CSR, Sustainability, Ethics & Governance

Transcription

1 CSR, Sustainability, Ethics & Governance Series Editors Samuel O. Idowu, London Metropolitan University, Calcutta House, London, United Kingdom René Schmidpeter, Ingolstadt, Germany For further volumes:

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3 Nakib Muhammad Nasrullah Mia Mahmudur Rahim CSR in Private Enterprises in Developing Countries Evidences from the Ready-Made Garments Industry in Bangladesh

4 Nakib Muhammad Nasrullah Faculty of Law University of Dhaka Eastwood New South Wales Australia Mia Mahmudur Rahim School of Accountancy Queensland University of Technology Brisbane Queensland Australia ISSN ISSN (electronic) ISBN ISBN (ebook) DOI / Springer Cham Heidelberg New York Dordrecht London Springer International Publishing Switzerland 2014 This work is subject to copyright. All rights are reserved by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. Exempted from this legal reservation are brief excerpts in connection with reviews or scholarly analysis or material supplied specifically for the purpose of being entered and executed on a computer system, for exclusive use by the purchaser of the work. Duplication of this publication or parts thereof is permitted only under the provisions of the Copyright Law of the Publisher s location, in its current version, and permission for use must always be obtained from Springer. Permissions for use may be obtained through RightsLink at the Copyright Clearance Center. Violations are liable to prosecution under the respective Copyright Law. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. While the advice and information in this book are believed to be true and accurate at the date of publication, neither the authors nor the editors nor the publisher can accept any legal responsibility for any errors or omissions that may be made. The publisher makes no warranty, express or implied, with respect to the material contained herein. Printed on acid-free paper Springer is part of Springer Science+Business Media (

5 Preface This book examines and evaluates how Corporate Social Responsibility (CSR) as a business agenda is growing and becoming recognised in the private enterprises of developing countries taking the readymade garments (RMG) industry of Bangladesh as a case study. In Bangladesh, CSR is growing in importance in corporate businesses in response to global trends. This book finds that the overall application of CSR in private enterprises in this country is emerging and progressing in an incoherent manner. This is due to certain challenges and constraints, notably the absence of multi-player activities, lack of adequate public sector interventions, and an absence of a national consensus on CSR or uniform CSR guidelines. The position is somewhat different in the private enterprises of the Bangladesh s (RMG) industry. This sector is the largest source of this country s export earnings. The practices of labour and environment-related CSR in the form of social compliance requirements from the international buyers are growing steadily in this industry. Also there is a trend of the development of the multi-player activism for the promotion of compliance with these requirements in it. But changes seem only to be occurring in the large contracting enterprises and the enterprises of Export Processing Zones (EPZ). A huge number of small and medium scale enterprises and non-contracting enterprises remain non-participants in this trend. The reasons for this include insufficient co-ordination among stakeholders, resource constraints in factories, the absence of concrete guidelines from government and associations, lack of awareness among workers about their rights, and the absence of firm commitments from international buyers. Eastwood, NSW, Australia Brisbane, QLD, Australia Nakib Muhammad Nasrullah Mia Mahmudur Rahim v

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7 Acknowledgements We could never have come to this book without the kind and generous help and cooperation we from our supervisors, colleagues and friends. Our special thanks to Professor M. Rafiqul Islam, who reviewed the initial draft of this book with interest and utmost care. We extend our thanks to AusAid for providing the Australian Leadership Award; this award helped to pursue a 2 year long research for this book at Macquarie University, Australia. It is impossible to say exactly how much we are grateful to our family members. This book would never have been possible without their patient and continued support. vii

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9 Contents 1 Introduction CSR and Private Enterprises CSR and Private Enterprises in Bangladesh Methodology Scope Framework Understanding of CSR and Its Standards Concept of CSR and Its Fundamentals Definitions of CSR Explaining the Different Dimensions of CSR Development of CSR Standards: Institutional Approaches Voluntary or Self Regulation as a Basis for the Development of CSR Standards Different Forms of Voluntary Codes of CSR Conclusion Trends in CSR Practices in Developed and Developing Countries Trends in CSR Practices in Developed Countries CSR in Developed Countries in Europe CSR in the US CSR in Japan Trends in CSR Practices in Developing Countries CSR in the Middle East CSR in Latin America CSR in Africa CSR in Asia Conclusion ix

