Today’s Journal also features an op ed by Coca-Cola CEO E. Neville Isdell, on his company “corporate social responsibility” policies. He cites some specific examples of the company working with local communities to gain and maintain its “social license to do business” and endorses the idea of engaging “responsible stakeholders who recognize that we cannot abandon or undermine our fundamental economic purpose.”
While keeping sight of the company’s central mission of creating value for shareholders is laudable, giving a nod to “stakeholders” can be dangerous, because this is a category of people who are usually distinct from those who have a true stake in the company — shareholders — and because the very definition of “stakeholders” can expand too easily. That said, Isdell’s recognition that in dealing with some groups appeasement is not an option is welcome:
[A] small minority of activists will always prefer confrontation, with its attendant publicity, to the search for mutually beneficial common ground. With such groups there is little room for dialogue. In these situations, a company has no choice but to vigorously confront parties who seek to use its brand to push their own agenda.
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