LAM_Project_Report Group 6 Section B

8/7/2019 LAM_Project_Report Group 6 Section B

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Corporate Social Responsibility and Human Rights


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Table of Contents

1 Preface................................................................................. 3

2 Introduction .......................................................................... 3

3 Overview of Corporate Social Responsibility ................................ 7

3.1 What is CSR?........................................................................ 7

3.2 Why has CSR become important?.............................................. 11

3.3 Business Case for CSR .......................................................... 14

3.4 Relationship between CSR and the law ........................................ 19

4 Corporate Social Responsibility and Human Rights ..................... 21

4.1 Introduction......................................................................... 22

4.2 Human Rights on the CSR Agenda............................................. 25

4.3 CSR and Human Rights: Main Initiatives ...................................... 26

4.3.1 Principles of United Nations Global Compact .................................. 26

4.3.2 United Nations Norms on the Responsibility of Transnational Corporations29

4.3.3 OECD Guidelines For Multinational Enterprises............................... 30

4.3.4 Amnesty International .............................................................. 31

4.3.5 Global Reporting Initiative......................................................... 31

5 CSR and Human Rights in India ............................................... 32

5.1 Example : Land Rights, Entitlements and CSR ................................... 32

5.1.1 Role of Corporate ................................................................ 35

5.1.2 Suggested Role for Corporates .............................................. 36

5.2 Example : CSR & Human rights in India: Indian Oil .............................. 37

6 Role of Judiciary- Contribution of Supreme Court / High Courts...... 40

7 Role of NGOs/Civil Society Groups and Business / Industry Associations

and other stake holders................................................................ 41

8 Conclusion and Suggestions .................................................. 42

9 Our Views regarding relevance of project for a business manager and

entrepreneur.............................................................................. 45

10 Reference ........................................................................... 46


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1 Preface

One of humankinds greatest challenges this century will be to ensure

sustainable, just and balanced development. The needs of current and future

generations cannot be met unless there is respect for natural systems and international

standards protecting core social and environmental values. In this context, it is

increasingly recognized that the role of the business sector is critical. As a part of

society, it is in business interest to contribute to addressing common problems.

Strategically speaking, business can only flourish when the communities and

ecosystems in which they operate are healthy.

2 Introduction

Responsible business is good business

We are committed to creating economic value, but we are not indifferent

to how we do it. ... Progressive businesses are gaining competitive

advantage by responding to societal signals. ... We prosper by helping

society to prosper.

Idar Kreutzer, CEO Storebrand, 2005

There is growing recognition of the significant effect the activities of the private

sector haveon employees, customers, communities, the environment,

competitors, business partners, investors, shareholders, governments and

others. It is also becoming increasingly clear that firms can contribute to their


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own wealth and to overall societal wealth by considering the effect they have on

the world at large when making decisions. Business opinion polls and corporate

behaviour both show increased levels of understanding of the link between

responsible business and good business. Also, investors and financial markets

are beginning to see that CSR activities that integrate broader societal concerns

into business strategy and performance are evidence of good management. In

addition to building trust with the community and giving firms an edge in

attracting good customers and employees, acting responsibly towards workers

and others in society can help build value for firms and their shareholders.

There is no way to avoid paying serious attention to corporate

citizenship: the costs of failing are simply too high. ... There are countless

win win opportunities waiting to be discovered: every activity in a firms

value chain overlaps in some way with social factorseverything from

how you buy or procure to how you do your researchyet very few

companies have thought about this. The goal is to leverage your

companys unique capabilities in supporting social causes, and improve

your competitive context at the same time. The job of todays leaders is to

stop being defensive and start thinking systematically about corporate

responsibility.

Michael Porter, Professor, Harvard Business School, at the April 2005

Business and Society Conference on Corporate Citizenship, sponsored

by the University of Torontos Rotman School of Management

It must be recognized up front that CSR still creates a degree of confusion and

controversy. Is the promotion and implementation of socially and environmentally

preferable corporate conducting a function of business or government? Is the


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implementation of CSR practices a cost or a value-enhancer? Is it just public

relations? In part, the problem stems from definitional issues, and a perception in

some quarters that CSR is more about philanthropy, rather than doing business

and responding to shareholder interests. The central thesis is that CSR is an

integral part of the new business model.

Properly understood, CSR should be seen as the way that firmsworking with

those most affected by their decisions (often called stakeholders)can develop

innovative and economically viable products, processes and services within core

business processes, resulting in improved environmental protection and social

conditions. This approach manifests itself in many forms, including high profile

statements made by many corporate CEOs. Launching General Electrics

Ecomagination vision of a cleaner, healthier world, Chief Executive Jeffrey

Immelt underlined the companys commitment to find the big answers for the big

questionsclimate change, health, waterand to develop solutions, working in

partnership with governments and civil society;3 in other words, aligning core

business strategy with the changing social and environmental context.

We believe that the leading global companies of 2020 will be those that

provide goods and services and reach new customers in ways that

address the worlds major challengesincluding poverty, climate change,

resource depletion, globalization, and demographic shifts.

Niall Fitzgerald, former CEO & Chairman, Unilever

Businesses are an integral part of the communities in which they operate. Good

executives know that their long-term success is based on continued good


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relations with a wide range of individuals, groups and institutions. Smart firms

know that business cant succeed in societies that are failingwhether this is

due to social or environmental challenges, or governance problems. Moreover,

the general public has high expectations of the private sector in terms of

responsible behaviour. Consumers expect goods and services to reflect socially

and environmentally responsible business behaviour at competitive prices.

Shareholders also are searching for enhanced financial performance that

integrates social and environmental considerations, both in terms of risk and

opportunities. Governments, too, are becoming aware of the national competitive

advantages to be won from a responsible business sector. At the same time,

leading industry associations, such as the World Business Council for

Sustainable Development, have also suggested that countries as well as

companies might gain a competitive advantage from corporate social

responsibility. In much of the developing world, governments and business

understand that their respective competitive positions, and access to capital,

Increasingly depends on being seen to respect the highest global standards.

Even companies which may have a good reputation can risk losing their hard-

earned name when they fail to put systematic approaches in place to ensure

continued positive performance. The effect of a tarnished reputation often

extends far beyond that one firm: entire sectors and, indeed, nations can suffer.

Hardly a month goes by without some example of a major corporation suffering a

reduced market position as a result of questionable behaviour, with many others

subsequently finding themselves to be a part of the collateral damage. These

firms frequently expend considerable time and money attempting to regain their

reputation, with mixed results.


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3 Overview of Corporate Social Responsibility

3.1 What is CSR?

Social responsibility (is the) responsibility of an organization for the

impacts of its decisions and activities on society and the environment

through transparent and ethical behaviour that is consistent with

sustainable development and the welfare of society; takes into account the

expectations of stakeholders; is in compliance with applicable law and

consistent with international norms of behaviour; and is integrated

throughout the organization.

