1. Published on Ethical Corporation (http://www.ethicalcorp.com)
Codes of conduct and standards: the pick of the bunch
Posted by [1] on Feb 21, 2011
Deborah Leipziger has picked her top ten codes and standards. In the first of a two-part report, here
she gives her views on five
While there are a wide range of codes and standards in the field of corporate responsibility, here are
five of my personal top ten of the most influential initiatives.
The UN Global Compact
Global Reporting Initiative
AA1000 Series
OECD Guidelines for Multinational Enterprises
Social Accountability 8000
The UN Global Compact Description:
Launched in 2000, the Compact addresses the environment, human rights, workers rights and
corruption. The Global Compact unites global principles with local networks to create fluid networks.
With more than 80 regional and national sub-networks, the UN Global Compact is a global
multi-stakeholder, multi-issue network. As a voluntary initiative, the Global Compact convenes all
key social actors: companies, labour, civil-society organisations and governments.
Unique selling points: With its local networks, the Global Compact operates at many levels:
globally, regionally and locally. The UN Global Compact benefits from the engagement of several UN
bodies, including the International Labour Organisation (ILO), The UN Development Programme
(UNDP), the UN Environment Programme (UNEP), the Office of the High Commissioner for Human
Rights and the UN Industrial Development Organisation (UNIDO).
The UN Global Compact differs from nearly all other corporate responsibility initiatives in that it
seeks to promote development through good corporate citizenship. By focusing on development, the
compact provides a new direction for corporate responsibility, giving voice to the poor and tackling
such issues as the digital divide and HIV/Aids.
Strengths and weaknesses: No other CR initiative has the moral authority and convening power
of the UN secretary-general. With these assets, the Global Compact has succeeded in promoting
corporate responsibility broadly through networks around the world.
The compact has also mobilised an impressive database of corporate activities on corporate
responsibility. The Global Compact is a truly global initiative, with significant participation from
companies in the south. If the principles of the Global Compact lack the specificity of SA8000 and
other initiatives it is because they were designed to meet the needs of a very global and diverse
constituency of governments and businesses.
The key difference is that the compact was never intended to supplant any regulatory initiatives.
Instead it complements them. The Global Compact office does not have the mandate or the
resources to monitor company activity.
The general nature of the principles can be perceived as both a strength and a weakness. It is easier
to attract a critical mass of companies with general principles than with highly specialised criteria.
Moreover, general principles make it easier for companies to integrate the compact into their own
internal codes or policies.
By developing a general standard, and by forging alliances with highly specialised initiatives such as

2. Published on Ethical Corporation (http://www.ethicalcorp.com)
GRI and SA8000, the compact is able to build critical mass. The Global Compact has been criticised
for lacking an assurance mechanism.
How it has evolved: Since its inception, the Global Compact has
grown dramatically to include 7,700 corporate participants with
networks in 80 countries. In 2008, alone, the Global Compact grew
by 30%. http://www.unglobalcompact.org [2]/
Global Reporting Initiative Description:
The Global Reporting Initiative has pioneered sustainability reporting, providing guidelines that serve
as a framework for economic, social and environmental reporting. In 2006, GRI launched the G3
Guidelines. Although the GRI Guidelines are not a code of conduct, a management system or
standard, they are extremely useful to companies working on code implementation.
The guidelines promote the communication of actions taken to improve economic, environmental
and social performance; the outcome of such actions; and future strategies for improvement. The G3
Guidelines are structured in two parts.
Part 1 includes principles to define report content: materiality, stakeholder inclusiveness,
sustainability context, and completeness and guidance on how to set boundaries for the report.
Part 2 includes standard disclosures, strategy and profile, management approach and performance
indicators.
Unique selling point: The GRI Guidelines are the product of an intensive, multi-stakeholder
consultation process, involving thousands of NGOs, companies, business groups, trade unions, and
accountancy organisations. GRI has developed sector-specific guidelines for a wide range of sectors,
including financial services, electric utilities, mining and metals, food processing and NGOs.
Strengths and weaknesses: GRI encourages companies to set targets and then to report on
whether or not those targets have been met. If the company has not met its targets, it should give
reasons. By encouraging companies to set and report on targets, stakeholders have standards to
which they can hold the company accountable.
