REPORT on the Commission Green Paper on Promoting a European framework for Corporate Social Responsibility
(COM(2001) 366 – C5‑0161/2002 – 2002/2069(COS))

30 April 2002

Committee on Employment and Social Affairs
Rapporteur: Richard Howitt
Draftsman for opinion*: Carlos Westendorp y Cabeza,
Committee on Industry, External Trade, Research and Energy
(* Hughes Procedure)

PROCEDURAL PAGE

By letter of 20 July 2001, the Commission forwarded to Parliament its Green Paper on Promoting a European framework for Corporate Social Responsibility (COM(2001) 366 – 2002/2069(COS)).

At the sitting of 11 April 2002 the President of Parliament announced that he had referred the Green Paper to the Committee on Employment and Social Affairs as the committee responsible and the Committee on Citizen's Freedoms and Rights, Justice and Home Affairs, the Committee on Industry, External Trade, Research and Energy, the Committee on the Environment, Public Health and Consumer Policy, the Committee on Development and Cooperation and the Committee on Women's Rights and Equal Opportunities for their opinions (C5‑0161/2002).

At the sitting of 24 April 2002 the President of Parliament announced that this report would be drawn up in accordance with the Hughes Procedure by the Committee on Employment and Social Affairs and the Committee on Industry, External Trade, Research and Energy.

The Committee on Employment and Social Affairs had appointed Richard Howitt rapporteur at its meeting of 12 September 2001.

It considered the Commission Green Paper and the draft report at its meetings of 19 February 2002, 18 March 2002, 17 April 2002 and 23 April 2002.

At the last meeting it adopted the motion for a resolution by 36 votes , with 3 abstentions.

The following were present for the vote: Theodorus J.J. Bouwman chairman; Marie-Hélène Gillig, Winfried Menrad and Marie-Thérèse Hermange, vice-chairmen; Richard Howitt, rapporteur; Jan Andersson, Elspeth Attwooll, Regina Bastos, Philip Bushill-Matthews, Alejandro Cercas, Luigi Cocilovo, Den Dover (for Roger Helmer), Harald Ettl, Jillian Evans, Carlo Fatuzzo, Ilda Figueiredo, Fiorella Ghilardotti (for Elisa Maria Damião), Anne-Karin Glase, Stephen Hughes, Anne Elisabet Jensen (for Daniel Ducarme), Karin Jöns, Dieter-Lebrecht Koch (for Enrico Ferri), Ioannis Koukiadis (for Anna Karamanou), Rodi Kratsa-Tsagaropoulou, Jean Lambert, Elizabeth Lynne, Thomas Mann, Mario Mantovani, Claude Moraes, Juan Andrés Naranjo Escobar (for Raffaele Lombardo), Bartho Pronk, Lennart Sacrédeus, Herman Schmid, Helle Thorning-Schmidt, Ieke van den Burg, Anne E.M. Van Lancker, Johannes Voggenhuber (for Hélène Flautre), Barbara Weiler and Sabine Zissener (for Miet Smet).

The opinions of the Committee on Industry, External Trade, Research and Energy and the Committee on Women's Rights and Equal Opportunities are attached. The Committee on Citizen's Freedoms and Rights, Justice and Home Affairs, the Committee on the Environment, Public Health and Consumer Policy and the Committee on Development and Cooperation decided on 16 October 2001, 6 November 2001 and 23 January 2002 respectively not to deliver an opinion.

The report was tabled on 30 April 2002.

The deadline for tabling amendments will be indicated in the draft agenda for the relevant part-session.

