Trends and Developments in Corporate Social Responsibility

- The Global Compact Perspective -

Tel Aviv, 30 January 2008Matthias Stausberg, UN Global Compact

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The UN and Business: A Partnership of Shared Interests

Building Markets

Good Governance& Security

Environment

Profit&

GrowthSocial Inclusion

Business

Global Health

Deepening Interdependencies

United Nations

Peace&

PovertyReduction

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The Global Compact – Overview

Launched on 26 July 2000 in New York with roughly 40 businesses Launched on 26 July 2000 in New York with roughly 40 businesses

UN Convention Against Corruption UN Convention Against Corruption

Rooted in universally accepted conventions:Rooted in universally accepted conventions:

Universal Declaration of Human RightsUniversal Declaration of Human Rights

ILO Declaration ILO Declaration

Rio Declaration Rio Declaration

Multi-stakeholder platform for collective action Multi-stakeholder platform for collective action

“A more sustainable and inclusive global economy.”“A more sustainable and inclusive global economy.”

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The 10 Global Compact Principles

Human Rights Principle 1: Businesses should support and respect the protection of internationally

proclaimed human rights; and Principle 2: make sure that they are not complicit in human rights abuses.  

Labour Standards Principle 3: Businesses 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 labour; Principle 5: the effective abolition of child labour; and 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; and Principle 9: encourage the development and diffusion of environmentally friendly

technologies   

Anti-Corruption Principle 10: Businesses should work against all forms of corruption, including extortion

and bribery. 

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Two Complementary Objectives

Facilitate partnerships in support of broader UN goals.

Facilitate partnerships in support of broader UN goals.

Make the ten principles part of business strategy, operations and

culture everywhere.

Make the ten principles part of business strategy, operations and

culture everywhere.

Implementation

Implementation

Contribution to

Development

Contribution to

Development

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The GC in 2007: Facts & Figures

Over 3700 active business participants in 120+ countries Over 3700 active business participants in 120+ countries

60+ active local networks around the world 60+ active local networks around the world

Launches in 2007: Jordan, Vietnam, Korea, Senegal, Ivory Coast Launches in 2007: Jordan, Vietnam, Korea, Senegal, Ivory Coast

1100+ non-business participants from civil society, labour, academia 1100+ non-business participants from civil society, labour, academia

Equal representation in developed and developing world Equal representation in developed and developing world

147 of the Financial Times Global 500 companies (by market cap) 147 of the Financial Times Global 500 companies (by market cap)

49 percent small and medium-size enterprises (SMEs) 49 percent small and medium-size enterprises (SMEs)

New business participants in 2007: 1087 (as of Oct. 29) New business participants in 2007: 1087 (as of Oct. 29)

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Reality Check – The Age of Globalization

Globalization

Technological Change

Uni/Multipolar Power Constellation

Phenomenon Result

More Wealth and Greater Gaps / Globalization of

Minds / Reactive Extremism

Reduced Transaction Costs / Transparency

Effects / New Organizational Models

Shifting centers of power

Governance Gaps

Human RightsSocial

EnvironmentalAccountability

Weak/Failing States

Limited Capacity of international institutions

to deal with new scenarios

Business expected to do more / fill institutional

voids

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Same Issues – New Drivers

Then: Human Rights in Nigeria Sweatshop Crisis Corporate Governance

Scandals

Now: Bribery Scandals Investment in Burma Investment in Sudan Product Safety Scandals

Moral Casedriven by:

Pressure GroupsCivil Society

Media

Moral Casedriven by:Pressure Groups

Civil SocietyMedia

Business Casedriven by:

Market ActorsMarket Forces

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CSR in 2008: A Multitude of Questions

ConsumersAre your products

safe?Are they made in

a sustainable manner?

Government

Are you complying with the law?At home and

abroad?

MediaAre you hiding

anything?Isn’t this just PR?

EmployeesIs our company

“clean”?Are we a

sustainable business?

SuppliersHow does this

apply to our work?What do we have

to do now?

Financial MarketsHow do you

minimize social, environmental

and governance risks?

Civil Society

Are you addressing stakeholder

concerns regarding

environmental and social

challenges?

Local Stakeholde

rsHow does your work affect our community and

our environment?

ACME Inc.What are we

supposed to do?

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Civil Society, Press and Media: Pressure,

Expectations

Financial Markets: Recognizing the

Importance of ESG

Public Policy: Recognizing

Business Responsibility

Penalizing Irresponsible

Behavior

Consumers: Changing

Preferences

Education: Changing Mindsets

DriversShaping the

Role of Business

Corporate Responsibility

Goes Truly Global

Increased Reporting on

Social and Environmental

Issues

Changing Relationship: Voluntary and

Regulatory Approaches

Strategic Philanthropy vs. Corporate Giving

From Avoiding Costs to Creating

Value

Global Trends

in Corporate Responsibili

ty

Changing Risk and Opportunity Landscape for Corporations

The Changing Context for Business

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Addressing Governance Gaps: New Alliances

CorporationsCorporations

GovernmentsGovernments Civil SocietyCivil Society

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CSRas

ValueCreation

CSR as

Risk Management

CSRas

Corporate Philanthropy

Three Stages of CSR

Compliance Medium to High Operational

Impact

Fundamental Strategic and Operational Impact

InnovationSustainable Business Models

Provide funding and skills

Little Strategic or Operational

Impact

Strategic Philanthropy

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Some Simple Truths about CSR

“Corporate Social Responsibility is not about how money is spent, it’s about how money is made.” -- Anonymous

“Done well, though, [CSR] is not some separate activity that companies do on the side, a corner of corporate side reserved for virtue: it is just good business.” – The Economist

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Introduction to the Global Compact