MODULE 2

INTERNATIONAL
FRAMEWORKS
GLOBAL PRINCIPLES AND
GUIDELINES
 The International Frameworks of CSR

ILO’S TRIPARTIRE

United Nations Global

Compact OCED GUIDLINES

ISO 26000: Social

Un Guiding Principles responsibility
 UNITED NATIONS GLOBAL COMPACT
• The united nations had initiated in 2000 a global compact to encourage the businesses to adopt
sustainable and social responsibility policies and to report on their implementation

• This is a framework based on the principles in the areas of human rights, labour, environment and
anti-corruption.

• Under the global compact the companies are brought into through the cities program with un
agencies. There are 193 united nations member states in the united nations

• It was announced in January 31, 1999 and was officially launched at UN Headquarters in new
york on July 26, 2000.
Human Rights
• Principle1:Business should support and respect the protection of internationally proclaimed
human rights
• Principle 2: Make sure that they are not complicit in human rights abuses
Labor
• Principle3:Business should uphold the freedom of association and the effective recognition
of the right to collective bargaining;
• Principle 4: The elimination of all forms of forced and compulsory labor;
• Principle 5: The effective abolition of child labor;
• Principle 6: The elimination of discrimination in respect of employment and occupation.
Environment
• Principle 7:Businesses should support a precautionary approach to environmental
challenges;
• Principle 8: Undertake initiatives to promote greater environmental responsibility;
• Principle 9: Encourage the development and diffusion of environmentally friendly
technologies.
Anti- Corruption
• Principle 10: Businesses should work against corruption in all its forms, including extortion
and bribery
 INTERNATIONAL ORGANIZATION ON
STANDARDIZATION (ISO 26000)
• It is a non-governmental body made up with the members of the National Standard Bodies around the world.

• They give world-class specifications for products services and good practice, to ensure quality, safety and

efficiency.

• Since 1947, ISO has published more than 19,500 International Standards to date covering almost every industry,

from technology, to food safety, to agriculture and healthcare

• ISO 26000 provides guidance on how businesses and organizations can operate in a socially responsible way.

• This means acting in an ethical and transparent way that contributes to the health and welfare of society.
 Labour practices
Organizational governance – Human rights
providing just, safe and healthy
accountability and transparency treating all individuals with conditions for workers;
at all levels; respect; making special efforts
to help members of vulnerable engaging in two-way
leadership promotes
groups discussions to address workers’
responsibility
concerns

Environment Fair operating practices Consumer issues

identifying and improving respecting the law; practicing providing healthy and safe
environmental impacts of your accountability and treating all products, giving accurate
operations, including resource partners fairly, including information, and promoting
use and waste disposal suppliers sustainable consumption

Community involvement and

development
Being involved as a good
neighbor for the betterment of
local community.
 THE CORE SUBJECT AND THE ISSUES COVERED
Core Subject Issue Covered
Organizational Governance • Decision making system to put into practice the
principles of social responsibility
Human Rights • Due diligence
• Human rights risk situations
• Avoidance of complicity
• Resolving grievances
• Discrimination and vulnerable groups
• Civil and politics rights
• Economic, social and cultural rights
• Fundamental principles to rights at Work

Labour Practices • Employment and Employment relationships

• Conditions of work and social protection
• Social dialogue
• Health and Safety at work
• Human development and training in the workplace
 THE CORE SUBJECT AND THE ISSUES COVERED
Core Subject Issue Covered
Environment • Prevention of pollution
• Sustainable resource use
• Climate change mitigation and adaptation
• Protection of the environment, biodiversity and restoration
of natural habitats
Fair Operating Practices • Anti-Corruption
• Responsible political involvement
• Fair Competition
• Promoting Social responsibility through Value chain
• Respect for Property Rights

Consumer Issue • Fair marketing, factual and unbiased information and fair
contractual practices
• Protecting consumers’ health and safety
• Sustainable consumption
• Consumer service, support, and complaint and dispute
resolution
• Consumer data protection and privacy
• Access to essential services
• Education and awareness
 THE CORE SUBJECT AND THE ISSUES COVERED

Core Subject Issue Covered

Community involvement and development • Community involvement
• Education and culture
• Employment creation and skills development
• Technology development and access
• Wealth and income creation
• Health
• Social investment
 ILO’s Introduction

• The ILO (International Labour Organization) is the United Nations international organization responsible for

creating and overseeing international labour standards.

