{"id":399,"date":"2019-04-24T15:09:48","date_gmt":"2019-04-24T15:09:48","guid":{"rendered":""},"modified":"2019-06-10T19:48:26","modified_gmt":"2019-06-10T19:48:26","slug":"corporate-social-responsibility-window-dressing-7738","status":"publish","type":"post","link":"https:\/\/www.lawteacher.net\/free-law-essays\/environmental-law\/corporate-social-responsibility-window-dressing-7738.php","title":{"rendered":"Is Corporate Social Responsibility just Window Dressing?"},"content":{"rendered":"

COURSE
\nASSESSMENT QUESTION:<\/strong><\/p>\n

\n

\u2018Corporate social responsibility (CSR) is nothing but window dressing. Not only is the scope of CSR unclear, its successful implementation into a legal framework is impossible to assess against qualitative criteria. Thus, the implementation of non-financial reporting requirements owing to <\/strong>Directive 2014\/95\/EU<\/strong><\/a> as part of corporations\u2019 annual reporting obligations is meaningless and distractive. <\/strong><\/p>\n<\/blockquote>\n

Bearing in mind the significant flexibility for corporations
\nto disclose relevant information and with reference to both relevant primary
\nand secondary sources, critically discuss<\/strong> the above statement.<\/p>\n

INTRODUCTION:                         <\/h2>\n

The concept of corporate social responsibility (CSR) has since the
\nmid-1990s, gained renewed force in public and political debates, about the
\nsocial responsibility of firms following the advent of transnational trade and
\nthe growth of multinational corporations (MNC).[1]<\/a>
\nThis rekindled interest in CSR and its relevance can be attributed to the
\neffect of globalisation, which introduces a more complex economic paradigm. [2]<\/a>\n<\/p>\n

The evolving global business environment creates moral burdens and
\nsocial obligations on businesses in their corporate relations with the various
\nstakeholders who are either directly or indirectly affected or have interest in
\ntheir business operations.[3]<\/a>
\nBesides adhering to the laws of the state, these business entities are expected
\nto fulfil social expectations by way of giving back to the society, part of the
\nbenefits they derive from the society within which they operate. What is most
\ncritical in today\u2019s corporate governance is the articulation of these social
\nobligations in terms of what is defined today as \u2018Corporate Social
\nResponsibility\u2019.[4]<\/a>\n<\/p>\n

The idea of CSR presupposes a mutual relationship between businesses,
\nstakeholders and the society.[5]<\/a> Sadly, most
\nbusinesses interpret this concept more as gratuitous and voluntary undertakings
\nborne out of their goodwill and not as a duty predicated on any legal obligation.
\nOthers use CSR as a tool for enhancing their corporate image and advertisement;
\npresenting impressive scorecards and cosmetic impression of good
\nneighbourliness without conforming to ethical standards.  While the early conception of CSR was less
\nproblematic because the actors were relatively limited to shareholders and
\ntheir customers, modern CSR tend to be more ambiguous in scope and hence,
\nproblematic. This is owing to the gradual departure from the traditional view
\nof CSR from the shareholder-centred perspective[6]<\/a>
\nto a more complex concept which integrates more stakeholders and other incidental issues like labour, human rights, bribery,
\nant-corruption and environmental matters within the scope of CSR.<\/p>\n

Interestingly, different laws
\nregulate most of these interrelated issues, which have been integrated into
\nCSR, thereby begging the question as to the very scope of CSR. The widened
\nscope also creates some uncertainties on the mechanisms for implementation of
\nCSR principles, in the light of its non-regulatory and voluntary nature, with
\nparticular reference to the EU Directive 2014\/95 on Non-financial reports of
\ncertain large organisations\/Undertakings.[7]<\/a> In
\ndiscussing the above statement, this work shall objectively analyse the
\nfollowing issues raised:<\/p>\n

    \n
  1. Is the scope of CSR unclear and not amenable to a legal framework?<\/li>\n
  2. Can the Directive 2014\/EU be effectively implemented?<\/li>\n
  3. Is CSR nothing more than window dressing?<\/li>\n<\/ol>\n

    MEANING AND SCOPE OF CSR<\/h2>\n

    The most fundamental question about CSR
    \nbothers on the true meaning.    [8]<\/a> Although
    \nthe term is widely invoked, it is seldom defined, and many of the ways in which
    \nit is actually used are either vacuous or ambiguous.    [9]<\/a> As
    \na result, even when the intentions of CSR advocates have been good, their
    \nrecommendations have often been damaging.    [10]<\/a>
    \nCSR is a wide concept with a variety of meanings.    [11]<\/a> <\/p>\n

