Which Way to Moral Capitalism?
A Comparison of CSR in the US and EU-Greece

by Chris Papoutsy

Generally speaking, corporations in Greece and other European countries that strive to be good corporate citizens do so under the flag of corporate social responsibility (CSR). In the US, however, the CSR flag and slogan are seldom used. In the US, a corporation's goodness usually assumes one of the following three forms: corporate philanthropy as cash and in-kind donations; the corporate citizen serving all stakeholders; or individual corporate executive philanthropy which constitutes donations to charitable and social programs. Understanding these varied approaches to social responsibility and giving can assist corporations and businesses today as they strive to improve their products or services and succeed in global markets. Moral capitalism is one of their ultimate goals.

A brief summary of each of the four approaches to CSR is outlined below:

European Corporate Social Responsibility

In Greece and other EU countries, corporations have adopted the slogan “Corporate Social Responsibility” as a designation for being a socially responsible business with emphasis on the environment, support of their employees, community involvement and social justice . CSR businesses in Europe link this corporate flag to their reputation and to customer and employee loyalty, but especially to brand image and social justice .

Corporate Philanthropy

 US corporations selectively target the charities or social programs that they can best support and serve by contributing huge amounts of tax-deductible cash donations. Annual gifting with this approach surpasses US$1 billion worldwide, with enormous donations from such philanthropic heavyweights as Ford Motor, Wal-Mart, Johnson & Johnson, Exxon Mobil, Pfizer, and Citigroup.

The Corporate Citizen

Another strategy that U.S. companies utilize is to wave the flag of good “corporate citizenship.” The good corporate citizen is more than a mere producer of profits for shareholders: this entity serves a variety of stakeholders . KLD Research & Analytics in Boston calculates scores annually for the largest publicly-traded companies by rating each one in the areas of community relations, the environment, employee relations, diversity and cultural relations, and social justice. A few of the top 10 on the 2000-2004 Best Corporate Citizen List are Proctor and Gamble, Intel Corp., Hewlett Packard, IBM, and Starbucks.

Individual Corporate Executive Philanthropy

In the U.S., the top 50 philanthropic corporate executives in recent years have donated a dizzying US$65 billion tax-deductible dollars to charitable and social programs worldwide. Many of the contributions address inequities that increasingly threaten domestic society, global stability, and world peace. Among the top 50 of these generous executives are Bill Gates, Warren Buffet, Michael Bloomberg, Ted Turner, Oprah Winfrey, and Michael Dell. Their assistance targets worthy causes such as health and educational issues, encouraging open and free societies, reproductive choices, the environment, global security, and medical research.

Of the four approaches outlined above, the US methods share some characteristics that are not readily apparent. They stand in contrast to the European CSR method, since brand image and social justice in the EU are not generally tied to company performance. In the US, the performance of a company is as important as obligatory philanthropy. Among these three major U.S. approaches to giving, however, are contrasting strategies and techniques whose selection is determined by cultural philosophies on giving, tax codes and regulations, the particular product or service of the individual companies, marketing schemes and brand image, and degree of economic freedom.

For more information about Mr. Papoutsy, his free lecture schedule, or to read other articles of his on corporate social responsibility or business ethics, visit the site archives or the Business Arena and Business Ethics sections of Hellenic Communication Service (HCS) website at http://www.HellenicComServe.com , or the web pages of the Christos and Mary Papoutsy Distinguished Chair in Ethics at Southern New Hampshire University at http://www.snhu.edu . Mr. Papoutsy welcomes comments and can be reached via email at papcoholding@papcoholdings.org.

2000 © Hellenic Communication Service, L.L.C. All Rights Reserved.