Club CSR

Posted: Aug 19, 2006 12:04 AM

In Ann Coulter’s latest best selling book, Godless: The Church of Liberalism, she notes that individuals who have suffered personal tragedy are shielded from criticism. Notwithstanding the controversy over the “The Jersey Girls”, her astute observation of special immunity rings true not only for these proponents of liberal dogma but also for CEOs who are disciples of corporate social responsibility (CSR). In this instance, the Left welcomes these converts from capitalism with open arms - as long as they promote the social activist agenda.

CEOs of some of the largest companies have become the biggest advocates for expanding the responsibility of business beyond financial performance to include social and environmental goals. With the public outraged over executive compensation, and high profile cases of corporate fraud, CSR is an insurance policy for image-sensitive CEOs.

By paying an ideological and financial cover charge to social and environmental causes, CEOs gain admittance to Club CSR and enjoy a host of membership privileges. One major club benefit is protection from advocacy actions such as protests and boycotts wielded by anti-business activists.

Membership requires the creation of a public relations campaign or business strategy that serves the CSR agenda. By feeding into politically correct themes, these campaigns frequently distract the media and shareholders from failed business practices and poor stock performance. Being viewed as socially responsible buys great latitude for struggling CEOs. No longer considered selfish capitalists, these CEOs can finally gain access to elite social circles.

Global warming, the Holy Grail of CSR topics, provides the greatest cover for a distressed CEO. For example, under the leadership of John Browne, the giant energy company BP has enjoyed a free ride from activist attacks because of the company’s aggressive advertising campaign promoting global warming concerns, carbon footprints and alternative energy.

Meanwhile, BP’s record includes a deadly explosion at one of its refineries and a major oil pipeline leak in Alaska. Because of these incidents, the company is under investigation by an alphabet soup of federal and state agencies – EPA, OSHA, and DOJ – for possible law violations. More recently, the company has been accused of illegally controlling propane prices, which drove up cooking and heating costs for consumers – many of them poor.

Even though the company is responsible for the tragic loss of life, polluting the environment and potentially ripping off poor consumers, there is a deafening silence of criticism from social and environmental activists.

Instead, BP is heralded as an environmental leader for its position on climate change. For example, BP received the top score in a ranking of 100 Global Companies on Climate Change Strategies last March by CERES – a coaliton of organizations that are working to advance environmental stewardship by businesses.

Another global warming disciple is GE – the giant industrial, entertainment and financial conglomerate. Through its environmental public relations campaign – Ecomagination – the company touts its investments in alternative energy and the need to reduce greenhouse gas emissions.

GE is now partnered with the World Resources Institute – an environmental activist non-profit – in seeking national regulations to address global warming. By joining the global warming cult, GE’s CEO Jeff Immelt is enjoying the benefits of a capitalism convert – favorable media coverge for the company’s green strategy and protection from critical reporting on GE’s profitability.

Media scrunity of GE’s business would expose the fact that its share price has been flatlined ever since Immelt took the helm. Moreover, aggressive reporting would expose that GE’s pursuit of greenhouse gas regulations will negatively impact GE’s earnings because of the effect of higher energy prices on its business and the entire economy. But these details get lost in the fog of CSR. The excitement of a giant company taking a leadership role addressing global warming trumps reality.

Today, CSR gives CEOs immunity from criticism, allowing them to enjoy a peaceful and highly prosperous tenure. Until it’s recognized that company support for CSR initiatives is often a sign of a troubled business, CEOs will be eager participants. In the meantime, shareholders and consumers will be left paying the price.

Thomas J. Borelli, Ph.D. is the editor of, a shareholder activist, and a senior fellow at the National Center for Public Policy Research, a Gold partner. The opinions expressed are his own.