10 x Contents 4 CSR Practices in the Private Enterprises of Bangladesh Introduction Background to the Emergence of CSR Practices and Its Driving Factors The Need for CSR Practices in the Private Enterprises Need for CSR Practices from External Perspective Need for CSR Practices from Internal Perspective The Need for CSR from the Sustainable Development Perspective A Review of Current CSR Promotion and Practices in the Private Enterprises Trends in CSR Practices in the Private Enterprises The Trend of CSR Management Certification and External Monitoring and Auditing Social Audit Practice The Trend of Corporate Social Reporting Government or Public Sector Role for the Promotion ofcsr The National Legal Framework and CSR The Role of Business Associations for the Promotion ofcsr The Role of International Agencies for Strengthening CSR in the Private Enterprises The Growth of National Institutes and NGOs for the Promotion of CSR in Bangladesh Obstacles to the Promotion of CSR in the Business Practice of the Private Enterprises in Bangladesh Conclusion CSR practices in the RMG sector of Bangladesh Introduction The Meaning of Social Compliance: Labour and Environment-Related CSR The Need for Social Compliance/CSR in the RMG Sector SMEs in the RMG Sector and their Scope to Access Global Market The Promotion of Social Compliance and Multi-Player Activism The Role of BGMEA for the Promotion of Social Compliance in the RMG Sector The Role of BKMEA for the Promotion of Social Compliance in the Knitwear Sector Government Initiatives for the Promotion of Social Compliance Issues/CSR in the RMG Sector

11 Contents xi Buyers Initiatives for the Promotion of Social Compliance in the RMG Sector The Role of Intergovernmental and Development Agencies in Promoting Social Compliance/Labour and Environment-Related CSR Issue in the RMG Sector The Progress and Current Status of Social Compliance in RMG Sector The Development of Enforcement Mechanism The Review of the Status of Practice in the RMG Sector Restraints Involving Social Compliance in the RMG Industries The Exercise of Social Development Activities and Corporate Philanthropy in the RMG Enterprises Conclusion Current Trends in CSR Practices in Private Enterprises in: Comparative Experiences of Bangladesh and Vietnam Introduction The Main Driving Forces of CSR in Bangladesh and Vietnam The Performance of Labour and Environment-Related CSR Standards and Compliance with Codes of Conduct The Role of Business Associations in Promoting CSR at Enterprises Level The Role of the Government and Public Sector as Navigator of CSR Practices The Development of Institutional and Partnership Activism Conclusion Concluding the Book CSR as a Business Agenda CSR as an Emerging Trend in Global Business Emergence of CSR in Bangladesh CSR in the RMG Sector in Particular The Growth of Multi-player Activities Development of Enforcement Mechanisms Situation of Social Compliance in the RMG Sector Recommendations for the Improvement of the Overall Situation of CSR in Bangladesh Establishment of a National CSR Forum Establishment of a Labour Standards Commission Promoting Government or Public Sector Roles Bringing Regulatory Reforms for Enhancing Companies Social Responsibilities

12 xii Contents Development of Business-Community Partnerships for Social and Development Activities Building Up Multi-player Activism Expanding the Support of Development Agencies and Intergovernmental Organisations Specific Recommendations for the RMG Enterprises Setting a Common Standard for CSR Application Initiative for the Formation of Participatory Committee at the Industry Level Strengthening Communication Systems Introduction of Mandatory Reporting on CSR Establishing a Tri-Party Partnership for Environmental Management Strengthening Coordination and Activities of the Social Compliance Forum Enhancement of Buyers Technical and Logistic Support Entrepreneurs Efforts for CSR and the Workers Associations Cooperation References Index