Are profitability and corporate social responsibility compatible?

Abstract

Recent months have not been happy ones for the reputation of the corporate sector. The spectacular failures of Enron, Anderson, Tyco and WorldCom has led to a general marking down of shares as investors have wondered how far the rot has penetrated. Clearly, after the failure of Arthur Andersen there is a need to enhance the current corporate governance guidelines. The recent volatility in stock markets have exacerbated the pensions funding problem - a reminder that, whereas many people think of companies as the preserve of bureaucrats and tycoons, the reality is that the major source of investment for most businesses is the pensions savings of millions of ordinary investors. Due to these recent events, here has been a renewed interest in corporate socio-responsibility.