A healthy, free-market economy has always depended on just three things: labor, capital, and raw materials. Every company in the economy consumes those three resources. A company is a good citizen only if it works to cultivate, maintain, refresh and restore those resources. A company is not a good citizen and has no real value to the economy if it does not put back into these basic resources at least as much as it took from them.

Some Definitions:

• Labor. Strong, intelligent people who are willing and able to do productive work.
• Capital. Money used to build the tangible assets of business.
• Raw Materials. Generally, any tangible or intangible thing other than labor or capital that is used to form the product or service that the company sells. They can include such widely varying things as iron ore, trees, air, the environment for generating ideas, time.

The company is part of the community (local, national, and global) that surrounds it. Because the company is there, the community builds roads to it and houses and schools near it. In a sense, as the company consumes resources, it returns value to the community in the form of taxes and wages, which are used to generate the resources for more business. Indeed, this is the normal way every business helps to maintain economic resources.

To measure the quality of a company's citizenship it is necessary to compare the taxes and wages on one hand with the resources consumed on the other. As the company consumes, does it pay enough in taxes and wages to compensate?

Part of the question is easily answered by the ordinary profitability of the company. If it doesn't make a profit, it ceases to exist and so has no continuing responsibilities as a citizen. If it makes a profit and continues to do so, then it must be paying wages, taxes and its ordinary bills and so at least some of its consumption is paid for.

To see if a company is paying for everything it consumes, we can apply a very old business principle, "Everything has a price", and its converse, "Nothing is free." For commerce in an open market, this principle must never be false. Nothing in the physical universe is free, the coal and iron we dig from the ground, the time it takes to turn them into a car, or the risk it takes to convince someone to buy the car.

To be a good citizen, every company must spend some of its resources considering how it is depleting the three main business resources and what it may do to replenish them. And, of course, it must work to do that replenishment, either by doing the replenishment directly or by seeing to it that the collective community gets it done. No company can decently afford to look solely to the cost of its products in the current fiscal period. Every company must look beyond.
 

A good corporate citizen pays for all of the materials it consumes.

A reasonable company already knows that the path to its front door is not free. That's why it's willing to pay taxes so that the community can build or maintain the path. "Nothing free" means that air and water and earth are also not free. So it's reasonable to expect the company that consumes air, water, or earth to restore those resources or to pay enough taxes so that the community might restore them.

A good corporate citizen nurtures the community of people.

Beyond paying for the materials it uses, a company must also see to the commonweal of the people in the community. Although the worker trades time for money, this trade is not as simple as an ordinary trade of goods. A trader is prepared to trade with many others, not just one. It's expected and desirable that the trader move freely among a large group of customers and vendors. But the ordinary worker can have just one employer at a time and is not expected to work for one on Monday, a second on Tuesday and back to the first on Wednesday. This difference in expectations helps create a dependency of the worker on the employer that necessarily pushes the company's responsibilities beyond the scope of the work shift.

Labor is a resource only if it is willing and able to work. A worker who is unwilling or ignorant or unable to get to the work place is valueless in the market place and a potential liability to the community. So if Labor is to maintain its value as a resource, these problems must be solved. Since the populace is ever changed by birth, death and other events, then the solution to these problems must be applied constantly. That is, these problems are a constant part of our corporate and personal lives and no one in the community may stop working with these problems without giving up the responsibility of citizenship.

The ability to work is determined by such things as age, education, and transportation. We know, for example, that children are kept from the workforce and we accept that kind of inability as a necessary and humane cost. Ignorance and lack of transportation are problems faced typically by such groups as the undereducated and the disabled, but more are affected in sometimes subtle ways. In a city, for example, the average worker might tolerate a one-hour commute. Typically, a city bus system is a fairly slow means of transportation. How much, then, could the effective workforce be increased by increasing the speed of the bus system by even one mile per hour?

A worker who won't work is a liability. The worker may be trivially unwilling because skiing or fishing have become more important that work for one day. More seriously, the worker may not be attracted to a salary that doesn't leave much after day-care costs, opting for a lower paying job that allows time for school or family. Perhaps the worker sees the neighborhood around the company as unsafe or dangerous. Maybe the worker is discouraged because, for too many times, the door to work has been shut because of race or poor education.

Acts of good citizenship can be a normal and desirable part of the business itself. Mercedes Benz, for example, spent 80 million dollars (US) on a training facility for new technicians, managers, and engineers. This normal kind of expense expanded into good citizenship because MB, cooperating with local schools, made that training part of the formal education process. Trainees who completed the MB course then were allowed to graduate from high school. MB defended its position by saying that it built a sophisticated product and couldn't leave to the community alone the responsibility of educating people well enough to continue the building.

There are thousands of ways that companies may act as good citizens.

If a  people is destitute and lost and if that destitution is surrounded by thriving businesses, then the destitution is caused, in large part, by the neglect of those businesses. 

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