SOMO – Centre for Research on Multinational Corporations
Joris Oldenziel
London, May 22, 2006 GOVERNING CSR:
The responsibility of states to apply CSR standards to trade
SOMO – Centre for Research on Multinational Corporations
Joris Oldenziel
London, May 22, 2006 GOVERNING CSR:
The responsibility of states to apply CSR standards to trade
Introduction SOMO Analysis of trade and investment regulations Research coporate behaviour in the South Corporate Social Responsibility/accountability Since 1973 research, advice and advocacy work on: Coordinating CSR networks (CSR Platform, OECD Watch, European Coalition for Corporate Justice) International guidelines and standards Voluntary (multistakeholder) codes of conduct Analysis of sectoral trends and issues
CSR should focus on the core activities of companies and their production processes throughout their supply chains CSR should be based on internationally agreed standards, conventions and agreements CSR may include voluntary activities but should have at its starting point compliance by minimum standards Basic concepts of CSR CSR is a process in which corporations take responsibility and are accountable for the social, ecological and economic impacts of their activities
Trends towards outsourcing: Supply and production chains are becoming increasingly global and complex Race to the bottom between developing countries to produce competitively and attract foreign investments The further down the supply chain, the more labour, human and environmental rights violations can be seen Key issues in global trade Imbalance between binding rights for MNEs (WTO) versus voluntary rules for MNE behaviour (OECD Guidelines, Global Compact)
CSR initiatives only work for the well-intentioned companies, usually those that have a brand name to protect WTO rules (non-discrimination) undermine governmental efforts to promote CSR through labelling Limits to current CSR initiatives Limits to what can be expected from consumers regarding ethical shopping No incentives for production processes with no clear link to consumers International standards and Guidelines (ILO, OECD Guidelines) apply only to investment
The scope of the OECD Guidelines should be extended from investment to trade OECD Governments should apply the OECD Guidelines to their own procurement policies, export credits and other governments subsidies The UN should work towards the development of internationally binding human rights framework and clarify the concept of “spheres of influence” Governing CSR in trade: WTO members should adopt interpretations that allow governments to introduce labelling, CSR criteria in procurement and to ban products
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