.
BUSINESS RESPECT
The free email newsletter on Corporate Social Responsibility
The current edition: In this issue, we review what should a socially responsible company be doing about genetically modified crops.
Subscribe here
Arguments against CSR and some answers
Definitions of Corporate Social Responsibility
Discussion
The Global Reporting Initiative - is it fit for purpose?
Translations
Companies in the News
Case studies of managing a crisis
Odwalla
Johnson & Johnson
and Tylenol
Exxon Valdez
Snow Brand Milk
Products
Emerging Issues
Drugs companies and AIDS
When to quit a bad country
Business Respect - CSR Dispatches No 83 - 16 Jun 2005
==================
An email newsletter with news and discussion focusing on corporate social responsibility globally, looking at the companies in the news and the emerging issues. Linked to the website at http://www.mallenbaker.net and produced every two weeks.
In this issue, we consider ISO's proposed new ISO 26000 social responsibility standard, and ask how valuable such a standard may be to businesses aiming to improve their performance.
In the news:
1. Kofi Annan calls on business to play bigger role in tackling poverty in Africa2. Japan: Mandom Corp pulls TV advertising slammed as racist
3. BP accused of 'showing two faces' on climage change
4. Citigroup agrees $2bn settlement over Enron
5. US: Tobacco lawsuit requested penalty slashed
6. Australia: HIH former deputy chairman cleared of dishonesty
7. Wal-Mart urged by investors to improve its reputation
8. New group to promote corporate responsibility for jewelry industry
9. Controversy over corporate citizenship award for Lukoil CEO
10. Andersen conviction on Enron overturned
11. Russia: Khodorkovsky meets expected fate whilst business wonders what next
12. Oil companies see the writing on the wall for their industry
13. Australia: Rio Tinto condemned by aboriginal people over business dealings
Feature articles on the internet:
1. The curse of anti-mining NGO stupidity - 2 Jun 2005 FROM Mineweb.net2. Khodorkovsky: And Just When Russia Became a Normal Country... - 1 Jun 2005 FROM Mosnews.com
===================
Topics:
WelcomeCSR News 16 Jun 2005
CSR FEATURES from the internet
Standards of Corporate Responsibiity
Want to read a hyperlinked version of this issue? You can find one on the website at http://www.mallenbaker.net/csr/nl/83.html.
Copyright 2004 Mallen Baker. All rights reserved. For information on how to subscribe, go to http://www.mallenbaker.net/csr/nl/subscribe.html
===================
Welcome
Well, our request for any stories of unsung heroes within the business - individual change agents who had helped to promote business change for responsible business practice - didn't quite get the sort of responses we had been hoping for. We did get several consultancies putting themselves forward as organisational change agents. Thanks for the responses, but not what we were looking for on this occasion!
This time around, we are focusing on CSR management standards. ISO has announced that it is hard at work on the proposed ISO 26000 social responsibility standard - a good time to reflect on the value of such tools to the business community.
Mallen is currently being kept busy with different aspects of the 'marketplace' work at Business in the Community, including the annual conference on 5-6 July which focuses much more this year on the responsibilities of companies in relation to their core products and services. It's an impressive line-up of senior businesses - see http://www.bitc.org.uk/events/events_calendar/annconf05.html for details.
We have now changed the vote on the website. The final tally for the previous vote is as follows:
When a world disaster strikes, business should consider whether to give support and conclude:
* Extraordinary events call for extraordinary generosity 673 (66%)
* Whether they should divert part of their existing community budget 174 (17%)
* That it is shareholders' money and not theirs to give 177 (17%)
Many thanks to the 1024 people who voted.
The new vote, in keeping with the focus of this issue is:
Management standards for CSR are generally:
* A useful tool for my business
* Something to refer to but not follow in full
* Not relevant to our needs
We do know that any of these questions can be laden with 'ifs' and 'buts'. Obviously, if someone were to invent the perfect management system that wholly encapsulated every aspect of running an excellent, socially responsible business, you would vote for the first option! You will just need to go on the basis of existing standards, such as SA8000, AA1000 et al.
Mallen Baker
Vanessa Wood
editors@mallenbaker.net
===================
CSR News 16 Jun 2005
Kofi Annan calls on business to play bigger role in tackling poverty in Africa
UN Secretary General Kofi Annan has said multinational corporations should play a more central role in tackling poverty in Africa during a corporate responsibility seminar.
