto CSR are lobbyingaggressively
againstsuggestedlegal models such as the US Alien Tort Claims Act.27We
need to learn more about the optimal balance of voluntaryand mandatory,
nationaland international,
and enablingregulation.Will therole of
prescriptive
24
forInternational
DFID, DFID andcorporate
(London:Department
Development,
25
FreemanandReed, 'Stockholders
andstakeholders',
p. 96.
See e.g. GeorgKellandDavid Levin,'The GlobalCompactnetwork:
an historic
in
experiment
26
2003), p. 9.
learningand action', Businessand SocietyReview io8:
27
2,
2003, pp. 151-81. JournalofCorporateCitizenship
issueno. I I, Autumn2003,examinestheUnitedNationsGlobalCompactin detail.

See JedrzejGeorgeFrynas,
'Socialandenvironmental
in Africa',
firms
litigation
againsttransnational
JournalofModernAfricanStudies42: 3, 2004, pp. 363-88.
509
MichaelBlowfield
national and regional governmentmove from that of enforcerto that of
facilitator?Will CSR be another channel whereby business influencesthe
substanceof formaljustice?Are the concept of 'stakeholder'and the notion of
'multi-stakeholder
engagement'rigorousand inclusiveenough to complement
or even be an alternativeto representativedemocracy in the governance
process?
limitations
ofCSR
Analytical
The above questions related to internationaldevelopmentand governance
have far-reaching
implications.Yet, while findinganswersto themis of course
important,we also need to considerwhy the questionsthemselvesare only
now being asked. We cannot understandhow CSR is developing only by
examiningwhat has happened; equallyimportantis to explorewho and what
are being overlooked,takenforgranted,ignoredor excluded.We have already
mentionedsome of the people in developing countrieswho are ignored or
marginalizedby CSR, not because they do not have a valid claim to be
consideredstakeholders,but because theywere eithernot acknowledgedor
but
were too difficult
to manage.This is recognizedby some CSR researchers,
typicallythe proposed solution is to improve the taxonomyof stakeholders.
What thistechnicalresponsefailsto ask is whetherthereis anythinginherent
within currentapproachesto CSR thatcauses certainentitiesand aspectsof
justice and well-beingto be excluded in the firstplace.
Going beyond technical responsesthat simply reinforceexistingnorms
about why and how to conduct CSR requiresus to introducehistoricaland
ideationalperspectivesinto our analysis.These are all missingfromresearchat
present,even as CSR is increasinglyviewed as a disciplinein its own right.
as a responseto and a
Consequently,while CSR is presentedsimultaneously
productof globalization,nowhereis thereany recognitionthatglobalizationis
a highlycontestedconcept stronglyinfluencedby ideological interpretation,
to understandanyinherentpossibilities,
biases
and thisin turnmakesit difficult
In
or limitationsin contemporary
other
CSR
as
a
words,
discipline
approaches.
lacksthe meansreflexively
to consideritsown orthodoxy.
Such a capacityis a prerequisitefor understandingor predictingCSR's
impact,especiallywhen applied in societiesthatdo not sharethe same cultural
and societalnorms,values and prioritiesthatunderpinCSR. Withoutit, CSR
is likely to treatparticularnorms as universal,and particularapproaches as
globallyapplicable. In doing so, there is a strongpossibilitythat CSR will
of
legitimizeand reproducevalues and perspectivesthatare not in the interests
developingeconomies or the poor and marginalized.
CSR practicedoes not, of course,lack ideationalor historicaldimensions,
but these are almostentirelyabsentfromany discussionabout CSR. Cutting
acrossthisabsence of a structural
is an inabilityor unwillingness
understanding
to considercausality.Thus, forinstance,povertyis presentedas a regrettable
51o
Settingnewagendas
fact ratherthan a consequence of any causal conditions and events. The
advantage of this is that it allows poverty to be presentedto business as
somethingundesirableand solubleon a parwith,forinstance,a malfunctioning
valve or a qualitycontrolproblem. However, it does nothingto encourage
examinationof the complexityof multilayered,
rootedproblemsor
structurally
of the role of businesswithinthem.
An unwillingnessto tacklecausalityis not unique to CSR, and it is possible
to argue that one of the reasons why CSR and internationaldevelopment
practicehave moved closer togetheris thattheyshareand reinforceassumpare fundamentally
tionsthatpovertyand marginalization
mattersof geography,
ratherthanstructural
identityor difference,
phenomena. The shiftevidentin
developmenttheoryfromseeingpovertyas somethingsystemicto seeingit as a
fallsoutside our scope here, but it is worth
matterof function/dysfunction
noting that CSR and developmentshare certainbeliefsor mythsabout the
developing world. For instance,both treat the geographicalseparationof
in understanding
