Corporate Social Responsibility in the MENA Regions - Abdeslam Badre

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Relatively new in the Arab World, Corporate Social Responsibility (CSR) is one among the ethical practices which has already become crucial in promoting a positive image about a few Arab Macro-economic projects throughout the Arab business community. Still, Arab companies make up just 1% of the 4,650 organizations which are registered and have filed reports on the Global Reporting Initiative’s Sustainability Disclosure Database (GRISDD. With the recent political uprisings in the Arab region, along with the international economic crisis, new challenges have came to the forth to shape new realities; yet, unfolding invaluable opportunities for modernizing the Business infrastructure in the region.

It is on this ground that civil society, being the backbone of the non-state power, especially in a region where most of the political institutions have been either inexistent or undemocratic, could play a leadership role in monitoring and enforcing social responsibilities‘ practices on both public and private sectors; with the intent 1) to modernize the Business Structure in the region, 2) to motivate and preserve collective investments, 3) and to optimize the number of companies registering in the Global Reporting Initiative’s Sustainability Disclosure Database (GRISDD).

This presentation talks about the unprecedented role Arab local and regional body of NGOs, which for decades have suffered from their regimes‘ oppressions, can and should play in monitoring and enforcing ethical practices and sustainable strategies of social responsibilities on the State as well as private-owned companies towards their communities, especially in Egypt, Tunisia, Libya, and Morocco wherein most of the vital economic sectors have been monopolized by the regimes‘ entourage. The presentation will also showcase the UAE experience in establishing partnerships for a sustainable future along with the Lebanese experience in implementing CSR initiatives, and Qatar's ethical investments.

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Corporate Social Responsibility in the MENA Regions - Abdeslam Badre

