Moralising at companies: What’s the point?

“Is moralising pointless?” – Adrian Henriques

The government and politicians have been lecturing companies on how to behave a lot recently – there’s tax, training and ISPs for a start. But does it work?

The issue of taxes not being paid has received the most attention. That led to Starbucks volunteering an extra £20m over two years. But that may be it. So pointing out that a company could give more money to the state, or that it could choose to train more local people or could limit access to nasty pornography sites will probably have limited success. Does that make it pointless?

The natural response to such efforts at moralising is that it is indeed a waste of time: the law has to change. On this view, the law and the business case are the only things companies recognise. Yet capitalism also has a moral foundation, as Adam Smith recognised. Companies don’t always do anything they can get away with.

Maybe in the long term moralising can help to change the climate of opinion within which companies operate, creating reputational hazards if nothing else. But it is only in the long term. For tax, training and ISPs it would probably be far more effective to regulate for the solution – but that is more work for the government. And interestingly that work would mainly be in persuading other parties that changing their behaviour would be the right thing to do.

Maybe there’s no escape from moralising after all.

By Adrian Henriques.

Adrian Henriques writes and comments on social issues and sustainability. He is an independent corporate responsibility consultant, providing advice to some of the world’s biggest companies, NGOs and public sector organisations. He is on the editorial board of the Journal of Corporate Citizenship (JCC). To read more from Adrian, visit his website.

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