Corporate social responsibility: A promising social innovation or a neoliberal strategy in disguise?

Abstract:Since the Lisbon Summit the European Union has become resolute in its intention to promote the uptake of corporate social responsibility among European companies. The recent financial crisis has provided further impetus for evangelising CSR, which is identified by the EU public authorities as one exit strategy from the crisis and a promising means of fulfilling the Treaty objectives of inclusive and sustainable social market economy. This paper finds the above assertion problematic and uses a Polanyian framework to evaluate its validity. The paper represents a conceptual intervention in the policy justification provided by the European Commission. Contrary to the overly optimistic voices that see decommodifying tendencies within CSR, this paper claims that CSR does not have a potential to re-embed the economy as argued by the Commission. Despite its protective invocation, CSR is predicated on deepened commodification. It depends on the staging of a special type of exchange relation, whereby reputation is quantified and sold as a commodity by being denominated in a common unit. As such the CSR form promoted by the Commission is a microeconomic counterpart to the regime of rule-based macroeconomic depoliticisation.Keywords: Corporate social responsibility, European Union, Polanyi, disembedded, commodification, neoliberal.The recent economic crisis has not left a corner of the world unaffected and the many reports are here to remind us of its consequences. While some countries and regions have restored their pre-crisis economic output, the European Union is still engaging in fire-fighting missions (Streeck, 2012; Roxburgh and Mischke, 2011). Despite the dire unemployment figures, member state governments have not formulated any tangible growth strategy that will boost the economic activity within the EU, notwithstanding the recent approval of the Compact for Growth and Jobs worth euro120 billion (European Council, 2012). Contrary to the ample evidence, the European politicians are neurotically clinching to the belief that all we need for a recovery to unfold is for the markets to gain confidence (Hemerijck, 2012). However, the proposed solution of fiscal tightening originates from a skewed twisting of cause and effect, wherein deficit spending is projected as the cause of the Great Recession. And every attempt is made to conceal the fact that it was the financial crisis that enticed some governments to acquire debt by bailing out their banks (Brassett et al., 2010). Although scholars have warned that the austerity policies would not necessarily cure the patient (Hemerijck, 2012; Schmidt, 2014), the politicians are depriving the population of a quick recovery by pursuing fiscal consolidation in times of depressed demand. Thus, Polanyi's (1944: 148) argument is even more valid today than ever, when:the repayments of foreign loans and the return to stable currencies were [time and again] recognized as the touchstone of rationality in politics; and no private suffering, no restriction of sovereignty, is deemed too great a sacrifice for the recovery of monetary integrity.In line with their confidence fairy myth (Krugman, 2012) and the belief in a private sector led recovery, the Commission has identified corporate social responsibility (CSR) as one possible exit strategy from the crisis. In its latest Communication on CSR, the Commission has stated that enterprises have responsibility to 'mitigate the social effects of the current economic crisis, including job losses' (COM2011: 3). While making the above claims the Commission does not elaborate on how an increase in the CSR uptake is supposed to lead to a resolution of the sovereign debt crisis. Although the link between CSR and the economic crisis, which requires macroeconomic adjustment, is not selfevident, one can assume its existence if one adopts a broader understanding of the crisis. The crisis in the EU is a multifaceted phenomenon and the current Eurozone calamity is only one manifestation of it. …