Perspectives in Responsible Sourcing

Responsible Legislation in Europe

In 2006, the European Commission (EC) launched their European Alliance for Corporate Social Responsibility, with the goal of inspiring European businesses to look further than the minimum legal requirements for responsible sourcing, transparency, and sustainability. The Alliance drew on consultation across the board, involving both businesses and NGOs; however the current policy rejects actual regulation, calling only for voluntary controls to be put in place by individual companies.

A number of European NGOs have formed a European Coalition for Corporate Justice, calling for tighter regulation and mandatory reporting, with the support of some well-known European companies, who adopt a serious CSR policy, expending revenue on stakeholder development and monitoring, and taking account of sustainability and responsibility issues when making business decisions. These companies feel that they lose out to their less ethical competitors, and would like to see all retailers across Europe being bound by the same requirements.

The EC policy has also been criticised by the UK's Labour Member of European Parliament, Richard Howitt, who believes that, businesses [should] have to report annually on the impacts of their work and have to meet a set of common standards. Mr Howitt has described the EC's current position as "too introspective," and continues to try to push legislation through the Parliament, that would make Europe a pole of excellence on CSR.

In the debating halls of Brussels, the lawmakers continue to try to satisfy their own stakeholders, seeking a strategy that meets the NGOs' demands for increased legislation, without losing the support of the business community.

CSR: A British Perspective

When I tell people in the UK what I do for a living, the most common questions I get asked are, "But why do companies have to have these assessments? Who makes them? Do you work for the government?"

In this country, “Corporate Social Responsibility” is not a well-known phrase, and the idea that big retailers should behave in an ethical manner is often met with a cynically raised eyebrow. It is generally assumed that there are two reasons why companies would adopt a social audit plan: to look good to their customers, or because they are required by law to do so.

The first of those reasons was thrust into the public eye in 2006, when many high-street stores launched major advertising campaigns to raise awareness of their own ethical activities. The best-known of these is Marks & Spencer, who plastered their entire shop windows with their Look Behind The Label campaign, pledging that all their products are sourced and manufactured to the highest ethical as well as quality standards.

This is a good example of the local understanding of CSR, which in the UK is not limited to sourcing products from socially compliant factories; in fact this tends to be lower in the list of priorities than good employee relations, not using genetically modified food, and of course animal welfare.

Perhaps the highest priority of UK firms who wish to be seen to be ethical is environmental sustainability. Tesco, the UK's largest chain of supermarkets, has very recently set out their intention to minimise waste and encourage their customers to recycle everything from carrier bags to Christmas cards. Their rival Sainsbury has identified another area of responsibility, and launched an initiative to source from smaller, local suppliers. This again may have roots in the need to be seen to be green, as "food miles" are currently quite a hot topic.

Many UK brands take an entirely different angle, combining marketing drives with charity donations and involvement in the local community. The Persil 'Be my coach' campaign was developed by manufacturer Unilever to encourage parents to participate in sports with their children, by giving away free sports gear with their products; and McDonald's in the UK are very involved in youth football (soccer) at a local level.

So a British perspective on CSR is that it is not all about responsible sourcing; in fact, charity begins at home.