What is Corporate Social Responsibility? - InnoTrain CSR

advances, innovation, research and work spaces with other developing regions. This
increases the influence of companies and offers opportunities for sustainable
development perspectives provided that power and responsibility within the meaning
of CSR are combined as two sides of a medal.
However, some transnational company groups whose financial might can exceed the
gross domestic product of a developing country are also exerting significant pressure
on states to abolish social and ecological regulations or to refrain from adequately
implementing existing standards. With their power on the market, companies can
lower legal requirements or create so-called special production zones in which
existing rules are invalidated. In these zones it is mainly the labour laws that are
disregarded and the environmental rules that are disrespected while the respective
companies are at the same time completely or largely exempt from paying taxes. If
this pressure is not resisted, there is a risk of migration of capital and production into
other regions. Therefore, the following proverb is common in many developing
countries: "There is only one thing worse than being overrun by international
companies - namely not being overrun by them."
If developing countries want to export due to an abundance of resources, usually
only a small minority is benefiting from the revenue. However, regional products
become less competitive because of currency revenue and associated corruption,
military conflicts or civil wars are often hampering the democratic and social
development. On the other hand, excess exports from industrialised countries, in part
at subsidised dumping prices, significantly harm the regional markets in developing
countries. For example: Mainly chicken breasts are sold in the EU. Other parts of the
chicken cannot be sold with a profit and are exported to Africa. They destroy for
example existing local chicken markets in Cameroon because the resident farmers
are unable to keep up with the low prices of the imported cheap and "waste"
products.
For companies committed to CSR in industrialised countries, it is crucial to develop a
CSR understanding along their global value chain especially for developing and
newly industrialising countries which is based on accurate analyses of the situation
on site. Or else the erroneous impression may arise in these countries that the
compliance with social minimum standards is largely voluntary. Especially small and
medium-sized enterprises in developing and newly industrialising countries consider
CSR an opportunity for achieving legal norms and standards. Therefore, companies
and governments especially in newly industrialising countries are increasingly
developing an interest in CSR. More and more companies realise that responsible
corporate management may become crucial for accessing the markets in
industrialised countries. In turn, governments notice that CSR is promoting the
implementation of labour and environmental laws.
In these cases, there is a multitude of options for CSR-active companies to endorse
the development cooperation, for example concerning the introduction of social and
ecological standards in the supplier industries, the energy and resource efficiency or
The project "InnoTrain CSR" is organized by GILDE GmbH and has been funded with support from the European Commission. This publication reflects the
views only of the author, and the Commission cannot be held responsible for any use which may be made of the information contained therein. 12/2010
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InnoTrain CSR
www.csr-training.eu