Blog of Q's

This is old news, but some readers
missed it. If the plaintiffs had won, it would have been an astounding
precedent for the use of U.S. courts to ajudicate actions that take
place in a foreign jurisdiction.  The controversial attempt to use
this ancient law for this new purpose is a major story  in the
area of
corporate social responsibility. What’s more, it involves 200 year-old
pirates. The law will certainly be back in the news in
2005. For a discussion of the Alien Tort Claims Act, see the January Newsletter at www.csrpolicies.org.
                              

Dec. 13, 2004 (MSNBC) LOS ANGELES – Oil giant Unocal Corp. has reached
an agreement in principle to settle human rights lawsuits involving
allegations of enslaved labor during a 1990s pipeline project in
Southeast Asia, a company spokesman said. The lawsuits maintained that
El Segundo-based Unocal should be held liable for the alleged
enslavement of villagers by soldiers during construction of a natural
gas pipeline in the 1990s in Myanmar…

The federal case, which relies on the 1789 Alien Tort Claims Act that
was originally enacted to prosecute pirates, was reinstated in 2002 by
the 9th Circuit Court of Appeals. The U.S. Supreme Court in June ruled
that certain types of cases involving violations of international law
could be pursued in federal courts under the obscure act.

Press Release from Lifeworth.com, 31st January 2005

Review of 2004 examines corporate contributions to poverty reduction,
and maps out future agenda for corporate social responsibility.

…  The shape of this new [poverty] agenda and the potential and
drawbacks for both business and society is analyzed in the 4th ‘Annual
Review of Corporate Responsibility’, published today, by the
progressive careers service Lifeworth.com. …

… Leading business strategists such as CK Prahalad report that some
companies have seized opportunities by designing products and services
that can be consumed by the world’s poor. …

The Review argues that business engagement with poverty and development
is essential but is currently poorly informed and over-hyped. Much of
the profitable business with lower-income markets involves products
such as mobile phones, not the provision of basic nutrition,
sanitation, education and shelter, so the current expansion of
profitable business in the global South does not necessarily imply
poverty reduction. The type of ‘development’ that is promoted by
marketing consumer products to the poor is also questioned. The
environmental impacts of changing consumption patterns need to be
looked at, as well as the potential displacement of local companies and
increasing resource drain from local economies, as larger foreign
corporations become more active.

The Review argues that future work on how corporations can aid poverty
reduction and development must address exploitative supply chains, tax
avoidance, and anti-competitive practices, as these currently undermine
corporations’ economic contribution to development. …

A good contribution to the debate about “business at the bottom of the pyramid.”

(CSRwire) 01/19/2005 Press release from: Whole Foods Market, Inc.

Whole Foods Market Announces Director of Animal Compassion Foundation
Austin, Texas – Whole Foods Market

(CSRwire.com) 01/25/2005  Press release from: SOHU

SOHU and Miss World Organization Join Hands to Raise AIDS Awareness in China

 BEIJING, CHINA … All contestants who took part in
the recently concluded 54th Miss World Contest have contributed a
favorite personal item that will be auctioned on SOHU’s online store.
… The proceeds will be donated to the [China Center for Disease
Control].

… This announcement contains forward-looking statements. Statements
that are not historical facts, including statements about our beliefs
and expectations, are forward-looking statements. These statements are
based on current plans, estimates and projections, and therefore you
should not place undue reliance on them. Forward-looking statements
involve inherent risks and uncertainties. We caution you that a number
of important factors could cause actual results to differ materially
from those contained in any forward-looking statement. Potential risks
and uncertainties include, but are not limited to, SOHU’s historical
and possible future losses, limited operating history, uncertain
regulatory landscape in the People’s Republic of China, fluctuations in
quarterly operating results, and the company’s reliance on online
advertising sales, e-subscriptions (most of which are collected from a
few mobile telecom operators) and e-commerce for its revenues. Further
information regarding these and other risks is included in SOHU’s
Annual Report on Form 10K for the year ended December 31, 2003, and
other filings with the Securities and Exchange Commission.

In other words, don’t bid too much for that Teddy Bear.
                                                   

* Corporate Social Responsibility

Jan 20th 2005

From The Economist print edition
The movement for corporate social responsibility has won the battle of ideas. That is a pity, argues Clive Crook (interviewed here)

OVER the past ten years or so, corporate social responsibility (CSR) has blossomed as an idea, if not as a coherent practical programme. CSR
commands the attention of executives everywhere—if their public
statements are to be believed—and especially that of the managers of
multinational companies headquartered in Europe or the United States…

On the face
of it, this marks a significant victory in the battle of ideas. The
winners are the charities, non-government organisations and other
elements of what is called civil society that pushed for CSR
in the first place… In fact, their opponents never turned up…

CSR cannot
be a substitute for wise policies … In several
little-noticed respects, it is already a hindrance to them. If left
unchallenged, it could well become more so.

The above excerpts are from the introduction to the Economist‘s
(Jan. 22) survey of corporate social responsibility. Although we often disagree
with that libertarian magazine’s placing all its faith in markets, it
does well to slow down the paradoxically politically correct CSR bandwagon that leads corporations to supplant governments.