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Beyond what’s legal: Economists may need philosophers on this CSR crunch issue

Some call CSR “corporate citizenship”. Does that include paying more taxes than legally required?

In his “Trump, Taxes and Citizenship” commentary, New York Times columnist David Brooks admirably parses this seminal business-in-society issue. Key excerpts:

“As Trump and his advisers have argued, it is normal practice in our society to pay as little in taxes as possible … The problem with [this] taxpayer mentality is that you end up serving your individual interest in short term but soiling the nest you need to be happy in over the long terms.

“If you orient everything around individual self-interest, you end up ripping the web of giving and receiving … Everything that is not explicitly prohibited in permissible.

“You can say that a billionaire paying no taxes is fine and legal. But you have to adopt an overall mentality that shuts down a piece of your heart, and most if your moral sentiments.”

The discussion now borders on moral philosophy. In the Citizens United case, the Supreme Court affirmed “corporate personhood” — that a company has many of the rights of citizens.  

With rights come responsibilities and, often, obligations..

Too, it’s relevant that early CSR centered on the legal aspects of addressing public issues. Compliance officers were central to that. But in 2016, especially in this year’s presidential campaign with a businessman as nominee — we’ve come a long way from that emphasis. Today, the opinions and actions of  company “stakeholders” — including, of course, investors, but also customers, employees and communities — matter greatly in business success.

It’s the primary reason why public relations specialists in CSR are playing an increasingly important role in corporate policy-formation and performance. Reputation truly matters. For companies, but also for presidential candidates.