NPO vs CSR: Will CSR eliminate the need for NPOs? The case of companies limited by guarantee in the UK.

In this paper the founder and Chairman of a successful social enterprise (company limited by guarantee), considers the differences between the strategic options available to such an NPO (not-for-profit organisation) and profit-orientated rivals with their increasingly common Corporate Social Responsibility (CSR) policies that could, on the face of it, produce similar outcomes in terms of the social good. The finding for this particular case is that while this form of organisation has some disadvantages compared to firms who have access to shareholder capital and thereby enjoy faster growth and the benefits this brings, it nonetheless has some advantages in terms of maximising the common good, even if we accept the Friedmanite view that extracting a surplus to give to shareholders isn’t necessarily one of them. The aim of the paper is not, however, to label the differences in terms of pros and cons, but to identify which of them are intrinsic to the organisational form in order to test the hypothesis that CSR will eliminate the need for NPOs in future.