Corporate Social Responsibility Report on CSR in Bangladesh, 2012 BEI, 15 July, 2012 Dhaka Check against delivery Brief sharing of Norwegian experience Ragne Birte Lund Ambassador of Norway I would like to congratulate the CSR Centre, Shahmin Zaman and her staff for presenting a very useful report and tool on CSR in Bangladesh 2012. I also want to thank Farooq Sobhan President of the Bangladesh Enterprise Institute for hosting this event to raise awareness, greater knowledge, share experience on how to implement good practices. The issue is no longer whether responsible business conduct makes sense, but how to ensure that the private sector can be most effectively harnessed to drive long-term economic growth, environmental sustainability and social progress. The conditions in societies where companies operate indeed vary. There is no one size fit model -yet - there are certain key principles that could and should apply in all countries. It needs to go beyond philanthropy. In recent years a set of CSR standards and universal values that the report also refers to has been codified and articulated. These have guided the Norwegian Government’s approach. The Norwegian government encourages the international activities of Norwegian companies. These activities create value and economic growth in Norway as well as in the host country, and may contribute towards political and social development. One of the strongest drivers of sustainable development is in the Norwegian Government’s view; responsible, long-term investment and private sector development. Through trade and long-term investment, transfer of technology, knowledge and competence building, businesses can contribute to infrastructure and asset development, enforcement of ethical guidelines and labour standards, Corporate Social Responsibility and competence development. Norwegian companies can contribute to significant job creation, raised standards and global competitiveness, increased tax revenues and diversified and sustainable economic and social development. The companies can show the way for greater participation of women in economic life. Corporate social responsibility towards people, society and environment that are affected by their activities has become an integral part of their core values and governance. Although Bangladesh has been one of the countries receiving the largest amount of Norwegian development cooperation funds, I believe today the most important contribution by Norway is happening through investments in the private sector, notably in the telecom sector. GP who is one of the companies interviewed in this report and GP has a very developed CSR policy. Innovation Norway’s Business matchmaking Program in Bangladesh has proved to be a win-win program for Norwegian and Bangladeshi companies. The objective of the Program is to establish sustainable and profitable business ventures between Norwegian and Bangladeshi companies, and reduce poverty in Bangladesh through increased employment and company profits. In the screening process of the companies both Norwegian and Bangladeshi CSR plays a major role. Focus on CSR and having a solid CSR policy is one of the major criteria to be eligible for the program. Increasingly companies are engaging in commercial activities and in trade with countries that are affected by political instability, widespread poverty and corruption. It is particularly in such markets that companies need greater awareness and expertise. However, social responsibility is relevant irrespective of the market and it applies also to activities in Norway. So in view of the increased engagement of Norwegian enterprises in the global market, and the recognition that active cooperation with business is essential in solving the challenges of our time- such as the financial crisis, climate change and widespread poverty a ground breaking work was initiated in 2008-2009 by the Ministry of Foreign Affairs with government institutions, private enterprises and civil society to formulate a White Paper on CSR to be put to the Parliament. The White Paper;” Corporate Social Responsibility in a Global Economy”, was a major step to develop a comprehensive government policy on CSR. It is the result of a wide consultative process with relevant stakeholders. The paper acquired strong support as a policy tool from the parliament. It clearly also states the roles and responsibilities of government. It sees CSR as responsible engagement. It is about how they integrate social and environmental concerns in their business and in their interactions with their stakeholders. CSR is what companies do on a voluntary basis beyond complying with existing legislation and rules in the country in which they operate. CSR and some key challenges that the Government clearly expects the companies to address in their operations First, we expect companies to respect human rights in all their operations. This includes among others the human rights of children, women and indigenous peoples, as set out in international conventions. CSR is about diligence or awareness to manage the issues and not become complicit to human rights abuses, to be a positive agent. Norway has supported the UN Secretary General’s Special Representative on Business and Human Rights who in his function is helping to clarify the human rights responsibilities. We are urging the companies to follow his practical recommendations as to Adopt a human rights policy Carry out risk and impact assessments of their activities Integrate human rights through the company Establish a system for monitoring and auditing in order to track their human rights performance Second, companies ought to respect the rights of employees and provide decent working conditions and pay attention to gender and take action against child labour, forced labour and human trafficking. Although the main responsibility for regulating the working environment lies with the authorities of the countries concerned the private sector has an independent responsibility for working conditions in its own operations. The fundamental standards are set out in the ILO core conventions. The government urges the social partners to actively advocate global corporate agreements in order to safeguard employees’ rights. Let me give an example regarding the supply chain. Even for a large Norwegian enterprise like Telenor, knowing its supplier chain well enough is demanding. This is a challenge for most companies in the global economy, and a challenge their employees, customers and civil society