Corporate objectives and the role and responsibility of the board of directors have been at the centre of academic debate for decades in various disciplines, including law, economics, management, politics and sociology. According to Hay and Gray, the evolution of corporate social responsibility (CSR) has travelled through three phases. It is worth discussing these phases to illuminate the progression and development of CSR as a modernized concept.Phase one was characterized by a ëprofit maximizerí tendency. This was the initial understanding of corporate objectives, based on the premise that individual self-interests would prevail and the sole objective of managers is to make profit for the shareholders. Profit maximization is generally regarded as an accurate description of corporate behaviour up to the 1920s. After the First World War there was a shift in business attitudes towards a more profit-oriented view, with the United States taking the lead and modernizing its economy. In the first half of the twentieth century, America was a society characterized by economic scarcity, with economic growth and wealth accumulation as the primary national goals. Corporations and other forms of business organizations were regarded as vehicles for eliminating economic scarcity. Social problems, such as working conditions, treatment of employees, child labour, environmental problems and protection of the interests of the community, were given little attention. The correlation between the welfare of the economy and the welfare of society was not perceived. Business ethics and social, environmental and philanthropic corporate responsibilities were relegated to subordinate concerns.
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