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Conceptual Framework for Understanding the
Ethical Dimension of Corporate Social
Responsibility*
José-Carlos García-Rosell, University of Lapland
Johanna Moisander, Aalto University
Jukka Mäkinen, Estonia Business School
Abstract
Drawing on ethical theory, this paper discusses the ethics of corporate responsibility (CSR): the
principles for doing what is good, right, and virtuous with respect to the roles and responsibilities
that business organizations have in society. We argue that the discussion and debate on CSR
inevitably entail fundamental ethical issues and would therefore benefit from a theoretically
sophisticated understanding of the ethical dimensions of corporate responsibility. To that end, we
propose a conceptual framework that will help managers to understand and assess the ethical
stances and social obligations of firms in society. We also illustrate this framework using some
globally well-known corporations as examples.
Introduction
Corporate Social Responsibility (CSR)—"the responsibility of enterprises for their impacts
on society” (European Commission 2011, 6)—has become a topic of animated discussion and
debate among practitioners and academics alike. In most large corporations, CSR has become
business as usual with designated CSR executives and strategies, along with specific management
systems and practices for dealing with CSR issues, through non-governmental organization (NGO)
partnerships and social reporting, for example (Arenas, Lozano, and Albareda 2009; Arnold and
Valentin 2013; Banerjee and Bonnefous 2011; Bondy, Moon, and Matten 2012; Schlegelmilch
and Pollach 2005). With the increasing public awareness of CSR, scholars have introduced
numerous CSR models and frameworks (Maignan, Ferrell, and Ferrell 2005; Maignan and Ferrell
2004; Sethi 1979; Matten and Moon 2008; Perks et al. 2013; Windsor 2006; Öberseder,
Schlegelmilch, and Murphy 2013), and a confusing myriad of reporting standards, indexes, and
ethical codes has emerged that organizations must conform with when managing their CSR
strategies and stakeholder relations (Crane and Matten 2007).
In this paper, we draw from ethical theory (MacIntyre 1984, 1966; Rachels and Rachels
2007; Rawls 1996, 1971; Sen and Williams 1982) to build a conceptual framework that helps
managers to understand and evaluate an organization’s ethical stance toward society and the
* Forthcoming in Joy, Annamma (2023) From Product to Purpose: Art, Fashion and Wine. Lexington Books.
This is The Author's Original Version (AOV) version of the article. Please refer to the final published version of the paper.
New Directions in Art, Fashion, and Wine:
Sustainability, Digitalization, and Artification
2
environment, as well as to delineate the social obligations that this stance implies. We argue that
corporate responsibility and business-society relations are rather complex ethical and political
issues that are open to multiple interpretations and conflicting, possibly incommensurable,
demands by different stakeholders. As a result, the discussion and debate on CSR and business-
society relations inevitably entail fundamental ethical issues and thus need to be analyzed as a
problem of ethical theory. The conceptual framework that we propose is based on the prevalent
approaches to normative ethics (i.e., consequentialism, deontology, and virtue ethics), which
inform much of the current discussion on corporate responsibility (Crane and Matten 2007). The
term normative is used here in reference to ethical theories that propose or prescribe morally
correct ways of acting.
We also briefly illustrate these different ethical stances by discussing the ethical stances of
some self-proclaimed ethically oriented brands as they have been represented in the global media.
As a basic starting point, we contend that to successfully implement CSR strategies in practice,
managers need to view organizations as ethical subjects (Clegg, Kornberger, and Rhodes 2007;
Crane and Desmond 2002; Crane, Knights, and Starkey 2008; Matten and Crane 2005) as well as
to deliberate on the ethical issues and dilemmas that decisions about CSR involve. Hence, while
acknowledging that CSR is a contested issue, we offer our framework as a tool that helps
organizations to deliberate on their ethical stance and obligations in society, as well as to establish
responsible relationships with their many stakeholders (Maignan and Ferrell 2004; Maignan,
Ferrell, and Ferrell 2005).