MOTION FOR A RESOLUTION

European Parliament resolution on the Commission Green Paper on Promoting a European framework for Corporate Social Responsibility (COM(2001) 366 – C5‑0161/2002 – 2002/2069(COS))

The European Parliament,

–   having regard to the Commission Green Paper (COM(2001) 366 – C5‑0161/2002),

-   having regard to the Final Report of the High Level Group on the economic and social implications of industrial change, 1998, and the Commission Communication to the Social Partners on Special Restructuring, January 2002,

-   having regard to the Conclusions of the European Council of Göteborg, 15 and 16 June 2001, SN200/1/01/REV1,

-   having regard to its resolution of 15 January 1999[1] on EU standards for European Enterprises operating in developing countries: towards a European Code of Conduct,

-   having regard to its resolution of 25 October 2001[2] on openness and democracy in international trade,

-   having regard to its resolution of 13 November 2001[3] on the Commission Communication "Services of General Interest in Europe",

-   having regard to the Commission Communication of 15 May 2001 on "A Sustainable Europe for a Better World: A European Union Strategy for Sustainable Development" COM(2001) 264,

-   having regard to the Commission Recommendation of 30 May 2001[4] on the recognition, measurement and disclosure of environmental issues in the annual accounts and annual reports of companies (notified under document number C(2001) 1495),

-   having regard to the Commission Staff Working Paper of 27 March 2001[5] "Consultation Paper for the preparation of a European Strategy for Sustainable Development" SEC(2001) 517,

-   having regard to its resolution of 14 November 2000[6] on the Commission Communication on the Charter of Fundamental Rights of the European Union,

-   having regard to its resolution of 25 October 2000[7] on the Commission Communication on the Social Policy Agenda,

-   having regard to Council Directive 84/450/EEC[8] relating to the approximation of laws, regulations and administrative provisions on the Member States concerning misleading advertising,

-   having regard to the Commission Communication of 20 June 2001[9] on Employment and social policies: a framework for investing in quality COM(2001) 313,

-   having regard to its resolution of 31 May 2001[10] on the Commission Communication on Bringing our needs and responsibilities together: integrating environmental issues with economic policy COM(2000) 576,

-   having regard to its resolution of 17 January 2002[11] on the Commission Green Paper on integrated product policy COM(2001) 68,

-   having regard to Regulation 761/2001 of the European Parliament and of the Council of 19 March 2001[12] allowing voluntary participation by organisations in a Community eco-management and audit scheme (EMAS),

-   having regard to the Commission Communication of 18 July 2001[13] on Promoting core labour standards and improving social governance in the context of globalisation COM(2001) 416,

-   having regard to the 1968 Brussels Convention as consolidated in Regulation 44/2001 of 26 December 2000[14] on jurisdiction and the recognition and enforcement and judgement in civil and commercial matters,

-   having regard to the two most authoritative internationally agreed standards for corporate conduct adopted by the ILO: the "Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy" and the OECD: "Guidelines for Multinational Enterprises", and to codes of conduct agreed under the aegis of international organisations such as the FAO, WHO and World Bank and efforts under the auspices of UNCTAD with regard to the activities of enterprises in developing countries,

-   having regard to the ILO Declaration on Fundamental Principles and Rights at Work, 18 June 1998, and its agreement of universal core labour standards: Abolition of forced labour (Conventions 29 and 105), Freedom of association and the right to collective bargaining (Conventions 87 and 98), Abolition of child labour (Convention 138 and Convention 182), and non-discrimination in Employment (Conventions 100 and 111),

-   having regard to the United Nations Universal Declaration of Human Rights and in particular its article where every individual and every organ of society is called upon to play its part in securing universal observance of human rights, the 1966 International Covenant on Civil and Political Rights, the 1966 Covenant on Economic, Social and Cultural Rights, the 1979 Convention of the Elimination of All Forms of Discrimination Against Women, the 1994 Draft United Nations Declaration on the Rights of Indigenous Peoples, 1989 UN Convention on the Rights of the Child,

-   having regard to the OECD Anti-Bribery Convention (1997),

-   having regard to the European Commission Communication (COM(2001) 211 of 11 April 2001[15]) on Conflict Prevention, the U.S.-U.K. Voluntary Principles on Security and Human Rights and the development of international certification schemes such as those for diamonds to link trade with conflict prevention,

-   having regard to the decision of the European social partners to contribute to the implementation of actions aimed at eradicating all forms of child labour exploitation and to promote the rights of these children throughout the world,

