Corporate Social Responsibility: Keeping us A-Float

Corporate Social Responsibility (CSR - not the sugar/engineering company) was a focus on the Masters degree that I had completed last year. Though I felt that there were some subjects that were more about the money you can make by being moral, me and my mind has been aims motivated over money motivated. I'm much more about 'being nice and respectful to each other - the stakeholders - and we'll make money' versus 'to make money - for our shareholders - we have to be nice and respectful'. This, in a nutshell, is the difference between narrow and broad CSR.

Below you will find something I wrote up two years ago that puts moral organisations and Corporate Social Responsibility in a more academic sense - removing all the citations as no-one is really here for that (but if you are send me a message and I'll point you to them) but keeping all the business ethics jargon in. Im 99% sure that over my time during my Master's Degree, I watched that video in an introductory lecture in three different subjects. It's like when a teacher pulls out an old CRT television in high school - it's the go to video when the teacher doesn't want to explain or teach.

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Moral Organisations

There are some that believe that companies exist to make a profit. This is a very narrow view of CSR. To make a company become a more moral organisation, the have to take a broader view of responsibility. Taking a more utilitarianist approach by achieving the greatest good amongst all the stakeholders, not just shareholders, and looking outside the walls of the organisation will make the organisation more socially and morally responsible. Businesses can do this by making sustainability a core initiative, and are able to show behavioural integrity through taking on responsibilities that individual people take on as civic duty to promote this healthy moral climate. It is also possible by adopting an 'ethic of care' throughout an organisation, by thinking about how decisions take care of the wider audience.

Edmans (TEDx Talks 2015 - video below) argues that if a company were to make CSR a priority, profits will follow and by applying an 'ethic of care' to decisions made will create value. CSR initiatives take at least 4-5 years to show as a profit, which goes against the fiduciary responsibility for the business to their shareholders that expect a short-term gain. However, a balance has to be made so that profit and purpose are equal to ensure the long-term success of the company.

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Another way to look at narrow CSR is that it's putting the shareholder first, or shareholder primacy, as in Freidman's famous idea that:

Corporations have no higher purpose than maximizing profits for their shareholders

This is the narrow form of CSR - the "social" responsibility of a business is to only make as much money for the people that have given money to them in good faith or help build the business. Or in other terms, the internal stakeholders (the ones that make the business run, kinda) and the external shareholders.

However, this doesn't create a super healthy moral climate for a buisiness. An extreme example is to think about child labour. If we take this narrow form of CSR, there would be no issues with getting garments make in factories known to use child labour and pay them a pittance - it maximises profits after all and in the short term the shareholders will be happy and be happy with the short-term financial return.

In our current times of the big data that exists on the internet and the savvy consumer base, there has been a shift towards Stakeholder Theory - a broader view of CSR. This means the above situation wouldn't fly as easily. Consumers would stop buying products because of children rights violations, and though the business saved money by using cheap labour they wouldn't be making a profit in the long-term. How can we apply these concepts to a Queer scenario?

SGLMG Parade: SGLMC Sponsors vs. Community Groups' Sponsors

There is an argument that the better treatment of SGLMG sponsors during the Mardi Gras parade is Stakeholder Primacy. That we know that almost 40% of revenue comes from sponsorship in one form of another, and that's not a percentage to scoff at - especially when historically there was a lack of support of corporations towards the Mardi Gras Parade. You can then argue that because corporations are spending money to support Mardi Gras they become shareholders; SGLMG have to bend over backwards to continue getting that money and make that a primary endeavour - especially that no-one wants to be the cause of a valued LGBTIQ organisation to go bankrupt. But now with an abundance of businesses showing support to the LGBTIQ community, and other LGBTIQ NFPs organisations now receiving a similar amount of revenue from sponsorships or other business means, SGLMG has to rethink it's sponsorship guidelines on floats for other LGBTIQ organisations.

It has only been a recent revelation that corporations want to align themselves with Mardi Gras. For example Cadbury withdrew sponsorship of Hey! Hey! It's Saturday! in 1994 when they promoted live crosses to the Mardi Gras parade - in which to try and get back the sponsorship Channel Nine removed the words "Gay" and "Lesbian" from the broadcast to try and appease them (Source: Australia Lesbian and Gay Archives). During and after the marriage equality debate, and in combination with the paradigm shift towards a broader sense of CSR for long-term survival, there are many businesses willing to support LGBTIQ organisations - and I'd be willing to assume that if SGLMG were to lose a major sponsor, another big entity would fight tooth and nail to take their space.

As smaller LGBTIQ organisations are also starting to recieve funds from other businesses almost to the same percentage stake, is it within SGLMG remit to restrict other LGBTIQ organisations to give back to their sponsors during the Parade? Smaller LGBTIQ organisations are not able to provide part of the fabulousness that Mardi Gras is known for without the support of the business sponsorship. By SGLMG limiting signage sizes for logos and messaging of sponsors, they limit the power the NFP organisation has in realising their relationships with for-profit business.

One option: Rebalance with Renegotiations

Rather than continuing to analyse the theory of the issue, I'd like to propose a way of moving forward from the issue. All of these things to balance back from profit to benefit to community will require renegotiations with the current business sponsors and other organisations and involving them with the process of these changes. Without them knowing what is happening all decisions made will look reactive rather than well thought out.

In talking about not knowing about things, there should be better transparency about what the business sponsors receive within the parade rather than what has been previously written in Parade Applicant Guidelines. I've seen double or triple the amount of parade participants for sponsor' float at a casual perusal walking around the marshalling area - but this is anecdotal and I don't have stats. It's great that 10-12% of the floats are from sponsors, but how many participant wristbands are given?

Another thing I think should happen is that there shouldn't be a float that is just for a corporate entity - rather it should be the people in said corporation creating something for the parade. Many corporations have a LGBTIQ pride group and should come up with an idea and apply for multiple floats as some NFP organisations have *cough* if they need more people. This will give the 10-12% stat more meaning to begin with (and allows for multiple floats to be sponsored by one entity) - but I would think that it would be more authentic to the LGBTIQ community if it were less about brand and more about themselves. They can still be sponsors of those floats and run with the exact guidelines as the NFP organisations - and if you give them a *bit* of leeway because of them being corporate sponsors and be transparent and honest about it, I'm sure other organisations will be okay with it.