Before our Responsible Business conference on 21 November 2016, we spoke to Sandra Gallina, Director for Sustainable Development, DG Trade at the European Commission about the evolving expectations for responsible business*.
How do you feel expectations for responsible business have changed over the past 10 years?
Expectations for responsible business have intensified over the past 10 years. This is quite clear when you look at recent international developments in this area.
Over the past years, several internationally agreed instruments or guidelines have been developed and adopted. For example the United Nations Guiding Principles on Business and Human Rights and the OECD Guidelines for Multinational Enterprises which provide a comprehensive and ambitious framework for expectations on relevant actors in terms of due diligence and responsible business practices. I expect this to be strengthened in the future as shown by work around the implementation of the UN Guiding Principles on Business and Human Rights, the OECD developments on due-diligence in specific sectors or the ILO conclusions on decent work in global supply chains adopted last June.
What factors and incentives do you feel have been the most significant in driving the adoption of responsible behaviours?
There is no one size fits all approach or recipe for success. Success factors depend on the specifics of each situation and there is a need to carefully assess where our action can bring real added value and can be the most effective.
At the same time, active involvement of all actors - including NGOs and business – have often proved successful in bringing progress on the ground, for instance by engaging in multi-stakeholder initiatives. The Bangladesh Sustainability Compact or the Myanmar Labour Initiative are concrete examples in this regard.
What frameworks do you feel are most effective in promoting responsible practices? What should the respective roles of business, government and civil society be?
In today's economy, promoting responsible practices requires global solutions. No actor can achieve desired results working in isolation. This is why:
- International organisations and governments need to work closely together in frameworks such as the UN, the G7, the ILO and the OECD with a view to step up work in these fora on developing global and ambitious approaches to due diligence in supply.
- Governments should also ensure the right tools exist to facilitate and provide incentive for responsible business behaviours.
- Businesses are also responsible for putting in place appropriate processes to integrate social, environmental, ethical, human rights and consumer concerns into their business operations and core strategy in close collaboration with their stakeholders.
- Other actors such as non-governmental organisations also have a key role to play in engaging with the above actors to provide feedback on what works best, to bring in some expertise on specific matters and help find innovative solutions.
What are your views on recent developments in responsible business and its governance?
As put forward in the 2011 CSR Strategy, the EU promotes and fully aligns with internationally recognised principles and guidelines on Responsible Business Conduct which represents an evolving and strengthened global framework for RBC. We believe this is key in order to advance a more level global playing field. One important focus of our action is to ensure and foster consistency between these different developments.
What are you currently working on?
As the European Commission, we promote responsible business conduct through different policies, including our development cooperation, public procurement and industry policies.
With regard to trade policy, a series of trade policy tools are deployed to encourage other countries to promote sustainable development. They include: Free Trade Agreements (FTAs) and Economic Partnership Agreements with ACP countries (EPAs) at multilateral level, unilateral instruments such as GSP+, as well as innovative partnerships such as the Bangladesh Compact or the Myanmar Labour Initiative.
Stakeholders including businesses have been key in helping us drive progress on the ground and we encourage them to continue their engagement. For example, our work in Bangladesh has been reinforced by the unprecedented private sector engagement. Business associations, in particular through the Accord and the Alliance, have indeed enabled significant progress in terms of health and safety of workers in Bangladesh.
We are aware that responsible management of supply chains arise not only from government action, but also from a shift in the market place towards more sustainable practices.
A key focus of our action is to contribute to the development and the dissemination of internationally agreed principles and guidelines on Corporate Social Responsibility (CSR)/RBC. We believe this is key to help our companies and investors to strengthen the contribution of their activities to sustainable and inclusive growth in the EU and abroad:
- In terms of development, as part of its trade and investment policy the Commission participates actively in the work on RBC and Responsible Business Conduct in the OECD.
- In terms of dissemination, we have included provisions on the promotion of CSR practices in our trade agreements (e.g. Korea, Central America, Colombia-Peru) – the most recent FTAs referring explicitly to internationally recognised guidelines and principles such as the UN Global Compact, the OECD Guidelines for Multinational Enterprises, or the Tripartite Declaration of principles for multinational enterprises of the International Labour Organisation (ILO).
- As our trade agreements enter into force, we want to make good use of the potential they have to support CSR, and look forward to a meaningful engagement in this area with our partner countries and other stakeholders.
*Please note that the views expressed above are of the speaker and not of Chatham House.