CSR study: time to move beyond the "voluntary vs mandatory" debate

Source: Euractiv.com, 21 June 2003

A new study explores how well companies understand the economic impacts of their activities on poor communities, and what actions businesses take to manage those to achieve the desired outcomes.
With its major share in global economic activity, the corporate sector is the main driver of economic development in low-income communities. Businesses make economic choices that create social and environmental outcomes in communities. "Many corporates are weak on driving economic development impact on the poorest communities, but there are a handful of companies that have started grappling with today’s big dilemma in terms of how their economic footprint leads to social and environmental benefits for the disadvantaged," said Chief Executive of AccountAbility Simon Zadek.

The report identifies how business activities, such as facilities siting and management, product and service development, as well as investments influence local communities.

The study underlines the importance of collective partnerships on a sectoral as well as regional basis between companies and advocacy groups, in a drive to deliver desired social and environmental changes. Regulation is a matter of balance, reminds the report, and it is important to move beyond the "voluntary vs mandatory" debate – considering the numerous examples of businesses that have supported regulation to create a level playing field.

The research project by AccountAbility and Business for Social Responsibility will now move to a next phase to examine how business and public policy strategies could improve the role of business in contributing to economic development in the Southern Hemisphere, focusing on specific industry groups.

Download the report (pdf)