Strategies and standards for corporate social responsibility
Overexploitation, environmental degradation, wage dumping and human rights violations: To avoid negative effects of natural resources exploitation (extractive industries) or the cultivation of crops (large-scale agricultural production), different actors have to cooperate. Companies are central actors and, by their own initiative, can have significant influence over the effects of natural resources exploitation on society. Such activities are summarized under the heading of corporate social responsibility (CSR). CSR is the umbrella for all contributions of a company to social, ecological and economic questions that go beyond the compliance with legal regulations.
The idea of CSR takes into account that multinational companies not only influence the international economic system but also society as such. They do not act in a vacuum but their actions have political, social, moral and ecological consequences. This is why CSR mostly refers to environmental protection, social minimum standards for employees and the general protection of human rights. Transparency, ethical behaviour and fairness are also part of it.
CSR can also have some important advantages for the companies. By acting socially responsible, resource-producing companies, in particular, may be more accepted in the population, which in turn may prevent conflict. Development projects for those who live close to mines, for instance, could be one expression of corporate social responsibility. This would also make good economic sense as it would save costs for security services, production downtime and—in the worst case—repairs after acts of sabotage.
Companies are responsible for implementing CSR and, depending on company policy, they are sometimes more, sometimes less important. Some corporate groups, for instance, make great voluntary efforts on a case by case basis to improve relations to customers or the population. Some few companies, on the contrary, have explicitly embraced CSR criteria in their business strategy to secure long-term market benefits.
Public interest in the social responsibility of multinational companies has never been higher before. Many companies consider CSR as a means of advertising, and the corresponding brochures publish positive figures of their social and ecological commitment. Still, one has to be cautious, and it is advisable to differentiate between mere lip service for public relations purposes and real, socially responsible action. One problem is that the guidelines a company has adopted and the degree of adherence to them are often not transparent. As has been shown by researchers from the University of Leeds and Euromed Management School (France), CSR reports often contain major flaws, with wrong or irrelevant data being used. Therefore ,it is all the more positive when companies participate in far-reaching initiatives for international standards (link to control regimes ) that contain clear rules and regulations or recommendations for each respective economic sector. EITI (Extractive Industries Transparency Initiative) is one such initiative.
CSR is of major importance in the mining sector, in particular, as its activities are often accompanied by large-scale destruction of the environment. One example of an industry with clearly defined standards is that of the jewellery industry. Some companies that are involved along the production chain of jewellery have joined forces in the Responsible Jewellery Council (RJC) and formulated common environmental and social standards that are to be upheld from the mine to the jeweller’s.
So far, implementation of the CSR depends on the good will of the companies. With globally nearly 300 CSR initiatives, it is nearly impossible to evaluate these rules and their compliance. Clear guidelines would be needed. The international guidelines on the social responsibility of companies of November 2010, ISO 26000, are a step in the right direction. They show how companies can implement their ecological and social responsibility effectively and create a standardized terminology.
Additionally, the compliance with CSR ought to be controlled by external, independent inspectors, and the results ought to become publicly available. This would certainly increase the credibility of CSR reports. The Global Reporting Initiative, in which the United Nations, companies, governments and civil society organizations play a part, has elaborated uniform guidelines for company reporting on societal effects of their activities. This is the first step towards an independent audit of CSR reports.
