Law and Corporate Social Responsibility
Responsibility, obligation and liability; these words are almost synonymous. Yet, when they are affixed to the word: corporation, the debate shifts to whether the present body of laws are applicable. Wells (2000) explains:
Until recently only two mechanisms for attributing criminal fault to corporations have been recognized: the vicarious principle, simply: an employer or principal is liable for many of the acts of any employee or agent; and the doctrine of identification, i.e., certain key personnel are said to act as the company.
At the 40th Annual Session of UNCITRAL, Seward Montgomery Cooper, the Chief Counsel for Good Governance of the African Development Bank, points out:
In analyzing the Canadian reaction to financial scandals seeking whether they produced changes in law, regulations, or attitudes that had lasting impact, Madelaine Drohan (2005) finds similar reasons why these mistakes are doomed to be repeated in the future.
Alizon (Jeffrey) Azer used an analogy: CSR is to a code of conduct what democracy is to a constitution, albeit with one critical distinction — constitutions are enforceable whereas codes of conduct are not. Corporations insist that governmental regulation of CSR would stifle progress, quash innovation, and siphon funds from social and environmental programs (2002: 16), yet
Some companies have made sincere efforts to change their behavior, taking social and environmental impacts seriously and genuinely consulting with local communities. Others, because of the voluntary aspect of CSR, have unfortunately focused their energy and resources in changing public perception of their projects, rather than changing their behavior or actual societal impacts. Using a 15-year panel dataset on nearly 3,000 publicly traded companies, Matthew J. Kotchen & Jon Jungbien Moon’s preliminary empirical investigation (2007) finds:
Bede Nwete (2007: 339) suggests creating a balance, such as:
Moreover, assessing the impact of corporations on society, UNCTAD (2004) states:
Azer, Alizon (Jeffrey) (2002). The Ethics of Corporate Social Responsibility: Management Trend of the New Millennium?. Sheldon Chumir Foundation for Ethics in Leadership, June 2002. p. X. back to text.
Cooper, Seward Montgomery (2009). Corporate Governance in Developing Countries: Shortcomings, Challenges & Impact on Credit, Proceedings of 40th Annual Session of UNCITRAL Modern Law for Global Commerce, Vienna. 9-12 July 2007. Vienna: UNCITRAL. back to text.
Drohan, Madelaine (2005). Scandals and their Aftermath: Why We Are Doomed to Repeat Our Mistakes. Sheldon Chumir Foundation for Ethics in Leadership, April 2005. pp. 28—29. back to text.
Javillier, Jean-Claude (2008). Corporate Social Responsibility and law: Synergies are needed for sustainable development, Governance, International Law & Corporate Social Responsibility. Research Series 116. Geneva: International Labour Organization (International Institute for Labour Studies), 2008. p. 61. back to text.
Kotchen, Matthew J. & Moon, Jon Jungbien (2007). Corporate Social Responsibility for Irresponsibility. Santa Barbara, CA: Donald Bren Hall, University of California, Santa Barbara,, 04 September 2007. p. X. back to text.
Nwete, Bede (2007). Corporate Social Responsibility and Transparency in the Development of Energy and Mining Projects in Emerging Markets; Is Soft Law the Answer?. German Law Journal, 08:04. April 2007. pp. 311—340. back to text.
United Nations Conference on Trade and Development [UNCTAD] (2004). Disclosure of the Impact of Corporations on Society: Current Trends and Issues. New York and Geneva: United Nations Conference on Trade and Development [UNCTAD], August 2004. p. 4. back to text.
Wells, Celia (2000). Criminal Responsibility of Legal Persons in Common Law Jurisdictions. Paris: Working Group on Bribery in International Business Transactions, OECD Anti-Corruption Unit, 04 October 2000. 10pp. back to text: 1 | 2.
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