Viability of Business as an International Development Actor

An Assessment of Benefit Corporations

Abstract

Business plays a central role in international development as both an intentional and unintentional actor. This paper evaluates the role of business as an international development actor and considers the benefit corporation, a for-profit entity that holds in equal part public benefit and profit within their mandate, as a potential avenue for businesses to play an intentional positive role. The current role of business in international development is hard to define, but its effects are certainly mixed. What is clear is that the behaviours of businesses have significant impacts on both human and environmental security. Many development efforts are based on the belief that a strong private sector and competitive markets are essential conditions for development. This has defined business’s role in development as mostly geared towards wealth creation, employment, and providing goods and services. Business practices and their effects on communities globally have repeatedly demonstrated the need for a code of ethics and the importance of caution and impact assessments as businesses shift into intentional roles as development actors. The benefit corporation model provides an opportunity for businesses to operate internationally while playing a positive role in international development. This paper uses CSR theory, a framework of classification for development agents, and a case study of the benefit corporation Patagonia to evaluate the viability of the benefit corporations as international development actors.