Here's the latest from Cityboy, author of the bestseller 'Cityboy - Beer and Loathing in the Square Mile'. Here he gives his thoughts on corporate social responsibility (CRS).
'To paraphrase Hermann Goering, when I hear the words 'corporate social responsibility', I reach for my gun.
Unfortunately, I heard those heinous words non-stop at a conference I recently attended. Frankly, the idea that huge, rapacious corporate entities think we're naive enough to believe that they're not just out to make as much wonga as humanly possible makes me cry into my beer. The fact that management teams, advised by trendy consultants, believe we're so stupid as to think that they actually care about things like the environment, makes me want to massively short the shares of every single company in the 'FTSE4Good' index - for eternity.
When I was a lad, you knew where you stood with industrialists and tycoon-types. They were the nasties who smoked huge cigars, poured chemicals into rivers, employed under age children at sweatshops in faraway countries, and exploited the workers whilst paying themselves preposterously massive compensation. These guys meant business in every sense of the word, and weren't going to allow namby pamby ethical considerations disrupt their never-ending mission to exploit this sorry planet and its poor inhabitants. They were old-school capitalists, whose greed was only matched by their lack of consideration for anyone who wasn't a member of their gentlemen's club.
Cut to your modern day blue chip CEO. He's having a chat to his company's PR department, and they've told him that his huge oil company needs to give the impression that it gives a damn about something other than lining its already-wealthy shareholders' pockets. Barely suppressing a giggle, the corpulent executive asks why he should consider doing something so patently absurd. Initially, the PR goons talk about how it makes 'business sense'. They explain that it will aid recruitment (because students are really interested in corporate carbon footprints), and that it will also improve staff retention (as this will enhance the internal perception of the company). They may even cite some report by some chaps called Orlizty, Schmidt and Rynes (crazy names, crazy guys), that claims that there is a correlation between social / environmental and financial performance.
Of course, they won't mention that statistics can be used by cunning analysts to find correlations in pretty much anything. Seeing that the boss is still not convinced, the PR types decide to come clean with the truth - nothing is really going to change! The whole caboodle is just a scam to make out the company is moving with the times. It's a ruse so that the company can curry favour with politicians by pretending to be part of Tony Blair's 'stakeholder society'.
I'm the first to accept that nostalgia ain't what it used to be. Still, I look fondly back at the days of Kerry Packer, James Hanson and Jimmy Goldsmith - when moguls were more honest about their never-ending mission to make themselves and their company shareholders ever richer. To me, CSR is akin to putting lipstick on a pig, or polishing a turd. It's a scam that came into being because prescient managers saw that it made financial sense to play along with it. Believe me, Satan will be selling ice-creams long before a chief executive makes a decision that suits CSR at the expense of his profits.
'Greed', for want of a better word, is still definitely good in the eyes of executives whose fiduciary duty is to maximize shareholder returns. It is only when CSR doesn't get in the way of greed that corporate executives will permit it to exist for its own sake. Call me old fashioned, but altruism contingent on self-interest ain't really altruism at all!'.
Check out Cityboy's blog - www.cityboy.biz
'CRS surely played a part in helping to save Nike!'.