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Corporate responsibility is considered an oxymoron by much of society. Corporations are among the least trusted of our institutions; and the 2008 financial crisis, BP's oil spill in the Gulf of Mexico, and the collapse of the house of cards that was Enron have only added to public skepticism.
So, at a time when trust in corporations has reached an all-time low, why is interest in corporate responsibility at an all-time high? A plausible explanation is that increasing numbers of stakeholders are demanding responsibility from corporations. Hyper-transparency of corporate activities, fueled by disclosure laws and the Internet, has increased awareness to the point where corporate behavior is under constant scrutiny. Smart business leaders are aware of this scrutiny and of the high costs of a public scandal. They know that in the long run it is cheaper to act responsibly now than to dig out from a PR disaster later.
Tim Mohin is a veteran corporate responsibility practitioner .
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