Firms, entrepreneurs and social values
Cristina Boari BS 2023-24
Value for
Shareholders Stakeholders
● Firm as a nexus of ● Customers, suppliers,
contract employees, money
● Economic profit as surplus lenders, landlords,
○ Net operating profit government, owners,
after tax− Cost of capital society
● Maximizing profits and the
value of the firm
● Challenges:
○ Complexity
○ Conflicts
● Challenges ○ Slow decision making
○ short-termism, financial manipulation,
excessive CEO compensation, and the
failures of risk management
Values and Values beyond profits
Society concepts or beliefs, about • In Universities, Hospitals,
desirable end-states or ONG, etc.
behaviors, that transcend • Corporate social
specific situations, guide responsibility in for-profit
selection or evaluation of organizations with impacts
behavior and events, and on:
are ordered by relative • Reputation
importance (Schwartz • Legitimacy to operate
and Bilsky,1987) • Redistribution of
created value
Cristina Boari BS 2023-24
Corporate social responsibility
• the set of activities that companies
engage in
• designed to further some social
objective
• that lie beyond the direct economic
interests of the firm
Cristina Boari BS 2023-24
What we know about CSR
• An interdisciplinary topic
• The contribution of standards
• Global Reporting Iniitives
• Bcorp https://www.bcorporation.net/en-us/
• Italian PNRR and the ex-ante need to certificate the “green impact” of the project
(and ex-post?)
• Social entreprenership: the use of innovative organizations and business
models to create and sustain social value
• To build/transfer capacity
• To deliver new business models https://www.treedom.net/en/plant-a-tree
• To promote institutional change https://www.ideaginger.it/
• Mixed results on the relation between CSR and profits/sustainability
Cristina Boari BS 2023-24
September 2022: the Earth is now our only We also, early on, began initial steps to reduce our own role as
shareholder. Nearly 50 years after Yvon a corporate polluter: we have been using recycled-content
Chouinard began his experiment in paper for our catalogs since the mid-’80s. We worked with
responsible business, ownership of Patagonia Malden Mills to develop recycled polyester from soda bottles
is transferred to two new entities: Patagonia for use in our Synchilla® fleece.
Purpose Trust and the nonprofit Holdfast Opened in 1996, our distribution center in Reno, Nevada,
Collective. Every dollar that is not reinvested achieved a 60 percent reduction in energy use through solar-
into Patagonia will be distributed as dividends tracking skylights and radiant heating;
to protect the planet. “Instead of extracting In the fall of 1994, we made the decision to take our cotton
value from nature and transforming it into sportswear 100 percent organic by 1996.
wealth, we are using the wealth Patagonia In January 2012, Patagonia became the first California company
creates to protect the source,” said to become a benefit corporation—a legal framework that
Chouinard. “I am dead serious about saving enables mission-driven companies like Patagonia to stay that
this planet.” way as they grow and change. We are also a Certified B
Corporation.
We began to make regular donations to smaller groups In 2013, Yvon Chouinard announced the formation of a venture
working to save or restore habitat rather than give the capital fund to help start-up companies that place
money to NGOs with big staffs, overheads and corporate environmental and social returns on equal footing with
connections. In 1986, we committed to donating 10 percent financial returns.
of profits each year to these groups. We later upped the In 2018 Patagonia Provisions took the first step when it
Cristina Boari BS 2023-24released Long Root Ale, a beer brewed with Kernza® grain for
ante to one percent of sales, profit or not.
its carbon-sequestration potential. Adopting Regenerative
Organic farming practices in our supply chain to grow fibers and
food is the next big step.
