This document discusses corporate social responsibility from various perspectives. It outlines international and local approaches to CSR, including guidance from organizations like ISO and the European Union. Key aspects of CSR addressed include the triple bottom line approach of profit, people, and planet. The document also discusses CSR requirements for South African companies in legislation like the Companies Act and King Report, including the establishment of social and ethics committees. Healthcare organizations are noted as benefiting from CSR through improved reputation, competitive advantage, and risk management.

1. CORPORATE SOCIAL RESPONSIBILITY
INA MEIRING

2. CORPORATE SOCIAL RESPONSIBILITY
> Global focus
> No “one-size fits all” approach
> No company operates in isolation: “No man/company is an
island”
> “Business and organizations do not operate in a vacuum.
Their relationship to the society and environment in which
they operate is a critical factor in their ability to continue to
operate effectively. It is also increasingly being used as a
measure of their overall performance.” (ISO 26000)
(International Organisation for Standardisation).
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3. CORPORATE SOCIAL RESPONSIBILITY
> EU Green Paper for Corporate Social Responsibility:
> A European approach to corporate social responsibility forms part of
the broader context of various international initiatives, such as the
United Nations Global Compact (2000), the International Labour
Organisation's (ILO) Tripartite Declaration of Principles concerning
Multinational Enterprises and Social Policy (1997-2000), or the
Organisation for Economic Cooperation and Development (OECD)
Guidelines for Multinational Enterprises (2000).
> “Being socially responsible means not only fulfilling the applicable
legal obligations, but also going beyond compliance and investing
"more" into human capital, the environment and relations with
stakeholders. The experience with investment in environmentally
responsible technologies and business practices suggests that in
going beyond legal compliance companies can increase
competitiveness and it can have a direct impact on productivity.”
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4. CORPORATE SOCIAL RESPONSIBILITY
> Australia: CSR Standard (AS 8003- 2003): the objective of
this standard is to provide essential elements for
establishing, implementing and managing an effective CSR
programme within an entity and provides guidance on using
these elements.
> ISO 26000:2010: provides guidance rather than
requirements, so it cannot be certified to unlike some other
well-known ISO standards. Instead, it helps clarify what
social responsibility is, helps businesses and organizations
translate principles into effective actions and shares best
practices relating to social responsibility, globally. It is aimed
at all types of organizations regardless of their activity, size
or location.
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5. TRIPLE-BOTTOM LINE APPROACH
> The phrase “the triple bottom line”: John Elkington, the
founder of a British consultancy called SustainAbility (1994)
> Companies should prepare three different (and quite
separate) bottom lines.
> Profit: the “bottom line” of the profit and loss account.
> People: social responsibility
> Planet: environmental responsibility.
> It aims to measure the financial, social and environmental
performance of the corporation over a period of time.
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6. KEY ASPECTS OF KING REPORT
> Good governance is about effective leadership
> Leadership is characterized by ethical values and based on moral
duties that find expression in the concept of Ubuntu.
> Responsible leaders direct company strategy and operations with a
view to achieving economic, socal and environmental performance.
> Sustainability: primary moral and economic imperative of the 21st
century (meeting the needs of the present without compromising
the ability of future generations to meet their own needs)
> Nature, society and business are interconnected.
> Corporate citizenship: a company should operate in a sustainable
manner
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7. CASE LAW
> Stilfontein Minister of Water Affairs and Forestry v Stilfontein
Gold Mining Co Ltd 2006(5) SA 333(W) AT 352:
> “The King Committee, correctly, in my view, stressed that
one of the characteristics of good corporate governance is
social responsibility. The Committee stated as follows:
> 'A well-managed company will be aware of, and respond to, social
issues, placing a high priority on ethical standards. A good
corporate citizen is increasingly seen as one that is non-
discriminatory, non-exploitative, and responsible with regard to
environmental and human rights issues. A company is likely to
experience indirect economic benefits, such as improved
productivity and corporate reputation, by taking those factors into
consideration.’”
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8. CASE LAW
> Standard Bank of South Africa Ltd v Dlamini 2013(1) SA 219 (KZD) (at p
237)
> “…. the Bank, like most large corporations that invest in corporate social
responsibility projects, had to be aware of the purposes of the CPA which
was already in the public domain. The purposes of the CPA are:
> '. . . to promote and advance the social and economic welfare of
consumers in South Africa by —.
> (c) promoting fair business practices;
> (d) protecting consumers from —
> (i) unconscionable, unfair, unreasonable, unjust or otherwise improper
trade practices; and (ii) deceptive, misleading, unfair or fraudulent
conduct; … “
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9. CSR: COMPANIES ACT 71 OF 2008
> Section 7(d):The purposes of the Companies Act include to
reaffirm the concept of the company as a means of achieving
economic and social benefits.
> Section 76(3)(b): A director of a company, must exercise the
powers and perform the functions of director in the best
interests of the company.
> Inclusive approach: directors must consider the legitimate
interests of the various stakeholders
> Section 218(2): Any person who contravenes any provision
of this Act is liable to any other person for any loss or
damage suffered by that person as a result of that
contravention.
