Voluntary vs mandatory to remain point of contention in CSR

Placing the emphasis on voluntary initiatives or mandatory measures is the hot debate as the EU’s Multi Stakeholder Forum on CSR concludes its 20-month mandate and delivers its final conclusions.

The EU’s Multi Stakeholder Forum on Corporate Social
Responsibility (CSR) completed its 20-month mandate on 29 June
after delivering its final summary report and recommendations. This
final report brings together the conclusions submitted by the
individual round tables.

The overall recommendations of the Forum are included in the
final section of the report. Firstly, in the context of “raising
awareness and improving knowledge on CSR”, the Forum makes a number
of recommendations on how to raise awareness of key principles in
reference texts, how to collect, exchange and disseminate
information about CSR and how to step up research on CSR. The set
of recommendations which focus on “developing the capacities and
competences to help mainstream CSR” highlight action to be taken to
enhance the capacity of business to integrate CSR, to build the
capacity of ‘capacity builders’, ie organisations or individuals
that specialise in CSR, and to include CSR in business school
curricula. The report sees an important role for the EU, public
authorities, companies and stakeholders in “ensuring an enabling
environment for CSR”.

The introductory section of the report explains the origins of
the concept of CSR in the EU and the concept of CSR itself,
starting from the definition put forward by the Commission in an
earlier Communication. The Commission has defined CSR as “… a
concept whereby companies integrate social and environmental
concerns in their business operations and in their interactions
with their stakeholders on a voluntary basis.”

The report then goes on to consider the texts and instruments
which have most commonly served as a starting point for companies
and stakeholders when developing their CSR approaches. These
include the ILO declaration on multinational enterprises (MNEs) and
social policy (1977, rev 2000), the OECD guidelines for MNEs (1976,
rev 2000) and the UN Global Compact (2000).

The next section in this summary explains that the take-up and
development of CSR depends on internal and external ‘determining
factors’ which vary in relevance according to the characteristics
of a company (such as its size, age, activity and its geographical,
political or cultural context).

The values and commitment of key decision makers as well as the
‘business case’ defined as “minimising risk, maximising
opportunity” are important internal drivers for the pursuit of CSR.
Different parts of society, including investors, consumers, public
authorities, NGOs, trade unions and other companies, put pressure
on companies from the outside to adopt a CSR approach.

A number of obstacles may arise along the way, such as cost
elements, lack of information, unclear boundaries and even the ‘CSR
jargon’ which has developed over the years. In order for CSR to
succeed, key people in companies need to show commitment, the CSR
approach should be integrated into corporate strategy and the
company should engage with both internal and external
stakeholders.

On the day of the final meeting of the forum, a group of
NGOs, including the Social Platform, the Green 8,
Oxfam, Amnesty International and BEUC sent an open letter to the
commissioners for enterprise and social affairs, the prime
ministers of Ireland and the Netherlands [the latter being the
holder of the current six-month rotating EU presidency] and to the
European Parliament to demand binding legal measures to ensure the
accountability of companies.

"Taken together the recommendations, if they are fully
implemented by the relevant actors, will help to generate a
significant advance," states the letter. However, the letter states
that voluntary commitment in itself is not enough to ensure
corporate accountability. "Only binding legal measures will
establish a general incentive for responsible corporate behaviour,"
it says.

UNICE, the European confederation of employers and
industry, welcomed the final Forum report as the outcome of a
twenty-months learning and discussion process. UNICE's Secretary
General Philippe de Buck highlighted that discussions within the
Forum had not been easy, particularly because of "the high
complexity of the subject; the very different understandings on
some issues... and very different expectations". While the report
is not considered perfect, UNICE welcomed the fact that the final
Forum report is a joint contribution and conclusion by the
stakeholder organsiations that have participated in the Forum,
building on the common understanding that has been gained. As such,
the report was judged to be an achievement and to add value to the
CSR debate in general. Philippi de Buck expressed some criticism
with regard to organisational and procedural aspects, considering
the process "unneccessarily complicated, complex and heavy", but
praised the methodology chosen for the Roundtables. UNICE invites
the European Commission to take account of the final Forum report,
stressing that public policies must respect the voluntary nature of
CSR, support dynamism and the development of a competitive edge and
should not be mixed up with policies pursuing different
objectives.

A Communication issued by the Commission in July 2002 called for
the establishment of the forum with the aim of raising the level of
understanding of CSR and promoting a dialogue between businesses,
trade unions, civil society organisations and other stakeholders
(see also EURACTIV's

).

The meetings of the forum took place in four theme-based round
tables, each of which met three times during 2003-04. The
objectives of the round tables were to:

  • improve knowledge about CSR and facilitate the exchange of
    experience and good practice;
  • foster CSR among small and medium-sized enterprises
    (SMEs);
  • consider the diversity, convergence and transparency of CSR
    practices and tools;
  • look at the development aspects of CSR.

 

The Commission is expected to issue a follow-up
communication later this year which will take into consideration
the recommendations of the forum.

 

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