Many societies in the world have embraced the corporate social responsibility doctrine. Supporters of the dogma argue that corporations perceived to be socially responsible have higher chances of making enormous sales. Researchers have conducted studies to establish whether corporate social responsibility principle is a socialist or capitalist phenomenon.
Unfortunately, studies indicate that social responsibility is neither capitalistic nor socialistic in nature. By analyzing the practices emerging from the ideology and considering the presence of the axiom ‘social’, one could conclude that CSR is a socialist dogma.
However, entities practicing it are all capitalistic in nature. This raises a number of questions as regards to the principle CSR. It is observed through analysis that socialist ideas are completely inconsistent with capitalistic ideologies.
In his film ‘Capitalism: A love story’, Michael Moore underscores the fact that CSR has dominated the lives of many people in America (Kalt, & Zupan, 1984). The artiste observes that Americans pay dearly for capitalism. Many people lose their jobs on daily basis because of capitalism. People are forced to spent everything they own in order to sustain their lives in a capitalistic society.
This would imply that the lives of many are always in danger. Moore analyzes the lives of ordinary citizens in Washington, DC and concludes that lives have been affected negatively by capitalistic ideologies. Moore tries to understand the lives of Americans, especially their love for capitalism. This article will try to bring out the existing differences between capitalism and socialism. Analytically, socialism and capitalism are incompatible.
In a capitalistic society, resources are owned privately. These resources could be in form of money or other valuables such as property. This implies that an individual has full control of over resources. The society recognizes an individual as a private entity. In socialism, goods and other valuables in society are owned by the state. In other words, the public collectively owns goods.
From this analysis, it is observed that the two ideologies are dissimilar. Capitalists believe that competition is healthy in society. It sharpens the wits of individuals. In this case, an individual is allowed to accumulate as much resources as he or she can. For an individual, only the sky is the limit. An individual is to determine his or her own destiny in terms of property ownership.
The state on its part acts as a utility to individual fulfillment. The state is supposed to provide mechanisms through which an individual would accomplish his or her mission. In this regard, the state is supposed to provide security. The state should ensure that tranquility and calmness is in the society. It is only through this that the society could produce the best individuals (Earl, & Hickson, 2000).
On the other hand, socialism holds that members of society should cooperate in fulfilling their dreams and wishes. Through cooperation, people live in harmony. The ideology does not recognize the efforts of individuals because resources are managed centrally. Whatever an individual produces is distributed to other members of society. The state is given the responsibility of overseeing distribution of resources.
In relevance to CSR, corporations are managed by qualified personalities in a capitalistic society, who are usually employed by owners of a firm. One individual or a group of people, who are further guided by laws, could possibly own a firm. An individual is the only mandated entity to exchange shares or property in a firm. The role of the state is to provide guidelines that would bring sanity in business.
The state does not interfere with individual property, as long as laws are followed. Supporters of capitalism argue that the state should never interfere with market activities because it causes instabilities. In other words, the market should operate according to its own internal logics.
Capitalists believe that manufacturers and consumers will always check each other implying that goods produced would automatically be sold to the market. Capitalists however agree that the state should intervene whenever there is turmoil in the market. The state should withdraw immediately normalcy and constancy is restored in the market.
Labor is privately owned in a capitalistic society. Employees are only willing to dispose their labor to a reasonable employer. This means that each person is entitled to a job and only employees can determine the cost of their labor. Capitalism generates unequal relations in the labor market. Employers will always seek to employ cheap labor. The aim of workers is to achieve high salaries.
Consequently, work is a variety of supply and demand in a free market economy. As earlier stated, ownership of resources and property in socialism is communal. This could imply that each member of society has power over resource expenditure. Each member of society works for the benefit of the other.
This means that there is no stable market in society. Whenever an individual wants a good or service, he or she can always acquire it without any restriction. The government has full responsibility to determine how resources are distributed in society (Carroll, & Buchholz, 2008).
Proponents of socialism claim that capitalistic principles favor the rich in society. They argue that individuals are not given equal chances as regards to resource and property ownership in a capitalistic society. The rich are given an opportunity to accumulate resources while the poor continue languishing in poverty. According to socialists, capitalism leads to pauperization, alienation, domination and perpetration.
The poor are forced to work for the rich under poor working conditions. Socialism emerged to challenge capitalism by claiming that each person should be allowed to own property.
In other words, things should be made equal in society. Socialism came about during the industrial revolution where the rich owned big factories and industries. The poor wanted to enjoy the privileges associated with the rich. The poor and the middle class claimed that power should not be left in the hands of the few rich people in society.
Socialists argued that work ethic would improve in case individuals worked to fulfill the demands of the entire society. On their part, capitalists believed that the society could achieve its goals in case people were allowed to compete favorably.
Companies would produce the best products in the market because of competition. Capitalism disregards socialist ideas because distribution of resources equally breeds laziness. It is therefore concluded that CSR is an idea supported and propagated by capitalistic corporations (Julie, & Sheffrin, 1991).
This means that it is purely an advertising tool that does not take into consideration the wishes and desires of the population. Multinational Companies are known to promote CSR because they aim at maximizing their profits. They engage in public relations affairs through promotion of CSR. Their main aim is to win the confidence of locals in order to make sales.
References
Carroll, A., & Buchholz, A. (2008). Business and Society. New York: Cengage.
Earl, A., & Hickson, R. (2000). Ideology and the Evolution of Vital Economic Institutions. New York: Springer.
Julie, A., & Sheffrin, M. (1991). Economic Literacy or Economic Ideology. Journal of Economic Perspectives, 5(3).
Kalt, P., & Zupan, A. (1984). Capture and Ideology in the Economic Theory of Politics. American Economic Review, 74(3).