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10. SOCIAL AND ETHICS COMMITTEE
> Regulation 43: state-owned companies, listed public companies
and any other company that has, in any two of the previous five
years, scored above 500 points (public interest score)
> Regulation 26(2): every company must calculate its 'public
interest score' at the end of each financial year, calculated as
with reference to, amongst others, numbers of employees, third
party liability, turnover, known individuals with beneficial
interest in issued securities .
> A company's social and ethics committee must comprise not
less than three directors or prescribed officers of the company,
at least one of whom must be a director who is not involved in
the day-to-day management of the company's business, and
must not have been so involved within the previous three
financial years.
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11. FUNCTIONS OF THE SOCIAL AND
ETHICS COMMITTEE
> To monitor the company's activities, having regard to any
relevant legislation, other legal requirements or prevailing
codes of best practice, with regard to matters relating to-
> (i) social and economic development, including the
company's standing in terms of the goals and purposes of-
> (aa) the 10 principles set out in the United Nations Global
Compact Principles; and
> (bb) the OECD recommendations regarding corruption;
> (cc) the Employment Equity Act; and
> (dd) the Broad-Based Black Economic Empowerment Act;
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12. FUNCTIONS OF THE SOCIAL AND
ETHICS COMMITTEE
> (ii) good corporate citizenship, including the company's-
> (aa) promotion of equality, prevention of unfair
discrimination, and reduction of corruption;
> (bb) contribution to development of the communities in
which its activities are predominantly conducted or within
which its products or services are predominantly marketed;
and
> (cc) record of sponsorship, donations and charitable giving;
> (iii) the environment, health and public safety, including the
impact of the company's activities and of its products or
services;
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13. FUNCTIONS OF THE SOCIAL AND
ETHICS COMMITTEE
> (iv) consumer relationships, including the company's
advertising, public relations and compliance with consumer
protection laws; and
> (v) labour and employment, including-
> (aa) the company's standing in terms of the International
Labour Organization Protocol on decent work and working
conditions; and
> (bb) the company's employment relationships, and its
contribution toward the educational development of its
employees;
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14. FUNCTIONS OF THE SOCIAL AND
ETHICS COMMITTEE
> (b) to draw matters within its mandate to the attention of
the Board as occasion requires; and
> (c) to report, through one of its members, to the
shareholders at the company's annual general meeting on
the matters within its mandate.
> Appointed by the board or by the shareholders?
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15. JSE LISTING REQUIREMENTS AND SRI
INDEX
> Listed companies: duty to report on social, health,
environmental and ethical performance, the efficiency of risk
management and internal control, and to disclose the degree of
compliance with the King Report
> Social Responsibility Investment Index (SRI Index): May 2004
> 2014: The entire FTSE/JSE All Share index forms part of the
automatic universe for the review, and the most recent
publically available information will be assessed automatically.
> The broad criteria are based on a holistic triple bottom line
sustainability approach and are structured along three pillars,
namely environment, society and governance & related
sustainability concerns.
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16. SRI INDEX
> 2013 SRI Index Best Performers:
> Anglo American Platinum
> Illovo Sugar
> Netcare Limited
> Standard Bank
> Steinhoff International
> Vodacom Group
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17. CODE FOR RESPONSIBLE INVESTING
IN SA (“CRISA”)
> The Institute of Directors in Southern Africa (supported by the FSB
and the JSE)
> CRISA gives guidance on how the institutional investor should
execute investment analysis and investment activities and exercise
rights so as to promote sound governance.
> CRISA applies to:
> Institutional investors as asset owners, for example, pension funds
and insurance companies
> Service providers of institutional investors, for example, asset and
fund managers and consultants
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18. CRISA
> There are five key principles:
> An institutional investor should incorporate sustainability
considerations, including environmental, social and governance,
into its investment analysis and investment activities.
> An institutional investor should demonstrate its acceptance of
ownership responsibilities in its investment arrangements and
investment activities; consider a collaborative approach to promote
acceptance and implementation of the principles of CRISA and
other codes and standards applicable to institutional investors;
recognise the circumstances and relationships that hold a potential
for conflicts of interest and should proactively manage these when
they occur; be transparent about the content of their policies, how
the policies are implemented and how CRISA is applied to enable
stakeholders to make informed assessments.
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19. HEALTHCARE: CSR
> Benefits:
> the long-term prosperity of companies;
> the opportunity to demonstrate the human face of business
as well as an important link to the communities.
> enhance reputation by taking into account the interests of
stakeholders — not only patients, but also investors,
employees, suppliers, communities, regulators, special
interest groups and society as a whole;
> competitive advantage – improve patient loyalty;
> improve access to capital (attracting investors), enhance
brand image, increase sales, develop employees, improve
risk management and reduce costs.
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20. THANK
YOU
Legal notice: Nothing in this presentation should be construed as
formal legal advice from any lawyer or this firm. Readers are
advised to consult professional legal advisors for guidance on
legislation which may affect their businesses.
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