Corporations, social responsibility and sustainability

The goal of most corporations and CEO has always been profit maximization, a public company has a responsibility to its share holders to run itself efficiently and make as much profit as it can. But does it also have a social responsibility to make decisions that are ethical and possibly sustainable?

Eleanor LeCain has noticed a new trend in corporate social responsibility, sustainability not only improves a business model but opens up opportunity to connect with culture. In one example, the people involved in sustainability movements and green  have a natural tendency to support companies that share there values, meaning more customers. Repurposing and reusing waste makes a company efficient instead of losing profit every time something is discarded, sustainably minded engineers look for possible uses for such material.  According to the author this new concept it has implications in changing the very economic system.  Its an idea shared by John Elkington, he sees other benefits of a changing economic system including confronting limits in natural resources, education of customers, overall efficiency meaning less waste and a fulfillment of corporate responsibility.

Looking ahead if more firms take on this sustainable appraoch our whole economy could change. “To get there, we need to shift accounting, tax and finance tools to more accurately reflect real costs. We can expose and change the enormous hidden subsidies in our economy.” LeCain I was very impressed with one example of change, in a power company in San Diego that has a natural monopoly, yet changed that way it goes about making money. A regulation change means this company profits when it installs efficient windows, generators, water heater etc. so instead of trying to sell more energy(think limited supply of fossil fuel) it  becomes a win win as customers pay less every month and the company makes greater profits.

What an interesting idea, that came about from a fresh perspective sustainability and social responsibility all while including a competitive profit seeking business model.