Multi-stakeholder forum issues CSR recommendations

In June 2004, the EU 'multi-stakeholder forum' on corporate social responsibility (CSR) issued its final report after 20 months of deliberations. The report contains nine concrete recommendations on how to encourage the development and implementation of CSR strategies.

The issue of corporate social responsibility (CSR) has been a focus of interest at European level for some time. The most recent initiatives have followed the Lisbon European Council summit on economic and social issues, held in March 2000 (EU0004241F), which called on companies to promote a sense of responsibility in order to achieve the EU’s strategic goal of becoming the most competitive economy in the world by 2010.

After the Lisbon Council, the European Commission began to look in more depth at CSR issues. It issued in July 2001 a green paper on the topic of CSR (EU0107228F) in which it asked for views on this issue from interested parties.

This was followed in July 2002 by a Communication in which the Commission outlined a strategy on CSR, entitled Corporate social responsibility: A business contribution to sustainable development (EU0207205F). In this Communication, the Commission called for a new social and environmental role for business in a global economy. It focused in particular on how to promote CSR practices among small and medium-sized enterprises (SMEs). One of its main proposals was to set up a new 'European multi-stakeholder forum' to examine a range of CSR-related issues.

The EU multi-stakeholder forum on CSR was thus set up in October 2002 (EU0211205F). The forum's brief was to create a common understanding of CSR and enhance its credibility and effectiveness in helping to achieve EU economic, social and environmental aims. More specifically, the aim was to promote innovation, convergence and transparency in existing CSR practices. The forum also examined a range of CSR tools, including codes of conduct, labels, reports and management instruments. In particular, it focused on four main issues:

  • improving knowledge of CSR and facilitating the exchange of experience and good practice;
  • the situation of SMEs and how to foster the concept of CSR among these companies;
  • increasing the transparency of CSR practices and tools; and
  • examining the development aspects of CSR.

The forum was made up of some 20 EU-level representatives of enterprises, trade unions, non-governmental organisations (NGOs), investors, consumers and other 'stakeholders' in this area.

The forum's report

After 20 months of intense discussions, the forum issued its final report on 29 June 2004. The report draws on the work of four thematic round tables that examined the following issues:

  • knowledge;
  • SMEs;
  • development aspects; and
  • transparency.

In total, 12 round-table meetings were held, at which 50 concrete company experiences were presented and discussed.

The report contains nine 'mutually reinforcing' recommendations addressed to enterprises and their stakeholders, public authorities and EU institutions. These are set out below.

Raising awareness of core values and key principles embodied in reference texts

The forum recommends that public authorities and all other stakeholders increase awareness of the key principles and reference texts in the field of CSR. This could be achieved in a variety of ways, including codes of practice, collective agreements, partnerships and global framework agreements.

Stakeholders should ensure that they cooperate, particularly in the area of how to turn values and principles into practice.

Collecting, exchanging and disseminating information about CSR

The forum recommends that all stakeholders contribute to the process of collecting, exchanging and disseminating information about CSR and that, in order to make information publicly and easily available, there should be a European multi-stakeholder-run internet portal.

Researching and improving knowledge about and action on CSR

The forum states that there is a lack of empirical research on CSR and therefore recommends that more comparative, qualitative research be undertaken, and in particular multi-disciplinary, multi-stakeholder and 'action' research, based on real case studies. Special attention should be paid to areas such as:

  • the impact at the macro level of CSR on competitiveness and sustainable development;
  • the integration of social and environmental criteria in public procurement and the impact of this;
  • supply-chain issues and partnerships between large and smaller companies;
  • the relationship between corporate governance and CSR; and
  • making CSR information accessible to consumers, investors and the public.

Enhancing the capacity of business to understand and integrate CSR

The forum recommends that there should be more cooperation within and between companies, business organisations and stakeholders concerning the development and implementation of CSR policies. Further, the general availability of easily accessible, ready-to-use, practical information and advice on how to secure 'coherent, incremental implementation' of CSR should be increased. There should also be more exchange of experience between purchasers and suppliers so as to build capacities in sustainable supply-chain management.

For companies that are trying to integrate CSR into their daily business operations, the forum recommends that they: adapt tools to take account of their needs and circumstances; be willing to examine their performance against their CSR objectives; offer appropriate training to people working on CSR issues; and focus on developing internal learning opportunities in the area of CSR.

Building the capacity of 'capacity builders'

There are certain organisations that can play a catalysing or support role for companies in the area of CSR. These include business advisors, consumer organisations, investors, trade unions and the media. The forum therefore recommends that these organisations develop relevant understanding, skills and capacities in the area of CSR. In particular, business advisors and support organisations should, if they wish, develop know-how on effective CSR practices and assist businesses in their CSR efforts. Finally, public authorities, companies and other stakeholders should support capacity-building activities.

Including CSR in education and the curriculum

The forum states that business schools, universities and other education institutions have an important role to play in building the necessary capacity for CSR strategies. It therefore recommends that CSR and related topics be mainstreamed into traditional courses, in the curricula of future managers and graduate students, in executive education and in other educational institutions.

Creating the right conditions for CSR

The forum makes a range of recommendations under the heading of 'creating the right conditions for CSR'. It calls on EU institutions and governments to step up their efforts towards a more coordinated policy approach. It also calls on public authorities to ensure that there is both a legal framework and the right economic and social conditions in place to allow companies that want to implement CSR to benefit from this in the marketplace, both in the EU and globally.

In the case of companies, the forum recommends that they: ensure that information reaching different stakeholders is meaningful and credible; identify the items that are pertinent to the company’s vision and objectives; and use relevant tools and frameworks to help them in the development of CSR strategies. Further, it recommends that information about Socially Responsible Investment (SRI) and other funds and their approach to CSR be made accessible so that potential investors and companies can understand, evaluate and use them better.

Developing stakeholder dialogue

Maintaining that constructive dialogue is very important in furthering the aims of CSR, the forum recommends that companies and stakeholders contribute to this. There should be a clear understanding of roles and expectations and a willingness to pursue 'innovative, inclusive and dynamic cooperation'. It stresses that dialogue with employees and trade union/worker representatives at company level is particularly important.

The role of public authorities and the EU

The forum recommends that EU institutions and governments be consistent across policy areas and set a context for CSR. They should also assist countries to ratify and implement international conventions protecting human and social rights and the environment.

Public authorities should recognise the role they can play in driving CSR and should evaluate how to use public funds in the most responsible and effective manner.

Commentary

The multi-stakeholder forum's report is without doubt a valuable contribution to the European debate on CSR. By bringing together representatives from all areas involved in CSR, it has succeeded in representing the view from all sides. Having looked at 50 concrete case studies, its recommendations are addressed to all stakeholders, urging them to take practical action in a range of areas to further the development of CSR and encourage those already involved in its implementation or who want to begin to put CSR into practice.

The Commission will now assess the progress of its CSR strategy and is expected to adopt a new Communication on the issue by the end of 2004. (Andrea Broughton, IRS)

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