CSR=Sustainability=An Economic Imperative

by Alex Harris for Reputation Report, November 8th, 2010.

“Business must be run for a profit, else it will die. But when anyone tries to run a business solely for profit …then also the business will die, for it no longer has a reason for existence. ” -Henry Ford

I really like this quote. To me it encapsulates much that is wrong with how some corporations go about their business. Driven by profit motive alone, they can be seduced into cutting corners or unethical practices such as falsifying records, deliberately misleading the stock market, or worse, all to generate a higher profit.

Some examples of such behaviour have been well covered in these pages already:

  • James Hardie’s dereliction of ethics and governance in its obfuscation of the evidence that  working with asbestos was the cause of an extended and painful death of its workers. It also continued to allow them to work unprotected with the material for 20 years, and then battled its workers and their families for years in the courts trying to avoid any obligation of compensation.
  • Rio Tinto’s building of a mine the women landowners didn’t want, with its subsequent destruction of the environment and swift death of the Jaba River, used as it was by Rio’s Bougainville Copper mine at Panguna for all mine waste disposal, sparked a civil war that killed nearly 20,000 indigenous people. The river still runs with copper and mercury, the people remain traumatised, their fresh water and fisheries remain contaminated. A court case to try Rio Tinto on human rights and environmental abuse is ongoing today, some 21 years after the mine was closed. And still, Rio Tinto is pushing ahead with plans to reopen this ‘bloody’ mine because of its profit potential.
  • Motivated by profit alone, BP cut corners on safety, on training, equipment and procedures in drilling the deepest undersea well ever undertaken, to cause the largest oil spill and environmental disaster ever seen. The impact to human health, wildlife and fisheries stocks and local economies will be felt for years to come. Even while saying it would ‘make things right’, BP was lobbying to cap its liability at US$75 million, effectively choosing to dump the bill for the destruction it caused on the American tax payer. (continue reading… )

 

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