Grade my essay, please?

[vijay120]

Some people believe that corporations have a responsibility to promote the well-being of the societies and environments in which they operate. Others believe that the only responsibility of corporations, provided they operate within the law, is to make as much money as possible.

 

Write a response in which you discuss which view more closely aligns with your own position and explain your reasoning for the position you take. In developing and supporting your position, you should address both of the views presented. 

 

The extreme positions of corporations being perfectly altruistic on one side and being perfectly selfish on the other is problematic since such practices are not sustainable. One has to only look at the public outcry created after studies found that companies using CFCs in their aerosol products created a massive ozone hole in the Antarctic to see that being perfectly selfish is unsustainable. Moreover, being perfectly benevolent by contributing to society and the environment while not generating profits to shareholders will leave investors running with their money. Modern corporations know this and have struct a middle ground; they have started to inculcate corporate social responsibility (CSR) projects into their operations, where a dedicated department works on beneficial social and environmental projects while the rest of the firm generates profit. However, this is problematic since CSR projects inherently create tension between maximizing value to the shareholder and being benevolent to society and the environment. I propose an alternative that is much more effective than CSRs: adding societal and environmental benefits into shareholder value. 

An example of this is Danone corporation, a multinational corporation that specializes in making yogurt and other diary products. It recently set up research facilities in Bangladesh to create a yogurt product that was enriched with nutrients so that a child could survive on the yogurt for a day without getting malnourished. They used beggars as their distribution channel since they intimately knew who needed this product the most and Danone provided financing to buy the yogurt. By doing this, the company was able to find the correct combination of ingredients it needed to sell this type of yogurt to its more higher profit margin markets in Europe and the Americas. At the same time, the yogurt benefitted hungry children in Bangladesh. Such a scheme shows how corporations can add societal benefits to their shareholder value.

Corporations can also market their social/environmental efforts directly to consumers, thereby distinguishing their product in a commoditized space and making them more valuable. For example, organic chicken farms advertise that their chickens were feed with fertilizer free food, were allowed to roam freely and were not confined in a cage to appeal to the socially/environmentally conscious consumer. This in-turn helps them profit by selling a pricier product than farms than raised caged chickens.

In conclusion, the statement of choosing the extremes of pure profit or benevolence is impractical and problematic. Even though companies currently follow CSR programs, a more effective alternative is incorporating societal and environmental factors in the heart of their business model, so that no conflict of interests arise.