What is Corporate Social Responsibility?

Nov 20 2002 by Brian Amble Print This Article

Launched in November 2000 by a group of international business organisations led by CSR Europe and The Copenhagen Centre, the European Business Campaign on Corporate Social Responsibility has set itself the goal of making the benefits of CSR visible to the wider business world. Aiming to reach out to more than 500,000 business people over a four–year period, the Campaign will culminate in the first ever Business Olympics on CSR.

The Campaign is organising a host of European-wide events and projects, including a series of 15 national conferences – the “European Business Marathon” - led by local and national business organisations active in the field of CSR. So far, the Campaign has already travelled through Greece, France, Spain, the United Kingdom and Finland and connected with more than 3000 people at national conferences.

Over the next two years, the Campaign will travel to 10 other European countries and present a variety of thematic initiatives to stimulate more companies to balance profitability and sustainability by placing Corporate Social Responsibility in the mainstream of their business practice.

So what does CSR mean in practice? Some examples of how CSR is employed throughout Europe provide a good illustration.

Informing the consumer: At the end of January 2002, the Belgian House of Representatives passed a ‘law aiming to promote socially responsible production’, also known as the ‘social label law’. What the social label will guarantee consumers is that a product has not been manufactured by forced or child labour and that, workers have been secured protection against discrimination and given the right to organize collectively. Companies interested in the social label will have to demonstrate that the International Labour Organisation’s labour norms have been respected throughout their entire production line, also outside of Europe. A 16-seat multi-stakeholder committee consisting of employers’ federation representatives, NGOs, trade unions, consumer organisations and public officials will oversee the awarding of a Social Label to eligible products.

Reporting on the social impact of business: In the Netherlands, the Council for Annual Reporting has formed a multi-stakeholder task force made up of business representatives, trade unions, NGOs as well as academics to determine how social aspects could best be integrated into corporate annual reports. At the same time, a lot of work is being done to determine what kind of indicators should be used in reporting on social impact, a difficult task. As their contribution to this work, the Global Reporting Initiative, having recently opened their secretariat in Amsterdam on the 1st of October, released their 2002 Sustainability Reporting Guidelines. The reporting guidelines consist of 24 core social indicators, 16 core environmental indicators and 10 core economic indicators that are to be reported on systematically by a company, including information on a company’s disciplinary practices, worker health and safety, emissions and waste data, number of employees, and bribery and corruption.

Working in partnership: the Madrid Local Social Capital partnership was formed in 1999 to promote the development of employment and economic opportunities in the two southern districts of Madrid, Villaverde and Usera. Spain has long held the European record for joblessness, with unemployment rates hitting as high as 25 % in the mid-1990s. Thanks to a take off in economic growth in the years after, this number has fallen to around 14 % today. But unemployment remains a crippling social problem, especially among youth. Led by the Spanish business network, Fundacion Empresa y Sociedad, the project has brought business representatives, public workers and civil society organisations together in partnership to help disadvantaged persons start up new businesses and co-operatives, as well as to provide training as well as job-guidance activities.

Investing responsibly: In the United Kingdom, pension funds and insurance funds, which together stand for about 40 % of the £1.5 trillion investment market have begun disclosing to which extents they take ethical, social and environmental criteria into consideration when making investment decisions. There is a growing demand from investors to know just how a company’s profits are being made and managed. An amendment to the Pensions Act that came into effect in July 2002 requires all pensions funds to disclose their ethical and social policies. The next important task facing the United Kingdom is to train investment analysts and fund managers in how environmental and ethical criteria should be used when making company forecasts and investment decisions.

Reintegrating the marginalized: the Irish Probation and Welfare Service has been working together with Business in the Community Ireland to provide offenders with training or job offers since February 2000. The Linkage Programme, as it is known, has in its just over two years of operation had 1,125 referrals of which 605 have been placed in either regular employment (over half) or training schemes. By having Probation and Welfare Officers refer offenders to Training and Employment Officers, a link to the job market or further education is established. The Programme is managed by a multi-stakeholder committee made up of representatives from the Probation and Welfare Service, the Irish Business and Employers Confederation (IBEC), the Small Firms Association, the Irish Congress of Trade Unions (ICTU) and Business In The Community Ireland. Such a partnership aims at developing a sense of ownership among communities about their offenders, since these people must return into the communities if the likelihood of more offending is to be reduced.

Founded in 1995 by former European Commission president Jacques Delors, CSR Europe is a business-driven membership network whose mission is to help companies combine profitability and sustainability by making corporate social responsibility a cornerstone of the way they operate. Through its 57 company members, 18 national partner organisations, benchmarking programmes and online resource centre (www.csreurope.org), CSR Europe has become the major European reference point on Corporate Social Responsibility strategies and practices for companies.

The Copenhagen Centre (TCC) is an autonomous, international knowledge centre established by the Danish Government in 1998. Focusing on social cohesion, TCC strives to promote voluntary partnerships between business, government and civil society in order to provide opportunities for the less privileged to be self-supporting, active and productive citizens. TCC serves as an intermediary for governments, businesses, social partners, NGOs and civil society organisations in developing forums for innovative activity and debate.