• The only tripartite U.N. agency, since 1919 the ILO brings together governments, employers and workers of 187

member States

• To promote and realize fundamental principles and rights at work

• To create greater opportunities for women and men to secure decent employment and income

• To enhance the coverage and effectiveness of social protection for all

• To strengthen triparty & social dialogue

 Aim and Scope
• Multinational enterprises play an important part in the economies of most countries and in international economic relations.
This is of increasing interest to governments as well as to employers and workers and their respective organizations.

• The aim of this Declaration is to encourage the positive contribution which multinational enterprises can make to
economic and social progress and the realization of decent work for all; and to minimize and resolve the difficulties to
which their various operations may give rise.

• This aim will be furthered by appropriate laws and policies, measures and actions adopted by the governments, including in
the fields of labour administration and public labour inspection, and by cooperation among the governments and the
employers’ and workers’ organizations of all countries.

• This Declaration sets out principles in the fields of employment, training, conditions of work and life, and industrial
relations which governments, employers’ and workers’ organizations and multinational enterprises are
recommended to observe on a voluntary basis; its principles shall not limit or otherwise affect obligations arising out of
ratification of any ILO Convention
 ILO’s tripartite declaration
Employment Employment promotion (Increased Employment)
Social security
Elimination of forced or compulsory labour
Effective abolition of child labour: Minimum age and worst
forms
Equality of opportunity and treatment
Security of employment
Training
Conditions of work and life Wages, benefits and conditions of work
Safety and health
Industrial relations Freedom of association and the right to organize
Collective bargaining
Consultation
Access to remedy and examination of grievances
Settlement of industrial disputes
www.ilo.org/business.
 OPERATIONAL TOOLS
Promotion

• Regional follow-up
• Promotion at the national level /promotion by tripartite appointed national focal
points
• Promotion by the International Labor Office

Company-union dialogue

• This procedure gives effect to the need to support dialogues involving

multinational enterprises and the representatives of the workers affected, in
particular trade unions, on the application of the principles of the MNE
Declaration.
 OECD - Introduction
• The Organization for Economic Co-operation and Development (OECD) is an international organization that

works to build better policies for better lives.

• Today, our 36 member countries span the globe, from North and South America to Europe and Asia-Pacific.

They are represented by ambassadors, who are part of the OECD Council

• India is not a member, but it is an implementation partner

 OECD - INDIA
• Highlights - The OECD Council at Ministerial level adopted a resolution on 16 May 2007 to strengthen co-

operation with India, as well as with Brazil, China, Indonesia and South Africa, through a program of enhanced
engagement, defining these countries as Key Partners of the OECD.

• As a Key Partner, India is included in OECD analysis and statistical databases. Its participation in OECD bodies and fora
is encouraged as a means of allowing Indian policy makers to benefit from the OECD’s technical expertise and analytical
capacity.

• Mutual benefits - OECD statistics, sector-specific country reviews and targeted joint activities are key to

advancing India’s domestic reform agenda while increasing the OECD’s relevance in global governance.