Working definition, ISO 26000 Working Group on Social Responsibility,

Sydney, February 2007

Corporate social responsibility (CSR, also called corporate responsibility,

corporate Citizenship, and responsible business) is a concept whereby organizations

consider the interests of society by taking responsibility for the impact of their activities

on customers, suppliers, employees, shareholders, communities and other

stakeholders, as well as the environment. This obligation is seen to extend beyond the

statutory obligation to comply with legislation and sees organizations voluntarily taking

further steps to improve the quality of life for employees and their families as well as

for the local community and society at large. The practice of CSR is subject to much

debate and criticism. Proponents argue that there is a strong business case for CSR,

in that corporations benefit in multiple ways by operating with a perspective broader

and longer than their own immediate, short-term profits. Critics argue that CSR

distracts from the fundamental economic role of businesses; others argue that it is


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nothing more than superficial window-dressing; still others argue that it is an attempt

to preempt the role of governments as a watchdog over powerful multinational

corporations. A key point to note is that CSR is an evolving concept that currently

does not have a universally accepted definition. Generally, CSR is understood to be

the way firms integrate social, environmental and economic concerns into their values,

culture, decision making, strategy and operations in a transparent and accountable

manner and thereby establish better practices within the firm, create wealth and

improve society. As issues of sustainable development become more important, the

question of how the business sector addresses them is also becoming an element of

CSR.

The World Business Council for Sustainable Development has described CSR as

the business contribution to sustainable economic development. Building on a base of

compliance with legislation and regulations, CSR typically includes beyond law

commitments and activities pertaining to:

y Corporate governance and ethics.

y Health and safety.

y

Environmental stewardship;y Human rights (including core labor rights);

y Sustainable development.

y Conditions of work (including safety and health, hours of work,

wages).

y Industrial relations.

y Community involvement, development and investment.

y Involvement of and respect for diverse cultures and disadvantaged

peoples.

y Corporate philanthropy and employee volunteering.

y Customer satisfaction and adherence to principles of fair

competition.

y Anti-bribery and anti-corruption measures.


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y Accountability, transparency and performance reporting; and

y Supplier relations, for both domestic and international supply

chains.

Generally, CSR is understood to be the way firms integrate social,

environmental and economic concerns into their values, culture,

decision making, strategy and operations in a transparent and

accountable manner, and thereby establish better practices within

the firm, create wealth and improve society.

It is also important to bear in mind that there are two separate drivers for CSR.

One relates to public policy. Because the impacts of the business sector are so

large, and with a potential to be either positive or negative, it is natural that

governments and wider society take a close interest in what business does. Thismeans that the expectations on businesses are rising; governments will be

looking for ways to increase the positive contribution of business. The second

driver is the business driver. Here, CSR considerations can be seen as both

costs (e.g., of introducing new approaches) or benefits (e.g., of improving brand

value, or introducing products that meet sustainability demands). The remainder

of this guide addresses the second of these drivers.

Since businesses play a pivotal role both in job and wealth creation in society

and in the efficient use of natural capital, CSR is a central management concern.

It positions companies to both proactively manage risks and take advantage of

opportunities, especially with respect to their corporate reputation and the broad

engagement of stakeholders. The latter can include shareholders, employees,8

customers, communities, suppliers, governments, non-governmental


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organizations, international organizations and others affected by a companys

activities. Above all, CSR is about sensitivity to contextboth societal and

environmentaland related performance. It is about moving beyond declared

intentions to effective and observable actions and measurable societal impacts.

Performance reporting is all part of transparent, accountableand, hence,

crediblecorporate behaviour. There is considerable potential for problems if

stakeholders perceive that a firm is engaging in a public relations exercise and

cannot demonstrate concrete actions that lead to real social and environmental

benefits.

Corporate responsibility is the basis on which business

renegotiates and aligns the boundaries of its accountability.

Responsible Competitiveness: Reshaping Global Markets Though

Responsible Business Practices, AccountAbility, December 2005

CSR can involve a wide range of stakeholders.


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A corporations stakeholders can include: shareholders, non-governmental

organizations, business partners, lenders, insurers, communities, regulators,

intergovernmental bodies, consumers, employees and investors.

3.2 Why has CSR become important?

In the flat world, with lengthy global supply chains, the balance of

power between global companies and the individual communities in

which they operate is tilting more and more in favor of the

companies. As such these companies are going to command

more power, not only to create value but also to transmit values,

than any other institution on the planet.

Thomas L. Friedman, The World is Flat, 2005.


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Many factors and influences have led to increasing attention being devoted to the

role of companies and CSR. These include:

y Sustainable development: United Nations (UN) studies and many

others have underlined the fact that humankind is using natural

resources at a faster rate than they are being replaced. If this

continues, future generations will not have the resources they need

for their development. In this sense, much of current development

is unsustainableit cant be continued for both practical and moral

reasons. Related issues include the need for greater attention to

poverty alleviation and respect for human rights. CSR is an entry

point for understanding sustainable development issues and

responding to them in a firms business strategy.

y Globalization: With its attendant focus on cross-border trade,

multinational enterprises and global supply chainseconomic

globalization is increasingly raising CSR concerns related to human

resource management practices, environmental protection, and

health and safety, among other things. CSR canplay a vital role in

detecting how business impacts labor conditions, local communitiesand economies, and what steps can be taken to ensure business

helps to maintain and build the public good. This can be especially

important for export-oriented firms in emerging economies.

y Governance: Governments and intergovernmental bodies, such as

the UN, the Organization for Economic Co-operation and

Development (OECD) and the International Labour Organization

(ILO) have developed various compacts, declarations, guidelines,

principles and other instruments that outline norms for what they

consider to be acceptable business conduct. CSR instruments

often reflect internationally-agreed goals and laws regarding human

rights, the environment and anti-corruption.


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y Corporate sector impact: The sheer size and number of

corporations, and their potential to impact political, social and

environmental systems relative to governments and civil society,

raise questions about influence and accountability. Even small and

medium size enterprises (SMEs), which collectively represent the

largest single employer, have a significant impact.

Companies are global ambassadors of change and values. How

they behave is becoming a matter of increasing interest and

importance.

y Communications:Advances in communications technology,

such as the Internet and mobile phones, are making it easier to

track and discuss corporate activities. Internally, this can facilitate

management, reporting and change. Externally, NGOs, the media

and others can quickly assess and profile business practices they

view as either problematic or exemplary. In the CSR context,

modern communications technology offers opportunities to improve

dialogue and partnerships.

y Finance: Consumers and investors are showing increasing interest

in supporting responsible business practices and are demanding

more information on how companies are addressing risks and

opportunities related to social and environmental issues.A sound

CSR approach can help build share value, lower the cost of capital,

and ensure better responsiveness to markets.

y Ethics:A number of serious and high-profile breaches of corporate

ethics resulting in damage to employees, shareholders,

communities or the environmentas well as share pricehave

contributed to elevated public mistrust of corporations.A CSR


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approach can help improve corporate governance, transparency,

accountability and ethical standards.

y Consistency and Community: Citizens in many countries

are making it clear that corporations should meet the same high standards

of social and environmental care, no matter where they operate. In the

CSR context, firms can help build a sense of community and shared

approach to common problems.

y Leadership:At the same time, there is increasing

awareness of the limits of government legislative and regulatory initiatives

to effectively capture all the issues that CSR address. CSR can offer the

flexibility and incentive for firms to act in advance of regulations, or in

areas where regulations seem unlikely.

y Business Tool: Businesses are recognizing that adopting an

effective approach to CSR can reduce the risk of business

disruptions, open up new opportunities, drive innovation, enhance

brand and company reputation and even improve efficiency.