The framework that we offer helps managers zoom in on the underlying assumptions about
morality that underpin different notions of corporate responsibility, thus shedding light on the
ethical complexities that arise when business corporations assess their roles and responsibilities
with respect to their stakeholders and society. In doing so, the paper thus directs analytical attention
to the ethical complexities of CSR. It highlights the importance of identifying the specific values
and implicit understandings about ethics that guide and constrain thinking and discussion of CSR
and business-society relations.
Ethics and CSR
While the social role of business in society is typically understood in terms of the economic,
legal, ethical, and philanthropic responsibilities that firms may have (Carroll 1991, 1999; Windsor
2006), the moral basis of CSR is seldom elaborated upon in the literature (Crane and Desmond
2002). As it is largely taken for granted that business organizations have the responsibility to be
profitable and to abide by the laws of society, the focus of attention has tended to be on the
philanthropic dimension of CSR (Carroll 1999). There are vast amounts of literature, for example,
on how and why companies should give back to the local community or enhance social well-being
in society by contributing to various kinds of social, educational, recreational, or cultural purposes
(Kotler and Lee 2008). In this literature, the philanthropic projects of firms are usually discussed
in terms of strategic choice and as investments into the business environment of the company. CSR
is thus represented as “long term maximization of an enlightened self-interest through corporate
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investment in the processes and rules of the firm’s social environment” (Matten and Crane 2005,
168).
The ethical dimension of corporate responsibility (to do what is good, right, and virtuous),
however, appears to have gained significantly less theoretically sophisticated attention in the
literature. While ethics and the ethical responsibilities of business organizations have repeatedly
been discussed in the literature (Lockett, Moon, and Visser 2006), much of this discussion appears
to draw on an implicit assumption that morality is something singular and that clear cultural
expectations or norms regulate what is right and what is wrong (Carroll 1991, 1999, 2004; Maignan
and Ferrell 2004; Maignan, Ferrell, and Ferrell 2005; García-Rosell and Moisander 2008). Most
theoretical accounts of CSR are based on a tacit understanding, for example, that it is morally
wrong for firms to deceive their customers and business partners or to abuse and mislead their
employees. It is also generally assumed that it is wrong for corporations to operate in ways that
pose threats to the natural environment since neither social nor economic goals can be achieved
without a healthy ecological system (Porter and Kramer 2006). With a closer look, however, many
of these accounts of the ethical dimensions of CSR seem to assume, albeit often implicitly, that
there is only one appropriate perspective on morality that applies.
We argue, however, that in the absence of political or legal frameworks and
institutionalized models of corporate responsibility, firms engage in CSR activities largely on a
discretionary basis, and the whole issue of CSR boils down to a question of ethics. Successful CSR
management entails complex ethical issues and requires that the company make informed and
justified ethical judgments about what is right and good for all its stakeholders. To be able to make
well-informed and justified ethical judgments, companies need to carefully analyze and evaluate
the concepts, principles, and theories that they appeal to in defining and defending their
management philosophies and normative claims about social responsibility.
Such critical reflexivity helps managers to build robust ethical corporate identities (García-
Rosell 2013, 2019; Cramer, van der Heijden, and Jonker 2006). By ethical corporate identity, we
refer here to an ethical form of business identity (i.e., who or what an organization is or aspires to
be) (Balmer et al., 2007; Fukukawa et al., 2007). For the firm, questions of ethical identity revolve
around its discretionary ethical responsibilities (i.e., the ethical dimensions of CSR). Ethical
corporate identity is concerned with what is right, just, and fair, but it is not necessarily bound up
with any existing legal frameworks (Balmer et al., 2007, 9). A carefully thought out and clearly
defined ethical corporate identity is essential for successful CSR management as it helps managers
to establish goals, policies, and procedures for CSR, as well as to align its CSR communication
with its CSR-related activities (Fukukawa et al., 2007).
