Corporate Social Responsibility: Gaining steam

Transparency International (TI) Germany’s work in support of strengthening adherence to the OECD Guidelines for Multinational Enterprises got a boost on July 4th when the European Women Lawyers Association (EWLA) adopted a “Resolution on Corporate Social Responsibility in Europe”. The resolution urges European lawmakers and corporations to commit to corporate social responsibility (CSR) as a key component in the protection of fundamental rights and strengthening of market competitiveness. In view of the crucial role that the OECD Guidelines for Multinational Enterprises could play in achieving this goal, the EWLA recommended that:

  • the European Commission introduce legislation requiring companies incorporated in a Member State to disclose their implementation of the OECD Guidelines for Multinational Enterprises;
  • an independent European monitoring mechanism be created for corporate behaviour and compliance with European law on corporate social responsibility;
  • EU Member States co-ordinate their activities within the OECD to improve the effectiveness of the OECD Guidelines for Multinational Enterprises. They should aim at extending the applicability of these Guidelines to the financial sector and trade, as well as at introducing rules that ensure the independence of National Contact Points and an effective follow-up process;
  • European institutions and the Member States widely disseminate the OECD Guidelines within the business community and among NGOs. (EWLA)

The Guidelines are a set of social, labor, environmental and anti-corruption standards developed by the OECD for transnational companies based in or operating from their territories.  A total of 41 nations – 30 OECD governments and 11 non-member states – have endorsed the Guidelines as a basic component of responsible corporate conduct. While the Guidelines are voluntary for companies, they have been useful for promoting corporate accountability. Adhering countries are bound by inter-governmental agreement to set up a ‘National Contact Point’ (NCP) whose function, amongst others, is to respond to complaints arising from alleged violations.

TI Germany has used the OECD Guidelines to lodge various complaints against corrupt business practises. The objective in all cases raised by TI-Germany was to remind the German government of its responsibility to promote adherence to the Guidelines’ anti-corruption provision and encourage companies that had failed to do so to improve their precautionary measures.

Due to the highly restrictive interpretation of the Guidelines practised by the German NCP, TI Germany has joined hands with other NGOs in lobbying the German Parliament and relevant ministries to change the institution charged with overseeing adherence to the Guidelines. The groups are calling for the transfer of these responsibilities from the Ministry of Economics to a wider based, more independent and pro-active institution. Similar concerns and aspirations have led national parliaments in countries like Britain, Canada, the Netherlands and others, to call for a variety of changes. Some cases have already produced significant reforms in the institutional arrangements, funding and operational procedures of NCPs.

The recommendation of the European Women Lawyers Association to introduce rules that ensure the independence of the National Contact Points, and thereby improve the effectiveness of the OECD Guidelines and CSR, is warmly welcomed support.

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