By Paul Bain
I have been reading various articles on the debate around Canada’s foreign CSR. It is a tough issue and I am still unsure where I stand on the matter. I do not want to try to lay out specific laws that should govern corporations because I feel that CSR is still evolving and CSR standards will be constantly changing over the next decade. Therefore, I want to focus this blog on answering this question: What role does party have with ensuring CSR?
The Shareholders of the Corporation: The shareholders have an important role in upholding CSR. Ideally, prospective investors should be responsible to consciously invest in companies which respect CSR. I believe that shareholders should demand for public disclosure of information corresponding with CSR issues. A third party CSR audit system should be implemented to establish legitimate transparency. These initiatives will enable the Government of Canada and the clients of the corporation, to better understand the initiatives taken by the corporation to uphold its social responsibility.
The Customer of the Corporation: Customer’s have the duty of researching and learning about the corporation’s CSR policies. The customer then has the power to choose which corporation they will support and buy from. Customer’s can pressure corporation’s (with their wallet’s and voices) to incorporate CSR into their business mandate.
NGOs: The role of NGOs is to help share information with the public about a corporations CSR practices. NGOs can act as a ‘watchdog’ by spreading awareness about CSR abuses. NGO’s that are active in a foreign state (where corporations are involved) have the opportunity to provide insight into the corporation’s effects on the local community.
The Government of Canada: The GOC should apply pressure on Canadian corporations to uphold their domestic CSR regulations when they are working in foreign countries. The GOC should be taxing corporations who are not conducting foreign CSR. The GOC should also provide positive incentives for a corporation’s compliance with CSR, such as tax breaks or a governmental stamp of CSR approval rating (something like certified Dolphin free tuna) to attract more conscience customers.
The Foreign Country’s Government: While this role may be the most important to ensure foreign CSR, it is possibly the least accountable. In developing countries it may be difficult to enforce strict CSR regulations when there is a dire need for foreign investment. There is also the issue of wealthy corporations ‘paying off’ foreign governments to avoid their domestic legislation on CSR.