Corporate Social Responsibility and Capitalism

 

The concept of CSR is one of the most important words that can be used today. It would not be correct to define this concept in a single way, but we can express it as the responsibilities of companies towards society and institutions in general. While criticizing this film, we will evaluate the CSR concept in terms of accountability and transparency, ethics corporate, governance, human rights, stakeholder management.

First, let's make an assessment in terms of accountability and transparency. Pfizer's 15k annual pricing for ARV is not accountability and transparency because the company only set the requested price because of patent rights, never disclosed the cost, and institutions such as the UN and the US Senate have long been obstacles to investigating this. For example, the counterpart company in India offered these drugs for less than $ 1 per day as a base, but this initiative was also blocked because the patent right belongs to Pfizer. Accountability and transparency have been ignored for pharmaceutical companies by looking at all these examples. Today, Pfizer is among the companies that found the Cov-19 vaccine. If this company sets the vaccine price above its costs, it means that we will see that the system has not changed from yesterday to today.  In fact, it is not right to put the entire burden on price on pharmaceutical companies such as Pfizer. In the capitalist system, every product whose demand is insufficient is valuable. In other words, since Pfizer could not produce 7 billion drugs at first, the wealthy class in the capitalist system is ready to pay more to access these drugs. This is one of the factors driving the price up.

Today, the most important element we look for in companies and managers is their approach in terms of ethics. In this film, when we evaluate companies from an ethical point of view, we can have many opinions. All businesses must fulfil their social responsibilities as well as their aim of creating economic value. The responsibilities here are about morality and the right to life of people, rather than making a profit. We can divide these responsibilities into 3. Legal, Ethical and Economic. In this movie, we can say that the pharmaceutical companies do not act ethically because they demand high prices by ignoring people’s lives. For example, although Volvo discovered the car belt for the first time, it did not claim a patent right to protect people from harm and they fulfilled a great responsibility for humanity. Pharmaceutical companies fulfil their economic and legal responsibilities here, but unfortunately, they do not fulfil their ethical values ​​and responsibilities. For instance, we can say that the company that offers legally equivalent drugs does not fulfil its legal responsibilities, although the patent right belongs to the other company, they have produced them. Actually, if we think legally and ignore the lives of people, we can say that the company producing equivalent drugs does not fulfil its legal responsibility. In short, our perspective changes the results.

Another important factors are government and laws that have an impact on CSR. Compliance with the law covers only some of the CSR responsibilities. We can state that management and governments are the most unethical institutions because government is insensitive to drug companies about the cost and price of drugs. Governments did not supervise pharmaceutical companies and prepared the appropriate ground for them. Pharmaceutical companies, taking advantage of this opportunity, found a suitable basis for price determination. Whereas, governments transferred money from people's taxes to pharmaceutical companies for RD work. Throughout this whole process, governments had the right to demand the right price from pharmaceutical companies, but they chose to remain silent as they would collect more taxes from companies that earn more.

Another issue worth discussing is what the institutions that defend the right to life do about it. According to the UN, every human being has the right to life. Here it is not possible to say that this is working for African people, we can even say that they prevented it. When we look to pharmaceutical companies, they have not only behaved unethically by offering their medicines to Africa at prices that are much more expensive than their costs, but also prevented the entry into the country with the governments for cheaper substitutes. As a result, we can say that companies and institutions ignore people's right to life.

When we evaluate with different views, we see another stakeholders that are another important actors in terms of CSR. They determine the direction of the companies also have an important position within the CSR. These owners have the option to protect the ethical values, but there are also options to opt out. At this point, unfortunately, stakeholders have preferred to gain more profit by giving up ethical values. This is their legal right. Many theories say that making a profit is the sole purpose of the company, whereas if ethical responsibilities are met, what they earn be greater than the money. For instance, these firms could leave good image by offering at available price to all world but instead of choosing it, they chose a reaction strategy. As a result of all this, we have seen that they are not acting ethically.

Finally we come to resource of all. This resource is the capitalism system. Capitalism is a system that provides income based on production and labour. This system does not work flawlessly on this impeller. It is not possible to say that laws and institutions approach every player in this system equally.

Now when we divide the capitalist class into three groups as low-income, middle-income and high-income people in general, we see that low and middle-income people work for high-income people. While,  if sub class make rich people, why the top group ignore these people who serve them, or why are the people at the bottom keep working for the people at the top? For example, why the African people who are working while the Pfizer Company is collecting chemical resources in Africa have to work for these people who do not give them medicine? There is only one thing I can give as the answer to all these questions.

Kahneman said in his book of Fast and Slow Thinking that the time for people to act logically is very, very short. Kahneman has proven that we are actually making the wrong decisions, assuming that we are making the right decisions under the information and circumstances presented to us. People constantly make a choice, how to stand up when they stand up is a choice and we don't think about it, it happens automatically. In this system, too, the lowest people are unfortunately surrounded and conditioned by conditions. Circumstances prevented them from making the right decisions, and they were caught between existence and absence.

Is it possible to say that capitalism is the worst system despite all my criticisms? No, it isn't. In Mc Kinsey's article Redefining Capitalism is the fact that we probably won't feel rich when we get into an isolated tribe with a large amount of money. Because an environment that can find solutions to diseases does not exist within the tribe. This is an indicator of how much capitalism has developed our societies. Every business has started to solve a problem for humanity and this process has created modern world. In this process, owners think that according to the Neoclassical Theory, biggest aim in this way is to make a profit. This is where our main problem.

According to Mc Kinsey, we can say that the ability of money to represent wealth is possible only in civilizations that have reached a certain level. What brings prosperity in these civilizations is companies that produce information for profit to solve people's problems. If we are criticizing the profitability of companies, do we have to give up the solution they produce? When we come to this point, we see that what we criticize is the rulers rather than capitalism.

These managers are in competition with all other companies. With the analysis we call 5 Forces, we can analyse this competitive environment. Here, companies with valuable resources constantly gain competitive advantage. Additionally, they create barriers within companies that want to enter the market. This reduces diversity and causes monopoly. If all this did not happen, we would be able to say that people's lives have been saved thanks to capitalism, if there were no entry barriers due to skating.

Ultimately, capitalism can turn into a life-saving system when managerial ambitions are eroded, diversity is encouraged, and entry barriers are loosened. Conversely, if ambitions are increased and monopoly power is created, it can also be fatal. To see more of its lifesaving role, we need to increase CSR training. Thus, a more prosperous world is possible.

To summarize briefly, my advice to all these companies is that they are badly remembered by people and portrayed badly in documentaries, they make less money instead of making much exaggerated money, and leave an exemplary behaviour to the history of humanity and civilization.

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