Slow steps forward

10 February 2007

2006 was a year of retrenchment for CSR in Brussels, but there are signs that the debate is moving forward again, writes Stephen Gardner. The European Union level debate on corporate social responsibility spent most of 2006 stuck in a very deep rut.  In March 2006, the European Commission published a CSR policy strategy that rejected regulation and put the emphasis squarely on voluntary measures from business.  This enraged non-governmental organisations and unions, who had called for a stronger lead on issues such as mandatory reporting of social and environmental impacts, and transparency. The pro-regulation camp felt especially let down by the European Multi-stakeholder Forum on CSR, a platform established in 2002 to crystallise the EU approach.  NGOs had contributed to the Forum but now felt ignored.  The process left them feeling “disillusioned”, says Virginie Giarmana, coordinator of NGO platform, the European Coalition for Corporate Justice (ECCJ). Consequently, when the Forum recovened in December 2006, most NGOs and unions boycotted it.  “We had the feeling there was no possibility for dialogue,” says Giarmana.  Instead, NGOs held their own forum, setting out “six principles for corporate justice”: internationally agreed standards, the need for regulation, stakeholders’ rights, independent checks and balances, transparency, and implementing CSR throughout the supply chain. Debate out of focus For more detached observers, the Brussels debate is increasingly irrelevant.  Outside Brussels, says one senior CSR consultant, NGOs work selectively and successfully with companies on CSR initiatives.  In Brussels, however, there is “deep division on how Europe should respond to globalisation.  It is back to the trenches a bit.  NGOs are frustrated at the Commission for listening too much to employers, but from the employers’ side, NGOs and unions are not seeing the threat of China and what it means for growth.” Richard Howitt, Labour MEP for the East of England, and European Parliament spokesman on CSR, concurs with this view.  The EU debate is “too introspective, short-sighted, not very ambitious and not matching what is coming from companies,” he says. Howitt has authored a Parliamentary report he hopes will help break the deadlock.  The Commission’s approach is not necessarily bad, he says, but concrete outcomes are needed.  “CSR at EU level should be value-added and looking outwards,” he says. “There is a real programme that could be made and the Commission could move on it.  A push from the Parliament could really make a difference.” Howitt is also critical of the central idea put forward in the Commission's March 2006 strategy: the European Alliance for CSR.  This, the Commission said, would be a “political umbrella for new and existing CSR initiatives,” and would help make Europe a “pole of excellence on CSR.” “The Alliance needs to get its act together,” says Howitt.  “It must be more transparent, with clearer objectives and timescales.  I’m not against the Alliance but it [currently] falls short of the requirements any business would expect.” Low profile Alliance It is certainly the case that the Alliance has so far kept a low profile.  The main European employer and corporate representative organisations, chief amongst them being the Confederation of European Business (UNICE – Union des Industries de la Communauté européenne), and CSR Europe, will put the flesh on the Alliance’s bones, and 2007 should be the year it really takes shape. Natascha Waltke of UNICE says that 130 companies have “expressed support” for the Alliance.  “It will have a medium-term perspective,” she says.  “We will try to gather information from companies engaged in the Alliance and communicate that as evidence of activities and [for] giving ideas.” CSR Europe is taking more practical steps.  The period since the announcement of the Alliance has been used to lay its foundations, says CSR Europe Senior Director Jan Noterdaeme.  CSR Europe has also published a “European Cartography on CSR Innovations, Gaps and Future Trends.”  This, says Noterdaeme, is a “reality check” that “maps the current situation as a basis for setting priorities” for the Alliance. CSR Europe has also been collecting expressions of interest from companies for the main initiative that will be launched under the Alliance umbrella: CSR laboratories.  These will bring companies together to explore different themes and identify specific deliverables. The first labs to launch will be on skills for employability (led by Microsoft, Randstad, Toyota and Cisco), mainstreaming diversity in companies (L'Oreal), and managing stress and wellbeing in the workplace (Johnson & Johnson). There will be 18 labs – 11 organised at national level by CSR organisations such as Sodalitas in Italy, Business in the Community in the United Kingdom, and France's Observatoire sur la Responsabilité Sociétale des Entreprises.  The remaining seven will be coordinated at EU level by CSR Europe. More relevant, not new The labs will not “reinvent anything but will use the Alliance to challenge those involved to make CSR more relevant,” says Noterdaeme.  As well as being platforms for sharing knowledge and exploring joint projects, they will publish CSR solutions and provide policy feedback to the Commission. The labs will also reaffirm the maxim at the heart of the Commission's approach: that CSR is for business to implement.  Non-corporate organisations can participate, but only if invited by corporate members.  “We have asked companies to map out which stakeholders they see as bringing value to the labs,” Noterdaeme says, adding that the labs “should not be a talking shop” and “cannot just have people there witnessing.” Noterdaeme argues, however, that the Commission has been “smart” by putting companies in the spotlight.  The approach puts pressure on them to deliver real results, he says.  It marks a move away from the “old, paralysing” debate on whether there should be regulation or not, which does not “mirror the reality of innovative [CSR] actions.” Nevertheless, arguments can be expected to continue, especially as some companies have expressed preference for an approach involving at least stronger guidelines, if not actual regulations.  ECCJ's Giarmana cites Carrefour's support for mandatory reporting of social and environmental impacts.  She adds that lines of communication remain open with the Commission.  “They are looking forward to receiving our proposals,” she says. In the end, says a senior EU consultant, it is a question of vision: what can CSR achieve?  The Commission itself is divided on this, and therefore the lack of a strong hand on the tiller is no surprise.  The Commission “should be clearer on where it wants to be and how to get there [and] needs an approach that examines what is working on the ground and results in greater engagement,” the consultant adds. CSR Europe's laboratories may contribute to this, but the divisions with non-corporate CSR organisations in Brussels are still far from resolved. A version of this article originally appeared in Ethical Corporation magazine.