The limits of CSR goals according to Drucker

Peter Drucker’s immense contribution to the thinking and practice of management extends to social responsibility in business.

While his work spans over 60 years, it still remains relevant today — notwithstanding the impacts of globalisation and the greater interconnectedness of business and society.

After first identifying Drucker’s corporate social responsibility “principles,” this article examines their implications for business today, particularly with respect to marketing practices.

We also consider Drucker’s views on the limits of social responsibility, or “bounded goodness,” and examine how his thinking informs the challenging question of “how much is enough?” when it comes to corporate responsibility issues.

Drucker consistently affirmed his belief in social responsibility in business (and other institutions).

After all, his earliest writing, The End of Economic Man: The Origins of Totalitarianism, and The Future of Industrial Man, indicated as much.

Moreover, by examining the grounds for corporate legitimacy, his works also detail the social responsibilities of management.

In Management: Tasks, Responsibilities, Practices, an 800-page treatise, Drucker devotes five chapters to social impacts and social responsibilities.

Consistent with these beliefs, some of his later writing addressed social responsibility directly, whereas other works, such as his last book, Management Challenges for the 21st Century, did so more indirectly by describing his humanistic conception of management and his concern for the social role and responsibilities of business.

Drucker differentiated between two types of social responsibilities: those involving social impacts or what business does to society and those involving social problems or what business can do for society.

Social impacts go beyond the specific contribution the company exists to make, such as providing needed products and services.

They are often unintended but inescapable by-products of business, as part of, and serving, society.

According to Drucker, social impacts are best eliminated once they are identified.

His principle was clear: identify and address — if not eliminate — undesirable social impacts of business activities and, if they cannot be turned into profitable business opportunities, seek a regulatory solution (industry self-regulation or government regulation) that creates an optimal trade-off for all involved.

Drucker also viewed social problems as sources of opportunity.