Consequently, we argue that in the field of marketing and management, both the theory
and praxis of CSR would seem to benefit from more explicit theoretical accounts of the ethical
dimensions of CSR as well as from conceptual tools for designing CSR strategies and policies that
are based on defining and framing the economic, social, and environmental goals of business
activities from an ethical perspective. In the following sections, we offer such an account and work
toward building a tool for CSR-related ethical deliberations in management practice.
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Ethical approaches to corporate responsibility
To theoretically elaborate on the ethical dimensions of corporate responsibility and to build
a framework for CSR-related ethical deliberations, we draw from three main approaches to
normative ethics: consequentialism, deontology, and virtue ethics.
There are two main forms of consequentialism: ethical egoism and utilitarianism. In the
context of CSR, ethical egoism is an ethical theory that proposes that firms fulfill their social
responsibilities best by promoting the interests of the firm, e.g., by maximizing shareholder value
(Rachels and Rachels 2007, 75). Utilitarianism, in turn, assumes that a morally responsible
organization considers the public consequences of its actions; a company acts in an ethically
responsible way if its actions bring about positive consequences for most of the stakeholders
involved, preferably producing the greatest good for the greatest number of stakeholders, e.g., the
welfare of society (Rachels and Rachels 2007, 89-90).
Deontological approaches to ethics and CSR, in contrast, assume that business practices
are intrinsically either right or wrong reasons (Robin and Reidenbach 1987, 46). For example,
price-fixing, bribery, misleading claims, targeting vulnerable consumers, and invading employees’
privacy are all seen as intrinsically wrong actions, and they cannot be justified by the positive aims,
cultural traditions, and beneficial consequences that these practices possibly involve. For
deontologists, business organizations have special commitments to their stakeholders, and based
on these commitments, they have special duties (McNaughton and Rawling 2006). In principle,
for example, a company can maximize the good by donating its profits to charities, but it has
special commitments to its shareholders, employees, customers, and other stakeholders that restrict
its freedom to do so or narrow its duties toward people depending on these charities.
Finally, virtue ethics shifts the focus of attention and analysis from moral acts to the moral
character of agents (Annas 2006; MacIntyre 1966, 1984). Whereas deontology focuses on the
underlying principles and rules of acts, and consequentialism on the outcomes or consequences of
the acts, the main concern of virtue ethics lies with the moral character of the decision-makers and
with the quality of their lives, as viewed from the perspective of their community. For virtue ethics,
then, the fundamental moral question for CSR thus deals with the notion of fair business life, and
deliberations about CSR and morality thus revolve around the moral virtues or the traits of
character of a virtuous top executive or manager that contribute positively to this fairness. For
example, the moral stance of firms such as Tom’s of Maine, Lush, and The Body Shop claim to
rely principally on the communities and traditions that have contributed to fashioning the virtuous
characters of their leaders (Marchese, Bassham, and Ryan 2002; Dawson and Bartholomew 2003).
Conceptual framework for deliberations on CSR and ethical corporate identity
We now proceed to propose a conceptual framework for the sort of critical reflexivity
(Balmer et al., 2007; Cramer 2005) about CSR and business-society relations that is needed to
establish carefully deliberated ethical corporate identities. In building this framework, we make a
distinction between forward-looking consequentialist and backward-looking non-consequentialist
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ethical approaches, as well as between individual and collective perspectives on moral judgment
(Rachels and Rachels 2007). We combine these two dimensions to form a two-by-two matrix with
four quadrants representing four basic perspectives on business ethics and ethical corporate
identity with distinct ethical goals for CSR. The framework is designed to help managers find
answers to three main questions: What are the prevailing moral reasons and values driving the
development and implementation of a CSR strategy in a firm? Who is the moral agent of the
strategy? And how do stakeholders conceive the firm’s CSR endeavors? The framework is
illustrated in Figure X.1.