The UN chief said that governments still bear the chief responsibility for achieving the UN Millennium Development Goals. But the active engagement of business is key, he said. "Business generates employment and wealth ... It is the absence of broad-based business activity, not its presence, that condemns much of humanity to suffering."
He said that 2,000 companies have signed up to the UN Global Compact for Business since its launch six years ago.
Japan: Mandom Corp pulls TV advertising slammed as racist
Cosmetics company Mandom Corp has said it is to stop showing a television commercial that was criticised for comparing black people and monkeys.
In the ad for facewipes, several black people wipe their faces whilst a chimpanzee wearing an afro wig imitates the action.
The company apologised for the offense it had caused, and said it had acted because it realised that adverts lacked 'an international sense of ethics'.
BP accused of 'showing two faces' on climage change
BP has been attacked by environmental groups for allegedly privately lobbying in Washington to block legislation to introduce a mandatory curb on greenhouse gases in the US.
The claims come just two days after BP joined a group of 12 companies urging the UK Prime Minister Tony Blair to back an initiative to reduce emissions.
Senator Jeff Bingaman has said that BP did not support his proposal in the US energy bill for compulsory limits on CO2 emissions. The company has said that it supports a different proposal from Republican Chuck Hagel focusing on the use of tax incentives to encourage emissions reductions.
The company said it did not believe that some of the other proposals would achieve the goal of reducing global warming.
Citigroup agrees $2bn settlement over Enron
Citigroup has settled a case that alleged the bank gave assistance to Enron to disguise its burgeoning debt brought by investors.
The settlement, similar in scale to one it made last year involving its work with Worldcom, was set at $2bn. The company said it had settled the case to remove the uncertainties around continued litigation, but has not admitted fault.
Deals with Citigroup accounted for a major part of the $1.3bn that Enron cited as net cash as it tried to avoid bankruptcy.
US: Tobacco lawsuit requested penalty slashed
US Justice Department lawyers made a dramatic change of heart in a major civil racketeering case against tobacco companies by slashing the requested penalty from $130bn to $10bn.
The penalty is intended to pay for promotional programmes to encourage smokers to quit. The government's case has been that six tobacco companies had taken part in a 50-year conspiracy to addict smokers and to hide the dangers of smoking.
Anti-tobacco campaigners expressed outrage, saying that the government's own experts had stated that the original figure was the right one for the scale of smoking cessation programme that was needed.
Australia: HIH former deputy chairman cleared of dishonesty
Charles Abbott, the former deputy chairman of HIH Insurance, has been cleared of charges of dishonesty in the lead up to the company's collapse.
The case focused on the fact that Mr Abbott had pressed for fee invoices owed to his own company, Ashkirk Pty, should be promptly paid the day before the company went into liquidation. The judge decided that a reasonable jury would not convict, as the prosecution did not dispute that the fees were owed and that Mr Abbott was entitled to prompt payment.
Payments were eventually made not only to Ashkirk Pty, but also to accountants KPMG and law firm Blake Dawson Waldron.
Wal-Mart urged by investors to improve its reputation
Some of the largest shareholders in Wal-Mart have written to the company urging action over the company's corporate reputation following a series of fines and class actions on workplace issues.
The letter, timed to coincide with the company's annual general meeting, argued that publicity around poor employment practices were beginning to impact on the company's share performance.
The shareholders, New York City Pension Funds, Illinois State Board of Investment, F&C Asset Management and the UK University Superannuation scheme - expressed 'serious concerns' about regulatory non-compliance.
New group to promote corporate responsibility for jewelry industry
A new business group, 'The Council for Responsible Jewellery Practices', has been set up with a founding membership including almost 20 industry organisations, including Jewellers of America.
In a seminar in Las Vegas, USA, the president and CEO of Jewellers of America Matthew Runci said that the fate of the industry depended on retaining the confidence of the consumer. This confidence could be seriously affected by issues such as conflict diamonds.
The new group will aim to establish corporate standards on social and environmental issues in a proactive approach covering all aspects of production including mining and retailing. These standards will then be promoted through the industry.
Controversy over corporate citizenship award for Lukoil CEO
An award for Corporate Citizenship for Vagit Alekprov, CEO of Lukoil, by the Woodrow Wilson International Center for Scholars and the Kennan Institute has created controvery, with allegations that the company has been seriously tainted in its business operations.
Alekprov become CEO of Lukoil in 1997, having previously been acting minister of energy following the collapse of the Soviet Union. From that time, critics argue that the company behaved without integrity, with links suggested between top officials and organised crime and corruption.
