Critical Thinking in Business - Essay Example

There is an ongoing debate over whether a firm should exist solely for making profits or whether it should pay heed to the social and environmental concerns that accompany the practice of Corporate Social Responsibility or CSR. The proponents of the view that a firm exists solely for making profit argue about the market being the final arbiter of allocating resources and point to the market as the place where incentives for allocating resources for social and environmental causes is to be found.

The opponents of this view take the stand that everything cannot be left to the market and there needs to be a mechanism in place whereby the environmental and social causes need to be taken care of. (Smith, 2003) If we examine both sides of the debate as well as take into account superficial attempts by businesses to pay lip service to CSR, the first strand of thought that comes to mind is about the need for businesses to invest in CSR as a way of mitigating the deleterious effects of the industrial paradigm on the environment.

The practice of CSR by industrial companies is in vogue these days because of the fact that they have contributed to polluting the environment. As Maak and Pless point out in their article, “If this world is to be a decent world in the future, Martha Nussbaum contends, ‘‘we must acknowledge right now that we are citizens of one interdependent world, held together by mutual fellowship as well as the pursuit of mutual advantage, by compassion as well as self-interest, by a love of human dignity in all people, even when there is nothing we have to gain from cooperating with them’’ (2005, p. 217) Hence in this interconnected and flat world (Friedman, 2005) there is a need for concerted action by the businesses to take steps that would alleviate the pressing issues of the day.

However, the opponents of this view are some of the multinationals themselves as can be seen from