Report reveals the true face of corporate social responsibility

Source: Christian Aid, 22 January 2004

As world business leaders and political figures gather in the fenced-off Alpine resort of Davos for their traditional New Year get-together, Christian Aid is calling on the politicians to take responsibility for the ethical operation of companies rather than surrendering it to those from business peddling fine words and lofty sentiments.
The image of companies working hard to make the world a better place is too often just that – a carefully manufactured image – says Behind the mask: the real face of corporate social responsibility, a new report from Christian Aid. Its target is the burgeoning industry known as corporate social responsibility – or CSR – which is now seen as a vital tool in promoting and improving the public image of some of the world’s largest companies and corporations.

But, as the case studies in this report – featuring Shell, British American Tobacco and Coca Cola – demonstrate, the rhetoric can also mask corporate activity that makes things worse for the communities in which they work.

‘Some of those shouting the loudest about their corporate virtues are also among those inflicting continuing damage on communities where they work – particularly poor communities,’ says Andrew Pendleton, senior policy officer at Christian Aid and author of the report. ‘Legally binding regulation is now needed to lessen the devastating impact that companies can have in an ever-more globalised world.’

Behind the mask: the real face of corporate social responsibility demonstrates how over the past decade companies have used an image of social responsibility to oppose regulation and convince governments in rich countries that business can put its own house in order. The report concludes that the voluntary approach to improving corporate behaviour is wholly inadequate and that international legally binding standards are now needed.

Shell in Nigeria claims that it has turned over a new leaf there and strives to be a ‘good neighbour’. Yet it still fails to quickly clean up oil spills that ruin villages and runs ‘community development’ projects that are frequently ineffective and which sometimes even widen the divide in communities living around the oilfields.

British American Tobacco stresses the importance of upholding high standards of health and safety among those working for them and claims to provide local farmers with the necessary training and protective clothing. But contract farmers in Kenya and Brazil claim this does not happen and report chronic ill heath related to tobacco cultivation.

Coca-Cola emphasises ‘using natural resources responsibly’. Yet a wholly owned subsidiary in India is accused of depleting village wells in an area where water is notoriously scarce and has been told by an Indian court to stop drawing ground water.

‘Governments must now adopt an international set of standards for the behaviour of companies. Rich countries like Britain have regulations that bind companies to good ethical practice at home. So why should companies not be tied to similar standards when they are working in poor countries?’ asks Mr Pendleton. ‘Instead of talking about more voluntary CSR in Davos, governments including Britain’s should be discussing how new laws can raise standards of corporate behaviour. ‘

Download the full report (pdf)