The Social Enterprise Report

Consumerism and The Future of Corporate Social Responsibility

by Olanrewaju Abiola

Consumerism refers to the habit of people purchasing goods, services and materials in excess of their basic needs. A phenomena which is now recognisable in most societies. The historical antecedents could be traced to ancient Egypt, Babylon and Rome.

The concept of consumerism specifically refers to set of relations of production and exchange that emerge from the political, social, cultural, and technological context of the late 19th and 20th century Capitalism with some visible roots in the social transformation of 16th, 17th and 18th century Europe. The consumer society emerged in the late 17thcentury and intensified throughout the 18th century. Many critics argue that consumerism was a political and economic necessity for the reproduction of capitalist competition mode of production.

The more positive middle–class view argues that this revolution encompasses the growth in the construction of vast county estates specifically designed to cater for comfort and the increased availability of luxury goods aimed at a growing market.  This included sugar, tea, tobacco and coffee, goods that were increasingly grown on vast plantations in the Caribbean as demand steadily rose.

In Morality and the Market: Consumer Pressure for Corporate Accountability, Smith, (1990) wrote of ethical influences on consumer behavior—ethical purchase behavior and how they might serve as a form of social control of business with consumers exercising “purchase votes on social responsibility issues”. It goes by a variety of names— “conscience consumerism,” “ethical consumerism,” and the “green consumer”, among others. But the idea is essentially the same, consumers care about issues of corporate responsibility and this will influence their purchase and consumption. The behavioral imperative provides incentives for companies to be socially and environmentally responsible.

Societal movement and the power of consumers

Smith’s thesis (1990) relied theoretically on consumer sovereignty as the rationale for capitalism. Although the concept is often ideologically laden (e.g. the consumer is king), there is certainly some measure of consumer authority in highly competitive consumer markets. Smith suggested that the domain of consumer sovereignty could extend beyond the immediate characteristics of the product to include corporate responsibility practices of the producer.

In support, he drew on the most clearly identifiable and deliberate form of ethical consumerism at the time pressure group organized consumer boycotts. Smith cited evidence of consumers in relatively large numbers boycotting companies over social responsibility issues; for example, as many as one in four UK consumers were said to be boycotting South African produce over apartheid and the pressure on Barclays Bank in its home market (coupled with its North American aspirations) was ultimately a key factor in South Africa consumer behavior during the apartheid years (it was the largest bank in that country).

Vogel’s (1978) Lobbying the Corporation offered similar evidence in its account of boycotts in the US over civil rights and the Vietnam War.

Historically, the boycott is attributed to some spectacular successes. The colonialists’ boycott of British goods led to the repeal of the Stamp Act by the British government in 1766 (Friedman, 1999). Wolman (1916) and Laidler (1963) described how the consumer boycott was the key to unionization in the US at the turn of the 20th century.

Gandhi organized boycotts of British salt and clothing, as part of a strategy of non-violent direct action that ultimately gave rise to Indian independence in 1947 (Bondurant, 1965). Rosa Parks’ refusal to give up her seat on a city bus to a white man triggered the Montgomery bus boycott of 1955; a boycott that nearly bankrupted the bus company and was supported by more than 90% of blacks until bus segregation was ended in the city. Friedman (1999) describes this as the most influential consumer boycott in American history, having marked the beginning of the modern civil rights movement in the US and launched Rev. Martin Luther King Jr., as its leader.

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