Figure X.1. Framework for forming and establishing an ethical corporate identity
The upper-left quadrant of Figure X.1 is labeled the interests of the firm and the upper-
right quadrant welfare of society. They both represent forward-looking consequentialist
approaches (ethical egoism/utilitarianism), which serve to define ethical identities based on the
outcomes of the daily business practices of the firm. The lower-left quadrant is labeled fair
business, and the lower-right quadrant is labeled good business life. They both represent backward-
looking, non-consequentialist perspectives, which serve to define identities on either the basis of
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rational principles of rights and duties that underlie the company’s CSR strategy (deontology) or
based on the tradition-based virtuous characters of agents who pursue the CSR strategy (virtue
ethics).
The horizontal axis refers to the weight given to individual values in moral judgment. The
ethical identities situated on the left (e.g., ethical egoist identities) are individualistic. It is
nevertheless important to note that deontology also “leaves agents’ considerable scope for
developing their own lives in their own way; provided they breach no duty they are free to live as
they see fit” (McNaughton 1998, p. 890). The ethical identities on the right tend to be more
collectivistic. In the case of utilitarianism that strives for collective welfare, the separateness of
persons and their identities might very well be lost altogether. But in virtue ethics, virtues are seen
as internal to communities or practices united by some shared conception of a good life (MacIntyre,
1984). In this sense, virtues are not based on individuals’ particular conceptions of good.
We offer this framework to help CSR managers reflect upon the moral basis of CSR
strategies. By carefully examining the four ethical corporate identities illustrated in the framework,
managers will be better informed about the ethical theories that they can appeal to in defining and
defending philosophies and normative claims about social responsibility. Furthermore, the
framework will help them to define and communicate organizational values and social
commitments as well as integrate them into their daily business practice. We are conscious,
however, that ethical corporate identity is continuously redefined through stakeholder interactions
and relationships (Balmer et al., 2007). Although the framework that we propose may help
managers to position business organizations within a particular quadrant, it should be noted that
there exists certain permeability between the different categories. Indeed, as we shall show in the
next section, the ethical corporate identity of an organization may be positioned in more than one
quadrant of our analytical matrix.
Empirical illustration
Next, we shall illustrate this framework by analyzing the business strategies of five well-
known corporations: American Apparel, Petróleos de Venezuela (PDVSA), The Body Shop, Café
Direct, and Patagonia. These corporations have hit the headlines at some point in time due to their
market success or based on their strong commitment to social and environmental causes. We start
by positioning these corporations in our framework (Figure X.2).
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Figure X.2. Positioning five corporations in the framework
American Apparel
American Apparel was selected for illustrating the interests of the firm because it has been
perceived as a business organization that aims to pursue social and economic objectives at the
same time. The ethical stance that we characterize here in terms of pursuing the interests of the
firm (upper-left quadrant of the framework) is a forward-looking consequentialist approach to CSR
that defines the right thing to do in terms of the expected outcomes or consequences of business
activities for the company (ethical egoism). From this perspective, all the business activities that
effectively serve the interests of the organization are morally right (Crane and Desmond 2002).
CSR activities that do not generate profits and serve the interests of the company are wrong
(Husted and De Jesus Salazar 2006).
In the early 21st century, the company was described in the media as ethical, socially
responsible, and sustainable (Brunel, 2004; Fawkes, 2007; Werner, 2007). However, as Dov
Charney, the former CEO of the company, argued several times, American Apparel was built on
more than do-gooder social objectives (Strasburg, 2004). According to him, the provision of
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affordable health insurance, subsidized public transport, free onsite massages, and English lessons,
among other things, contributed not only to the general well-being of employees but also to
considerably to their motivation and thus, the performance of the company. Similarly, the original
location of American Apparel in downtown Los Angeles was based on a sound business strategy.
By having production facilities close to the market, the company was better able to react to
changing fashion trends and consumer demands. This business approach made good sense, as Dov
Charney argued in several media interviews in the past. At American Apparel, CSR strategy thus
clearly served strategic business objectives.
