Will the COVID-19 pandemic change how businesses understand CSR and make it more intrinsic in their business models? ProfessorsAndrew Crane, School of Management, University of Bath (UK), and Dirk Matten, Schulich School of Business, York University (Canada), explore how conventional CSR was impacted by the pandemic and how it should be approached for a better future.
Unlearning CSR: Is conventionally understood CSR a dead-end? by CoBS Editor Pavan Jambai Narayanan Sedhu. Related research: Covid-19 and the Future of Research, Andrew Crane and Dirk Matten,Journal of Management Studies 58:1 January 2021 doi:10.1111/joms.12642
Covid-19 will be remembered for its direct threat to human lives. But it will also be remembered for exposing and challenging several assumptions, concepts, and practices in various fields. Profs Crane and Matten dive deep into one of such fields – Corporate Social Responsibility (CSR), reviewing four key areas – Stakeholders, Societal Risk, Supply Chain Responsibility, and Political Economy – where CSR should be conceptually re-imagined.
Stakeholders: Who and what really counts?
COVID-19 exposed a deep-rooted fallacy in our society by clearly illustrating who should be regarded as the most ‘essential’ stakeholders of a business. The pandemic shed light on the importance of frontline workers in healthcare, food services, and public transportation as well as unrewarded labour at home and in schools, such as teaching, childcare, and eldercare – workers, who, if not for the pandemic, would still be considered disposable.
We might be inclined to think that the “essential” workers are treated and compensated fairly but the reality remains bleak with such workers often being exposed to infection without necessary protection, and remaining poorly paid and economically vulnerable. The paradox that those deemed most essential receive such a small slice of the economic pie should be at the focal point of future research.
CSR has traditionally been presented as a tool to manage and fend off risks such as future legislation for individual companies. However, the risks that connect companies to COVID-19 are of a far broader scope. With the origin of the pandemic from the ‘wet markets’ in China reasonably well-established, the question arises as to the role of business responsibility in preventing such pandemics in the first place.
Businesses are also at the core of solving – or at least containing – the problem. Face masks, ventilators – and of course, vaccines – are all produced by businesses. As such, the core function of a business to produce goods and services that address social needs and demands has been brought under the spotlight by the pandemic. Moreover, Crane and Matten advocate that CSR needs to shift from an individual to a societal conception of risk.
Supply chain responsibility and political economy
Many of us can remember that not long ago at the outset of lockdown, personal protective equipment, ventilators, and toilet paper were more valuable than stocks, gold, and bonds. Indeed, Covid-19 demonstrates the fragility of some of our global supply chains, especially when lockdowns severely disrupted production and logistics. And as is customary, low-wage workers in these supply chains clearly faced the music with many of them left without pay, employment, or social protection.
This leads us to the question that if corporate-led responsible sourcing programmes are largely unable to protect those most at risk in global supply chains when they most need it during a global pandemic, are they really worth continued attention and investment? In this light, the authors suggest that future research should focus on exploring alternative ways of ensuring that the rights and livelihoods of precarious workers in the supply chain are ensured and protected.
Will CSR become a thing of the past?
While existing CSR research increasingly depicts governments as incompetent in tackling grand challenges, COVID-19 has indeed forced governments to take the centre stage. The pandemic has once again reinforced the fact that the social responsibility of a company is to coordinate with government by employing and protecting workers, producing socially useful products, and protecting their stakeholders. And not so much by voluntary, charitable good deeds – although these actions also play a positive role.
Profs. Crane and Matten contend that CSR should truly attempt to integrate social responsibility into business instead of being boxed in CSR boundaries that are often in the self-interest of the firm.
As such, COVID-19 questions the core purpose of what a firm is about and what role it should play in society. An ideal future is where CSR is a thing of the past – since all businesses ideally are infused with good intentions and practices to make society a better place in which to live. This sounds good and fair enough, but will it soon become a reality? This current crisis can serve as an opportunity to approach core questions around the purpose of business from the immediate necessities posed by fighting a pandemic.
- Link up with Andrew Crane and Dirk Matten via LinkedIn
- Read a related article: How Institutions Shape CSR in the MENA
- Discover CBOS Bath and Schulich School of Business
- Download the CoBS publication: Leadership, Governance, and Crisis.
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