Monday, February 13, 2012

When bad CSR happens to good companies

During the first 6 weeks in my Corporate Social Responsibility class we have explored several topics such as Ethical Theories and Approaches, The Shareholder vs. Stakeholder, Exploitation and Externalities, Corporations, and most recently Sustainability. During these lectures the class has had the opportunity to voice our own opinions. After hearing several different outlooks it made me curious about how CSR positively and negatively impacts businesses. During my research I discovered this article which discusses “When bad CSR happens to good companies”. Throughout this article the writer discussed her views on how easily companies known for good CSR practices can be affected by a couple bad CSR decisions.

The writer makes it clear from the start that there is no such thing as “100 % sustainability” in businesses with her first example relating to the clothing store H&M. For years H&M have been known for having a pretty respectable CSR profile producing clothing items comprised of organic cotton. The organic clothing line gave consumers a positive image towards H&M. This image took a downward plunge very quickly after 3 different reports in one year regarding the accusations of contamination of GM (genetically modified cotton from India) in the organic clothing line, destroying and throwing away unsold clothing, and the ridiculous low prices attached to the new clothing line. This example shows how fast a company can change its sustainability.

This article really makes you wonder what we are really purchasing. Is the product really environmentally friendly? How can we be so sure? Was H&M being unethical selling contaminated product? Are they the only company engaged in this behaviour? Who else is participating?

I wanted answers to these questions so I decided to expand my search on H&M only to discover this about organic cotton:

Organic cotton provides a better deal for farmers not just with lowered pesticide costs and health risks but also economic benefits. According to the latest figures released by Textile Exchange in spite of the recession organic cotton showed a 15% growth. For these reasons and more, the switch to organic cotton is essential for clothing companies moving forward.

Despite a couple slip ups it is unreasonable to say H&M doesn’t participate in good CSR practices. They have been committed to working with the suppliers from China to reduce water, energy and toxic chemical use.

I found the ending of the article very intriguing. I completely agree with the writers “bar for good CSR performance”. It ends with a very good quote that CSR-image is not one single thing. It is a series of events... unfortunate or otherwise.
Writer - Akhila Vijayaraghavan

Jesse Steptoe

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