Updated: Feb 14
In September 1970 Nobel laureate Milton Friedman wrote an article for the New York Times magazine titled “The social responsibility of business is to increase it's profit”. He explained that an executive is an employee of the owners of the business who has the responsibility to conduct the business in accordance with the owners' desires, presumably about making as much money as possible, while abiding by the general rules of society. Distracting corporate resources in order to achieve social responsibility goals was the same, according to Friedman, as levying a tax on the owners of the business, its customers or its employees and choosing to allocate it to a purpose that none of those stakeholders had explicitly approved of. He specifically mentioned that making expenditures aimed at reducing pollution beyond the amount corresponding to the best interests of the Corporation or required by law, in order to contribute to the social objectives of improving environment would be unacceptable.
Lets fast forward 45 years. The 2015 Nielsen sustainability survey reported that sixty-six percent of consumers say they are willing to pay more for sustainable brands—up from 55% in 2014 and 50% in 2013 . A more recent report finds that sales in fast-moving consumer goods, like chocolate, coffee or bath grow two and a half times faster for products that are labelled sustainable (Nielsen 2018a). In other words, today even Milton Friedman would have to admit that a corporate executive hshould take into account sustainability and social responsibility in order to maximise the business profits.
What happened in the last 50 years is that the separation between our role as consumer and our role as citizen has considerably faded. Individual economic decisions are traditionally regarded as taking place separately from values and commitment as citizens As citizens we are expected to care about public good and collective welfare while as consumers we are expected to be driven by rational decisions to maximise the benefit we extract from of our purchases. This boundary separating consumer and citizen, very clear in the mind of Milton Friedman, is now slowly crumbling and the act of consuming is becoming infused with moral, ethical and political characteristics that pertain to our notion of citizenship, local or global . The emergence of a conscious citizen-consumer making purchasing choice related to the sustainable development of the world community has been observed by social scientist and marketers alike, the latter pragmatically noting , to quote the Nielsen research, that “Sustainable shoppers buy the change they wish to see in the world”.
Image credit : Image by Gerd Altmann from Pixabay