3.3 Business Case for CSR

The business case for CSR will differ from firm to firm, depending on a number of

factors. These include the firms size, products, activities, location, suppliers,

leadership and reputation (i.e., of the sector in which the firm operates). Another

factor is the approach a firm takes to CSR, which can vary from being strategic

and incremental on certain issues to becoming a mission-oriented CSR leader.

The business case for CSR also revolves around the fact that firms that fail to

engage parties affected by their activities can jeopardize their ability to create

wealth for themselves and society, and increase the risk of legal or other

responses. Taking into account


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the interests and contributions of those one affects is the basis for ethical

behavior and sound governance. CSR is essentially a strategic approach for

firms to take to anticipate and address issues associated with their interactions

with others and, through those interactions, succeed in their business endeavors.

There is growing consensus about the connection between CSR and business

success. The World Business Council for Sustainable Development (WBCSD)

has noted that a coherent CSR strategy based on integrity, sound values and a

long-term approach offers clear business benefits to companies and contributes

to the well-being of society.

Potential benefits of implementing a CSR approach

We believe in CSR because it is a proposition aligned with our

values, but also because it makes business sense. Our commercial

partners expect from us sound environmental and social practices.

We get and understand the message and are actively promoting

CSR among associates. We want to be recognized as a

responsible industry, adding value to our products.

Ronald Bown, President, Chilean Fruit Exporters Association (at

GRI G3 launch, October 2006)

Key potential benefits for firms implementing CSR include:

y Better anticipation and management of an ever-expanding

spectrum of risk.Effectively managing governance, legal, social,

environmental, economic and other risks in an increasingly complex

market environment, with greater oversight and stakeholder


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scrutiny of corporate activities, can improve the security of supply

and overall market stability. Considering the interests of parties

concerned about a firms impact is one way of better anticipating

and managing risk.

y Improved reputation management.Organizations that perform

well with regard to CSR can build their reputation, while those that

perform poorly can damage brand and company value when

exposed. Reputation, or brand equity, is founded on values such as

trust, credibility, reliability, quality and consistency. Even for firms

that do not have direct retail exposure through brands, their

reputation for addressing CSR issues as a supply chain partner

both good and badcan be crucial commercially.

y Enhanced ability to recruit, develop and retain staff.This can

be the direct result of pride in the companys products and

practices, or of introducing improved human resources practices,

such as family-friendly policies. It can also be the indirect result of

programs and activities that improve employee morale and loyalty.Employees are not only front-line sources of ideas for improved

performance, but are champions of a company for which they are

proud to work.

y Improved innovation, competitiveness and market positioning.

CSR is as much about seizing opportunity as avoiding risk. Drawing

feedback from diverse stakeholders can be a rich source of ideas

for new products, processes and markets, resulting in competitive

advantages. For example, a firm may become certified to

environmental and social standards so it can become a supplier to

particular retailers. The history of good business has always been

one of being alert to trends, innovation, and responding to markets.


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Increasingly, mainstream advertising features the environmental or

social benefits of products (e.g., hybrid cars, unleaded petrol,

ethically produced coffee, wind turbines, etc.).

y Enhanced operational efficiencies and cost savings.These flow

in particular from improved efficiencies identified through a

systematic approach to management that includes continuous

improvement. For example, assessing the environmental and

energy aspects of an operation can reveal opportunities for turning

waste streams into revenue streams (wood chips into particle

board, for example) and for system-wide reductions in energy use,

and costs.

y Improved ability to attract and build effective and efficient

supply chain relationships.A firm is vulnerable to the weakest

link in its supply chain. Like-minded companies can form profitable

long-term business relationships by improving standards, and

thereby reducing risks. Larger firms can stimulate smaller firms with

whom they do business to implement a CSR approach. Forexample, some large apparel retailers require their suppliers to

comply with worker codes and standards.

y Enhanced ability to address change.A company with its ear to

the ground through regular stakeholder dialogue is in a better

position to anticipate and respond to regulatory, economic, social

and environmental changes that may occur. Increasingly, firms use

CSR as a radar to detect evolving trends in the market.

y More robust social license to operate in the community.

Improved citizen and stakeholder understanding of the firm and its

objectives and activities translate into improved stakeholder


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relations. This, in turn, may evolve into more robust and enduring

public, private and civil society alliances (all of which relate closely

to CSR reputation, discussed above). CSR can help build social

capital.

y Access to capital.Financial institutions are increasingly

incorporating social and environmental criteria into their

assessment of projects. When making decisions about where to

place their money, investors are looking for indicators of effective

CSR management. A business plan incorporating a good CSR

approach is often seen as a proxy for good management.

y Improved relations with regulators.In a number of jurisdictions,

governments

have expedited approval processes for firms that have undertaken

social and environmental activities beyond those required by

regulation. In some countries, governments use (or are considering

using) CSR indicators in deciding on procurement or exportassistance contracts. This is being done because governments

recognize that without an increase in business sector engagement,

government sustainability goals cannot be reached.

y A catalyst for responsible consumption.Changing

unsustainable patterns of consumption is widely seen as an

important driver to achieving sustainable development. Companies

have a key role to play in facilitating sustainable consumption

patterns and lifestyles through the goods and services they provide

and the way they provide them. Responsible consumerism is not

exclusively about changing consumer preferences. It is also about

what goods are supplied in the marketplace, their relationship to


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consumer rights and sustainability issues, and how regulatory

authorities mediate the relationship between producers and

consumers.

3.4 Relationship between CSR and the law

There is a close relationship between CSR and the law. The main instrument

governments use to address a firms social, environmental and economic

impacts is the law. Many countries have a wide range of laws, whether at the

national, state or local levels of government, relating to consumers, workers,

health and safety, human rights and environmental protection, bribery and

corruption, corporate governance and taxation. A firms CSR approach should

begin by ensuring full compliance with those laws already in place. No matter

how good a CSR policy may be, failure to observe the law will undermine other

good efforts. Looking ahead, the CSR activities of firms can be seen as a

proactive method of addressing potentially problematic conduct before it attracts

legal attention.

A key feature of the emerging CSR debate is the difference between a

compliance mentality (i.e., only doing those things that are required) and a

value driven mentality (i.e., using a CSR approach to innovate and seek new

markets). Some commentators argue that a compliance-based approach does

not help business, because it tends not to drive innovation and the out of the

box thinking they see as necessary in the rapidly changing business world. That

said, a number of specific legal aspects are worth mentioning.

y Performance reporting and the law.In many jurisdictions there

are laws in place requiring firms in particular sectors to publicly

disclose certain of their practices and activities. The U.K.

