The fundamental problem that needs to be addressed in CSR scholarship is whether it is descriptive or normative or something else (Crane et al. 2008). This is a problem rooted in both philosophy and the history of the social sciences.
The great success of the scientific revolution in the 17th and 18th-centuries gave rise to a new intellectual attitude: the Enlightenment Project (Adorno & Horkheimer 1990; Carl Becker 1962; Bloom 1987; Capaldi 1998; MacIntyre 1981; McCarthy 1998). The Enlightenment Project asserts that there can be a social science comparable to physical science, that social science can help us explain, predict, and control the social world. In short, there is the belief that there can eventually be a social technology. The dream of a social technological utopia is the common inheritance of liberals, socialists, and Marxists ((Carl Becker 1962), chapter four). Some of us would argue this is delusional and misguided.
It is precisely this belief in a social technology that informs much of the social science disciplines those trained in the social sciences and, ultimately, therefore many practitioners in the CSR field. There are academicians ever ready to play the part of Philosopher Kings and Queens. In his critique of what he calls the entrepreneurial society, George Brenkert (long time editor of Business Ethics Quarterly) warns that “instead, then, of a Platonic society, which looked to its philosopher kings, our entrepreneurial society will look to its entrepreneur bosses.” ((Brenkert 2002) p. 17). A large part of the hostility of many intellectuals to modern commercial societies is that such societies are not enterprise associations requiring a clerisy (De Jouvenel 1974; Klein 2006; Mises 1975; Nozick 1998; Schumpeter 1975).
“…intellectuals also detested Americanism for a more personal reason. They knew that in an Americanized society, dominated by commercial culture, the place of philosophers and literati was marginal at best. Far from being the dogma by downtrodden peasant, Occidentalism more often reflects the fears and prejudices of urban intellectuals, who feel displaced in a world of mass commerce” ((Buruma & Margalit 2005), p. 30).
Prior to the modern (Renaissance) period, classical and medieval theorists asserted the existence of a universal teleology. Everything, including the human and social world, was governed by an internal telos (goal). From this perspective, describing and normatizing amount to the same thing. All of that came to an end when modern physics (Descartes, Newton) denied the existence of final causes and therefore denied the existence of teleology in the physical world. If social science is supposed to be modeled along the lines of modern physics, then it cannot appeal to objective internal norms or a telos.
It is the Enlightenment Project mentality that obfuscates the distinction between describing and explaining the inherent norms of commercial activity along with an internal critique of when we fail to instantiate those norms as opposed to normative CSR which proscribes, presumably, from a purely external position what participants in commerce should be doing. Where do these external norms originate? Do these external norms reflect a private political agenda or do they reflect a larger social structure? Who has correctly apprehended that larger social structure? Is that structure defensible? How so?
It is not my purpose to denigrate advocacy of any kind or to inhibit political, social, and economic reform. It is my purpose to point out that this is not scholarship. One may use scholarship to support advocacy but advocacy is more than scholarship, and, by itself, scholarship does not entail specific reforms or agendas. To engage in advocacy under the guise of scholarship is to reflect either intellectual confusion or intellectual dishonesty.
There are numerous histories of CSR (Carroll 2008). Relative to my concern with the administrative fallacy, I offer another such history as it emerged in the U.S. (Ryan 2006). The field of CSR was economically and politically liberal because of its origins in business schools and philosophy departments. With regard to business schools, it can be traced back to the University of California-Berkeley in the 1960s, where many of the first leaders of the nascent Business and Society field worked or were trained (Epstein 1999). Research focused on corporations’ “social responsibilities” and sought economic reforms to assuage the inequalities perceived to be inherent in capitalism (Jones 1980).
With regard to philosophy, philosophers’ traditionally “hostile attitudes” toward business ((Shaw 1996): 490) became immediately evident. They used a specific political agenda to “understand, assess, and perhaps modify the socioeconomic context…that frame[s] the moral choices that confront individuals,” often leading to critiques from a Marxist or immoral-market perspective ((Shaw 1996): 496). Others focused the attention of students on corporations’ social responsibilities, questioning whether firms should do “more” than maximize profits.
Philosophy has a specific role comprised of two parts, pedagogical and cultural. The pedagogical role is making us self-conscious, aware of our basic presuppositions. This is analysis; it can be taught; and it can be practiced outside of the discipline, the profession and the academy. The cultural role is the fashioning of a narrative that brings the presuppositions of an entire array of cultural practices into some sort of coherent synthesis. This is a role that has been unique to philosophy or to those we identify as great philosophers, even though many of them have played that role outside of the academy.