The Nation reported that Peter Reddaway, a leading defender of Soviet dissidents and former director of the Kennan Institute, sent a letter of protest to the Wilson Center detailing the allegations against Alekperov and posted a comment onto a Russian listserv: "Why is this obscure CEO of a company with uncertain reputation abroad and no record of achievement in the United States the right person to be honored by a leading federal institution, especially one established by Congress as 'our nation's official living memorial to President Woodrow Wilson'? Is it because the Center's board of trustees, who include Secretaries Condoleezza Rice, Margaret Spellings and Michael Leavitt, decided to honor Mr. Alekperov?".
The Woodrow Wilson Center Director defended the choice, and said that there was no evidence that Alekperov had been involved in criminal activity.
Andersen conviction on Enron overturned
Three years after the company was destroyed through its association with the Enron scandal, the US Supreme Court has overturned Arthur Andersen's criminal conviction for obstruction of justice.
The court found that the original jury had been given 'overly broad' instructions by the federal judge presiding. The finding is a significant blow for the Department of Justice, which proceeded with action against the big four accounting firm against a chorus of disapproval from various sides.
The recent ruling said that Andersen had been convicted without proof that its shredding of key documents had been an intentional undermining of a forthcoming enquiry.
Russia: Khodorkovsky meets expected fate whilst business wonders what next
Former Yukos boss Mikhail Khordokovsky has been jailed for nine years for offences including tax evasion and fraud. As the verdict was finally announced, Russian prosecutors said that they may soon bring fresh charges, and Khordokovsky said he would appeal against the verdict. Meanwhile, the business community and the outside world is trying to assess the implications.
Various observers have expressed great disquiet over the prosecution, which came as only the latest step in what had been a years-long campaign to dismantle Yukos. For example, US President Bush said that he had expressed concerns to Moscow that Khodorkovsky seemed to have been judged guilty before the trial had even begun.
Khodorkovsky, who is now seen by some as a martyr and by some business people as a beacon for corporate responsibility, said that he would continue his public activities from jail. However, others have drawn attention to the way that Russia's hugely wealthy Oligarchs made their money in the first instance, and suggest that Khodorkovsky has discovered social responsibility rather late.
Oil companies see the writing on the wall for their industry
In two separate initiatives, the major oil companies have begun to show that they are taking stock of the challenge of sustainable energy. In the UK, BP and Shell joined a group of 12 major business leaders in writing to the Prime Minister arguing that climate change is a huge challenge that needs serious investment by business. In a separate move, Exxon Mobil - long regarded as the industry's most optimistic business-as-usual operator - has produced a report that predicts an impending plateau in non-OPEC oil production.
The Exxon report, The Outlook for Energy: A 2030 View, suggests that there will be a peak in non-OPEC oil production in just five years. This will begin rapidly to produce higher prices for fuel unless OPEC decides significantly to boost production. It represents the first time an oil company has acknowledged the likelihood of such a forecast.
In the UK initiative, the business leaders - also including top bosses from HSBC, BAA, John Lewis and Scottish Power - support the government's targets of reducing CO2 emissions by 60%. In so doing, they pointedly contradict the main business lobby group, the CBI, which has opposed cuts as being a burden on business. The business leaders argue that they believe the cuts are achievable through improved efficiency and new technology.
Australia: Rio Tinto condemned by aboriginal people over business dealings
Rio Tinto's Pilbara Iron has been attacked following a meeting of more than 750 aborigines in Western Australia's Pilbara region for failing to meet its own social responsibility standards in dealing with traditional owners.
The meeting focused on the perceived gap between the booming demand for iron ore, a key resource for the region, and the lack of positive impact the ore extraction was having for local communities. Australia's Native Title Act now requires companies to negotiate with traditional owners, but the Pilbara Native Title Service said the company was still carrying out mining operations commenced before the Act was introduced.
Representatives from the group have called for Rio Tinto to fulfil a 'moral responsibility' to return some of the profits made back into the indigenous community.
CSR FEATURES from the Internet
The curse of anti-mining NGO stupidity - 2 Jun 2005 FROM Mineweb.net
While the mass media had a field day with AngloGold Ashanti's announcement Wednesday that it had paid protection money to a rebel group, unfortunately, it is not an isolated episode for international mining and exploration companies.
Nevertheless, Human Rights Watch is also notorious within industry circles for targeting major mining companies. However, the credibility of the study is overshadowed by two glaring missteps. First, the "study" relies on the now tried and true formula of supply chain elements now regularly regurgitated by NGOs seeking funding and publicity in the wake of the resounding success of their original "blood diamond conflict" strategy.
