Presentation on theme: "How This Disaster Affected ME"— Presentation transcript:
1 How This Disaster Affected ME Global CRSHow This Disaster Affected ME
2 Corporate Social Responsibility: A Global Perspective Concepts, key issues, contextKey CSR driversImplications for enterpriseImplications for developmentDr. Anthony Miller to theUnited Nations Conference on Trade and Development
3 Retain this Presentation for Study Provides key backgroundFramework for study emphasisFrequent reference to this presentation will help reinforce lessons of the book
4 Main Concepts of CSR CSR (Carrol, 1979) Firms have responsibilities to societies including economic, legal, ethical and discretionary (or philanthropic).- See also DeGeorge (1999) on the “Myth of the Amoral Firm”Social Contract (Donaldson, 1982; Donaldson and Dunfee, 1999) – There is a tacit social contract between the firm and society; the contract bestows certain rights in exchange for certain responsibilities.Stakeholder Theory (Freeman, 1984) – A stakeholder is “any group or individual who can affect or is affected by the achievement of an organisation’s purpose.” Argues that it is in the company’s strategic interest to respect the interests of all its stakeholders.
5 CSR = political economy Main Concepts of CSRCSR = political economyThe rights and responsibilities assigned to private industry.
6 Key Issues in CSR Labor rights: child labor forced labor right to organizesafety and healthEnvironmental conditionswater & air emissionsclimate changeHuman rightscooperation with paramilitary forcescomplicity in extra-judicial killingsPoverty Alleviationjob creationpublic revenuesskills and technology
7 Context GloballyLiberalization of markets – reduction of the regulatory approachEmergence of global giants, consolidation of market share (distribution of wealth)Development of the ‘embedded firm’ and the global value chain – see illustration for explanationDevelopment of supplier networks in developing countries
8 Key drivers of CSR Around the world Developing Countries NGO Activism Responsible investmentLitigationGov & IGO initiativesDeveloping CountriesForeign customersDomestic consumersFDIGovernment & IGOFDI is defined as cross-border investment by a resident entity in one economy with the objective of obtaining a lasting interest in an enterprise resident in another economy.-IGOs are established by treaty or other agreement that acts as a charter creating the group. Examples include the United Nations, the World Bank, or the European Union.
9 Key Drivers: NGO Activism Facilitators: IT (esp Internet), media, low cost travelBoycotts, brand damage, influence legislation, domino effecte.g. Shell in Nigeria, Exxon in Cameroon, Sinopec in Sudan, Apparel Industry (Nike, Gap), GMO, Wood Products, etc.
10 Break for Video: How NGOs Make People Think and Companies Change NGO POWER
11 Key Drivers: Responsible Investment Roots of: South Africa Apartheid DivestmentSignificant size: US SRI = 2.3 trillion $ in 2005 or 10% of all professionally managed investmentsShareholder activism: shareholder resolutions; voting processInfluence corporate reporting and disclosure requirementsNew rules on CSR reporting
12 Chico State Example?“Chico State divestment from fossil fuels”
14 Principles for Responsible Investment www.unpri.org Signatories will1 …incorporate ESG** issues into investment analysis and decision-making processes.2 …be active owners and incorporate ESG issues into our ownership policies and practices.3 …seek appropriate disclosure on ESG issues by the entities in which we invest.4 …promote acceptance and implementation of the Principles within the investment industry.5 …work together to enhance our effectiveness in implementing the Principles.6 …each report on our activities and progress towards implementing the Principles.***Environment, Social, Governmental
15 Key Drivers: Litigation Foreign Direct LiabilityAlien Tort Claims Act (ATCA): human rights, environmental rightsUnocal BurmaCoca-Cola ColumbiaRio Tinto Papau New GuineaDel Monte GuatemalaThe Gap SaipanShell Nigeria Other tools: RICO, False AdvertisingE.g. Saipan ‘sweatshop’ cases; Katsky v. Nike$30,000,000 settlement
16 United Nations Initiatives UN Global CompactUN Principles for Responsible InvestmentUNEP Equator PrinciplesILO Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy (MNE Declaration)UNHCHR Business and Human RightsUNODC Anti-corruptionUNCTAD Corporate Responsibility Reporting, World Investment Report
17 Implications for Enterprises CSR DriversNew social and product liability patternsDevelopment of Codes of Conduct and CSR reportingExpanding sphere of influenceApplication of Code of Conduct to value chainCSR management: value chain management = compliance managementTransnational CorporationsThe Extended FirmRegional Plants / JV PartnersSuppliers / Distributors
18 Implications for Enterprises: TNC as an “organ of society” “every individual and every organ of society [should] promote respect for these rights and freedoms and to secure their universal and effective recognition.” - UN International Declaration of Human RightsIt would be a strange tort system that imposed liability on state actors but not on those who conspired with them to perpetrate illegal acts through coercive use of state power Eastman Kodack Co. v. KalvinTrend in international lawInternational principles apply to governments and companiesInternational principles apply only to governments
19 Implications for Enterprises: CSR Management How do companies address socio-environmental & legal compliance issues?Policies - Code of ConductSystems - Compliance ManagementReporting - Accounting and Reporting
20 CSR Management: Systems approach Sustainable business development does not come about of its own accord. Rather, commitment to sustainability demands that corporate processes be reliably controlled and that everyone's actions - in finance as much as in environmental and social areas - be coordinated.Prerequisites for this are binding guidelines, unambiguous corporate goals and a clear organizational structure.- Deutsche Telekom
21 CSR Management: Management structure Example: ChiquitaBoard of DirectorsPresident & CEOGroup PresidentsChief Financial OfficerVP of Human ResourcesGeneral CounselCorporate Responsibility OfficerSteering CommitteeAudit Committee of Board
22 CSR Management: Plan, Do, Check, Act method Consult stakeholdersEstablish code of conductSet targetsDoEstablish management systems and personnelPromote code complianceActCorrective actionReform of systemsCheckMeasure progressAuditReport