at home expects them to take on. The film “A tower of promises” disclosed child labour and dangerous working conditions in Bangladesh at the plants of suppliers to their local partner Grameen phone. To address the challenge the Norwegian parent company Telenor has had to strengthen the implementation of their supplier conduct principles across the value chain. Third, we expect companies to protect the environment and climate. In 2008 the Norwegian Government pension fund excluded the mining company Rio Tinto from the fund’s investment universe, due to the fund’s Ethical Council’s opinion that the fund as investor could be complicit in pollution from a mine in your country. Increased attention to the issue of complicity means that not only companies directly operating the plants, but also partners in joint ventures and others in the value chain must consider their environmental responsibilities today. Institutional investors of considerable size are putting systems in place to manage these issues. Fourth, we expect companies to engage in fighting corruption and increasing transparency .Transparency about a company’s operations and their impact on people and the environment is in itself a soft power. We need soft but firm mechanisms driving voluntary responsibility. Transparency is one such mechanism. According to surveys Norwegian companies suspect they have lost business in their international operations due to bribery by competitors. 27 % are sure that they have lost business due to corruption. 34 % have refrained from doing business in a country due to the country’s reputation for corruption. Norwegian courts may also hold the headquarters in Norway legally responsible if their branch in another country engages in corruption even on the level of facilitation payments. Fines or, up to ten years in prison, may be the consequence. Any Norwegian company may face situations where bribes or other forms of corruption are expected. The law is clear the challenge must be handled by the company. The message is quite clear; CSR is about respecting human rights, respect for the rights of employees and decent working conditions, protection of the environment and fighting corruption. There is yet another side of the coin. The Government not only expresses what it expects of companies and regulates them. It is an agent in its own right. If we expect companies to act responsibly we must consider our own responsibility and promote coherent policies in all areas. So the white paper also discusses the respective roles and responsibilities of the authorities, the private sector and other actors. The Government seeks systematically to boost Norwegian companies’ motivation and ability to demonstrate corporate social responsibility by strengthening guidance and advisory measures and by increasing openness and exchange between the authorities and the private sector. The main government roles are; As law maker and regulator Taking part in negotiating international treaties and conventions in relevant areas and we are pursuing efforts to develop conventions and other more binding mechanisms. When it comes to our own practice the government emphasises CSR in Norwegian development assistance and in support for investments in developing countries The Government aims for the public sector to be at the forefront in CSR procurement, ownership and investments. Regarding public procurement a 3 year action plan has been drawn up in order for the Government to become a more responsible customer taking account of environmental and social issues. Also through its investments policy the Government may influence companies through its ethical guidelines for the foreign investment part of the Norwegian Pension Fund. Active ownership is exercised. Some 30 companies have been excluded from the fund’s investment universe. CSR has a central role to play for private sector and as well as for the political authorities if positive opportunities are to be grasped and negative consequences avoided. Another characteristic of the Norwegian approach to CSR is the Government’s positive impression of Norwegian companies’ ability and willingness to contribute. Thus, cooperation, information and motivation are strong components of the Norwegian CSR policy. In stressing human rights, decent work, environment and anti-corruption, the Norwegian approach to CSR means that responsibility should manifest itself in the core activities of the companies. It does not matter how much a company contributes to the community or to charities in cash or kind, if not the core activities are conducted in a responsible way. Norwegian companies have a tradition for a cooperative relation to trade unions, where both the process of conflicts and areas of cooperation are regulated by binding agreements. Norwegian companies have a well developed practice in the field of Health, Environment and Safety, both reducing the negative impacts of enterprise, and improving the productivity and profitability of companies. We strongly encourage Norwegian companies to share these experiences, and to uphold their best practice in their international operations – as well as learning from the best practice of others. Finally, The White Paper clearly underlines Norway’s international approach to CSR. We contribute to important international processes like the OECD guidelines for multinational enterprises and promote the UN Global Compact and its 10 fundamental principles, ILO’s decent work agenda, working with WTO and ILO, as well as the process led by UN Secretary General’s Special Representative, Mr. John Ruggie on Business and Human Rights that led to the adoption of the Guiding Principles on Business and Human Rights; Implementing the UN “Protect, Respect and Remedy” Framework . We are also an active partner in a unique tripartite multi- stakeholder initiative for Voluntary Principles on Security and Human Rights for the oil, gas and mining companies. A short version of the White Paper on corporate social responsibility that includes the key international guidelines is made available to you. Today’s launch of the CSR 2012 report on Bangladesh will hopefully help to strengthen the momentum of CSR among key actors in Bangladesh in taking practical steps to include CSR in their policies and core activities – and to seize CSR as a source of opportunity, innovation and competitive advantage. It will certainly be of use to the NCCI and for those who look to Bangladesh as a business destination.
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