In 1970, Milton Friedman said, "The social responsibility of business is to make profits". As such, as late as the 70s, social responsibility was the main responsibility of Governments. As Governments' role began to shrink, due to reducing national income as a result of the reduction in corporation and income taxes and deregulation, social responsibility has slowly shifted to the responsibility of corporations.

There are a large number of multinational corporations operating world wide, whoes turnover is many times that of the GDP of many poor nations, for example, GE, Carrefour, Microsoft, Toyota, HSBC and Shell. As such, it is only logical that corporations, especially the multinationals operating in low cost countries, takes over some of the responsibilities previously managed or have been neglected by local Governments.

Corporate social responsibility (CSR) is defined as any social activity that is not a legal requirement of the country it is operating in. CSR is not philanthrophy. In this context, corporations would have to design effective use of their resources, which includes money and time of employees in activities that are above legal requirements, and are beneficial to the community that they are assisting. Effectiveness would mean bringing about beneficial changes that does not directly benefit the business. As such, huge donations to sponsor charitable events, via advertisement, are not deem appropriate CSR activities. Effectiveness should also be measurable for reporting purposes to stakeholders that the money was well spent.

Multinationals that has strong corporate social responsibility are always welcome by the host nation to do business locally, as it has played its part in assisting the local government in developing the nation. It must then seek a partnership with the government to ascertain the needs of its citizens and how these corporation could then compliment the government in its long term goals and targets.

For instance in Malaysia, IT companies like Cisco, donates personal computers to local village schools to bridge the digital divide. In addition, they also provide specialized training to vocational students so that national labor targets of software or IT engineers could be met. While in Kenya, almost all multinationals like Total, have HIV and AIDs program in their CSR objectives. Motor vehicle producers like Toyota world wide, have green programs incorporated in their operations which ever country it is operating

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