Corporate Social Responsibility
About six years ago, I found out that the average American CEO salary is an overwhelming 700 times higher than regular employee salaries. For you non Math majors, this means for every dollar a, let's say, Unocal employee makes, the Unocal CEO makes $700. The figure astounded me and I often repeated it in various forums, classrooms, coffee shops, faculty lounges, at home to my three year old son, as a pretext for my livid outbursts on corporate responsibility.
I definitely understand, and I am also sympathetic to a corporation's right to make a profit, but what I'm concerned with is when the desire for profits supercedes an individual's right (employee/consumer right) to also attain wealth and happiness, or when the desire for profit hurts employees and consumers, much like what is happening now with big oil companies' record profits. Corporate failures like Enron also ring aloud every time I think about this topic. Enron gouged California out of $17 billion, raped employees' retirements, and ran shareholders' stocks into the ground, all for profits and personal gain. Although Enron is an extreme case of corporate greed, it is never the less an example of what is going on right now all over the world.
However, a compromise is simple. Since there are never justifications for $100 million salaries, ever, here's a modest proposal. What if a CEO who makes $100 million only accepted $25 million and reinvested the $75 million back into the company, say: raising pensions, employee salaries, lowering product costs, etc? The benefits would be astounding for that company. Shareholders would invest more, employee morale would go through the roof, and consumers would buy more products from a company they trust. In fact, according to Sourcewatch.org regarding Corporate Social Responsibility (CSR):
"People's consumption patterns are influenced by corporate social responsibility efforts, according to a 2004 survey of more than 400 'opinion elites' (members of the top 10 percent of society, with regard to media consumption, civic engagement, and interest in public policy issues) in 10 countries, by APCO Worldwide. 'Positive CSR information has led 72% of the respondents to purchase a company's product or services and 61% to recommend the company to others. Conversely, negative CSR news has led 60% to a boycott of company's products and services,' reported PR Week."
In essence, the corporation is making a larger profit by committing to a responsible corporate model. I know this is an idealistic notion, borderline naive, but it's never the less real and attainable and beneficial for all, including the corporation.
I definitely understand, and I am also sympathetic to a corporation's right to make a profit, but what I'm concerned with is when the desire for profits supercedes an individual's right (employee/consumer right) to also attain wealth and happiness, or when the desire for profit hurts employees and consumers, much like what is happening now with big oil companies' record profits. Corporate failures like Enron also ring aloud every time I think about this topic. Enron gouged California out of $17 billion, raped employees' retirements, and ran shareholders' stocks into the ground, all for profits and personal gain. Although Enron is an extreme case of corporate greed, it is never the less an example of what is going on right now all over the world.
However, a compromise is simple. Since there are never justifications for $100 million salaries, ever, here's a modest proposal. What if a CEO who makes $100 million only accepted $25 million and reinvested the $75 million back into the company, say: raising pensions, employee salaries, lowering product costs, etc? The benefits would be astounding for that company. Shareholders would invest more, employee morale would go through the roof, and consumers would buy more products from a company they trust. In fact, according to Sourcewatch.org regarding Corporate Social Responsibility (CSR):
"People's consumption patterns are influenced by corporate social responsibility efforts, according to a 2004 survey of more than 400 'opinion elites' (members of the top 10 percent of society, with regard to media consumption, civic engagement, and interest in public policy issues) in 10 countries, by APCO Worldwide. 'Positive CSR information has led 72% of the respondents to purchase a company's product or services and 61% to recommend the company to others. Conversely, negative CSR news has led 60% to a boycott of company's products and services,' reported PR Week."
In essence, the corporation is making a larger profit by committing to a responsible corporate model. I know this is an idealistic notion, borderline naive, but it's never the less real and attainable and beneficial for all, including the corporation.
posted by Caleab at 11:59 AM
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