“Strategy & Society: The Link between Competitive Advantage and Corporate Social Responsibility” by Michael E. Porter and Mark R. Kramer Essay (Article)

Introduction

The article “Strategy & Society: The Link between Competitive Advantage and Corporate Social Responsibility” by Michael E. Porter and Mark R. Kramer sets out to demonstrate the importance of corporate social responsibility (CSR) in today’s business environment. The authors are accredited experts in the field of CSR and are therefore better placed to shed some light on how business entities can improve the social and environmental consequences of their activities.

Throughout the paper, the authors highlight the successes that CSR concepts have had in making businesses socially and environmentally friendly. They also discuss the common misconceptions held by businesses in regard to the application and impact of CSR to business practices. This paper shall discuss some of the arguments forwarded by the authors in regard to the general understanding of CSR, its importance in strategy formulation, and demonstrate the strengths and weaknesses of the authors’ points.

Article Review

The authors begin by stating that while CSR is currently an inescapable priority to businesses due to pressure from the government, media and activists, the efforts by businesses to account for the environmental and social consequences of their activities have not reached their maximum potential. From this observation, the authors theorize that strategic CSR is characterized by the acknowledgement of the interdependence between the company and the society (Porter & Kramer, 2006).

To support this theory, the authors claim that the inadequacies exhibited by companies in their effort to showcase CSR is as a result of the fact that the ranking used to measure CSR performance of companies put them against society, and force companies to view CSR generically as opposed to ways that can improve the firms competitiveness.

The authors emphasize on shared value as the central concept of their article. According to the authors, the successful integration of business and society relies primarily on decision making processes that produce beneficial choices to both parties.

They argue that CSR is currently inefficient because business and society focus their attention on the tension that exists between them rather than their intersection (Porter & Kramer, 2006). To solve this issue, the authors suggest that a company should identify the points of intersection, choose the social issue to address, create a corporate social agenda, integrate inside-out and outside-in practices, and create a social dimension to the value proposition.

The central argument of the paper is that current approaches used to facilitate CSR are separated from the business to an extent whereby many companies fail to seize the great opportunities that can effectively benefit society. According to the authors, moral obligation, sustainability, license to operate and reputation have been used to justify and define CSR.

These four concepts are the specific hypotheses for this article. The authors use quantitative research methods (correlative, case study and descriptive research designs) to test these hypotheses. Through these research designs, Porter and Kramer (2006) provide proof of how each concept can be used to form a case for CSR. They also show how each concept is inadequate in the integration process.

To support their claim, the authors use various case studies (Nestle’ District, Whole Foods market, and GE among others) to substantiate their arguments. In addition, the evidence they provide is supported by adequate examples, which can be used to analyze the effectiveness of CSR approaches used by different companies.

Through out the article, the authors have used various theoretic and practical concepts to advance their claim. As such, the value positions of their argument are clear, concise and logical. Porter & Kramer (2006) emphasize on the importance of integrating business and society by discussing an array of benefits that companies may accrue from such intersections.

Considering the immense pressure companies face from the public to improve their CSR approaches, this article provides such companies with a foundation from which strategic and responsive CSR can be achieved.

he article has new concepts and facts that can be used by researchers and business leaders to advance their scope of thinking in regard to CSR. As such, the article is a great and valuable addition to the currently present literature since it provides interested parties with a new way of thinking, as well as a foundation for further research.

One of the major strengths that can be seen throughout this article is that the authors have supported their claim with sufficient factual evidence, clear definition, and vivid descriptions. As such, the article has well articulated discussions and arguments that advance the reader’s knowledge, all the while, activating the reader’s desire to learn more.

On the same note, the article’s structure is well organized and has a logical flow of ideas. The language and style used by the authors is not complex, which means that the article is suitable, and can be easily understood by people with different levels of understanding on the topic.

Conclusion

This article provides readers, business leaders and other interested parties with an avenue through which they can be able to measure the effectiveness of CSR approaches used by companies. It is an educative and interesting read with valuable information that can help companies prioritize and choose issues that will create a lasting impact to society even in the long run.

Reference

Porter, M. E., & Kramer, M. R. (2006). Strategy and society: The link between competitive advantage and corporate social responsibility. Harvard Business Review, 84(12): pp. 76-92.