Corporate Social Responsibility

By SARAH EFRONSON and TIFERET UNTERMAN[1]

Around the globe, corporations are fulfilling what have traditionally been government functions. For example, in some countries they provide infrastructure and utilities, and in all countries they influence government’s international policy agendas. In fact, 51 of the world’s 100 largest economies are corporations and 80 percent of world industrial output is produced by only 1,000 corporations. Because of their ever-increasing global power, corporations have become central players in international affairs and necessary partners in efforts to prevent genocide. As such, governments should implement policies that further motivate corporations in this arena.

One way to focus corporations on prevention efforts is through the lens of corporate social responsibility. Broadly, corporate social responsibility means that corporations should manage their businesses in a way that not only maximizes profits but also contributes to the resolution of environmental and social problems. Increasingly, corporations are recognizing a responsibility not just to shareholders, but also to other stakeholders such as customers, investors, governments, and local communities.

Many are familiar with the application of corporate social responsibility to the extraction or procurement of “conflict resources,” or to the protection of the environment in the midst of oil pipeline construction. Less explored is the application of corporate social responsibility to the specific task of genocide prevention.

The goal is for corporations to apply a genocide prevention lens to business practices. They can begin by recognizing that genocide is a process, not an event, with identifiable transitions from the point of societal stability to the point when atrocities occur. Genocide scholars Barbara Harff and Gregory Stanton offer the most widely accepted risk assessment and stages model that outline what the genocidal process often looks like. These approaches provide indicators of a potential genocide, or a genocide that is in its very early stages. Harff recognizes the following risk factors for genocide: prior genocide in the same polity, autocracy, ethnic minority rule, political upheaval during war or revolution, exclusionary ideology, closure of borders to international trade, and discrimination. Stanton establishes the following stages of genocide: classification of the targeted group, symbolization, dehumanization, preparation, polarization, organization, extermination, and denial. In addition to these risk factors, resource scarcity and conflict are also recognized as common precursors to genocide.

Corporate social responsibility has a role to play both in genocide intervention (after violence has started to occur) and prevention (prior to the outbreak of violence), the latter being preferable and most effective. To accomplish this task, corporations must aim to reverse the factors that can lead to genocide by:

  • expanding the openness of markets,
  • involving a multiplicity of stakeholders in the target country,
  • increasing power-sharing among a diversity of political and social groups,
  • helping to unify, rather than disenfranchise, different social groups,
  • encouraging a more inclusive ideology through marketing and drawing on a diverse subcontractor base, and
  • working to limit monopolies while encouraging increased international trade.

Governments can assist corporations by adopting policies and laws that encourage, if not compel, them to act in accordance with the above. This may be accomplished through combining a voluntary/incentive-based approach with a regulation-based approach.

The key to the voluntary/ incentive approach is to promote genocide prevention as a profitable venture for corporations. This approach has been successfully implemented with respect to environmental protection. In the movement to “go green,” corporations profited through brand differentiation by selling their product as environmentally-friendly and having more efficient operations while complying with environmental concerns. The focus on environmental protection has also brought smaller businesses and subcontractors worldwide into better compliance with the environmental goals and policies of their larger corporate purchasers. Similarly, governments should encourage corporations to use their genocide prevention activities as a brand differentiator and promote research and education into how corporations will profit from said efforts.

Regulations should also be adopted to foster corporate involvement in preventive measures. One approach is to mandate that companies participate in corporate social responsibility. Such a regulation has been adopted under Article 5 of the Chinese Company Law, which requires companies to “undertake social responsibility” in the course of business. Another approach is to require companies to give funds to corporate social responsibility. In India, there is a proposal under consideration that would require large corporations to allot a percentage of their profits toward socially responsible initiatives. A third approach is a disclosure regulation such as the United States Dodd-Frank financial reform law, which requires companies to publicly disclose their use of conflict minerals that originated in the Democratic Republic of Congo or an adjoining country. As a result, companies like Intel and Apple have created auditing programs and aid projects to help Congo develop a clean minerals trade and tracing projects to identify problems in their supply chains.

Government regulations could include mandatory auditing and disclosure of company activities that directly contribute to known factors that could lead to genocide, such as whether a corporation’s activities are involved with closing a country’s borders to international trade. Although an international scheme to regulate corporate activities would be best, individual national legislation often leads to international cooperation.

A successful example that demonstrates the combined use of the voluntary/ incentive approach and the regulation approach is the 1986 United States Comprehensive Anti-Apartheid Act, designed to undermine the apartheid regime then existent in South Africa while simultaneously bolstering interracial development. The Act prohibited future investments and trade in South Africa, leading to austere economic measures. At the same time, it encouraged procurement of goods from businesses that had more than 50 percent beneficial ownership by non-white South Africans and exempted the Export-Import Bank from a certification requirement to encourage it to export or import from such businesses. This law provided procurement incentives and stopped harmful corporate investments in apartheid. Furthermore, this Act also addressed ethnic minority rule — one of the aforementioned genocide risk factors.

Applying the corporate social responsibility concept to genocide prevention is a new idea. With very little written on the subject and very little data to understand trends, it is still a nascent concept. There are therefore many challenges to overcome, and questions that remain:

  • Oversight lapse: Self-reporting and voluntary fulfillment can lead to false claims and allows for corporations to appeal to consumers through branding as being socially responsible without meaningfully implementing genocide preventive measures.
  • Lack of education about genocide prevention: Corporate social responsibility as it relates to genocide prevention is a new concept and many corporations are unaware of its benefits. They may even foster genocidal conditions if they deem it to be economically beneficial.
  • No standard models to apply to genocide prevention efforts: Companies are more willing to adopt environmental and social policies and programs, since they have been previously modeled and can be replicated. But the novelty of corporate involvement in genocide prevention efforts means that new policies and programs need to be developed into replicable models.

In the international arena, states are no longer the only actor. Corporations have growing influence and are necessary partners with states in genocide prevention efforts. Corporate social responsibility has been successfully implemented in other fields and should be applied to genocide prevention as well. Governments have a vital role in incentivizing corporations to contribute to genocide prevention and should work to educate, regulate, and partner with corporations in genocide prevention efforts. Both governments and corporations should seize on this window of opportunity and cultivate positive steps to not just end genocide, but to stop it before the loss of life.

Image: industryplayer.com


[1] Sarah Efronson and Tiferet Unterman are law students participating in the Human Rights and Genocide Clinic at the Benjamin N. Cardozo School of Law in New York City. In this capacity, they were invited to present their research on corporate social responsibility and genocide prevention at the Auschwitz Institute for Peace and Reconciliation’s Raphael Lempkin Seminar for Genocide Prevention in Auschwitz, Poland in November 2012.

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