• This interaction also benefits OECD members and other Key Partners’ engagement with India as a major player in the
global economy.
 OECD - INDIA
• Coordination - The Global Relations Secretariat co-ordinates OECD-wide co-operation with India, pursuing a

mutually beneficial strategic orientation to engage central and state governments, business associations, and think tanks

• Area of Work - OECD-India collaboration continues to build, in areas such as anti-corruption, corporate

governance, economic policy, environment, fiscal relations, as well as, responsible business conduct, steel, taxation, trade
and investment.
 OECD Guidelines
General policies Comply with domestic laws and regulations & prevent
negative impacts in regard to human rights, workers’ rights,
the environment and corruption
Disclosure of information on business activities Expected to publish information on their business activities
and financial performance on a regular and transparent basis
Human rights Expected to find ways to prevent negative impacts on human
rights and to take corrective action in the case of negative
impacts
Employment and industrial relations Should respect the rights of their workers and engage in
cooperation with the workers’ representatives
Environment Multinational enterprises are urged to prevent and mitigate
negative impacts on the environment
Combating bribery, bribe solicitation and Fight against corruption and bribery by taking internal control
extortion and ethical conduct.
Consumer interests Should observe fair and honest marketing practices and
ensure that their products and services are safe and of high
quality.
 OECD Guidelines
Science and technology An impact on economic and social development by spreading
new technologies around the world
Competition Comply with the applicable competition laws and refrain from
actions that restrict competition
Taxation Emphasize that enterprises should act in accordance with the
spirit and letter of the tax regulations in their countries of
operation
 UN Guidelines
• The UN Guiding Principles on Business and Human Rights are the authoritative global standard on

business and human rights.

• They were proposed by UN Special Representative on business & human rights, John Ruggie, and

endorsed by the UN Human Rights Council in June 2011.

• These Guiding Principles apply to all States and to all business enterprises, both transnational and

others, regardless of their size, sector, location, ownership and structure

 How are they relevant for the company ?
• Companies may cause negative impacts, for example if employees are injured due to unsafe working
conditions, or if companies displace communities from their lands and livelihoods without due process and
compensation;

• Companies may contribute to negative impacts, for example if their purchasing practices incentivize
suppliers to force workers into unpaid overtime to meet contract requirements, or if multiple companies drain
or pollute the water resources essential for local communities’ drinking supply;

• Companies' operations, products or services may be linked to negative impacts, for example if forced labor
or child labor is used to harvest ingredients or make components that go into their products or if a technology
company's equipment is used by government security forces to track, imprison and harm end-users, despite
the company's reasonable efforts to avoid these outcomes.
 How to prevent negative impacts on human rights?
• A public commitment to respect human rights that is embedded into a business’s culture

• An ongoing process of human rights due diligence through which the business assesses risks to human

rights, integrates the findings into its decision making and actions in order to mitigate the risks, tracks the

effectiveness of these measures, and communicates its efforts internally and externally

• Processes for providing remedy to anyone who is harmed where the business caused or contributed to that

harm.
A. The three pillars of the UN Guiding
Principles
• One of the major and widely recognized contributions of the Guiding Principles has been to clearly set out the
duties of States and the responsibilities of companies to ensure that businesses operate with respect for human
rights.

• The Guiding Principles are founded on three pillars:

• The State duty to protect human rights against abuse by third parties, including business, through appropriate
policies, legislation, regulations and adjudication;

• The corporate responsibility to respect human rights, meaning to act with due diligence to avoid infringing on
the rights of others and address adverse impacts with which they are involved;

• The need for greater access to effective remedy, both judicial and non-judicial, for victims of business-related
human rights abuse.