Consequently, the ethical identity of American Apparel would have seemed to be best
positioned in the interests of the firm quadrant. In the eyes of its main stakeholders (e.g., the media,
employees, and customers), however, the ethical identity of the company also seems to embrace
some elements related to the fair business quadrants (see Figure X.2). The company was repeatedly
portrayed in the press, for example, as a company that respects workers’ social rights by going
beyond the minimum U.S. working standards in its employment policies and actively campaigning
for better wages for immigrant workers in the U.S., for instance. Reportedly, the company was
also active in promoting the interests of the immigrant community in L.A., actively calling for the
legalization of illegal immigrants, for example. Nonetheless, the way the company positioned itself
in the debate on workers’ freedom of association, which took place in the early 2000s, showed that
a consequentialist and forward-looking ethical orientation prevails over a non-consequentialist and
backward-looking one. When the employees of the American Apparel tried to unionize, the former
CEO of the company systematically resisted the efforts, arguing that it would have put into risk
the business system that the company had created with all its stakeholders (Greenburg, 2004).
Even though American Apparel went through a complete turnaround after being purchased by
Canada-based Gildan Activewear in 2017 (Li 2017), the company, or to be more precise, the brand,
continues to keep this ethical position within our framework.
PDVSA
PDVSA, Venezuela’s state-owned oil corporation, provides an illustrative example of the
ethical approach to corporate identity that we have positioned in the quadrant welfare of society.
The ethical stance that we characterize here in terms of pursuing the welfare of society (upper-
right quadrant of the framework) is also a forward-looking consequentialist approach to CSR that
defines the right thing to do in terms of the expected welfare consequences of business activities
(utilitarianism). From this perspective, all the business operations that effectively serve the
interests of the whole society are morally right (Robin and Reidenbach 1987: 46-47). Activities
that do not serve the general welfare are wrong. Hence, CSR strategies are always clearly aligned
with the collective interests of society.
PDVSA, which was established in 1975 by the Organic Law Reserving to the State the
Industry and Commerce of Hydrocarbons (also known as “1975 Nationalization Law), was
managed in a way similar to that of a private firm where decision-making was guided by corporate
objectives independent of State policies (PDVSA 2006, pp. 9-10). In 1999, however, as a reform
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took place in the Venezuelan government, PDVSA started to undergo a redefinition of its ethical
identity, assimilating consequentialist elements, and thus moving from the interests of the firm
quadrant to the welfare of society approach. The strong utilitarian ideology of PDVSA was
evidenced by its CSR strategy, which stressed the redistribution and investment of petroleum rent
into the welfare of the Venezuelan people, its human capital, and its social and economic
advancement (PDVSA, 2006, pp. 41-42). To work toward these objectives, the company launched
three key social programs: social missions (promotion of social projects), the fund for social and
economic development (promotion of national infrastructure), and the program of endogenous
development (financial support to local communities). At PDVSA, a business decision is
considered morally right if it contributes to maximizing the welfare of Venezuelan society.
The idea that the good is prior to and independent of the right, as expressed by Rawls (1982,
p. 176), can also be found in the business practices of the company. For instance, in 2003, PDVSA
violated employees’ rights by firing thousands of workers for participating in a national strike and
for their opposition to the emerging ethical corporate identity of the company. In a public speech,
the former CEO of the company, Rafael Ramírez, even emphasized that if some managers did not
feel comfortable with the business orientation of the company, they should give their jobs to others
who did (BBC NEWS 2006a). This is in line with the reflections of Rawls (1982, p. 179)
concerning the challenge of utilitarian interpersonal comparison. It can be argued that by detaching
itself from its historical commitments and ties to old corporate structures, the ethical identity of
PDVSA offers a great degree of flexibility to adapt its corporate objectives to the needs of a whole
national economy.
The Body Shop
The Body Shop, a corporation whose business strategy reflects the personal,
environmental, and social values of its founder Dame Anita Roddick (Joachimsthaler and Aaker
1997), embodies the idea of an ethical identity based on a good business life. The ethical goals of
pursuing a good business life (lower-right quadrant) may be characterized as backward-looking,
non-consequentialist approaches to CSR. This approach guides an organization to define its CSR
strategies based on tradition-based virtuous characters of the agents who pursue the CSR
strategy—the leaders of the company in particular (virtue ethics). More specifically, it orientates
the organization toward defining its CSR strategies in terms of traditional virtues that constitute
good business life (Williams and Murphy 1990). Furthermore, this approach is collectivistic, as
virtues are viewed as internal to communities or practices, grounded in shared conceptions of a
good life and not on individuals’ particular conceptions of good (MacIntyre 1984).