  1. 1. Corporate Social Responsibility in the MENA Region June 19-20, 2013 • Istanbul-Turkey Pera Palace Hotel NGOs Role in Enforcing Social Corporate Responsibilities‘ Practices in in MENA Region Abdeslam Badre, PhD 7/2/2013 Johns Hopkins University & The Protraction Project 1A. Badre
  2. 2. Layout O A glimpse at the development of civil society & CSR in MNEA O Factors shifting Human Rights NGOs interest in CSR O The two paradigms O NGOs tactics with companies vis-à-vis CSR 7/2/2013A. Badre 2 Johns Hopkins University & The Protraction Project
  3. 3. Evolution of CSR Before the 70s Corporations had a legal obligation: profit making 1970s, in the wake of the Lockheed and Ford Pinto, and other scandals, led to passage of the Foreign Corrupt Practices Act in the United States, and to the first wave of attempts by the UN Economic and Social Council and other international organizations to regulate MNC behavior In the 1980s the corporate social responsibility (CSR) agenda was significantly broadened when, in the wake of Bhopal, Exxon Valdez, and other highly publicized environmental disasters, the NGO environmental movement pressed home the idea that MNCs must also protect the environment From the early 1990 s on, human rights NGOs and other voices within civil society have been calling upon corporations to accept responsibility for promoting labor rights, human rights, environmental quality, and sustainable development. 7/2/2013A. Badre 3 Johns Hopkins University & The Protraction Project
  4. 4. CSR in the Arab World: same old oil in a new bottle 7/2/2013A.Badre 4 Johns Hopkins University & The Protraction Project
  5. 5. Development of NGOs in MENA Region NationalismColonial period Political / constitutional Dawn of Independence Social concerns Post colonial EconomicGlobalization Era 7/2/2013A. Badre 5 Johns Hopkins University & The Protraction Project
  6. 6. How have Human Right NGOs ended up working in the field of Business? 7/2/2013A. Badre 6 Johns Hopkins University & The Protraction Project
  7. 7. Factors contributing to human rights NGOs’ interest in the business: The most important factor is the perception that political and economic power has shifted away from governments and toward corporation. In the South MNC often have more economic power than governments, and continue to control access to most of the valuable natural resources while maintaining power over impoverished populations by force. Within NGOs, there is a widely held view that multinational corporations, already the dominant institutions in contemporary society, are increasing their influence over the economic, political, and cultural life of humanity while remaining almost completely unaccountable to global civil society. A perceived shift of power formation -states to corporations and international financial institutions such as the World Bank and the International Monetary Fund • The lack of social and environmental accountability of MNCs under existing national and international laws • The growing anti - corporate – globalization movement • A desire on the part of some people in the NGO world to enlist businesses • A conclusion on the part of large, International human rights organizations that they have been too focused on traditional categories of civil and political rights while neglecting economic, social, and cultural rights 7/2/2013A. Badre 7 Johns Hopkins University & The Protraction Project
  8. 8. NGOs two paradigm vis-à-vis CSR 7/2/2013A. Badre 8 Johns Hopkins University & The Protraction Project
  9. 9. Engagement Approach Aims at persuading corporates to adopt voluntary codes of conduct and implement business practices that incorporate commitments to respect and protect labor rights and human rights as well as the environment. 7/2/2013A. Badre 9 Johns Hopkins University & The Protraction Project
  10. 10. The triple bottom line The environm ental account The social account The financial account 7/2/2013A. Badre 10 Johns Hopkins University & The Protraction Project
  11. 11. Confrontation Approach Thus, companies can only be made to be socially and environmentally accountable by means of economic coercion or through binding legal obligations. Those who take this view look toward the development of a mass social movement that will compel governments to enact enforceable international legal standards (EILS) that would make corporates legally accountable to global society influence indirectly those of the employees of their subcontractors and suppliers. Companies also have direct control over health and safety issues in the work place, worker compensation, and rights to organize and bargain collectively. Companies are directly and routinely implicated in abuses of many important social and economic rights control employment for millions of people around the region and are in a position to influence directly the enjoyment of the labor rights and economic rights of their own employees 7/2/2013A. Badre 11 Johns Hopkins University & The Protraction Project
  12. 12. NGOs Tactics In practice, no NGO acts solely as an engager, nor does any act purely in a confrontational mode; all utilize strategies that fall along an engagement- confrontation spectrum. There are at least eight different tactics that various NGOs have employed with respect to different companies in order to encourage them to accept social responsibilities 7/2/2013A. Badre 12 Johns Hopkins University & The Protraction Project
  13. 13. NGOs Tactics O Dialogue aimed at promoting the adoption of voluntary codes of conduct—the pure CSR approach O Advocacy of social accounting and independent verification schemes O The filing of shareholder resolutions O Documentation of abuses and moral shaming O Calls for boycotts of company products or divestment of stock O Advocacy of selective purchasing laws O Advocacy of government - imposed standards O Litigation seeking punitive damages 7/2/2013A. Badre 13 Johns Hopkins University & The Protraction Project
  14. 14. NGOs Tactics Most NGOs try to tailor the tactics to the target, based upon the specific characteristics of the company’s position on corporate social responsibility issues, but there are clear philosophical differences between those that favor dialogue and those on the confrontational side of the spectrum. 7/2/2013A. Badre 14 Johns Hopkins University & The Protraction Project
  15. 15. Conclusion Unless they are able to mobilize two other important constituencies: consumers and governments, NGOs trying to influence corporate behavior by means of any combination of strategies and tactics are unlikely to be successful in the long run Recent studies of consumer preferences have consistently found that consumers are motivated to avoid purchasing products that they know are being made under abusive labor conditions. As long as the majority of consumers remain either ill informed or indifferent to the labor and human rights conditions under which corporations produce the goods they deliver to the market place, no amount of NGO pressure is going to produce sustainable reform 7/2/2013A. Badre 15 Johns Hopkins University & The Protraction Project
  16. 16. Conclusion Governments could and should be doing a great deal more than they currently are, not only in the process of standard setting and negative regulation, but also in providing tax and other regulatory incentives that will reward corporations for good behavior. The NGO-led corporate social responsibility movement must now move the CSR agenda from voluntary compliance to “soft law ” approaches, and finally to rigorous national and international enforcement regimes; but it is unlikely to be able to do so unless it can mobilize support for greater corporate social accountability from informed consumers, concerned government officials, and progressive companies. 7/2/2013A. Badre 16 Johns Hopkins University & The Protraction Project
  17. 17. References Morton Winston, 2002. NGO Strategies for Promoting Corporate Social Responsibility. Ethics & International Affairs 1 6 ,n o. 2 Kjetil Selvik, 2013. Business and Social Responsibility in the Arab World: the Zakat vs. CSR models in Syria and Dubai. Michelson Institute, Bergen Department of Comparative Politics, University of Bergen. Comparative Sociology 12 (2013) 95–123 Arabia Corporate Social Responsibility Awards 2011. GUIDELINES© Arabia CSR Network available at: www.arabiacsrnetwork.com . Consulted on June 11th 2013 at 16:49 7/2/2013A. Badre 17 Johns Hopkins University & The Protraction Project

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