Companies Act 2006, for example, requires publicly-listed

companies to report on a number of specific issues where they are


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necessary to understanding the companys business. These

include environmental matters (including the impact of the

companys business on the environment), the companys

employees, social and community issues, and risks through the

company supply chains. Similar provisions also exist in France and

across the EU.

y Corporate governance and disclosure.Social and environmental

issues are increasingly being seen as integral components of the

corporate governance agenda. In many countries firms issuing

securities are required to publicly disclose their corporate

governance practices and comply with local guidelines on the

subject. A 2005 report by the international law firm Freshfields,

Bruckhaus and Deringer concluded that under the current legal

systems of many countries, directors might be in breach of their

fiduciary duties if they did not take into account environmental,

social and governance issues.

y

Bribery.CSR also stresses that firms should adopt responsible

practices wherever they operate. National laws making it illegal to

bribe foreign officials to obtain or retain business on the subject are

often based on the 1997 OECD Convention on Combating Bribery

of Foreign Public Officials in International Business Transactions

and the 2003 UN Convention Against Corruption.

y Requirements under different jurisdictions.It is important to be

aware of the varying legal requirements of different countries. In the

U.K., for example, legislation requires pension fund trustees to

publish a comment in their investment statements on the extent to

which their investment policies address social, ethical and

environmental issues. As noted above, in European countries laws


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require companies to report on their social and environmental

performance. In the U.S., a number of firms have been sued under

theAlien Tort Claims Act(e.g., Doe v. Unocal), which raises the

possibility that corporate liability could be established through

transnational civil litigation. The U.S. has also significantly revised

its corporate governance legislation in recent years, in particular,

passing the Sarbanes-Oxley Actin 2002 which establishes stricter

standards for all U.S. public company boards, management and

public accounting firms. At the United Nations, a Special

Representative on Business and Human Rights to the Secretary-

General was appointed in July 2005. The Special Representative is

expected to identify standards of corporate responsibility and

accountability, enhance understanding and recognition of these

standards, and issue recommendations on future United Nations

work regarding business and human rights issues.

Mention should also be made in this context of the many business codes of

conduct that exist. These codes, often developed by a specific industry sector,

are usually voluntary and not legally-binding. Nonetheless, they can be used in a

legally-binding manner in a contractual context (e.g., in a supply chain). Here,

various legal questions may arise, including in relation to whether national,

regional or international standards take precedence.

4 Corporate Social Responsibility and Human Rights

Human rights are relevant to the economic, social and environmental aspects of

corporate activity. For example, labor rights requiring companies to pay fair

wages affect the economicaspect. Human rights such as the right to non-

discrimination are relevant to the socialaspect. And the environmentalaspects of

corporate activity might affect a range of human rights, such as the right to clean


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drinking water. So, while the primary responsibility for the enforcement of

international human rights standards lies with national governments, there is a

growing acceptance that corporations also have an important role to play.

Corporations impact on human rights in significant ways. These impacts have

increased over recent decades as the economic might and political influences of

corporations has grown, and as corporations have become more involved in

delivering services previously provided by governments.

Corporations have come to recognize that part of being a good corporate citizen

includes respecting the human rights of those who come into contact with the

corporation in some way. This might be direct contact (for example, employees

or customers), or indirect contact (for example, workers of suppliers, or people

living in areas affected by a corporations activities).

Corporations are also responding to the fact that many consumers and investors

expect corporations to act in a socially responsible manner. The extent to which

a company implements a comprehensive CSR program can influence consumer

and investor decisions.

4.1 Introduction

On the face of it, human rights and the company seem worlds apart, and like oil

and water, an impossible mix. But reality is proving otherwise. Every day brings

more tangible and visible evidence of how closely human rights and todays

enterprises are linked, the key perspective being corporate social responsibility

(CSR). Until recently, human rights were mostly thought to inhibit the domain of

rights and duties of states, never (compliance with law apart) the corporate

domain. Although currently gaining ground in theoretical debates and in the

practice of some companies, the issue is not really a new one. The mid-1970s

had seen a dawning realization of how company power was extending beyond

economic to political, cultural and social areas. Since then, the continuous

evolution of company activities and power seem to have radically restructured

the equilibrium of their relations with the state and society. Nowadays,


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companies are among the most decisive actors in determining how human rights

are put into practice. Several working documents of UN commission on Human

Rights and UN Sub-Commission on the Promotion and Protection of Human

Rights as well as Security Council resolution establish a close relationship

between the activities of some companies and Human Rights abuses. These

documents stress the fact that companies have very often applied the so called

downward harmonization which basically entails the selective adoption of the

employment and enviormental legislation offering the lowest international social,

enviormental and Human Rights standards. The documents also point out that

while companies may contribute to development by creating jobs, paying taxes

and transferring technology, they may also instigate structural violence, poor

working conditions and destruction of ecosystems, and in so doing effectively

become barriers to sustainable development of the least favored nations. As a

result, the above documents offer substantial input into the timeless debate

around company contributions to the right to development.

Today the traditional concept by which only states and individuals can be held

responsible for abuses of Human Rights is clearly being called into question by

civil society in general, in political circles and over the last decade, also by some

business managers. Indeed increasing number of companies are linking human

rights to their CSR strategy upstream as a basis for CSR screening (policy) and

downstream as a resource for CSR measurement and evaluation (practice).

What is being considered today is a new paradigm of the company in which

respect for minimum international human rights standards has become as issue

inextricably linked to the process of building a responsible company.

Social, political and economic actors no longer view companies as mere

suppliers of products and services but as new social, economic and

environmental actors in a globalized economy where production processes are

being closely examined. Nowadays, the question goes beyond environmental

and social quality concerns (CSR matters) and includes human rights issues.


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Organizations formerly operating within a legal framework are now aware of a

new frame of reference instigated by citizens and consumers. These days,

societys relationship with companies and their authorization to act is under

constant review, and currently extends to whether they violate Human Rights

within their area of influence. In effect companies are being required to build their

legitimacy and identity on the basis of respect for Human Rights, increasingly

seen an integral part of responsible 21st century businesses and business

leadership.

The crucial issue here is, however, is not only where Human Rights fit into CSR

strategies, but how this is happening and what present and future challenges to

expect. The process seems to start from within, when companies begin to

question why and how they should be managing this new field within its CSR

strategy. Here are some of these few questions:

y What is the general Human Rights context within which companies

are operating? In other words, what are the real trends on the

Human Rights agenda internationally and what are the new

challenges facing their protection and promotion?

y

In this context, why are Human Rights being included on companyagendas today? What are the main initiatives linking companies

with protection of Human Rights, turning it into the core value of

company CSR?

y What king of Human Rights are we talking about in the company

context? And what is the area of influence of companies in the field

of Human Rights?

y Finally, what are the issues still to be addressed on international

and corporate agendas that link Human Rights to business fields?