Many companies find the large number of indicators within the GRI framework daunting. Reporting
can also be expensive, especially for large organisations.
Progress to date: Thousands of companies in over 60 countries
issue reports which follow the GRI Guidelines. GRI is to be
commended for its cooperative work with a wide range of
organisations, including the Carbon Disclosure Project and others. http://www.globalreporting.org [3]/
AA1000 series Description: Launched in 1999 by AccountAbility, the AA1000 Series is designed to
assist companies, stakeholders, auditors, consultants and standard-setting bodies. AA1000 can be
used in two ways: on its own or in conjunction with other corporate responsibility standards.
It provides a road map for companies on key CR issues, explaining points of divergence and
convergence with other major standards. Founded in 1995, AccountAbility is a global, organisation
set up to promote accountability innovation for sustainable development (though it is in the midst of
a controversial re-structuring).
The AA1000 Series has as its premise three principles: inclusivity, materiality and responsiveness.
The AA1000 Series includes three standards: AA1000APS Accountability Principles AA1000AS
Assurance Standard AA1000SES Stakeholder Engagement Standard
Unique selling point: The AA1000 Principles are compatible with the UN Global Compact, the GRI
and ISO 26000. The AA1000 Assurance Standard can be used with audits of factory compliance with
labour standards and carbon emissions.

3. Published on Ethical Corporation (http://www.ethicalcorp.com)
Strengths and weaknesses: The AA1000 Series provides an overarching framework for corporate
responsibility. The AA1000 Assurance Standard (a part of the series) is designed to cover assurance
processes across the spectrum of sustainability issues.
It is accessible on-line at no cost. The accessibility of the standard is important, as it facilitates
consultation with stakeholders. The consultation process for the AA1000 Assurance Standard has
been thorough, benefiting from input into a wide range of organisations. A major challenge facing
the field of assurance will be to build capacity among assurance providers.
Progress to date: The AA1000 series is used by a wide range of
organisations, including multinational companies, small and medium
sized enterprises, governments and civil society. http://www.accountability.org [4]
OECD Guidelines for Multinational Enterprises Description:
The OECD Guidelines for Multinational Enterprises feature recommendations from governments to
companies. Unique among corporate responsibility tools in its comprehensive nature, the OECD
guidelines address all aspects of corporate behaviour, from taxation and competition to consumer
interests and science and technology.
The guidelines are voluntary and non-binding. To fully understand the objectives of the guidelines, it
is necessary to review the role of OCED. The Organisation for Economic Co-operation and
Development promotes policies that contribute to economic growth and development.
Founded in 1961, OECD has made a significant contribution to corporate social responsibility by
developing CR-related principles, including the OECD Principles of Corporate Governance and the
OECD Convention on Combating Bribery.
Unique selling points: The OECD guidelines are among the most comprehensive of CR tools,
addressing a range of issues unparalleled in any single CR instrument. The guidelines are a map for
companies of the type of CR issues they may encounter. OECD requires each member state to
appoint a National Contact Point (NCP) to promote the guidelines. The NCPs provide local
infrastructure for the guidelines.
Strengths and weaknesses: The guidelines encourage companies to observe standards of
employment and industrial relations not less favourable than those observed by comparable
employers in the host country.
In many regions, observance of local norms would be insufficient to meet basic standards set by the
International Labour Organisation. The ILO participated in the negotiations and views the Guidelines
as being compatible with its own conventions and declarations.
The words not less favourable than mean that companies are asked to observe the other
recommendations on human rights, core labour standards, and supply chain codes.
Progress to date: The 42 governments that adhere to the guidelines have
begun work to update the guidelines. The last revision occurred in 2000. http://www.oecd.org [5]
Social Accountability 8000 Description:
Social Accountability 8000 is a global and verifiable standard designed to make workplaces more
humane. The standard combines key elements of the ILO conventions with the management
systems of the International Organisation for Standardisation (ISO). SA8000 is a certification
standard developed, overseen and updated through multi-stakeholder dialogue with trade unions,
companies, NGOs and academics.
