One statement currently in fashion holds, in effect, that: "The world that businesses are operating in is changing. In the future there will be an increasing need to give all of the stakeholders fair consideration, and not just those who provide capital." One might excuse some of the world's innocents for thinking that the world in which business operates changed long ago. When the sweat shops of early-twentieth century industrial society were eliminated and when societies appeared to be making businesses act as good citizens whether or not they were in actual fact, many people assumed that the world had changed. While the innocents hoped for the best, however, the forces of reaction were busy attempting to undo whatever modicum of social responsibility had been introduced into the operation of businesses.
At the close of the decade of the 1960s, some people thought that industrial societies were beginning to develop a strong social conscience. One of the ideas being incorporated into the expanded concepts of corporate social responsibility was that all institutions and organizations ù including business firms, which derived benefit from being a part of and which individually or collectively affected the direction of a society ù had responsibilities to that society which extended beyond self interests. American economist Milton Friedman (1970) and most business executives of the day, however, rejected this notion.
Friedman (1970) said that a corporation should be free to act as it wishes, so long as it stays within the rules of the game. Friedman (1970), of course, was referring to operations that fall within the framework of the principles of market economics, as he interprets these principles, and to operations that conform to the legal and ethical standards in the United States, as he thinks these standards should exist. Friedman (1970) had his counterparts in the other major market economies.
Some people, howev...