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Making Multinational Corporations Aware of Their Social Responsibility: Law Versus Reputation?

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Abstract

Designed primarily as a moral responsibility, corporate social responsibility (CSR) is a privileged basis from which to question the reputation of multinational companies and thereby to act on their ability to create economic opportunities. In this movement, Law seems relegated to the background, entangled in its difficulties to take over offshore litigation and to reposition the States in a balanced report of power with multinationals. This chapter argues that Law, and specifically “soft law,” can consolidate the approach of CSR in its questioning of companies’ reputations. Furthermore, and under the condition that it reforms itself, we think that Law can reappear in the foreground of the levers that are available to our societies in order to ensure that multinational companies satisfy social and public interests.

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Notes

  1. 1.

    Ideas that inspired the Rawlsian approach can nevertheless mitigate passions, especially the use of procedures of development of the standard which, according to Paul Ricoeur, have for purpose and for service “to ensure the rule of the righteous over the good, by substituting the procedure of deliberation to any commitment concerning an alleged common good.” In other words, the more the standard of “weak law” will proceed a process that organizes the expression of the different initial designs, and decides in the most democratic way, the more it will gain opportunities to escape social protest.

  2. 2.

    Particularly illustrative in this regard, the international repository of the United Nations “Global Compact” is designed in the form of ten principles deducted of different basic internationalstandards that this institution carries. It aims to lead companies to wonder, in the early stages of the development process of their CSRstrategy, on framework concepts or deliberately vague formulations that must guide their action. Note that other international repositories also use this flexibility in content, in particular the “Guiding Principles of the OECD to the attention of multinational companies,” or even the ISO 26000 standard. Also, reviewing all of these texts, it appears their editors offer an “interpretation” of the stated principles, not so much to impose a unified approach, but to support the company in its questioning and make sure that it is considering all the dimensions of the mentioned subject.

  3. 3.

    In French law, is often cited the judgment of 15 October 1998, by which the Court of cassation has deduced the existence of a contract of employment from the terms of the moral Charter of a humanitarian association, this text requiring indeed from its volunteers a number of principles which violations could be a cause of breach of contractual relationships. Even if a standard of “soft law,” and despite relatively imprecise formulations that it could contain, the judge found that volunteers were submitted, by the effects of this Charter, to the control, the management, and the power of sanction of the association, three elements that constitute a salaried employment relationship.

  4. 4.

    At the end of the 1990s, the reputation of the Nike company had been called into question by several associations because of its social practices in the countries of Southeast Asia. In order to defend itself against these attacks, which we measure easily the negative impact on its reputation, the company responded by developing a very active policy of communication, defending itself of having reprehensible behavior. A Californian community activist, Mr. Kasky, thus heard to call into question the responsibility of the Nike company claiming that it had lied in its communication campaign. In support of its application, he stated that the firm was committed to enforcing social and environmental regulations upon its subcontractors.

  5. 5.

    No more the California jurisdictions than the Supreme Court of the United States finally judged this affair, following a transaction concluded between the parties.

  6. 6.

    Frison-Roche, M.-A. (2017). The author defines compliance as “the will of governmentsto impose rules which they do not have the strength to ensure the effectiveness of. (…) Regulators thus internalize the implementation of these monumentalpublicstandardsinto structuresthat are de jure and de facto informed and powerful: multinational companies which operateinternationalfinancial operations. Hencecomplianceis theglobalinternalization of a localpublicregulationwithin supranational companies that are designated as effective agents ofglobal, monumental goals. Since the goal set bypublicauthorities is legitimate (fight against terrorism, crimes against children, drug trafficking, etc.), the company is bound. It can only outbid the ‘compliance device’ it is implementing to achieve the purpose ofRegulation. If its organization andbehavioris not consistent with the provisions taken by the laws in the very specific areas that are monitoringinternationalandglobalfinancial flows to detect systemically harmful behaviors, then the company is sanctioned and cannot oppose neither any justification nor its own legalsystem: that is howregulationapplies ‘relentlessly.’ Sanction is not the cause ofcomplianceanymore, but rather its consequence.”

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Petit, B. (2019). Making Multinational Corporations Aware of Their Social Responsibility: Law Versus Reputation?. In: Bartoli, A., Guerrero, JL., Hermel, P. (eds) Responsible Organizations in the Global Context. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-11458-9_8

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