–   having regard to the EU framework policy on quality of work, including the elements of gender equality, diversity and non-discrimination, lifelong learning, and career development, worker involvement, and health and safety,

–   having regard to the Commission Staff Working Paper of 7 March 2002 on the Environmental Integration in the External Policies of the General Affairs Council (SEC 2002) 271,

–   having regard to Rule 47(1) of its Rules of Procedure,

–   having regard to the report of the Committee on Employment and Social Affairs and the opinions of the Committee on Industry, External Trade, Research and Energy and the Committee on Women's Rights and Equal Opportunities (A5‑0159/2002),

A.   whereas all people throughout the world are entitled to work in an environment where their basic human rights, as set out by the Universal Declaration of Human Rights and the ILO Core Labour Standards are fully respected,

B.   whereas there is a clear basis in international law for extending obligations on companies to respect human rights,

C.   whereas global consensus is growing inside companies and in investors’ circles, that they have a broader mission than only making profits, and that the challenge for success lies in combining profitability with sustainability and accountability; whereas major companies and investors have committed themselves to such broader missions and are engaged in initiatives like the Global Compact to elaborate on that mission,

D.   whereas European companies must constantly strive to maintain a gender balance, particularly at middle and senior management levels, with regard to the internal dimension of the branches of their business, not only in Europe but also in third countries where they have branches,

E.   whereas a company's stakeholders are defined as all actors that influence the company or are influenced by the company, and whereas employees remain the primary stakeholders in company activities;

F.   whereas it is widely recognised by the business community that companies are corporate citizens and need to act responsibly towards all stakeholders,

G.   whereas companies could play an important role in promoting sustainable development, especially to combat social exclusion and discrimination, reduce environmental impacts, and develop services and products meeting the criteria of design for all,

H.   whereas only one third of the voluntary codes of conduct on Corporate Social Responsibility world-wide refer to international social standards of the ILO, according to an ILO survey in 1998,

I.   whereas the broad diversity of voluntary codes of conduct and labels with very different standards and verification mechanisms makes comparison of effective performances problematic, and whereas many of these codes of conduct have been adopted unilaterally by the management of the companies concerned;

J.   whereas there is increasing consensus that the starting point must be a voluntary approach, without removing the possibility of regulation where appropriate;

K.   whereas providing and using information on the social, environmental and economic impacts of companies in a format that is authoritative, accessible and transparent; and as far as possible in a manner that facilitates inter-company comparisons of effectiveness, would be an effective foundation to promote corporate social responsibility throughout the European Union;

L.   whereas there is a growing need for the statistical and quantitative methods in this field to be complemented with the development of a more dynamic dialogue; companies in dynamic dialogue with their stakeholders can more easily and more effectively identify and resolve problems associated with corporate social responsibility,

M.   whereas an EU framework for corporate social responsibility should build on the experience of the EU EMAS regime, in particular its aim for continuous improvement and independent auditing and verification, but recognising that there can be no ‘one-size-fits-all’ approach to CSR,

1.   Welcomes the Green Paper on Corporate Responsibility, the corresponding consultation process and other Commission initiatives aimed at furthering the CSR debate and promoting Corporate Social Responsibility;

2.   Welcomes the huge response to the Commission's consultation as well as voluntary initiatives by companies and employers' organisations, coalitions of NGOs and Trade Unions to promote corporate social responsibility; emphasises however that these initiatives, whilst often complementary, remain subordinate to national and international legislation ;

3.   Points out that companies are required to implement fully statutory provisions concerning equal opportunities for men and women under the relevant international, European and national legislation; calls on companies to take voluntary measures to ensure a high level of equality between men and women (e.g. through positive action) in order to enhance female potential and guarantee that their subcontractors and suppliers uphold women's rights and provide equal opportunities for men and women;

4.   Considers that social and environmental practice by European companies should be subjected to similar scrutiny as competitive practices;

5.   Calls on the Commission to ensure that the practical implementation of its strategy does not detract from efforts to promote clarity in Community action; calls for the administrative requirements which the strategy entails for companies to take account of the Member States’ efforts to simplify administration;

