Spin Rewriter - version 8.0

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The age of responsible business is upon us, if not in terms of practice, then certainly in terms of public expectation. The ongoing financial crisis has made it much more difficult for corporations to maintain a business as usual mentality – on issues from executive pay, to tax avoidance and corruption, as well as the externalisation of social and environmental responsibilities through complex business relationships around the world. The coming years will see even greater focus on the triple bottom line (financial, social and environmental) and an expectation that business must always operate within the interests of wider society.

Of course, few businesses have ever claimed to act against the interests of society. But for too long, Corporate Social Responsibility (CSR) has been based largely on the assumption that the business case always aligns with the societal case as long as enough philanthropy is dispensed. The United Nations Guiding Principles on Business and Human Rights, agreed by consensus in 2011, move us significantly beyond this idea.

 

Governments have now affirmed that all businesses have a direct responsibility for all their impacts and for preventing human rights harms they might cause, whilst ensuring that adequate remedies are available when abuses occur. The OECD, European Union, International Standards Organisation and others have already aligned with the UN principles. Mainstream CSR now needs to be rethought. Later this year, the UK Government will announce its business and human rights strategy for British business, at home and abroad, centred on the concept of corporate human rights due diligence. Direct reference to this approach has already been discussed in terms of British investments into Myanmar (Burma).

So the question is no longer whether a business should behave in a socially responsible manner, but rather how this should be done in practice. Here are some initial thoughts on key issues that require further dialogue and joint action if we are to make faster progress. All of these issues will be topics of this blog and others over the weeks and months ahead:

 The first theme is knowledge: how much should any business be expected to know about the impacts it or its suppliers has on society and the risks it might pose to communities, in particular the most vulnerable? We need to agree on what can reasonably be expected for a specific business in a specific geographic context in terms of the proactive measures (or due diligence) it undertakes. Once it acquires this knowledge the business has to act to reduce risks and prevent, as much as possible, adverse impacts. It needs to use its leverage over the actions of others: other businesses or even, within reason, the actions of governments. If a business behaves responsibly, it should be recognised for the preventative measures it takes. If it is does not undertake adequate due diligence, then it should be seen as reckless or even negligent.

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