Corporate moral responsibility vs. corporate social responsibility: Friedman was right

Journal article

What do firms owe to those around them in terms of consideration, restraint, and active support? This question—which I’ll call the question of “firm responsibility”—first rose to prominence in the modern context in the 1950s. While questions about what one entity owes to others and how it may impose on them are essentially questions about moral responsibility, the debate about firm responsibility has been conducted almost exclusively in terms of social responsibility until quite recently. I argue below that we need a different approach. The paradigm of corporate social responsibility is failing, if it has not already failed, and scholars and practitioners alike should shift to the paradigm of corporate moral responsibility. I begin with a brief discussion of paradigms and how they function in the social sciences, especially regarding the social institutions of government and business (Sect. “Paradigms”). With that established, I outline the paradigm of corporate social responsibility (CSR) and argue that it is failing (Sect. “Corporate Social Responsibility”), then present the paradigm of corporate moral responsibility (CMR) and note the ways in which it compares favorably (Sect. “Corporate Moral Responsibility”). Briefly, CMR is a more coherent and ultimately more familiar paradigm, far better developed with stronger justifications and clearer options for analogous development. Beyond these benefits, I argue in (Sect. “Corporate Political Responsibility”) that the paradigm of CSR both encourages and obscures the intrusion of private firms into arenas traditionally reserved to governmental authority—a move to what would be better described as corporate political responsibility (CPR, sometimes called political CSR). It is highly controversial to allow such an intrusion, much less to claim that it is obligatory, but our reliance on the paradigm of CSR makes it hard to even realize that it is happening, much less to articulate and discuss the concern. In contrast, adopting the paradigm of CMR brings the long-standing distinction between moral and political theory into play. Doing so highlights the radical nature of this intrusion and gives us the language we need to describe it, debate it, and manage it if we choose to pursue it. Further, properly distinguishing between CMR and CPR reveals the possibility of an under-explored field that lies between the two (for both human and corporate moral agents)—what I have here called communal responsibility, for lack of a better term. I conclude by acknowledging the clear parallels between the claims I have developed here and Friedman’s claims in his (in)famous article.

Authors: Hess, KM

• Publication status: Published
• Peer review status: Peer reviewed
• Publisher: Springer
• Journal: Journal of Business Ethics
• Volume: 202
• Issue: 3
• Pages: 487-502
• Publication date: 2025-04-15
• Acceptance date: 2025-02-26
• DOI: 10.1007/s10551-025-05982-2
• EISSN: 1573-0697
• ISSN: 0167-4544
• Language: English
• Keywords: corporate moral agency; political CSR; moral theory; Milton Friedman; paradigms; corporate social responsibility