With the recession, companies are cutting back on their corporate social responsibility budgets but it's not going away. As reported here, the big cuts are in corporate philanthropy but they are still focusing on areas like green supply chains. Why is that happening?

A report in Slate, and republished here, sheds light on this question. It used an interactive tool called the Socially Responsible Investing Stock Screener, which ranks 500 of the country's largest companies according to five categories of behavior: gay and lesbian rights; environmental practices; labor and human rights; whether the company sells military equipment and weapons; and a category called "vice," which covers everything from alcohol and tobacco to gambling and pornography. It then took the 100 most responsible companies and the 100 least responsible companies and then randomly selected a sample of 25 companies from within each group. For each of those companies, it compared the stock price on February 11, 2008, before the worst of the economic crisis, and 12 months later, on February 10, 2009. Then, for each of those two groups of 25, it calculated the average change in stock price. And the result? Companies that were socially responsible did not perform any worse. In other words, the crash has not made any difference.

Indeed, one could argue the CSR is now more important than ever. I recently chatted about this with Princeton University ethicist Peter Singer who said to me: "In the long term, you could suggest in a downturn it's more important than ever for corporations to be responsible citizens and to help and support communities. And it would be crazy to think we don't need to deal with carbon emissions because of the economy."

Jeff Swartz from Timberland has told Ethical Corporation magazine that cSR is actually a strategic opportunity in this climate because there is such an enormous amount of anti-corporate feeling in North America and Europe and the legitimacy of business is being tested as never before.

CSR is unlikely to fade with the recession. And ironically as companies are cutting back everywhere, the economic crisis might make it even stronger.