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4.2 Human Rights on the CSR Agenda

Four basic trends can be identified as catalyses of the new Human Rights

presence in business discourses and practices and at top-level economic

forums.

y First the controversial process of economic globalization. In an unequal

world, globalization causes economies to resort increasingly to

internationalization and off-shoring, thus spreading productive processes

over countries with very different levels of Human Rights protection.

y

Second, the emerging network society. Under its rules, companies areperceived as not simply economic actors, but as playing their part along

with other social actors in interactions with their equivalents in other

fields.

y Third, Information and knowledge technologies which create

expectations of greater corporate transparency, while fast tracking and

multiplying content and information on these issues in local and global

interactions

y Fourth, the emerging risk society, by which company reputation, image

and identity are coming under scrutiny of certain rising values in a civil

society that is increasingly informed and mobilized on such issues. One

of a companys main assets, on a par with other more tangible assets

like product quality and technological innovations, is its reputation. It is

therefore in this context that our societies are calling on responsiblecompanies to build into their legitimacy, identity and responsibility a

respect for Human Rights.


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4.3 CSR and Human Rights: Main Initiatives

Beyond initiatives put forward by international organizations in the 80s and the

90s (such as the Declaration on Fundamental Principles and Rights at Work,

(ILO), the Tripartite Declaration on principles concerning Multinational

Enterprises and Social Policies (ILO)) all aimed at giving companies guidance on

the incorporation of Human Rights criteria into their strategies it ought to be

stressed that in recent years, new proposals on these same issues have been

consolidating in international, business and third sector circles. Guided by the

type of instruments featured in the report of European Commission, Mapping

Instruments for corporate social responsibility, here are the most significant

instruments in this area, including guidelines and statements of principles and

system of accreditation and accountability.

4.3.1 Principles of United Nations Global Compact

Human Rights:

y Principle1: Businesses should support and respect the protection

of internationally proclaimed human rights.

y Principle2: Businesses should support and respect the protection

of internationally proclaimed human rights.

Labour Standards:

y Principle3: Businesses should uphold the freedom of association

and the effective recognition of the right to collective bargaining;

y Principle4: the elimination of all forms of forced and compulsory

labour;

y Principle5: the effective abolition of child labour; and


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y Principle6: the elimination of discrimination in respect of

employment and occupation.

Environment:

y Principle7: Businesses should support a precautionary approach

to environmental challenges;

y Principle8: undertake initiatives to promote greater environmental

responsibility; and

y Principle9: encourage the development and diffusion of

environmentally friendly technologies.

Anti-Corruption:

y Principle10: Businesses should work against corruption in all its

forms, including extortion and bribery.

Global compact therefore invites companies to:

y Support and respect the internationally proclaimed protection of

Human Rights within their sphere of influence.

y They are not complicit to Human Rights abuse; an issue that

carries at lot of weight as far as United Nations positions is

concerned.

According to the report Business and Human Rights: A progress report that

examines progress in the field of the Global Compact, companies who support

this initiative must:

y Respect local and international laws principles on Human Rights

spans both legal framework.


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y Satisfy consumer concerns, given recent allegations about activities

violating economic, social and cultural rights like labour rights.

y Promote the rule of law.

y Build community goodwill.

y Select partners, suppliers or subcontract companies according to

their respect for Human Rights.

y Explore Human Rights situations in the countries where they invest

so as not to interfere with international or European sanction

policies.

y Introduce and effectively apply social responsibility measures on

Human Rights.

Finally, Global Compact suggests that companies should follow a series of

practical steps for the integration of Human Rights into their corporate strategy.

y Identify issues relating to Human Rights that a company can and

must confront. This will vary considerably depending on the sector

and country in which they operate. The analysis of the impact of

business activities on Human Rights and their relationship must

help to define the corresponding policy and its implementation.

y Carry out a policy based on international instruments.

y Define mechanisms for implementation.

y Dialogue/Collaboration: For may companies, this is the first step

and consists of starting from a consensus between the different

actors involved, facilitating transparency in the process.

y

Train own and foreign staff on corporate principles on HumanRights issues.


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session of United Nations Human Rights Committee in2004. Main criteria established

by the norms:

y Corporations shall ensure that they have no negative impact on the

enjoyment of Human Rights in its widest sense.

y Corporations shall establish internal mechanisms that ensure

compliance with Human Rights.

y Corporations shall submit to independent monitoring.

y Corporations shall ensure non-discriminatory practices.

y Corporations shall not benefit from contexts where International

Humanitarian Right is violated.

y Corporations shall respect labour rights.

y Corporations shall maintain fair marketing practices.

y Corporations shall respect the environment and contribute to

sustainable development.

4.3.3 OECD Guidelines ForMultinational Enterprises

The OECD guidelines are voluntary recommendations addressed by government

to multinational corporations operating in or from adhering countries. These

guidelines form part of the OECD Declaration on International Investment and

multinational enterprises adopted in 1976 to facilitate direct investments in its

member states. They provide voluntary principles and standards for responsible

business conduct, forming the first multilateral initiative taken by several

governments in the corporate Human Rights field. The 2000 review of the

Guidelines recommends observance of the Guidelines by enterprise wherever

they operate, even outside the OECD area.

Areas dealt with in the guidelines are:

y Labour and industrial relations


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y Human Rights and Enviroment

y Information disclosure

y Competition, taxation,

y Science and Technology.

4.3.4 Amnesty International

AI is pursuing the social responsibility strategy by trying to convince MNCs to

voluntarily adopt human rights principles and policies in their own codes. AI does not

call for economic sanctions against countries nor boycotts againstcompanies. AI takes

no position on the legitimacy of economic relations between companies and

governments guilty of human rights violations.

AI may in some cases oppose specific transfers of equipment, training or other support

used to commit human rights violations.

AIs Human rights principles1

Company human rights policy based on Universal Declaration of Human Rights

(UDHR).

y Security arrangements must not permit Human Rights Violations (HRVs).

y Community engagement.

y Freedom from discrimination.

y Freedom from forced labour.

y Health and safety.

y Right to association and collective bargaining.

y Fair working conditions (adequate standard of living).

y Elimination of child labour (as lawfully required).

y Independent monitoring and transparency.

1www.amnesty.org.uk/business; www.iblf.org/humanrights; www.business-humanrights.org.


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4.3.4 Global Reporting Initiative

It is a voluntary, long-term, multi-stakeholder international guideline for sustainability

reporting. GRI addresses Economic, Environmental, and Social dimensions of

Business.

y Economic: wages and benefits, labour productivity, job creation, expenditures

on R&D, investment in training.

y Environmental: impacts of processes, products and services on air, land,

water, biodiversity, and human health.

y Social: workplace health and safety, employee retention, labour rights, human

rights, working conditions.

y

GRI Features Comprehensive reporting guideline applicable to almost all businesses.

Improves transparency with stakeholders.

Supports consultation with key stakeholders.

Allows for incremental implementation.

Provides a management tool to help evaluate and continuously improve

business operations.

Common format allows comparisons and illuminates relationships among

core elements.

Supports independent verification, but does not provide it.

5 CSR and Human Rights in India

5.1 Example : Land Rights, Entitlements and CSR

Land is one of the most scarce of the natural resources. It has been subject to

ownership laws and property regimes for centuries. Yet the enforcement of these

laws leaves much to be desired. The paper cites the real problems that stem


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from the denial of these basic human rights from the perspective of Corporate

Social Responsibility and suggests how corporates can help.

