Historically, corporations have been motivated primarily by the central focus on profits in classical economic ideology. However, as they have grown in size and power, they have been exhorted and pressured to alter this single-minded focus. This is because (1) the idea of corporate social responsibility has continuously expanded in meaning and (2) the power of stakeholders to define corporate duty has increased.

Whereas only a short time ago the norms and power equations of individual nations defined the responsibilities of corporations, the explosive growth of global trade and global corporations created new standards and practices of social responsibility tied to global norms. The rise of these new standards and expectations is reflected in proliferating corporate codes of conduct. If history is any guide, the doctrine will continue to expand.

In this chapter we focused on defining and explaining the idea of corporate social responsibility and its evolution. Figure 5.2 summarizes this evolution. In the next chapter we look at the methods corporations adopt to ensure that they carry out their responsibilities to society.

FIGURE 5.2 The Evolution of Corporate Social Responsibility
Although the term corporate social responsibility is of recent use, the idea it represents has been under construction for more than two centuries. This timeline shows how various elements changed to expand the idea. The duty to serve society by making a profit has remained constant. Philanthropy has been a constant duty of business owners and later of corporations themselves. The duty to comply with regulation has grown since the first restrictive statutes in the late 1800s. And the theory of social responsibility has evolved from the cruel denials of Herbert Spencer to broad expectations on transnational corporations today.

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