    Mohr,
    \n    [12]<\/a>
    \ngroups the definitions into multidimensional and the concept of social
    \nmarketing. He posits that multidimensional definitions describe the major
    \nresponsibilities of companies while social marketing concept defines CSR at a
    \nmore theoretical level.    [13]<\/a>
    \nKotler    [14]<\/a>
    \nsimplifies this view, as he aptly explains that the social marketing concept
    \nrelates to positive impact of businesses on the society. He stresses that
    \nbusinesses should be carried out in a way that improves both the customer and
    \nsociety\u2019s wellbeing.    [15]<\/a>
    \nThis infers that necessity is laid upon businesses as a matter of obligation, to
    \ncarry out their operations in a socially responsible manner to minimise harm to
    \nboth humans and the environment, while responding to the legitimate demands of
    \nits stakeholders.    [16]<\/a>\n<\/p>\n

    Archie
    \nCarroll gives a more comprehensive definition of CSR.    [17]<\/a>
    \nHe explains that CSR includes four kinds of dimensions- economic, legal,
    \nethical, and philanthropic. To Carroll, each aspect of CSR can be tested in
    \nrelation to the various stakeholders of the company (e.g. customers, owners,
    \nthe community, employees and the public at large). Carroll is more authoritative
    \nas he expounds on the legal responsibility dimension of CSR, which means that
    \noperating within the ambit of the law is not a question of choice but a legal
    \nobligation. Although these definitions vary in level of abstraction and, appear
    \nquite different, they all emphasize that a socially responsible firm should have
    \nconcerns beyond short-term profitability.    [18]<\/a>
    \nThis is well captured by the World Business Council for Sustainable Development\u2019s
    \n(WBCSD)    [19]<\/a>
    \ndefinition CSR as \u2018the continuing commitment by business to behave ethically
    \nand contribute to economic development while improving the quality of life of
    \nthe workforce and their families as well as the local community and society at
    \nlarge\u2019.<\/p>\n

    Evidently,
    \nCSR is a well-directed effort to address the business concerns for social
    \nneeds.    [20]<\/a>
    \nIt is a strategy by which companies incorporate societal concerns in their
    \nbusiness operations and in their interactions with the different stakeholders
    \nand interest groups.    [21]<\/a>
    \nWhile the need for mutual benefits between businesses and the society forms the
    \nbasis for CSR, it\u2019s scope appears to be ambulatory, in line with the dictates
    \nof changing nature of business operations. As businesses continue to develop
    \ninto complex undertakings, with domineering influence and presence in almost
    \nevery sphere of the society and governance,    [22]<\/a>
    \nso has CSR evolved to cater for such development.    [23]<\/a>
    \nSome corporations have demonstrated significant control over the economic,
    \npolitical and even social sectors of most developing countries,    [24]<\/a>
    \nwithout a corresponding regulatory framework to checkmate this overwhelming
    \ninfluence. With greater influence comes greater demands and expectations from
    \nthe society and this accordingly expands the scope of CSR from the traditional
    \nshareholder-centred perspective    [25]<\/a>
    \nto a modern view which accommodates more stakeholders and incidental issues
    \narising from corporate relations,    [26]<\/a>
    \nlike human rights, environment, labour and anti-corruption.    [27]<\/a>\n<\/p>\n

    Whilst
    \nthis justifies the expanding scope of CSR and the renewed interest by the
    \ngovernment,    [28]<\/a>
    \nit however creates uncertainty as regards the utilitarian value of the expanded
    \nscope without a corresponding distinct legal framework, because most of the business-related
    \nissues like human rights, anti-corruption, labour and environment which have
    \nbeen subtly incorporated into the scope of CSR are regulated by their
    \nrespective laws. There appears to be no corresponding legal framework to
    \ncomplement the expanded scope of CSR, even from the various definitions given
    \nby various authors and writers referred above, except as thinly introduced by
    \nCarroll in his \u2018legal responsibility\u2019 classification of CSR. This apparently
    \ntends to justify the assertion that \u2018not only is the scope of CSR unclear, its successful implementation
    \ninto a legal framework is impossible to assess against qualitative criteria.\u2019\n<\/p>\n

    Aligning
    \nwith the above submission completely would be prejudicial to the various international
    \nprinciples and soft laws (like the OECD, UN Global Compact, GRI, UN Draft Code of Conduct on Transnational Corporations,    [29]<\/a>
    \nthe Ruggie Framework    [30]<\/a>
    \nwhich
    \nhave tried to establish a legal basis for CSR, albeit in the absence of a
    \ndefinite legal framework to ensure compliance.
    \n    [31]<\/a>
    \nThus, a careful analysis of few of these international initiatives and efforts
    \nby States gives glimpse of hope of the possibility of a successful
    \nimplementation CSR into a legal framework and technically punctures the above
    \nstatement.<\/p>\n

    INTERNATIONAL FRAMEWORK FOR IMPLEMENTATION OF CSR<\/h2>\n