North-South,developed and developing,as valid distinctions
whereand whypovertyexists.Both treatcivilsocietyas a valid,unproblematic
and largelypositivecategory,despitethe manydifferences
among civil society
their
and
the
roles
raise
about
organizations
questions
contemporarydemocracy. Above all, by ignoring any structuraldimension to poverty,they
reinforcethe beliefthatit can be solved by discrete,identifiableactors.
It is not necessarilythatthe assumptionsfoundin CSR are wrong; but at
presenttheyare simplynot acknowledged,and thishas realconsequencesboth
forinternational
developmentand forcompanies.In Litvin'shistoricalstudyof
that
were harmed or destroyedbecause of theirbehaviour in
corporations
foreigncountries,a recurringtheme is the tragicconsequences of failingto
investin understandingand addressingthe complexitiesof theirrelationship
with society.28One of the concernsabout contemporaryCSR is that,rather
than encouragingmore detailed understanding,it may be reinforcingthe
misguidedbeliefthatforeverycomplex problemthereis a simplesolution.
caseforCSR
Thebusiness
Anyone wondering how the above assumptionsget reproducedand legitimized need look no further
thanthe emphasisplaced on 'the businesscase for
CSR'. Throughoutthiseditorialwe have cited examplesof businessthinking
influencingthe language and practiceof CSR. For example,we have quoted
Freemanand Reed's beliefthatstakeholdersare somethingto be managedby
froma productor a brand),and we have
companies (seeminglylittledifferent
alluded to the use of techniquesrooted in financialmanagementto manage
social and environmentalperformance.Perhapsabove all, we have repeatedly
used the term'business'as if it were a homogeneous category,ratherthanan
28 Daniel
andcorporate
Litvin,Empires
commerce,
ofprofit:
conquest
responsibility
(London:Texere,2003).
51I
MichaelBlowfield
arena where the often conflictinginterestsof managers,other employees,
investorsand otherentitiesare acted out.
Nowhere is acceptanceof businesshomogeneitymore apparentthanin the
numerousattemptsto make the businesscase for CSR. The businesscase is
partlydrivenby businessschools, where CSR is usuallyjustifiedas enabling
managerseitherto protectfirmsfromexternalthreats(e.g. riskmanagement)or
to benefitfromexternalopportunities(e.g. new productdevelopmentthrough
with NGOs)-as illustratedby the many studieson the contripartnerships
bution of CSR towardsfirmprofitability
or those on stakeholdermappingin
business
such
as
journals
the
Review.At the extreme,
top
Academy
ofManagement
firmsare advisedto considera groupas a stakeholderonlyiftheydepend on its
resources.29Suchwork has an effectfarbeyond businessschools, as it has the
potentialto influenceCSR practitionersand futuremanagerswho translate
ideas about CSR into practice.
However, if considerationof a social, economic or environmentalissue
whathappensto
dependson therebeing a businesscase forsuch consideration,
thoseissueswherethatcase cannotbe made? Is theparamountcygrantedto the
businesscase influencingwhich issuesget addressedand which ones ignored?
Can corporations,
builton a westerneconomic model,recognizevaluesrooted
in other cultures?Is CSR in some way allowing businessto appropriatethe
meaningof ethics?
If we look at CSR standardssuch as those forworkers'rightsand natural
resourcemanagement,it is certainlypossibleto conclude thatimportantissues
for people in developing countrieshave been inadequatelyaddressed.For
instance,labourcodes ofpracticeare farmorelikelyto outlawslaveryand child
labour (practiceswhere thereis littledirectfinancialmotivationto continue,
especiallycompared to the potentialconsequences of a consumerbacklash)
thanto recognizethe rightto a livingwage or freedomof association(both of
which many companies fearmightwork to theircommercialdisadvantage).
But we should also be aware of what has not been included at all in such
standards.One mayask,forexample,why crucialeconomic issues(as opposed
to labour issues)are alwaysexcluded fromthe contentsof CSR standards,
and
whose interestsare servedwhen no mentionis made of the rightto investand
disinvestat will or the supremacyof the marketas a determinant
of price.
The businesscase is not necessarilya bad thing,and it is an importantaspect
of gettingseniormanagementengagedin CSR. But we need to considerhow
farthe businesscase shapesnot only the choice of issuesor relevantconstituents,but also the verydiscoursethatdelineatesthe boundariesof CSR. This
influenceis evidentin theunquestionedadoptionofbusinessmeasurementand
managementtechniquesto addresssocial and environmental
issues,something
thatMichael Blowfieldclaimsin thisissue contributesto business'sredefining
of the meaningof development.These techniquesdetermine,to some extent,
29
See I. Jawaharand G. McLaughlin, 'Toward a descriptivestakeholdertheory:an organizationallifecycle