Khodorkovsky: And Just When Russia Became a Normal Country... - 1 Jun 2005 FROM Mosnews.com
On Wednesday, the Kommersant daily published for the first time an interview with convicted oil tycoon Mikhail Khodorkovsky that was recorded in 2002, when his Yukos oil company was one of the biggest in the world and one of the most successful and transparent in Russia. Now that Khodorkovsky has been given a nine-year prison sentence in Russia’s most talked-about trial, his old thoughts on his company, on Russian politics, and on the future have become particularly pertinent.
=================================
Standards of Corporate Responsibiity
Article by Mallen Baker
The International Standards Organisation has just completed a summit meeting in Korea on the future development of the proposed Corporate Social Responsibility standard ISO 26000. At the same time China has announced a new responsibility standard for the textiles and garments industry. Surely such standards represent progress. I wonder.
There are certain things that can be achieved reasonably well with management systems. Environmental management has shown itself over the last ten years to be one. After all, ISO 14001 is effectively about identifying impacts and managing processes to reduce them. Environmental issues are scientific in nature. Your process will produce a number of emissions and wastes. Redesigning the process, and improving efficiency, can reduce these. All you need to do is to apply human ingenuity to the problems, and then consistently manage and control the processes.
Quality is the same. No point in producing top quality products one time in three, if consistent monitoring and control of the process means that you can achieve zero defects.
Both approaches have their detractors, of course. Consistency is not the same as quality, and a process-driven approach isn’t necessarily as good as a customer-driven approach. But this is about what kind of system works best, not whether it is desirable to have a system at all.
Given the world impact of the ISO family to date, we should surely be enthused and excited about the prospect of – at last – a standard to define best practice in corporate responsibility into a management system that can achieve consistency. If one believes that corporate responsibility is all about how you create policies, objectives and targets, and then manage the processes to achieve these, then there is a lot in this. And, of course, there are significant parts of corporate social responsibility that are served well by this sort of approach.
But it’s not enough. Corporate social responsibility is often about how you resolve the dilemma of conflicting stakeholder demands that require a fine judgement. It is very often about leadership, and how a company can define its place as a shaper of the expectations of its marketplace.
Fundamentally CSR is about relationships. Stakeholders change their minds. They can punish you today for doing what they demanded yesterday. Building those relationships – and resolving the dilemmas that present themselves along the way is really rather more of an art than a science. It’s not something that easily lends itself to a standards-based approach.
Does this mean that an ISO standard would be of no value? It would be rather premature to reach this conclusion in advance of the final shape of the animal being visible. Nevertheless, what would be potentially very damaging would be for an ISO 26000 to become a badge of ethical quality, in the way that an ISO 9001 became so widely required by corporate customers as an easy ‘guarantee’ of quality from suppliers. Of course, the current description of 26000 is that of 'social responsibility guidelines' as opposed to a de facto management system standard. Thinking will no doubt evolve considerably before it is actually published - intended to be in 2008.
It would be interesting to make some real progress on finding ways to identify a good company. One of the most important would surely be some reflection of the ‘corporate personality’. When Enron was busy running all the best community programmes and environmental management systems, the only visible signs of a problem in advance of the final collapse were the stores that appeared occasionally highlighting an aggressive marketplace style – in short a corporate personality that suggested that any values base really went skin deep. There are other well feted companies with sparkling programmes whose business activities spark similar stories today. These are important intangible indicators. They rather defy a standards-led approach.
There’s nothing wrong with a good management system to encourage a quality approach to managing key aspects of corporate responsibility. It would just be good if this didn’t come to be the badge that defines a ‘good company’ – or perhaps more importantly if the broader understanding of what constitutes corporate social responsibility doesn’t come to be defined solely by what is covered by the ISO standard.
=================================
All content may be quoted with appropriate acknowledgement by any non-profit or non-commercial organisations. Others please contact editors@mallenbaker.net. No guarantees are made to the accuracy of any articles. This electronic publication is independently produced, and should not be taken as representing the views of any organisation.
For information on how to subscribe and for a website archive of issues, go to http://www.mallenbaker.net/csr/nl/index.htmlSend comments and editorial contributions to editors@mallenbaker.net
To unsubscribe go to http://www.mallenbaker.net/csr/nl/unsubscribe.php
|
INSTANT CSR VOTING! |
In the news from the latest issue
To make any comments / suggestions re. this site, please contact mallen@mallenbaker.net
Business Respect - most recent edition added on 17th August 2008