• Since their endorsement, the Guiding Principles have driven a convergence in standards on business and human
rights across the international arena, reinforcing their position as the authoritative global standard on business and
human rights.
B. The corporate responsibility to respect
human rights
• The Guiding Principles make clear that companies should have in place:

• A statement of their policy commitment to respect human rights;

• A human rights due diligence process to:

• assess their actual and potential human rights impacts;

• integrate the findings and take action to prevent or mitigate potential impacts;

• track their performance;

• communicate their performance;

• Processes to provide or enable remedy to those harmed, in the event that the company causes or contributes
to a negative impact.
 KEY FEATURES OF THE CORPORATE
RESPONSIBILITY TO RESPECT HUMAN RIGHTS

• The responsibility relates explicitly to the risks to human rights that can result from companies’ activities
and business relationships

• Identifying and addressing human rights risks effectively requires an understanding of the perspectives of
those who may be impacted

• The responsibility to respect human rights applies across the company’s own activities and also to its
business relationships

• The responsibility to respect human rights is distinct from a company’s efforts to support or promote
human rights
C. The ongoing nature of implementation
• Implementing the corporate responsibility to respect human rights takes time. Moreover, for many
companies, the nature of human rights risks associated with their operations, products or services
will change over time, as their operating contexts, activities and business relationships also change.
Implementation is therefore an ongoing process.

• The steps defined in the Guiding Principles empower companies to know and show that they are
advancing adequately in their efforts to meet this responsibility.

• The expectation that companies should know and show how they are progressing in their human
rights performance has reinforced calls for more and better corporate reporting in this regard.
Issues in Indian Economy and
Social Development
Population Growth Deteriorating Infrastructure Corruption

Intolerance – Everything From

Shaming Religion And Art To Personal Baseless Criticism
Choices

Blind Faith In The Air, Sound And Water

Hygiene And Sanitation
Government Pollution

Huge Dependence on
Women’s Safety Low level of Technology
Agriculture
Corporate Governance and CSR
 What Is Corporate Governance?
• It refers to the rules, practices and processes that govern corporations.

• Board directors and managers are the major players, along with employees, vendors and other stakeholders of
CG

• Compliance requirements, regulations and laws ensure that corporations are fair to their shareholders,
consumers and employees.

• It also provides a process for corporations to compete fairly within their industries.

• Corporate best practices evolved as a standard of basic principles for corporations to strive for to demonstrate
that they’re governing themselves well, and that they’re operating with honesty, integrity and accountability
Factors of Corporate Governance
 CG and CSR
• In general, relationship between CSR and CG is studied using two concurrent theories, which are
Stakeholders’ Theory and Agency Theory.

• It implies that there is an expectation from community that company will work in an ethical way and it will
be socially responsible. Thus, managers act ethically and show such ethical act in order that people perceive
it. When a manager lose credibility, hardly it will be recovered.

• The reputation of the company can be enhanced by CSR and CG, both working together.

• It can strengthen the relations with key stakeholders and can mitigate agency conflicts. In this way,
engagement in CSR would be positively related to effective mechanisms for CG

• CG attributes play a vital role in ensuring organizational legitimacy through CSR disclosures.
 CG and CSR
• The social responsibility activities that address internal social value, as the companies' relationship with their
employees and the quality of products, increase the company's value more than other CSR sub categories of
external social improvement, for example, relationship with community and environmental concerns

• The strong family presence in the board of directors has led to the emergence of a culture where the values of
corporate governance mechanisms are not always properly appreciated by the management.

• Thus, their results suggest that pressures exerted by external stakeholder groups and corporate governance
mechanisms involving independent outsiders may allay some concerns relating to family influence on CSR
disclosure practices.
Sustainable Development
 What Is Sustainable Development ?
• It is the development that meets the needs of the present, without compromising the ability of future
generations to meet their own needs

• It is responsibility for the impact that the organization exerts on its surroundings, in business, environmental
and social terms. Conscious management of the impact translates into lower costs, improved external
relations and better managed risks.

• It is skilled positioning of the organization in the economic reality, taking account of the social and
economic challenges, environmental opportunities and threats.

• It is transformation and development of the organization as well as creation of its long-term value based on
innovation as well as intellectual and relation capital.
 Benefits of Sustainability
• Improved brand image and competitive advantage
• Increase productivity and reduce costs
• Increase business ability to comply with regulation
• Attract employees and investors
• Reduce waste
• Make shareholders happy
Thank You 