Corporate Social Responsbility

There is an interesting debate going on about the social responsibility of business. Steve Bainbridge highlights an example of a tough issue.

what does the board and management do when they are faced with a zero sum decision in which there will be winners and losers? In particular, what decision-making norm should the board adopt when faced with a zero sum decision in a final period transaction, such as when responding to a takeover bid? The answer, of course, is to maximize shareholder wealth. Anything else (a) is incoherent and (b) invites directors and managers to use nonshareholder interests as camouflage for decisions in their own self-interest.

Tyler Cowen has also made some comments.

  • dino

    I thimk, this concept is very importan for this situation. without csr, the corporet never will not care abouth the enviroment. so the corporate will be ekploited the enviroment without esponsibility.