6.   Encourages the Commission to elaborate a broad and more precise definition of corporate social responsibility, not as a marginal concept but as a key objective for a future-oriented company policy, and guiding principle for European socio-economic policies, as developed in the process of the spring summits starting with Lisbon; nevertheless underlines that the concept of Corporate Social Responsibility does not prejudice or replace other initiatives of the European Social Agenda; the promotion of CSR should instead help to promote a more positive attitude in the business world to social legislation and regulation, and a better compliance performance in this field;

7.   Emphasises the importance of social partnership of employers and employees and employee representatives both within the company at different levels, and in a broader local, regional, sectoral, national, European and global framework of social dialogue;

Codes of conduct and social reporting

8.   Invites the Commission to bring forward a proposal in the appropriate Directive (The Fourth Company Law Directive) for social and environmental reporting to be included alongside financial reporting requirements;

9.   Calls on the Commission to include in this proposal proactive encouragement for each company to present, in cooperation with workers' representatives, annual equal opportunities plans which provide information regarding the numbers of men and women at each of the company's organisational levels, possible measures to improve the situation in cooperation with employees' representatives, information for each sex regarding remuneration, promotion and training opportunities and proposals designed to ensure that work is better organised for the purpose of reconciling family and working life;

10.   Calls on the Commission in particular to initiate discussions in relation to this proposal to ensure compliance as a requirement of stock exchange listing, initially through collaboration with Member State stock exchange regulators;

11.   Calls for annual social and environmental impact assessment reports to be independently verified and include all levels of the company, its supply chain and business partners, where appropriate, and to consider proposals being formulated by Social Accountability International, the Clean Clothes Campaign, the Fairwear Foundation, the Ethical Trading Initiative and the Institute for Social and Ethical Accountability on monitoring and verification mechanisms;

12.   Calls on the Commission to investigate within the limits of its own competencies and those of the Member States, how far information about companies’ social and environmental performance already held by regulatory authorities could be better collated and published;

13.   Calls on all European private and collective pension funds to state their ethical criteria in their investment policies;

14.   Calls on the Commission to put forward a proposal on social labelling; it should as a minimum be based on criteria such as compliance with human and trade union rights, the work environment, training and development of employees, equal treatment, social and ethical consideration for employees and citizens in the surrounding community; the Commission is also called on to consider whether it is appropriate to introduce common social and environmental labelling;

15.   Calls on the two sides of industry at European, national and sectoral level to agree on codes of conduct that uphold women's rights particularly regarding (1) equal pay for work of equal value, (2) the quality of women's employment, (3) measures to combat discrimination on recruitment, (4) the adoption of innovative and effective measures to combine family and professional life, (5) the improvement of career opportunities for women, (6) basic and further training opportunities for women enabling them to adapt to technological and economic developments, thereby facilitating their professional reinstatement, (7) health and safety issues and (8) combating duress, mobbing and sexual harassment at the place of work;

An EU Multi-Stakeholder Platform for Corporate Social Responsibility

16.   Calls for a proposal to be brought forward for the creation of an EU Multi-Stakeholder CSR Forum, comprising representation from business, trade unions, non-governmental organisations and public authorities including developing country representatives; calls on the Commission to act as facilitator and convenor and supports the idea of a secretariat being provided by the European Foundation for the Improvement of Living and Working Conditions in Dublin;

17.   Calls on the Council and Commission to ensure that the EU CSR Forum will offer the opportunity to register voluntary codes of conduct and similar initiatives and verify them against minimum applicable international standards such as the OECD Guidelines for Multinationals and the ILO Core Labour Standards;

18.   Calls on the Council and Commission to ensure that their proposals stipulate that Company annual environmental and social impact assessment reports are incorporated in the EU CSR Forum and that companies are encouraged to undertake initiatives based on international standards;

19.   Urges the governments of the Member States and the enlargement countries to set up their national contact points for the OECD Guidelines for Multinationals;

