Thou Shall Not Get Distracted by CSR Foolishness

Now it’s time to set off a few firecrackers: PR (at least from the business world) fails when it forces too much attention on corporate social responsibility (or CSR for those who prefer acronyms to English).

CSR is the catch-phrase that encompasses the notion of what Oz’s Wizard referred to as “good-deed doing,” in which the corporate world shows it has a heart and a conscience by getting involved in a variety of socially relevant activities such as volunteerism, philanthropy, sponsorship of nonprofits, and so forth. On the agency side, this might involve taking on pro bono accounts (usually involving smaller nonprofits) with the plan of using PR connections to raise awareness of some socially, culturally or even spiritually relevant cause.

On the surface, it seems like a wonderful idea. But from a PR standpoint, CSR has become an inane distraction which ultimately never serves its purpose because it is grounded in a basic flaw: calling attention away from the corporation’s mission with fluffy news and self-congratulatory accolades concerning isolated actions of good citizenship.

Reality check: CSR is a defense mechanism that gets set up when a corporation and/or its leaders begin to generate seriously rotten PR. Of course, responsible corporations don’t need to blow their own horns on how great they are because anyone operating in an ethical and moral manner already has the respect of their customers and investors.

Consider, as an example, the case of Ford Motor Company, which issued a glowing press release in late 2006 noting it had been “rated among the top 25 companies in the world in corporate social responsibility reporting by ‘Tomorrow’s Value: The Global Reporters.’ Ford is the only automaker among the top 25 of the 50 companies demonstrating best practices in corporate social responsibility.”

“Tomorrow’s Value” is a corporate sustainability report developed by the combined efforts of the United Nations Environment Program, Standard & Poor’s and SustainAbility Ltd. Ford was honored for being “the first in the automotive industry to develop, implement and report a Code of Basic Working Conditions.”

Ironically, that press release was distributed around the same time when Autoblog reported that “Ford is looking to rid itself of 10,000 of its 38,500 salaried workers by 2008” by using buyouts or involuntary layoffs. Really, is there a point in having a Code of Basic Working Conditions if tens of thousands of people are being cut from their jobs? Where’s the social responsibility when mass layoffs have damaging effects on the regional economies that relied on the company’s presence as an employer, especially in Michigan?

A few companies have always operated by trumpeting how wonderful they are in regard to social responsibility – Ben & Jerry’s and The Body Shop were ubiquitous (and, ultimately, emetic) in reminding us what good citizens they were. Ultimately, such PR shenanigans didn’t help their respective bottom lines.

From the C-Suite perspective, CSR is bad for business since it diverts time, energy and resources from more important functions. Betsy Atkins, CEO of Baja Ventures, a venture capital firm concentrating on technology and life sciences, was perhaps the most eloquent in her summary of the fallacy of CSR in an essay from the November 28, 2006 edition of Forbes Magazine:

“The concept of corporate social responsibility deserves to be challenged. It seems that political correctness has obfuscated the important business points. It is absolutely correct to expect that corporations should be ‘responsible’ by creating quality products and marketing them in an ethical manner, in compliance with laws and regulations and with financials represented in an honest, transparent way to shareholders. However, the notion that the corporation should apply its assets for social purposes, rather than for the profit of its owners, the shareholders, is irresponsible.

The corporation’s goal is to act on behalf of its owners. The company’s owners--its shareholders--can certainly donate their own assets to charities that promote causes they believe in. They can buy hybrid cars to cut back on fossil fuel consumption or support organizations that train the hard-core unemployed. But it would be irresponsible for the management and directors of a company, whose stock these investors purchased, to deploy corporate assets for social causes.”

Where PR people should be active in regard to CSR is the exact place where they are often absent: in the Investor Relations side of things. Sister Patricia Wolf, executive director of the Interfaith Center for Corporate Responsibility (an international coalition of 275 faith-based institutional investors) told me that she never deals with PR people whenever there is an issue of curious corporate activities – she goes straight to the CEOs. The absence of PR professionals from the IR ranks (particularly in targeting the growing socially responsible investing sector) would suggest that too many PR people have no clue how to approach CSR.

CSR, from an American PR perspective, has become an irritating distraction that is so overpowering that some companies even devote resources to creating special reports detailing just what wonderful corporate citizens they are. That kind of nonsense doesn’t fool anyone – particularly the socially responsible institutional investors who are more interested in deeply ingrained problems of corporate malfeasance and dubious business practices (especially in distant countries where companies or their subcontractors exploit the local working classes). And that’s where CSR fails miserably in most cases: it becomes so obsessed with highlighting happy news (no matter how trivial) that it gets caught off-guard when socially responsible investors start agitating for change. That sector has $2.3 trillion in capital to invest and they don’t give a damn about touchy-feely publicity stunts. More often than not, PR officers wind up doing crisis control when the socially responsible investors want to see genuine examples of CSR and not the PR puffery.

If a company wants to get involved in some benevolent activity, like a walkathon or a mentoring program, there’s nothing wrong with that. Nor is there anything wrong with an isolated press release highlighting this activity. But getting carried away with an excessive PR campaign trumpeting foolish CSR is as valueless as the golden calf worshipped by our Biblical brethren – who, as punishment for genuflecting to the wrong deity, wound up getting Baaled.

Amen!

(Phil Hall is the former president of Open City Communications, a New York PR agency, and former editor of PR News. His latest book “The New PR” will be released later this year from Larstan Publishing.)