A leading consultancy is advancing the debate about the
responsibilities of multinationals with a set of principles that
enjoins the companies to use their position as ‘economic actors’ to the
wider benefit of society.
The UK-based SustainAbility consultancy is devising the principles
because it believes that while large corporations undoubtedly bring a
wide range of benefits to society, they also tend to ignore the
negative effects of their economic clout.
Geoff Lye, SustainAbility’s vice-chairman, said he hoped the
principles, once finalized, will start a debate ‘on the need to shift
from corporate social to corporate economic responsibility’. He said
too many companies, when they draw up corporate responsibility
programmes, pay far less attention to their ‘economic responsibility’
than to their social and environmental policies.
The Principles of Corporate Economic Responsibility for Multinational Corporations,
now in draft form, will stress that companies have a moral duty to
oppose global trade that in general favours developed countries over
developing ones, often through subsidies.
‘With their scale and supply chain influence, large corporations should
actively seek to ensure that the power balance protects local and
smaller enterprises through fair competition,’ said Lye.
The principles will also propose that companies:
discourage monopolistic and anti-competitive activities, particularly in the areas of patents and copyrightsupport the role of small- and medium-sized enterprises, which are often forced to close by multinationals squeezing pricesredress
the ‘power imbalance’ between the top and bottom of the supply chain by
improving payment terms and setting more realistic order deadlines when
practicalpromote fair trade pay taxes within the local economies where they are due.
