Good Business

We feel compelled to respond to the deeply cynical–and indeed inaccurate–article, "Corporate Social Irresponsibility," [Issue #3] by Aaron Chatterji and Siona Listokin. While corporate social responsibility will never be a panacea for solving the myriad ills of society, Chatterji and Listokin seriously understate the positive impact that scores of progressive companies and voluntary initiatives are achieving–in areas ranging from HIV/ AIDS, climate change, access to water, labor standards, and poverty alleviation, to name just a few. Progressive companies understand that globalization is presenting a range of new–and material–risks and opportunities that must be integrated into long-range business strategy. The fact that mainstream investment companies–including Goldman Sachs, UBS, HSBC, and many others–are beginning to actively incorporate these issues into research and asset management is proof of their importance.

With respect to the UN Global Compact, we must correct a blatant error. Chatterji and Listokin state: "While firms can tout their Global Compact membership, almost nothing is done to ensure that they actually embody the ideals of the organization." In fact, all participants (not "members") are required to issue an annual communication on progress detailing implementation efforts–part of a broader policy that incorporates a range of integrity measures. A company that fails to develop this important communication after two years is delisted. In October 2006, the Global Compact office publicly announced the delisting of more than 300 such companies.

GEORG KELL
Executive Director
UN Global Compact
New York, N.Y.

Aaron Chatterji & Siona Listokin respond:

Mr. Kell is right that we are cynical about the lasting impact voluntary initiatives can have on issues like global disease, labor conditions, and climate change. While we applaud private-sector efforts to address social causes, we maintain that focusing activist resources on private, rather than public, regulation is inefficient at best. Regarding the UN Global Compact in particular, we are encouraged by its actions in October 2006 and January 2007 to declare more than 500 companies "inactive" (300 in October, more than 200 more in January) after failing to comply with the initiative’s requirements. As far as we can tell, participant requirements amount to an annual "Communication on Progress," sent to stakeholders and shared publicly on the Internet, which indicates the company’s plans to uphold the spirit of the voluntary compact; failure to issue the Communication for two straight years makes the company’s participation in the UNGC inactive. It is up to readers and UNGC stakeholders to decide whether this constitutes the kind of serious monitoring effort necessary to enhance corporate social responsibility. The disappointing fact that 500 companies could not even produce this deliverableis a separate issue on its own. As more than 1,000 companies were added as UNGC participants in 2006, we hope that UNGC will continue to further its mission and that the participants will live up to the admirable ideals of the Compact. After all, we share many of the UNGC’s goals, but we differ on the most effective means of getting there.

Objection

Erwin Chemerinsky is right to note that he is about as sympathetic a reader as I could ask for–he is a brilliant and erudite scholar ["Judicial Restraint," Issue #3]. So it is doubly disappointing that I seem to have failed to convey to him my basic point. My book, The Myth of Judicial Activism, is a response to charges of activism: that judges are abusing their authority and imposing their personal preferences in the guise of constitutional law. I set out to explain why most of the decisions attacked as "activist" are justifiable and legitimate–that is, to explain why they are something more than the imposition of policy preferences. "Legitimate," as I tried to explain, does not mean "right" or "best." Chemerinsky is correct to point out that in many cases–the ones I call "hard"–a decision going the other way would also be legitimate. That is to say, in hard cases, a decision either way is typically not an abandonment of the judicial role.

If the factors are not supposed to point ineluctably to a correct result in every case, what’s the point of setting them out at all? There are three things I hoped to achieve. First, by casting the core issue in terms of whether the Supreme Court should defer or not–that is, whether the Court or some other body is the best decision- maker–I hoped to make clear that we should think of debates over judicial activism as a separation-of-powers issue. The portion of the American public that responds to rhetoric about activism frequently seems unaware of this. They are distrustful of courts, but also of Congress and the president, and they don’t seem to understand that bringing courts to heel will place the public more at the mercy of the other branches.

Second, I hoped to offer a framework for more productive debate. Within the realm of legitimate decision-making, there are better and worse decisions. One can argue that in a given case, the alignment of factors makes one level of deference more appropriate than another. The factors I offer are relatively apolitical; they are considerations of what constitutional scholars Jack Balkin and Sanford Levinson have called "high" or constitutional politics rather than "low" or partisan politics. People will, of course, disagree about the relative significance of the factors and, as I noted, they may propose others. But because a discussion of the appropriate weight of particular factors does not immediately invoke partisan preferences, it may be fruitful.

Last, I suggested that in choosing judges, we should be interested in their views on when courts should defer and when they should not. Just as citizens can discuss these issues without falling into partisan disputes, judges can discuss them without evaluating particular decisions (something apparently off-limits in the confirmation process) and still tell us something useful about their approach to constitutional law.

KERMIT ROOSEVELT III
Professor
University of Pennsylvania Law School
Philadelphia, Penn.