One of the basic assumptions related to land entitlements is that there is

increased efficiency of resource use, facilitation of development, protection of de

facto rights, and equity in distribution.

If one goes into the history of evolution of laws related to land entitlement, one

finds that during the British period, land was allocated to the highest bidders.

These high revenue providers were allocated large chunks of land and so the

system of landlords was brought into existence.

Post Independence, there were various movements to promote the equitable

distribution of land. The Bhoodan (land gifts collected under the Land Ceiling Act)

movement forced big landlords to donate their lands that were then distributed to

the landless farmers. In India, there is a general perception that land reform has

led to insignificant changes. Distribution of land is unequal, and only a couple of

states have made progress in redistributing land. Rapid agricultural growth and

all-round development of the rural sector largely depends on the implementation

of land reforms, which is missing in India. The rural poor, most of who are

landless or have very small holdings are caught in the trap of debt and starvation.

India, at present, finds itself in the midst of a paradoxical situation: On the one

hand there are record food grain stocks and on the other hand, over 200 million

Indians are underfed and millions are undernourished. The reason is that most of

the farming population has marginal land holdings or no land holding at all.

Efficiencies of production are alien to them; and their high dependence on the

monsoons and use of ineffective/unsustainable methods of agriculture makes

them more vulnerable. Problems of land alienation, loss of land

rights/entitlement, improper land management and use, unsustainable agriculture

and deforestation all add to the woes of the people.

Land resources are limited and very important for prosperity and dignified living.

It is the right of all human beings to have entitlement to land productive land. In


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Tarapur Taluka, IGSSS supports a project for the rights of the Valmikis (manual

scavengers). In Changla village these Dalits were denied grazing land, for their

cattle, by the Panchayat (specifically the upper caste darbars). The Dalits, who

had formed a Sangathan, were threatened with woeful consequences if they

continued to press their demands. With the support of the voluntary organisations

working for them, the Valmikis filed a complaint under the Prevention of Atrocities

Act. The accused were arrested and locked up in jail for two days a strong

lesson was learnt. The Panchayat was forced to allot 30 acres of grazing land to

the dalits.

In Sabarkantha district, Gujarat, construction work began on a water reservoir

(Hathmati Jalasaya) in 1958. Due to this 12 villages were brought under

submerged area forcing the landlords and their workers to move. When 10,000

acres of land went for the dam, 5000 acres of land was given to the original

landlords as compensation. According to the landholding regulations, these

landlords were entitled only to 1500 acres. Our project partner organised the

landless labourers and ensured that they harvested the crop from the remaining

3500 acres. Securing the communities title to this land is important to ensure

continued access to this natural resource.

However, these cases are few and far between. The systematic deprivation of

the poor from land entitlement is a pertinent issue in India. Rural poverty in India is

related to the lack of access to cultivable land or its low productivity. The World Bank

Report, India: Achievements and Challenges in Reducing Poverty (A World Bank

Country Study 1997), reported that landlessness is by far the greatest predictor of

poverty in Indiaeven more so than caste or illiteracy.More than 250 million rural

residents live in households that own less than 0.2 hectares of land. Access to

productive land will free these households from the clutches of poverty and hunger.

However, land policy and the legislative and administrative framework in India present

substantial obstacles to gaining greater land access and rights. Apart from the

administrative, policy and implementation issues concerning land entitlement, the past

few years have seen the rise of a new entity the Corporate, who competes for the


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same natural resources (land) that the government, rich landowners/mafia and the

actual owners/title holders do.

5.1.1 Role of Corporate

The onset of globalization and the opening up of the world markets meant that

now there were more demands on resources. Indias liberalization policy and open

market reforms meant on the one hand a growth opportunity and on the other a cause

for greater marginalization of the poor.

The so called development projects like setting up of industries, mines, dams,

and shopping malls have induced large scale displacement not only in India, but also all

over the world. Thousands of acres of land have been taken away, in the name of

development, from people who are totally dependent on it for their livelihood.

Rehabilitation plans (on paper) are shown to the displaced people. Policies are

there to provide agricultural land or replace the livelihoods of those displaced by large

projects. However, these policies are meant to ensure the large-scale transfer of lands

to private companies and corporate bodies. The policies are the means to legitimize

this resource alienation and to strengthen corporate control over land.

While the policy grapples with and articulates these most germane issues of the

displacement and rehabilitation process, it does not provide any appropriate mechanism

or framework for either the assessment of the necessity of displacement, or the

identification or compensation of the ousted with livelihoods. What is the reality of the

compensation framework? Does it ensure that the ousted will actually receive

agricultural land? Or is the concern about the non-viability of cash

as a compensation instrument merely rhetorical?


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and confidence need to be built between the community and the corporate to establish

a base for future partnership.

In understanding this, today corporates have started to move into playing a

greater role in society. This may be attributed to external factors like mounting pressure

from their own stakeholders, society and the government on responsible business

practices or may also have arisen from an introspection of the returns that their

business gives to those it takes from. Whatever the drivers, there is no denying the fact

that there is a greater initiative in Corporate Social Respons ibility than there was a few

decades ago.

5.2 Example : CSR & Human rights in India: Indian Oil

We cite the example of flagship petroleum refiner IndianOil Corporation Ltd2, a Central

Public Sector enterprise of Mahanavratna Status. At IndianOil, corporate social

responsibility (CSR) has been the cornerstone of success right from inception in the

year 1964. The Corporations objectives in this key performance area are enshrined in

its Mission statement: "to help enrich the quality of life of the community and preserve

ecological balance and heritage through a strong environment conscience."

IndianOil has set core values as Care, Innovation, Passion and Trust to guide in all

their activities. They take pride in being able to claim that all countrymen are their

customers. Public corporations like IndianOil are essentially organs of society deploying

significant public resources. They strive to work as wholesome entities created for the

good of the society and for improving the quality of life of the communities we serve.

As a constructive partner in the communities in which it operates, IndianOil has been

taking concrete action to realize its social responsibility objectives, thereby buildingvalue for its shareholders and customers. The Corporation respects human rights,

values its employees, and invests in innovative technologies and solutions for

sustainable energy flow and economic growth. In the past five decades, IndianOil has

supported innumerable social and community initiatives in India. Touching the lives of

2 http://www.iocl.com/Aboutus/corporatesocialresponsibility.aspx


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millions of people positively by supporting environmental and health-care projects and

social, cultural and educational programmes.

Besides focusing primarily on the welfare of economically and socially deprived sections

of society, IndianOil also aims at developing techno-economically viable and

environment-friendly products & services for the benefit of millions of its consumers,

while at the same time ensuring the highest standards of safety and environment

protection in its operations.

Sharing Profits

Every year, IndianOil sets aside a fixed portion of its profits for spreading smiles in

millions of lives across the country through a comprehensive community welfare and

development programme. About one-fourth of the community development funds are

spent on the welfare of Scheduled Caste and Scheduled Tribe beneficiaries.

IndianOil has a concerted social responsibility programme to partner communities in

health, family welfare, education, environment protection, providing potable water,

sanitation, and empowerment of women and other marginalised groups. IndianOil has

always been in the forefront in times of national emergencies. IndianOil People have

time and again rallied to help victims of natural calamities, maintaining uninterrupted

supply of petroleum products and contributing to relief and rehabilitation measures in

cash and kind.

