PayPal's decision on North Carolina showed the right kind of corporate responsibility

PayPal’s decision not operate in an area where some employees may find themselves insufficiently protected by legislation is a welcome, and sends out an important message to the state’s legislators

PayPal says the newly passed law perpetuates discrimination (Eric Piermont/Getty)

Some 30 years ago the new-fangled concept of ‘corporate social responsibility’ was an amateurish affair tinged with a lick of greenwash. By the mid-1990s businesses believed – some earnestly, some cynically in consideration of the bottom line – that if they showed an awareness of the hole in the ozone lawyer, and demonstrated they were doing something good for their local community too, they were more likely to build brand awareness and loyalty.

Things have moved on since then. Corporate social responsibility and sustainability directors are now senior posts in most major organisations with a hotline to the chief executive. What began as an attempt to use staff labour to plant a few trees has become a multi-million consultancy industry.

Yet there have been successes. Corporations are, indeed, more aware of their environmental impact than ever before, and they are taking steps to mitigate it. And the remit of CSR has broadened to take in their influence on social policy too.

This week the financial services firm PayPal abandoned plans for a $3.6m operations centre in North Carolina due to the state’s passing of the Private Facilities Privacy & Security Act, a law which amounts to an attack on gay and transgender rights. Critics of the legislation state that it puts lesbian, gay and bisexual people in a perverse position where they may marry their partner and yet, quite within the bounds of the law, face discrimination on the grounds of their sexuality at work.

PayPal’s decision not operate in an area where some employees may find themselves insufficiently protected by legislation is a welcome, and sends out an important message to the state’s legislators. The local economy will lose up to 400 jobs as a result – hitting them where it hurts.

It also suggests that social responsibility has taken on a new meaning. Being responsible is business is no longer just about recognising and mitigating any negative impact your organisation has, it’s about acting as an advocate of the values your organisation represents. The possibilities for positive social change ushered in by thinking businesses are immense, and very exciting.