This review gives a summary and evaluation of the article “The pyramid of corporate social responsibility: Toward the moral management of organizational stakeholders” by Archie B. Carroll. This article provides a better understanding of corporate social responsibility (CSR) based on the four levels of business and societal affiliation (Carroll, 1991). The main purpose of the article is to isolate the ethical component of CSR so as to reflect immoral, moral and amoral management by the firms and their respective orientation towards the major stakeholders of a firm. Therefore, these stakeholders have been identified as shareholders, customers, employees, suppliers, community and the social activity groups.
This article addresses the basic requirements of an organization as not only conforming to its sole role and purpose of realization and maximization of profits but also on the social responsibility to the welfare of its stakeholders. It gives another direction based on the legal, ethical and philanthropic responsibilities.
The article successfully constructs a pyramid showing the four responsibilities that a corporate organization should undertake in realizing not only the financial gains but also the societal achievements (Carroll, 1991). In this respect, it creates a pyramid with economic, legal, ethical and philanthropic components with the economic being the “heavier” level on the pyramid. It majorly focuses on the ethical responsibility of the firm by defining the three moral management schemes and routines as either moral, immoral or amoral management or their orientation towards their stakeholders.
The article has also provided in-depth understanding of CSR in relation to organizational stakeholders based on their claims, stake, interest in the operations and decision-making process of the firm. It further states legal claims, moral claims and opinion for fairness and justice.
The article presents a new and better definition to CSR. According to the author’s understanding, the term was defined as “a shift to social responsiveness in corporate action, production and implementation of social role and to include both economic and legal obligation, ethical and discretionary (philanthropic) responsibilities” (Carroll, 1991, p. 39). It focuses on the ethical and philanthropic parts in promoting human welfare and goodwill. The definition goes an extra mile in expounding on what constitutes CRS. From the article, Milton Friedman argued that “social matters are not the concern of business people” (Carroll, 1991, p. 42). It is fair to mention that this is only valid to those economists who are amoral and are only concerned with the huge profits and well-being of the firm by using the employees as a tool of trade.
The article gives an orientation structure of how the firm’s stakeholders are inclined towards moral management. The major advantage of such a framework is related to aiding managers in solving numerous ethical issues their organizations are facing. It is no doubt that most firms are faced with the danger of being managed by unethical managers; the author comes up with a clear framework of what is the best was to identify unethical managers as well solving the ethical dilemma (Carroll, 1991).
The article successfully formulates its aim of giving out guidelines on corporate responsibility on moral management of a firm’s stakeholders. It also gives executives profiles to enable them to manage well the businesses and stakeholders. Consequently, the article emphasizes on an ethical approach to conducting businesses by including both moral management and considering the development of the society and other stakeholders (Carroll, 1991). It is the desire of every business to operate business and acquire competitive advantage, which will help them stay in business for long, expand their operations and make huge profits. Therefore, it is agreed by scholars that one way of attaining competitive advantage may be by acting in ethical manner. For this reason, the article is a benchmark for firms to act ethically and solve any ethical issues that they might be faced with. This article has successfully accomplished all these since the language used and the logical flow of ideas were perfect. However, the article fails to adequately explain how economic and legal conflicts based on social demands are solved. For instance, in diamond mining, the community usually expects favourable rewards from the mining companies since they presume that they own the oil. This has led to civil wars in parts of Sierra Leone (Gberie, 2005). It could have been helpful and wise if the article had used real life example to explain how to solve ethical issues resulting from economic and legal conflict.
The article provides a critical analysis of CSR and company executives with a means of identifying what areas create conflict amongst the stakeholders (shareholders, customers, employees, suppliers and societies). It also shows the expectations from the society. The article was well written and managed to capture important attribute of corporate social responsibility. However, future studies should be undertaken to establish how the businesses and the society mutually co-exist without any source of conflicts due to differences of expectations.
Carroll, A. (1991). The Pyramid of Corporate Social Responsibility: Toward the Moral Management of Organizational Stakeholders. Business Horizons, 3(1): 39-48.
Gberie L. (2005) A Dirty War in West Africa The RUF and the Destruction of Sierra Leone. Bloomington/Indianapolis: Indiana University Press.