By Svetlana Skryagina

The notion of soft power – the ability of a country to attract and persuade, coined by Joseph Nye in the late 1980s, is recently being used in relation to corporate business. Drawing the analogy with nation-states, corporate soft power came into existence with strengthening of corporate hard power – business globalization and vast increase in the scale of operations. But how is it being addressed by the corporate world? If nation-states utilize the public diplomacy as a premier tool for influencing public opinion and promoting country image, what do companies employ? Corporate social responsibility (CSR) might be the case.

CSR and corporate philanthropy programmes form a strategic basis of corporate soft power. International aid projects, including international pro bono and corporate volunteering initiatives, present a good example of companies’ efforts to contribute to social development, while enhancing their visibility and strengthening goodwill. One of the leaders in international pro bono services is IBM and its Corporate Service Corps program. Under the program IBM employees implement community-driven development projects for local communities, public bodies and non-governmental organizations in emerging markets. Since its launch in 2008 more than 1200 people took part in the program, making positive social impact in more than 20 countries around the world. Such projects allow business to create shared value in local communities, communicate its company image and at the same time develop employees through experiential learning.

Another way of shaping stakeholder preferences and mainstreaming values is through thought leadership and alignment with social context. As countries communicate their vision, culture and values through public organizations such as Goethe Institute, British Council or Confucius Institute, so companies establish corporate funds and fellowships to address topical social issues or target specific groups.

L’Oreal Women in Science International Fellowship program raises awareness on the contribution of women researchers to the sciences. Under the program more than 1200 outstanding female scientists across the globe were awarded the fellowships, supporting their further research since 1998. Avon is well-known for its Avon Breast Cancer Crusade – initiative, which comprises research, education, trainings, counseling and outreach on breast cancer, making the company a leading corporate supporter of the cause globally.

The clothing and outdoor gear manufacturer Patagonia challenged the basics of market economy by introducing the Common Threads Initiative. Using a break-through approach of free repairs for its clothing, constant research on creating eco-friendly yet durable fabrics, and responsibility for recycling its own garments, the company addressed the issue of excessive consumption.

All these cases speak loud of CSR as an effective corporate soft power instrument. Yet the question remains – will this power be used for better or for worse, strengthening CSR case or cheating on stakeholder expectations.