Corporate social responsibility(CSR) plays a vital role in ensuring that corporate interests align with the broader social and environmental interests of the community in which businesses operate.
However, the basis for CSR and what it entails is not well agreed among the players in the economy. A fundamental question is: Is CSR about good business or necessary ethics?
There are different approaches to ensuring the take-up of CSR: from encouraging moral capitalism (such as celebrating corporate heroes) and discouraging brute capitalism (such as identifying and shaming corporate abuse), to mandating it through rules and regulations. Two new approaches—reporting companies’ CSR practices to investors, and potentially quantifying nonfinancial CSR variables—show great promise.