Unique selling point: SA8000s management systems differentiate the standard from most codes
of conduct and statements of intent. Its requirement of the creation of management systems

4. Published on Ethical Corporation (http://www.ethicalcorp.com)
ensures that social issues are integrated into all aspects of company policy and day-to-day
operations. Management systems include the need for training programmes, communications,
elected representatives, management reviews, control of suppliers, and planning and policies,
among others.
Strengths and weaknesses: SA8000 applies to companies around the world and across industries,
serving as a common benchmark that ensures basic rights are respected within the supply chain of
companies and industries.
Social Accountability International, which developed SA8000, has implemented extensive training
programmes and capacity building efforts around the world. SA8000 has been criticised for being too
rigorous and by others for being too weak.
Like other standards that include management systems, SA8000 is biased towards companies that
have already established management systems. As such, it may be easier for large companies to
implement SA8000 than for smaller companies.
Progress to date: As of June 2010, there are 2,258 workplaces certified to
SA8000 in 60 countries and 66 industries. Over 1.3 million workers are
employed in facilities which have received SA8000 certification. http://www.sa-intl.org [6]/ In part
two, I will examine the following.
Universal Declaration of Human Rights
ILO Tripartite Declaration
OECD Convention for Combating Bribery
The Ethical Trading Initiative Base Code, and the
Ceres Principles
Deborah Leipziger is the
author of The Corporate
Responsibility Code Book.
EC readers can save 40%
on the fully revised second
edition here: http://www.greenleaf-publishing.com/productdetail.kmod?productid=3095 [7] by using
the discount code EC4CODE at the checkout.
Links:
[1] http://www.ethicalcorp.com/user/9332
[2] http://www.unglobalcompact.org
[3] http://www.globalreporting.org
[4] http://www.accountability.org
[5] http://www.oecd.org
[6] http://www.sa-intl.org
[7] http://www.greenleaf-publishing.com/productdetail.kmod?productid=3095
Powered by TCPDF (www.tcpdf.org)

5. Published on Ethical Corporation (http://www.ethicalcorp.com)
Codes of conduct and standards: the top ten, part II
Posted by [1] on Jun 27, 2011
Deborah Leipziger has picked her top ten codes and standards. In the second of a two-part report,
here she analyses another five
In the first [2] part of my report, I analysed the following international codes of conduct and
standards.
The UN Global Compact
Global Reporting Initiative
AA1000 Series
OECD Guidelines for Multinational Enterprises
Social Accountability 8000
Here, I will examine the other five that make up my top ten:
Universal Declaration of Human Rights
ILO Tripartite Declaration
OECD Convention for Combating Bribery
The Ethical Trading Initiative Base Code
Ceres Principles
Universal Declaration of Human Rights
Description: The Universal Declaration of Human Rights is one of the most significant documents
ever drafted. It enshrines the concept of human rights broadly, to include not only political rights but
also social and economic rights. Universally accepted, the UDHR has formed the basis of many
constitutions around the world. Moreover, the UDHR is cited in many corporate responsibility codes
and principles.
Adopted by the UN General Assembly in 1948, the UDHR was unanimously adopted by the then 48
member states of the United Nations. In 1993, 171 governments adopted the Vienna Declaration
which affirms support for the UDHR. The declaration is not legally binding but is accepted as
customary law. The UDHR is elaborated on in two UN international covenants – one on civil and
political rights and one on social, economic and cultural rights. These two covenants are binding for
states that decide to become a party to these treaties.
Unique selling point: One of the greatest strengths of the UDHR is its acceptance around the world
as a cornerstone of human rights. The clarity of its composition is also a great strength.
Strengths and weaknesses: Despite the fact that it is already over a half century old, the UDHR
remains as relevant in 2010 as it was in 1948. However, it is important to remember that the
drafters of the UDHR were predominantly of western background, leading some critics to argue that
the concept of human rights is a “western” notion. To refute this argument, it is worth noting that
very few governments have filed significant reservations on any human right treaties (which are
based on the UDHR) they have ratified. The UDHR has also been criticised for its lack of focus on
minorities and indigenous peoples. However subsequent UN documents have compensated for this
oversight. The declaration is not easily translatable into corporate action but is a starting point for
companies seeking to commit to human rights principles.

