Corporate social responsibility pays

The government is introducing new measures to further boost corporate social responsibility (CSR), write Lilianne Ploumen, Minister for Foreign Trade and Development Cooperation, and Henk Kamp, Minister of Economic Affairs, in a letter to parliament. It believes governments, businesses and civil society organisations at home and abroad need to work together better in order to make this happen.

The Netherlands generally scores well on CSR. Dutch companies rank high on the Dow Jones Sustainability Index, for instance, and on international measures of transparency. A growing number of SMEs and trade associations are partners of CSR Netherlands, the national knowledge centre and network organisation on the issue. In other sectors, however, there is still room for improvement.

The government sees CSR as a business opportunity as well as a way for companies to fulfil their social responsibility. According to the OECD Guidelines for Multinational Enterprises, the framework for international CSR, companies have to know how their actions impact on people and the environment, both directly and indirectly through suppliers and buyers. They are responsible for identifying risks and should use their influence to improve situations on the ground.

Working closely with the business community and civil society organisations, the government will audit Dutch companies’ CSR performance using sector risk analysis. In the spring of 2014, based on these analyses, the government will identify sectors that need to address CSR more seriously. It will then launch consultations with these sectors, as it has already done with the textile industry, aimed at a voluntary agreement on CSR including commitments to step-by-step improvements.

In addition, the government will strengthen its focus on public awareness, transparency and oversight. Following the success of the Access to Medicine Index, it will provide funding for new performance indicators. These provide transparent, easy to compare information on individual companies’ efforts on social issues like access to medicines, thus encouraging them to outdo each other. At EU level, the Netherlands calls for asking multinational companies to account in annual reports for their actions with regard to human rights, the environment, social and employment issues and corruption.

In order to strengthen oversight in countries with heightened risks, the government will concentrate on support for capacity building and technical assistance to supervisory authorities. The National Contact Point (NCP) for the OECD Guidelines plays a key role in the Netherlands. The government will decide in 2014 whether any changes need to be made to this body, based on a comparative study into the functioning of NCPs in other countries.