Review26: 3, 200 I, pp. 397-414.
approach', AcademyofManagement
512
Settingnewagendas
who or what is a stakeholder,and what issuesare addressed.In otherwords,
participationin the CSR discourseis disciplinedby the need to use a language
and modes of thinkingacceptableto the businesscommunity.
fornewperspectives
Suggestions
Common to all of the above concernsabout how CSR relatesto development
is the observationthaton the one hand thereis too littleevidence to draw
indicationthatwe
definitiveconclusions,but on the otherthereis sufficient
need to know more. In so faras neitherresearchnor practicein CSR has to
date addressedthiscontradiction,a more criticalagenda seemsjustified.Many
of the questions that need asking are set out above, and to answer them
effectively
requiresa mixtureof (a) criticalresearchto understandtheimpactof
CSR in the developingworld; (b) a propercritiqueof the CSR discourseto
embedded limitationsand the potential of current
identifythe structurally
approaches;and (c) a considerationof alternativeapproaches,includingthose
that go beyond the business case. Of the articlesin this special issue, the
fieldworkof Newell in India, Frynasin Nigeria and Lund-Thomsenin South
Africashows some of the different
impactscompaniescan have in developing
some of the strengths
and limitationsof CSR, a
countries.Each demonstrates
perspectivethatis centralto the discussionof power and influencein Nielsen's
CSR initiativein Bangladesh.In
case studyof the makingof a groundbreaking
different
ways,Jenkins,Fig and Blowfieldrevealsome of the shortcomingsof
CSR in addressingdevelopmentchallenges,and offerexplanationsof why
of how fardeficienciescan be resolved.Each article
theseexistand assessments
demonstrates
the limitsimposed by contemporaryCSR's predilectionforthe
businesscase, but-although each hintsat ways forward-none attemptsto
offercomprehensivealternatives.
Some mightfeelthatraisingquestionswithoutoffering
solutionsis an inadto a degree,and thecontributions
equate positionto hold. This is understandable
in thisspecialissuedo go farbeyondunconstructive
criticism.
But thereis a danger
in holdingthe rightto questionhostageto proposingalternative
solutions.Ifwe
do not dig more deeply,thenwe riskinvestingresourcesin an area thatfailsto
advancethegoalsofinternational
uncertainties
development.
By leavingunaddressed
about the efficacyof CSR in developingcountries,we do nothingto alleviate
corporatehesitancyabout investingin or sourcingfromthepoorestnations.By
allowing potentiallyproblematicapproachesto go unchallenged,we increase
thatcorporatereputations
the possibility
will go unprotected
withoutanydemonstrablebenefitforthedevelopingworld.By leavingunquestionedCSR's reliance
on consensusandwin-winoutcomes,we leavethepoor and marginalized
exposed
offurther
to thepossibility
and marginalization
as a resultofinequitable
exploitation
exertionsof power. It is not thatcompanies,developingcountriesor the poor
will suffer
as a resultof CSR: rather,the concernis thatwe do not know ifthat
will be the case. And thatalone is a justificationfora criticalagenda.
513

Critical Assesment of CSR in Global Development World)

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Critical Assesment of CSR in Global Development World)

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Setting New Agendas: Critical Perspectives on Corporate Social Responsibility in the Developing

The themeof thisspecialissueis CorporateSocial Responsibility(CSR) in the

International Affairs8I, 3 (2005)

Joanne B. Ciulla, 'Why is businesstalkingabout ethics?Reflectionson foreignconversations',California

Cambridge UniversityPress, I991).

See e.g. Christian

Waddell, 'Complementaryresources:the win-win rationaleforpartnershipwith NGOs', in Jem

learningand action', Businessand SocietyReview io8:

2003, pp. 151-81. JournalofCorporateCitizenship

issueno. I I, Autumn2003,examinestheUnitedNationsGlobalCompactin detail.

JournalofModernAfricanStudies42: 3, 2004, pp. 363-88.

See I. Jawaharand G. McLaughlin, 'Toward a descriptivestakeholdertheory:an organizationallifecycle

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