6. Published on Ethical Corporation (http://www.ethicalcorp.com)
Progress to date: One of the challenges in the human rights field is to translate the UDHR [3] into
business principles. Social and economic rights are being translated into business codes but civil and
political rights are rarely included in business principles. The Danish Centre on Human Rights has
made significant progress in translating the articles of the UDHR into business principles with the
support of companies and stakeholders.
ILO Tripartite Declaration
Description: Launched in 1977, the International Labour Organisation’s Tripartite Declaration of
Principles concerning Multinational Enterprises and Social Policy is directed towards companies,
governments, trade unions and employer organisations. The declaration refers to 28 ILO
conventions, and as many recommendations, that were negotiated within a multilateral framework.
Unique selling point: The Tripartite Declaration provides a very useful reference for governments
as well as companies on their role in promoting corporate responsibility as well as social and
economic development.
Strengths and weaknesses: The declaration includes procedures for examining disputes that arise in
its implementation. A government or trade union can seek to establish whether or not the behaviour
of a company is in accordance with the declaration. As for the OECD Guidelines for Multinational
Enterprises, companies are encouraged to observe standards comparable to the host country in
which they operate. For many parts of the developing world, the observance of local norms could still
involve poor working conditions.
Progress to date: The declaration has had a significant impact on corporate responsibility codes
and standards, many of which draw on ILO [4] conventions.
OECD Convention for Combating Bribery
Description: Launched in 1999, the OECD Convention on Combating Bribery of Foreign Public
Officials in International Business Transactions is a landmark agreement, defining key terms and
developing a legal framework for addressing bribery. The convention applies to bribery of foreign
officials anywhere, regardless of where the incident takes place.
The convention criminalises offering and/or paying bribes, but not soliciting and/or accepting bribes.
It covers only the bribery of foreign officials and not private-to-private corruption. The convention
allows “small facilitation payments” to low-ranking officials.
Unique selling point: The OECD works with a wide range of regional programmes to combat
bribery.
Strengths and weaknesses: Despite the OECD’s wide-spread co-operation with regional programmes,
the corruption of public officials continues. According to Transparency International’s Bribe Payers
Index, local firms are more likely to bribe government officials than multinational companies are. The
convention does not address bribery of officials by local business and it has been criticised for failing
to capture the full extent of bribery. For example, it does not cover bribery of private-sector
employees. Moreover, it fails to address the bribery of political parties and political candidates. The
convention provides no protection for whistle-blowers who uncover corruption, which can lead to
reluctance to disclose incidents of bribery.
Progress to date: The convention has been ratified by all 33 members of the OECD [5] and by a
growing number of non-members as well.

7. Published on Ethical Corporation (http://www.ethicalcorp.com)
AA1000 Series
Description: Launched in 1999, the AA1000 Series is designed to assist companies, stakeholders,
auditors, consultants and standard-setting bodies. AA1000 can be used in two ways: on its own or in
conjunction with other corporate responsibility standards. It provides a road map for companies on
key CR issues, explaining points of divergence and convergence with other major standards.
The AA1000 Series has been developed and established by AccountAbility, and has as its premise
three principles: inclusivity, materiality and responsiveness.
The AA1000 Series includes three standards:
AA1000APS Accountability Principles
AA1000AS Assurance Standard
AA1000SES Stakeholder Engagement Standard
Unique selling point: The AA1000 Principles are compatible with the UN Global Compact, the GRI
and ISO 26000. The AA1000 Assurance Standard can be used with audits of factory compliance with
labour standards and carbon emissions.
Strengths and weaknesses: The AA1000 Series provides an overarching framework for corporate
responsibility. The AA1000 Assurance Standard (a part of the series) is designed to cover assurance
processes across the spectrum of sustainability issues. It is accessible online at no cost. The
accessibility of the standard is important, as it facilitates consultation with stakeholders. The
consultation process for the AA1000 Assurance Standard has been thorough, benefiting from input
into a wide range of organisations. A major challenge facing the field of assurance will be to build
capacity among assurance providers.
Progress to date: The AA1000 [6] series is used by a wide range of organisations, including
multinational companies, small and medium sized enterprises, governments and civil society.
