Paul Hohnen Sustainability Strategies

This article was published in Ethical Corporation on January 2, 2008.

From Mr PAUL HOHNEN

A prediction for 2008: We'll see more action from Governments on corporate social responsibility

UN member governments closed 2007 with heightened attention to CSR. This is to be welcomed, writes Paul Hohnen, but will need effective follow-up

With notable exceptions such as the UN Global Compact, the OECD Multinational Enterprise Guidelines and the ILO Tripartite Declaration, government support for corporate social responsibility (CSR) has never been very strong.

CSR is normally seen as non-regulatory initiatives by the business sector to show its good (corporate) citizenship, and hence the government role is marginal.

This situation, however, is gradually changing. The adoption on 5 December 2007 by the UN General Assembly of the resolution “Towards global partnerships” in many ways highlights the shift in thinking which is occurring.

The "global partnerships" resolution is significant in several respects.

First, it underlines recognition by UN member governments of the emergence — and importance — of voluntary partnerships between both public and non-public bodies in advancing the internationally agreed goals, such as the Millennium Development Goals (MDGs).

While stressing that such partnerships should be consistent with national laws, and should not be a substitute for government action, the resolution implicitly recognizes that the interplay of government, business and civil society roles has profoundly changed in recent years.

As the Secretary-General's own report to the General Assembly noted, “there is a growing recognition that many of the world's most pressing problems are too complex for any one sector to face alone”.

Building on this, second, the resolution calls upon “the international community” — meaning governments - to promote multi-stakeholder approaches in “addressing challenges of development in the context of globalization.”

In this context, it specifically mentions the UN Global Compact — a set of 10 principles to which businesses and others can commit their intention to follow - as an “innovative public-private partnership” to advance UN values and responsible practices.

Third, the resolution “encourages” the UN system to bring greater coordination, coherence and transparency to its own approach to partnerships, and to share lessons learned.

Probably reflecting concerns that there is sometimes too little evidence of the performance of partnership initiatives, governments also requested Ban Ki-moon to promote “impact-assessment mechanisms of partnerships”, to explore possible new partnerships (e.g. with the World Bank and WTO), and to report on progress next year.

For CSR jargon watchers, the resolution uses the term "corporate social and environmental responsibility".

It defines this in conventional terms as “taking into account not only the economic and financial, but also the developmental, social human rights, gender and environmental implications of their undertakings ... bringing such values and responsibilities to bear on their conduct and policy premised on profit incentives, in conformity with national laws and regulations.”

In short, CSR is becoming more firmly embedded on the UN agenda.

And none too soon.

Over the last decade, there has been a flourishing of innovative multi-stakeholder initiatives and instruments, both at the UN level, and at other levels.

While some of these involve governments directly, some have no government input. Still others have participation by intergovernmental agencies.

Many CSR initiatives have little or no multi-stakeholder character, being developed by a specific company or sector. Some are broad in scope, others are quite specific.

Some, like the ISO social responsibility standard now being developed, are likely to set real or de facto standards that are widely used in the market place, sometimes encouraging superior behaviour that local law may not require. Others, like the Global Reporting Initiative (GRI), are now being used by government to improve the transparency of government-owned companies. (The announcement last month by the Swedish authorities is an example.)

Most are transparent as to their mission, governance and funding, but many less so in relation to their specific impacts. As many users have experienced, moreover, it is sometimes unclear how and whether they relate to each other.

As the latest General Assembly resolution and the 2007 G8 Summit Declaration show, governments understand the need to support and track such developments more closely.

The focused contributions of the business sector and NGOs are essential if challenges such as sustainable development are to be addressed. Governments must play an active role in helping these sectors, and themselves, to work together more effectively.

Amsterdam-based, Paul Hohnen consults, speaks and writes on sustainability and CSR issues. www.hohnen.net. Mr Hohnen is a member of Ethical Corporation's editorial advisory board.