IndianOils community-focused initiatives include allotment of petrol/diesel station

dealerships and LPG distributorships to beneficiaries from among Scheduled Castes,

Scheduled Tribes, physically handicapped, ex-servicemen, war widows, etc. The

Corporation has also unveiled kisan seva kendras as small-format retail outlets to reach

quality products and services to people in the rural areas. IndianOil has also set up the

IndianOil Foundation (IOF) as a non-profit trust to protect, preserve and promote

national heritage monuments. The Corporation also supports a variety of endeavours in

arts, culture, music and dance, apart from organising programmes on its own under the

banners of IndianOil Art Exhibition, IndianOil Sangeet Sabha and IndianOil Kavi

Sammelan.

As part of its environment-protection initiatives, IndianOil has invested close to Rs.


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7,000 crore in state-of-the-art technologies at its refineries for production of green fuels

meeting global standards. To further reduce dependence on precious petroleum

products and secure the nations energy security, the Corporation is now in the process

of commercialising various options in alternative fuels such as ethanol-blended petrol,

biodiesel, and Hydrogen and Hydrogen-CNG mixture.

With safety, health and environment protection high on its corporate agenda, IndianOil

is committed to conducting business with a strong environment conscience, so as to

ensure sustainable development, safe work places and enrichment of the quality of life

of its employees, customers and the community. IndianOil is also committed to the

Global Compact Programme of the United Nations and endeavours to abide by the 10

principles of the programme, some of which are already part of the Corporations Vision

and Mission statements. It is the firm resolve of IndianOil People to move beyond

business, touch every heart and fuel a billion dreams.

In India, traditionally business is seen as legitimate, integral part of society with inherent

Vedic philosophy Sarva Loka Hitam the well being of all stakeholders along with

business excellence. Today most of our big business houses like TATA, BIRLA,

RELIANCE, etc and CPSEs, SPSEs all have taken CSR as part of their mission.

However, this has to be further inculcated up to bottom level of their day to day working.

This can be achieved through regular training and incentives to all involved. As ex-prime

minister Late Shri Rajiv Gandhi in one of his rallies stated that if Rs 100/- is sent, only

Rs 15/- reaches up to the needy. The main stress shall be on accountability of

distribution of Public Goods whether food items through Public Distribution System or

money through various YOJNAs like NREGA, Gramin Sadak Vikas etc. Rapid

implementation of UID scheme may help in rooting out this problem. The education and

health system shall also be revamped as they are becoming very costly day by day,

making them out of reach of our majority of population. Schools like KVS, NVS, etc shallbe leveraged in standard of education and facilities to make them at par with private

schools. Government Hospitals services are to be made at par with Private Hospitals.

Also, these entities should be discouraged for making them money churning house at

the cost of exorbitant fees.Infrastructure like, roads, railways, irrigation, housings all

need a CSR perspective while planning and implementation. All things said and done


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can only bear their desired fruits, if the population is kept under control. At 120 crores

today, and further increasing at a rate higher than world rate, it has to be given foremost

weightage. In light of the above arguments in favour of CSR, and its benefits, attempts

should be made to mandate CSR, or else, the people would be deprived of a whole new

forum of ensuring poverty reduction and social development, apart from the

government. In this way, the government and the corporate can work hand in hand,

both assuming their duties and responsibilities while realising rights of the people. Thus

CSR exhorts firms to diverge from their sole aim of maximising profits and to lay more

importance on improving the economic and social standards of the community in their

countries of operation.

6 Role of Judiciary- Contribution of Supreme Court / High Courts

CSR issues cannot be put before Judiciary as it is not mandated through any legislation.

However, it is the role of the judiciary to interpret the law in the socio-economic and

political context in which it is meant to be interpreted. Further, the judiciary recognised

the civil and political rights by broadening locus standi, making the judiciary more

accessible. The responsible role played by the judiciary in terms of judicial activism, by

recognising CSR, as long back as in 19833. However, the legislature has still not given

effect to it in terms of any statutory standing, even though the judiciary, by recognising

CSR, has actually supplemented the burden of the government, with that of the

corporates, which could have ended up in division of responsibilities of the government.

Also, through Public Interest Litigations (PILs) any citizen in India can raise an issue

concerning Human Rights which in his / her view is not upheld by any business entity.

Some examples are Uphaar Cinema Fire Incidence, Bhopal Gas Leakage Case and

excessive use of groundwater by Coca Cola in Kerala. All these cases when put up for

judgment, have a CSR angle as the culprit company is considered to not uphold their

responsibilities.

3 AIR 1983 SC 759, where it was held by the Apex Court that the traditional view that a company is the property of the shareholders

is an exploded myth. According to the new socio-economic thinking, a company is a social institution having duties and

responsibilities towards the community in which it functions. Also, it is agreed that if a company has caused some loss to itssurrounding areas, it is its obligation to make up for that loss, whether technical or environmental, as a part of its CSR. Also, refer topara 4 in MANU/SC0025/1982, where Justice P.N. Bhagwati refers to this as the new Corporate Philosophy, and also attracts theDirective Principles of State Policy, and their furtherance with the help of such corporates.


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Till now, redressal is available only against the actions of the government. If CSR is

mandated, there would be a more effective redressal forum in the form of the judiciary,

in case of failure on the part of corporates, apart from the current accountability forum,

i.e. the media. Further, even the UN Norms seek to impose responsibilities on

businesses within their respective spheres of activity and influence.

7 Role of NGOs/Civil Society Groups and Business / Industry Associations

and other stake holders

Non Government Organisations (NGOs) are private voluntary organizations (PVOs) that

represent social movements. They function as moral entrepreneurs that are selling

ethical ideals and standards for no-profit and no-loss. They vary greatly in size, mission,

strategies and degree of democratic legitimacy.

NGO Strategies and Tactics for Promoting CSR are

y Research and Reporting media exposure

y Social Responsibility dialogue with Trans National Corporations (TNCs)

y Social Accountability standards and audits

y Shareholder Activism shareholder resolutions

y

Economic Pressure boycottsy Sanctions/Divestment selective purchasing

y Government Regulation supporting legislation

y Litigation bringing law suits.

y Norm Creation development of international law

NGOs can play the role of mediator between Corporate Businesses and civil society by:

Understanding need to address demands from civil society as a responsible dialogue

partnerswho can represent civil society interests.

y NGOs have relevant expertise to assist TNCs in country risk assessments and

social auditing programs.

y Provide guidance about social standards and social auditing.


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y protecting TNCs reputation and public criticism.

NGOs are also interested to co-ordinate with Transnational Corporations due to

y shift of power in the Post Cold-War world towards TNCs and economic issues.

y Perceived lack of social and environmental accountability of TNCs under existing

laws.

y Internal critique of the human rights movement for being too Northern and too

focused on traditional civil and political rights.

y Desire to find new allies in the on-going struggle for human rights and dignity for

all people.

