The balance between survival and social responsibility: The spotlight on Shake Shack

 by Nicole Lim

Has COVID-19 shattered the social fabric or repaired it?

The global GDP is forecasted to contract by 5.2%, creating the severest recession in decades. The largest contributor being businesses that have been forced to either shut operations or continue with new approaches.

This balloons the ethical challenges faced by businesses. As Harvard Lecturer Badaracco put it, the struggle is with issues of right versus right.

The challenge to balance survival with the expectations of corporate social responsibility is best demonstrated through the case of Shake Shack and the Federal Paycheck Protection Program in the U.S. that enabled corporations like Shake Shack to take a part of this fund, leaving less for smaller businesses. The question was whether this was right. The improved ability of Shake Shack to maintain jobs, clashed with the altruistic aims of the program and expectations of society of who should get to benefit.

In response, unlike other big corporations like Potbelly , Shake Shack returned the aid it received, despite the struggle it faced such as a 70% decline in sales, possibly mirroring that of smaller businesses. Does this prove true what ethicist Hoffman said, “To behave ethically can cost dearly”?

Perhaps, there is no clear answer. Covid-19 has produced resilience in the relationship between consumer, corporation and employee – minority-owned businesses have evidently supported communities and workers. However, it has also produced cracks in the ongoing pursuit for greater ethical behaviour in the corporate sphere. Bigger firms may ignore their social duties – if this exists – for personal survival. Would this be justifiable in times like this? What are the consequences for the future of corporate social responsibility, when the balance is disregarded during times where it matters the most?