In my work as a lawyer advising business clients on labour, employment and human rights issues I have found that there is a general confusion about two types of related but distinct forms of logic: the "rational" and the "reasonable". The distinction between the rational and the reasonable has been recognized explicitly or implicitly by philosophers like Max Weber, Chaim Perelman, and John Rawls. In my view, understanding the distinction is of essential importance to understanding Corporate Social Responsibility (CSR) obligations. Proper understanding of the distinction can allow business to maximize fundamental business objectives like profitability while ensuring social sustainability. Failure to recognize and act upon the distinction is a recipe for disaster. Let me explain...

Both rationality and reasonableness refer to the character of logical validity. If we say someone is acting "rationally" or "reasonably", we mean in both cases that they are acting logically. There are occasions where the terms will be synonymous. Sometimes however, there will be an essential distinction between the terms. For example, we can say that someone is acting "rationally", but that they are entirely "unreasonable". We may, to use a blunt example, say that a criminal acted "rationally" because they carried out their crime in a logical way. They have acted "unreasonably" however because we believe that crime is wrong. Such a statement makes sense because of the subtle difference between the terms. Rationality is a form of logic that flows from premises that are self-evident or incontestable. Such premises may be objectively or empirically verifiable. They may also simply be squarely within the personal preference of the actor under consideration. In this sense, economic actors are said to be "rational" insofar as they act upon their own preferences. Those preferences, as logical premises used to draw logical conclusions regarding the "rationality" of the economic actor, cannot be contested. We cannot challenge someone's preferences as "invalid" or "untrue". A person's preferences are their preferences, and as such are self-evident and uncontestable facts, to the extent they are identifiable.

Evaluations of "reasonableness" do not flow from self-evident premises. Instead, we evaluate reasonableness based upon shared preferences, or values, or other normative considerations which themselves may be subject to contestation because different audiences may have different understandings of what is reasonable or not. Reasonableness, as a question, is therefore determined by considering the preferences, values, or interests of a broader social audience than simply the actor being evaluated as "reasonable" or "not reasonable". For an assessment of reasonableness or unreasonableness to be logically true, the one making the assessment must give consideration to whether the criteria used to assess reasonableness are persuasive, and then consider whether the evaluated actor is acting in a way consistent with acceptable premises. Only then will the conclusion of "reasonableness" or "unreasonableness" have any meaning. Conversely, this means that a reasonableness assessment can be challenged on the basis that it has applied the wrong premises, meaning that the criteria of "reasonableness" are not persuasive and should not be used, or that the evaluated actor actually has acted in a manner consistent with such premises.

On the contrary, if a conclusion of rationality is drawn it will be valid so long as the premises are empirically true, and the evaluation is logically sound. Normative concepts, such as values etc., cannot be shown to be empirically true in this way (except to show that they are empirically shared by a salient audience and are thus appropriate for such an audience to use in a reasonableness evaluation). As such, reasonableness evaluation is not an empirical exercise, as much as it is an act of persuasion, employing the logic of