This second role is not an authoritative role. An individual thinker may choose to do both. However, the legitimacy of the policies derived from the vision in no way follow from the value of the vision. Others can in retrospect appreciate the value and importance and influence of the vision without endorsing the derived policies. We value Aristotle’s analysis of the polis, but most of us would choose not to live in one. To engage in this activity is to offer a vision, not an argument, although the vision may contain arguments within it. Identifying presuppositions is different from the application of those presuppositions or the challenging of some of those presuppositions in the light of others. It is a role that acknowledges the freedom of the imagination, the autonomy of choice, and in the contemporary context the goodness or validity of a civil association. It is a role that can never be played by self-alienated and self-proclaimed elites who strive to reveal to others their respective roles and beliefs and actions within an enterprise association, that is, an association with a collective goal to which individual goals are subordinate. Many prominent members of the philosophy profession are so unreflectively hostile to modern commercial societies that they have incapacitated themselves from providing a vision: Rorty, MacIntyre, Blackburn, Derrida, Foucault, to name just a few. A large part of the hostility of many intellectuals to modern commercial societies is that such societies are not enterprise associations requiring a clerisy Hollander (Hollander 2006). Philosophy, for many, is the articulation of a moral vision (an alternative vision) for those hostile to substantive religious communities.
Even so-called empirical research was tainted by a bias. One study claimed that undergraduate business students were overwhelmingly “utilitarian egoists” (Wood et al. 1998), and another that MBA students were egoistic. The assumption in both studies was that “egoism” is of the “subjective” variety, emphasizing maximizing one’s subjective view of one’s own good in the short term and ignoring the consequences for others. This study, of course, ignores other variants of philosophical egoism. These studies reinforce the assumption that business students, and ultimately business persons, are morally wanting.
The field’s most successful assault on free-market thinking is “stakeholder theory,” which claims that the corporate executive’s job is to balance the needs and desires of all the corporate constituencies (Donaldson & Preston 1995). That position is contrasted in the literature with “stockholder theory,” which generally follows Friedmans (Friedman 1970) position that executives should maximize profits “within the rules of the game.” We ignore for the moment whether this is an accurate account of Friedman. What needs to be emphasized is the reaction of the business community to stakeholder theory initially and later when business people attempted to apply it in practice. According to the Business Round Table:
[1990] Corporations are chartered to serve both their shareholders and society as a whole. The interests of the shareholders are primarily measured in terms of economic return over time. The interests for others in society (other stakeholders) are defined by their relationship to the corporation….The thrust of history and law strongly supports the broader view of the directors’ responsibility to carefully weigh the interests of all stakeholders as part of their responsibility to the corporation or to the long term interests of its shareholders. (“Corporate Governance and American Competitiveness,” March 1990)
[1997] The weakness of the stakeholder model is the absence of an overall objective function which implicitly or explicitly specifies the tradeoffs from expenditures on various items, including each of the firm’s stakeholders. This in turn implies that the top managers of such organizations cannot be held accountable for their decisions because without an overall objective function, there is no way to measure and evaluate their performance….it would leave the board with no criterion for resolving conflicts between interests of stockholders and of other stakeholders or among different groups of stakeholders. (“Statement on Corporate Governance,” September 1997, pp. 3–4).
Two other things need to be emphasized, and both of them concern how executives are supposed to balance various claims. First, Schumpeter’s concept of ‘creative destruction’ is not only an economic concept calling attention to how entrepreneurship in a dynamic economy constantly changes the economic landscape: what we produce and do not produce; how we produce it; how we organize production, distribution, marketing, financing, etc. It also applies to changes in the social world that reflect changes in the economic world. For example, think of how economic growth and globalization led to the greater participation of women in the workforce. Think again of how that participation has radically altered not only the workplace but the relationship between men and women, family life, etc. Not only have we not caught up to digesting these changes, but we also have to ask ourselves what other changes are percolating or will develop. If so, how do we know we are balancing claims now in a way that will evolve positively in regard to future developments? The answer is we do not know, we cannot know, and there can certainly be conflicting approaches.
Second, taking Archie Carroll’s pyramid as our frame of reference, we might want, and I certainly do, to challenge the notion that we live or ever have lived or expect to live in a morally monistic world. Let me suggest that we live in morally pluralistic world (all of past history and current events are my evidence). Let me suggest that this is sometimes a good thing. If all of the foregoing is true, then there is no single way to balance claims, no algorithm that we can discern or teach.
A serious scholarly review of the philosophical literature will reveal that there is no consensus on resolving ethical disputes at the highest level (Solomon 2006). To begin with, it is not only the case that there are significant ethical disagreements about substantive issues. Many if not most of these controversies do not appear to be resolvable through sound rational argument. Again, many of the controversies depend upon different foundational metaphysical commitments. In most metaphysical controversies resolution is possible only through the granting of particular initial premises and rules of evidence. Even when foundational metaphysical issues do not appear to be at stake, the debates turn on different rankings of the good. Resolution does not appear to be feasible without begging the question, arguing in a circle, or engaging in infinite regress. We cannot appeal to consequences without knowing how to rank the impact of different approaches with regard to different ethical interests (liberty, equality, prosperity, security, etc.). Nor can we appeal to preference satisfaction unless one already grants how one will correct preferences and compare rational versus impassioned preferences, as well as calculate the discount rate for preferences over time. Any Appeal to disinterested observers, hypothetical choosers, or hypothetical contractors will not avail either, because if such decision makers are truly disinterested, they will choose nothing. To choose in a particular way, one must already be fitted out with a particular moral sense or thin theory of the good. Intuitions can be met with contrary intuitions. Any particular balancing of claims can be countered with a different way of achieving a balance. In order to appeal for guidance to any account of moral rationality one must already have secured the content for that moral rationality.