Influenced by her travel experiences in developing countries, where natural substances
such as aloe vera and cocoa butter were used by local women for body care, Dame Anita Roddick
founded The Body Shop in 1976 in Brighton, England (Steinberg, 1988). Driven by her own
fascination for natural substances for cleaning and protecting her body (Malkin, 1990), she
visualized a market for women in developed countries who share her ideas and values—women
interested in treating their bodies well rather than searching for beauty and sexuality (Chatzky,
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1992). Since then, the corporate strategy and business development of the company have been
prompted and guided by the beliefs and commitments of its founder. For instance, the core values
of the company (the idea of natural beauty, commitment to no-animal testing, and support of fair
trade) all reflect Dame Anita Roddick’s traits of character—traits of character that have been
fashioned by her lifestyle and the system of values and institutions surrounding her own life
(Rachels and Rachels 2007, p. 183). It can thus be argued, in line with Hartman and Beck-Dudley
(1999), that The Body Shop personifies the ethical corporate identity that we have labeled good
business life.
With the acquisition of the company by L’Oreal (a company often cited for unethical
practices) in 2006 and with the sudden death of Dame Anita Roddick in 2007, however, the ethical
identity of The Body Shop started to change (BBC News 2006b). These incidents pushed the
company toward an ethical corporate identity that we have labeled in our framework interests of
the firm. The virtuous legacy of Dame Anita Roddick, traces of which can still be seen in the
current business strategy of The Body Shop (currently owned by Brazilian group Natura), has
nonetheless allowed the company to keep elements of the good business life perspective (Gallas
2017). In line with Murphy (1999, 111), The Body Shop can be seen as a community in that its
members continuously reinforce certain virtues over others through their daily practices and
choices. For example, virtues such as honesty, fairness, trust, friendliness and shame have played
an important role in shaping the ethical corporate identity of the Body Shop (see Hartman and
Beck-Dudley 1999).
Café Direct
Café Direct, a fair-trade coffee, tea, and cocoa supplier, serves as a good example of the
fair business perspective on CSR. The ethical goal of pursuing fair business (lower-left quadrant
of the framework), then, is a backward-looking, non-consequentialist approach to CSR. It guides
an organization to define its CSR strategies based on rational principles of rights and duties
(deontology). Instead of calculating the positive consequences of their CSR policies (on the firm
or large segments of society), this approach suggests that responsible firms perform according to
given ethical background rules, principles, and reasons (Robin and Reidenbach 1987: 46). This
approach is individualist in the sense that it leaves firms considerable freedom of choice and action
for developing their own business and CSR strategies as long as no duties are breached in the
process.
Café Direct was born as a response to the collapse of the International Coffee Agreement
in 1989, which put the lives of millions of small farmers in jeopardy by sending market prices
plunging. It was an initiative driven by Oxfam, Tradecraft, Equal Exchange, and Twin Trading,
which joined forces to form Café Direct (Davies, Doherty, and Knox 2010). The company has
openly expressed its commitment to ensuring a decent income for small farmers in developing
countries. Accordingly, Café Direct states on its website that it is proud to work with growers and
thus contribute to their social and economic development. In this sense, this U.K.-based company
considers farmers as ends in themselves instead of simple means of production. While the company
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also addresses its responsibility toward the natural environment, its main ethical motivation is
grounded in human rights and justice. In effect, the company is strongly committed to improving
the lives of coffee and tea farmers by promoting an ethical conscience among consumers in
developed countries (BBC News 2001). Café Direct is, thus, an illustrative example of an ethical
identity based on an anthropocentric fair business perspective. Although the company’s business
approach benefits many farmers and the natural environment (e.g., by promoting organic farming),
the main moral motivation that drives Café Direct’s business strategy is based on the idea of
treating every farmer justly and fairly within the highly competitive international coffee market
(Davies, Doherty, and Knox 2010). However, due to the company’s impact on society at large, its
ethical identity could be positioned in proximity to the welfare of society quadrant.
