Corporate Social Responsibility Through an Economic Lens

36 Pages Posted: 16 May 2008 Last revised: 24 Mar 2021

See all articles by Forest L. Reinhardt

Forest L. Reinhardt

Harvard Business School

Robert N. Stavins

Harvard University - Harvard Kennedy School (HKS); Resources for the Future; National Bureau of Economic Research (NBER)

Richard Vietor

Harvard University - Business, Government and the International Economy Unit

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Date Written: May 2008

Abstract

Business leaders, government officials, and academics are focusing considerable attention on the concept of "corporate social responsibility" (CSR), particularly in the realm of environmental protection. Beyond complete compliance with environmental regulations, do firms have additional moral or social responsibilities to commit resources to environmental protection? How should we think about the notion of firms sacrificing profits in the social interest? May they do so within the scope of their fiduciary responsibilities to their shareholders? Can they do so on a sustainable basis, or will the forces of a competitive marketplace render such efforts and their impacts transient at best? Do firms, in fact, frequently or at least sometimes behave this way, reducing their earnings by voluntarily engaging in environmental stewardship? And finally, should firms carry out such profit-sacrificing activities (i.e., is this an efficient use of social resources)? We address these questions through the lens of economics, including insights from legal analysis and business scholarship.

Suggested Citation

Reinhardt, Forest L. and Stavins, Robert N. and Vietor, Richard H. K., Corporate Social Responsibility Through an Economic Lens (May 2008). NBER Working Paper No. w13989, Available at SSRN: https://ssrn.com/abstract=1133904

Forest L. Reinhardt (Contact Author)

Harvard Business School ( email )

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Robert N. Stavins

Harvard University - Harvard Kennedy School (HKS) ( email )

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Richard H. K. Vietor

Harvard University - Business, Government and the International Economy Unit ( email )

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