The Ethical Trading Initiative
Description: The Ethical Trading Initiative seeks to improve the lives of workers in global supply
chains by creating a forum to identify and promote good practice in the implementation of codes of
conduct. The ETI is tripartite, consisting of membership groups from three sectors: companies, NGOs
and trade unions. It is funded by the UK government’s Department for International Development
and from membership fees.
Unique selling points: The ETI is interested in sharing the lessons learned from various different
approaches to monitoring, verification and other aspects of code implementation. In pursuit of its
aims, ETI conducts experimental projects into aspects of code implementation, hosts seminars,
events and conferences and has a research and publications programme.
Strengths and weaknesses: Company members report that the ETI provides a valuable forum in

8. Published on Ethical Corporation (http://www.ethicalcorp.com)
which to engage trade unions and NGOs. In addition, the ETI catalyses learning by sharing good
practice and networking while providing a peer review of corporate progress and co-operation rather
than competition.
The forging of new partnerships is also an important priority for the ETI and it works in partnership
with industry stakeholders in all its experimental work. For example, in the South African province of
Western Cape, the ETI has helped to establish the Ethical Trading Forum, which brings together
producers, trade unions, NGOs and government to promote better working conditions within the field
of agriculture.
One of the major lessons learned through ETI consultations is the degree of complexity and
ambiguity within the field. As the pilot studies replicate the ETI tripartite model they are forging
important alliances. However, working within the tripartite structure can be time-consuming and
expensive.
Progress to date: The ETI’s [7] members include companies with a combined turnover of over
£107bn, from a wide range of sectors, including supermarkets, fashion retailers, department stores
and stone sourcing companies, as well as major suppliers to retailers of food and drink, flowers,
clothing, shoes, home, promotional and other products.
Ceres Principles
Description: The ten Ceres Principles cover the major environmental concerns facing companies,
including energy conservation, reduction and disposal of waste, and risk reduction. Originally known
as the Valdez Principles, they were launched in 1989 as a response to the environmental disaster of
the Exxon Valdez oil tanker.
Endorsing companies must commit publicly to the principles, address issues raised by the Ceres
network and other stakeholders and report annually on their progress in meeting the Ceres
Principles. Ceres is a coalition of more than 80 companies, with Sunoco being the first Fortune 500
signatory, joining in 1993. Coca-Cola, the Ford Motor Company, General Motors and Polaroid are
among some of the most well-known companies that have endorsed the principles.
Unique selling point: One of the greatest strengths of the Ceres Principles is the degree to which
Ceres engages with companies in on-going dialogue. Unlike the majority of the other principles and
standards featured here, a company cannot unilaterally decide to adopt the Ceres Principles.
Endorsing the principles is a two-way process which includes both the commitment of the company
and the acceptance of the board of directors of Ceres.
Strengths and weaknesses: The Ceres Principles are among the few initiatives profiled in this
report that include a clause to protect whistle-blowers. This is very important to safeguard those
employees who disclose damaging information from suffering retaliation for going public.
Ceres is a US-based organisation addressing global issues. It would be a challenge for an
organisation such as Ceres to expand globally and still maintain its cohesive network and sense of
trust. Ceres maintains its US roots and identity, but with a global reporting mechanism.
Progress to date: There are nearly 100 Ceres [8] companies, including Bank of America, Gap, Nike
and Timberland. Ceres also works with investors worldwide.
Links:
[1] http://www.ethicalcorp.com/user/9332
[2] http://www.ethicalcorp.com/governance-regulation/codes-conduct-and-standards-pick-bunch
[3] http://www.un.org/en/documents/udhr/index.shtml
[4] http://www.ilo.org
[5] http://www.oecd.org
[6] http://www.accountability.org
[7] http://www.ethicaltrade.org/
[8] http://www.ceres.org/page.aspx?pid=705

9. Published on Ethical Corporation (http://www.ethicalcorp.com)
Powered by TCPDF (www.tcpdf.org)

10. Published on Ethical Corporation (http://www.ethicalcorp.com)
ISO 26000: Sustainability as standard?
Posted by Jon Entine [1] on Jul 11, 2012
Jon Entine asks if, almost two years on since its launch, ISO 26000 is working
Is ISO 26000 – from the International Organisation for Standardisation – meeting its goal of
pressuring governments, business and NGOs to operate according to a set of global social
standards? That’s a challenging question considering the final document was simultaneously
ambiguous, ambitious and toothless.