Patagonia
To our knowledge, few business organizations promote the idea that corporations have a
prima facie duty to protect the environment. Patagonia, however, claims to be one—a business
organization that personalizes a non-anthropocentric deontological ethical corporate identity. As
pointed out in Time magazine, the company seems to be more interested in protecting the
environment than in making profits (Rosenblatt and Hole, 1999). In an interview, Patagonia’s CEO
Yvon Chouinard compares the consumer society with an “out-of-control tumor,” which is
responsible for clear-cutting forests, polluting oceans, and destroying wetlands in the name of
development (Casey, 2007). The strong public commitment of the company toward environmental
issues dates back to 1972 when the company published its first catalog, which, among other things,
contained the following essay by Sierra climber Doug Robinson:
There is a word for it, and the word is clean. Climbing with only nuts and runners for
protection is clean climbing. Clean because the rock is left unaltered by the passing
climber. Clean because nothing is hammered into the rock and then hammered back out,
leaving the rock scarred and the next climber's experience less natural. Clean because the
climber's protection leaves little trace of his ascension. Clean is climbing the rock without
changing it; a step closer to organic climbing for the natural man.
This respect for Mother Nature can still clearly be seen in the company’s core values, which
state: “build the best product, cause no unnecessary harm, use business to protect nature and not
bound by convention” (Gannon 2021) Nevertheless, similar to The Body Shop, the ethical
corporate identity of Patagonia also draws on some form of virtue ethical thinking, reflecting the
traits of character of its founder Yvon Chouinard and the community setting in which the company
is embedded (Paumgarten, 2016). Patagonia, as a community, is indeed continuously pursuing a
care for nature, justice, civility, inclusion, and other virtues that underpin the company’s mission
and strategic objectives (Sten, Sand, and Van de Poel 2021).
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Conclusions
In this paper, we have argued that the debate on business-society relations and CSR
unavoidably involves fundamental ethical issues and thus needs to be examined as a problem of
ethical theory. Our argument is based on the belief that the promotion of critical reflexivity and
moral deliberation within the field of CSR can help companies to elucidate their ethical
responsibilities toward society. By drawing on three major approaches to normative ethics—
consequentialism, deontology, and virtue ethics—we elaborated on and illustrated the ethical
complexities that are involved when corporations assess their roles and responsibilities in society.
To support CSR-related critical reflection and decision-making in corporations, we also worked
toward a conceptual framework for forming and establishing carefully deliberated ethical
corporate identities. With this framework, four key bases for an ethnically well-deliberated
approach to CSR were discussed: interests of the firm (ethical egoism), welfare of society
(utilitarianism), fair business (deontology), and good business life (virtue ethics).
We offer this conceptual framework as a tool for exploring and critically examining the
moral basis of CSR in a business organization as well as for defining a carefully deliberated ethical
stance concerning different organizational stakeholders. The framework allows managers not only
to better understand the variety of ethical approaches to CSR but also to recognize and better
explain normative claims about CSR. In doing so, the framework helps to develop managers’
ability to define and communicate organizational values and social commitments to different
stakeholders as well as to better integrate these values and commitments into the everyday business
praxis.
We would like to emphasize, however, that the ethical stance that organizations develop
concerning their stakeholders is seldom static but rather in a process of continuous development
and adaptation, as we discussed above. As such, a major challenge in the implementation of CSR
strategies is to foster and support moral reflection and constructive dialogue on the appropriate
roles, rights, and responsibilities that organizations have in society. There is a need to view a CSR
strategy as a social process that involves multiple moral actors. Not only employees but also
customers and other stakeholders play a role in defining and establishing and shaping the ethical
stance of an organization.
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