Civil Society Groups

Ethical banks excel in community involvement, as do other financial institutions such as

credit unions. Community involvement is not limited to ethical banks as conventional

banks also partake in such actions. The following are a few examples of community

involvement done by ethical banks, credit unions, and conventional banks:

y Affordable housing projects

y Many banks/credit unions try to increase financial literacy in the communityy Give local scholarships & sponsorships.

y Financially support community events

Securities & Exchange Board of India (SEBI) also emphasizes CSR of businesses.

8 Conclusion and Suggestions

Corporate social responsibility is most frequently used to describe a company's relationswith its wider community. CSR is on the boundary of HR and PR. There are dangers for

companies and for the HR function if it is allowed to slide too far towards PR. More than

excessive use of relationship management techniques they should make use of

strategic relationship management approaches. This strategic relationship management

approaches includes the relationship development, maintenance and separation factors.


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After the goal attainment the HR managers should be able to separate themselves from

the community and Non Governmental Organisations and lead them to new

interventions and action programmes where the organisations development and Social

Development can be better integrated. If HR managers are not orienting and

experimenting them with innovative areas the Human Resource Management don't

have better role in the industrial sector. HR has a role in demonstrating the benefits of

workplace practices that both reflect CSR and at the same time, contribute to

organizational efficiency and success.

The Business Case for CSR

y Enhances compliance with local and international laws.

y Benefits from promotion of rule of law.

y Better internal control and control over supply chain.

y Protection of reputation and brand image.

y Enhances risk management.

y Increases worker productivity, morale, and loyalty.

y Provides management tools.

y Addresses shareholder concerns.

y Builds community goodwill.

y Applies corporate values.

y Reduces operating costs.

y Enhances financial performance.

y Increases stock value.

y Enhanced ability to attract quality workforce.

y Improves business relationships.

Push Factors

y Globalization of production.

y Privatization of state-owned industries in some cases.

y Communications and IT.


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y Calls for greater corporate transparency.

y Threats of trade sanctions, boycotts and divestment campaigns.

y Threats of negative publicity and damage to reputation.

y Desire to address concerns of consumers and active shareholders.

y Desire to address concerns of NGOs, Trade Unions, and Faith-Based

organizations.

y Desire to address concerns of local communities.

y Desire to respond to CSR initiatives by governments.

y Desire to keep up with industry leaders in CSR.

Next Steps for Companies

y Companies should adopt strong CSR policies.

y Companies should commit to creating internal management systems to monitor

compliance.

y Companies should seek to achieve external certification through auditing

systems such as SA8000.

y Companies can cooperate with local NGOs and community groups in identifying

issues, assisting internal and external auditors, and solving problems.

y Companies need to be more transparent about what they are actually doing in

the field of CSR.

The Way Forward

y More companies must get past Why should we? to How can we? Dont wait to

be shamed for bad practices.

y More NGOs need to loose their anti-business biases and begin to distinguish

among different companies.y Companies need to begin to think about CSR compliance as a normal part of the

cost of doing business, and as providing a competitive advantage.

y NGOs need to begin thinking of companies as potential allies and partners rather

than as adversaries.


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y Ultimately, governments will need to create and enforce CSR standards

internationally.

9 Our Views regarding relevance of project for a business manager and

entrepreneur

This project may help a business manager / entrepreneur to understand importance of

his/ her CSR.

Role of Human Resource Managers

If Non Governmental Organizations can play better role in the corporate social

responsibility, then Human Resource Management Department of the industry can play

better role in linking industry with community. The HR managers shall take lead in the

effort to link between community and the industry. To develop better rapport with the

people, HR managers have to make use of their Strategic Relationship Management

Skills. They should interact with the community by establishing better linkage with the

Non Governmental Organisations Working there in the locality. The HR managers can

initially conduct Focus Group Discussion (FGD) with the community and community

leaders with the help of Non Governmental Organisations and need evaluation and

need prioritization should be conducted. Here HR managers can act as facilitators in

the Corporate Social Responsibility initiatives. The community may have unlimited

social needs. It is the responsibility of the HR managers to intervene into those needs

and give a realistic perception to the community members related to their unlimited

andunrealistic needs. The needs of the community are to be segregated into important

and important needs. Both short-term goals and long-term goals are to be segregated.

The discussion to be entertained and the need categorization and finalization should

come from the community itself. The HR managers who act as the implied leaders

should lead the community towards realistic goal perception that integrate the goals and

objectives of Corporate Social Responsibility programme initiated by the organization.


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This indicates that as leaders of the Corporate Social Responsibility programme, HR

managers should integrate the needs of the community and that of the organisation.

The list of social development needs and the environmental protection needs to be

discussed soon after the Focus Group Discussions, with the top management in order

to ascertain whether all those needs can be met with the budget allotment for the

developmental programs. A multi level discussion, with members of the NGO's, HR

managers and representative of the Top Management, is to be initiated for the

finalization of the social intervention programme. Corporate Social Responsibility offers

the HR community opportunities to demonstrate its strategic focus. The relationship with

the community and Non Governmental Organisations indicates the level of HR

manager's success role in the Corporate Social Responsibility effort.

10 Reference

http://www.csreurope.org CSR Europe is a business-driven membership network. Its

mission is to help companies achieve profitability sustainable growth and human

progress by placing corporate social responsibility in the mainstream of business

practice.

http://www.csrwire.com - CSRwire seeks to promote the growth of corporate

responsibility and sustainability through solutions-based information and positive

examples of corporate practices.

http://www.bsr.org - Business for Social Responsibility (BSR) is a global organisation

that helps member companies achieve success in ways that respect ethical values,

people, communities and the environment.

http://www.business-humanrights.org - Business & Human Rights Resource Centre is a

charity promoting greater awareness and informed discussion of important policy

issues.

http://www.unglobalcompact.org - the Global Compact seeks to advance responsible

corporate citizenship so that business can be part of the solution to the challenges of

globalisation.


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http://www.ilo.org This is the website of the International Labour Organisation.

http://www.hrw.org - Human Rights Watch is dedicated to protecting the human rights of

people around the world.

http://www.goodmoney.com This website provides information on Social, Ethical and

Environmental Investing and Consuming & Corporate Accountability.

http://www.inform.umd.edu/crge/resources/interest.htm This is an association of

academic units and individual faculty on the University of Maryland Campus whose

mission is to promote, advance, and conduct, research, scholarship, and faculty

development that examines the intersections of race, gender, and ethnicity with other

dimensions of difference.

http://www.international-alert.org - International Alert is an NGO committed to the

peaceful transformation of violent conflict

http://www.iocl.com/Aboutus/corporatesocialresponsibility.aspx

http://www.lawyersclubindia.com/articles/Corporate-social-responsibility-in-a-Strategic-

Methodology-3316.asp

http://www.caclubindia.com/forum/corporate-social-responsibility-voluntary-guidelines-

2009-98392.asp

http://www.caclubindia.com/forum/corporate-social-responsibility-voluntary-guidelines-

2009-98392.asp

http://www.chillibreeze.com/articles_various/CSR-in-India.asp

LAM_Project_Report Group 6 Section B

Documents

Transcript of LAM_Project_Report Group 6 Section B