The standard’s goal is in fact modest. It’s not a management system but a guide to “socially
responsible” organisational behaviour. It offers social philosophy without certification – which critics
say makes it a limp noodle. After all, with no verification, corporations can use it to boost their public
image by trumpeting standards that for the most part require little more than high-minded rhetoric.
“Many companies will be happy to proclaim their use of the standard [whether legitimate or
not],” warns Adrian Henriques [2], chair of the UK committee on ISO 26000 and visiting
professor of accountability at Middlesex University business school. Henriques cites Toshiba, whose
most recent corporate responsibility report is structured on ISO 26000, although it is not referenced.
Often, the standard appears to be invoked as a public relations gimmick. Henriques notes that
Showa Denko, a leading Japanese chemical engineering firm, writes in its 2011 social responsibility
report that it used the standard to “ensure compliance with guidelines for social responsibility”, but
provides no data to support this claim.
Nevertheless, ISO 26000 has its defenders, based on the rationalisation that something is better
than nothing. “I strongly believe that a guidance document is exactly what is needed at the
moment,” says ISO secretary-general Rob Steele, rejecting criticism that it lacks enforcement
mechanisms.
Let’s be clear: the 26000 standard is nothing like the guidelines put forth by the ISO on other aspects
of business. Because of the charged issues here, ISO 26000 is both vague and highly political. Each
section has a laundry list of daunting societal problems, mostly in developing countries, followed by
a wish list of NGO-supported solutions, the bill for which would be picked up by developed countries
or multinational companies.
The standard is being used. Various aspects are providing blueprints for left-leaning European
countries, empowering advocacy groups and inspiring activist judicial systems to embrace these
“universally agreed upon” principles when conflicts involving corporations come to a head.
National standards
An Austrian national version is expected to mandate actions that are only recommended in ISO
26000. Denmark has used it to adopt a national standard, DS 26001, which offers a “socially
responsible management system” certification. The Swedish local government procurement
standard, launched in 2007, was influenced by developing drafts.
Not surprisingly, developing countries, for example St Lucia, Nigeria and Malaysia, are also
vehement supporters. They believe they could gain from tighter reins placed on multinational
corporations.
The United States and India, which supported early drafts of ISO 26000, ultimately voted, along with
three other countries, against the final version. Critics believe it contains problematic proclamations
about contested notions of environmental impacts and employee and consumer rights, but no
endorsement of shareholder rights.

11. Published on Ethical Corporation (http://www.ethicalcorp.com)
Much of the concern revolves around ISO 26000’s embrace of the “precautionary principle” to
resolve environmental conflicts. Although that conforms to EU practices, it’s rejected by the US,
Japan and other countries, and is considered problematic by scientists because it often eschews
cost-benefit analysis. After much haggling, the final draft eliminated the only criterion that would
have specifically recognised that firms could weigh the costs of taking action on principles of social
responsibility.
Conservative critics also fret that ISO 26000 could be a stalking horse for a United Nations-type
transnational government, threatening national sovereignty. It does not address how to resolve
conflicts between shareholders and stakeholders – direct stakeholders such as employees or indirect
ones such as NGOs that often proclaim to represent “the environment” or “consumers”.
Does an activist group legitimately represent the environment just because it makes aggressive
pronouncements and has ready access to the echo chamber of the media and web? To what degree
should advocacy groups be granted “stakeholder status”?
Many industry leaders, particularly in the US, believe these kind of standards encourage
protectionism ahead of innovation, which is an economic drag, dampening economic recovery. There
are also worries that if ISO 26000 does lead to transnational regulation, it could put a pillar of market
capitalism – the ability of companies to transact business – up for grabs.
Through all the scepticism surrounding ISO 26000, its advocates remain adamant that its potential
for mischief is overstated and its long-range impact will turn out to be both profound and mostly for
the good.
Jon Entine is senior fellow at the Center for Health and Risk Management at George Mason University
and founder of the consulting firm ESG MediaMetrics.
Links:
[1] http://www.ethicalcorp.com/users/jon-entine
[2] http://www.henriques.info/
Powered by TCPDF (www.tcpdf.org)