Business ethics rules may be the right move

The last week has not been a good advertisement for globalisation, what with
WorldCom and the shoddy G8 meeting on world poverty in Canada.

Meanwhile, back in Europe, the EU is drawing up proposals for a directive on
corporate social responsibility which could force organisations to report on
issues including their record on the environment, diversity at work and their
relationship with local communities.

DTI minister Stephen Timms is gearing up for a battle to stop any such law
reaching the statute books, and he will get the support of many in the business

For HR professionals the CSR movement offers complex challenges. Where CSR
has clear benefits, to the employer brand and recruitment for example, HR has a
definite remit to embrace it. Where CSR smacks of altruism and business ethics
for the sake of it, HR is wary of appearing to promote welfare issues at the
expense of the bottom line – a perception that could send the profession back
to the dark ages.

But CSR is an issue that needs to be filtered carefully through all of our
consciences. Business has a poor track record on taking responsibility for
stakeholders other than shareholders, and in the case of WorldCom, even the
shareholders have been abused.

The argument that restrictions and legislation would stifle the voluntary
approach to CSR does not hold water. Companies only turn to CSR voluntarily
because they understand the business benefits that come in terms of customer
loyalty, recruitment and staff morale. They will not abandon these approaches
because a CSR law has been introduced as it would not make business sense to do

It is where there is no business benefit or, worse, an incentive to behave
irresponsibly that legislation is needed. Any support for CSR rules needs to be
hedged around with qualifications, but it would be irresponsible to reject the
idea simply out of principle.

By Noel O’Reilly

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