20.   Observes that dialogue between the two sides of industry acting on their own responsibility is and remains one of the primary concerns of the EU; considers that the EU Forum can act as a mediator between companies and individuals or organisations if certain codes have been violated or discrepancies are observed in the annual reports;

21.   Calls on the Council and Commission to ensure that information about the processes and requirements of annual reporting, the basic standards applicable to codes of conduct and sample annual reports and codes of conduct are made publicly available, including through a website of the EU Forum for CSR;

A better role for Stakeholders

22.   Calls at the next revision of the European Works Council Directive, for a section to be inserted in the supplementary provisions of the directive requiring companies or groups of companies to provide information about the social and environmental impact of their operations; calls on the Social Partners in the sectoral dialogue to consider negotiating new agreements in this respect similar to those achieved in the food, commerce and textile sectors;

23.   Considers that the European social dialogue at industry level is a useful instrument for tackling jointly problems associated with the social responsibility of businesses;

24.   Calls for the EU CSR Forum on CSR to devise guidelines for wider stakeholder dialogue, drawing from the experience of companies, NGOs, trade unions, academics and governmental authorities in particular; recommending the adoption of existing guidelines such as AA1000;

25.   Calls on the Commission to promote multi-stakeholder initiatives and pilot projects in the field of CSR in order to ensure dialogue makes the necessary transition to practise; draws attention in this context to the importance of employee engagement in such initiatives and projects;

26.   Recommends that in its Proposal relating to annual social and environmental reporting, companies are asked to ensure board members are specifically made responsible for CSR, and to explore other changes to corporate governance rules at the European level to promote stakeholder dialogue and the rights of minority shareholders;

27.   In particular calls on the High Level Group of Company Law Experts, appointed by Commissioner Bolkestein in September 2001, to specifically investigate the issue of wider stakeholder representation in corporate governance rules in their final report and for the Commission to incorporate this question in its response to the report;

28.   Urges that measures be adopted to ensure that SMEs can make use of instruments which are appropriate to their specific characteristics and which are genuinely accessible for them in practice;

Mainstreaming corporate responsibility issues in European policies

29.   Calls on the European Commission to ensure the basic principles of CSR are fully taken on board in all areas of Community competence, most notably company law, internal market, competition policy, financial market legislation, trade policy, the Common Foreign and Security Policy, and development co-operation policy;

30.   Reaffirms its call to the European Commission to set an example of CSR best practice in all of its own operations;

31.   Welcoming the decision of the Dutch Government to link access to export credits to companies’ compliance with the OECD Guidelines for Multinational Enterprise, calls on the Commission to link incentives for voluntary standards with public sector financial support;

32.   Urges the Council to take into account the Parliament’s position on the principle of corporate social responsibility in the directive on public procurement;

33.   Calls on Commission and Council to take into account the stakeholder approach and other elements of CSR in the further debate on corporate governance and accountability of companies, as well as in the further discussion about company law and financial market issues such as the new proposal for a take-over directive;

34.   Calls on the Commission to support and assist corporate watch groups and other civil society initiatives aimed at monitoring corporate behaviour;

35.   Calls on the Commission together with the European Parliament to strengthen the reporting requirements for corporate political activities at a European level through a corporate lobbyist public registration system; and to ensure the accountability of all its policy-making committees relating to the corporate sector;

36.   Calls on the Commission and the Council to develop Community assistance programmes to third countries in accordance with accepted international environmental and labour standards, and to draw up new projects aimed at facilitating the incorporation of CSR principles into national social and employment legislation by national governments and to include the social partners in this process, and work with labour and environment inspectorates to assure enforcement; furthermore calls on the Commission to support capacity building for southern verification of codes; southern adaptation of international codes to a local context; and southern commentary on corporate reporting and trends in CSR;

37.   Calls on the Commission to enforce strong consumer protection measures to uphold the credibility of corporate information in relation to environmentally and socially responsible business practice, in particular applying provisions regarding misleading advertising;

A role for the European Parliament

38.   Welcomes and encourages the annual hearings held by the Committee responsible on European enterprises operating in developing countries and urges the Committee to continue with these hearings;

39.   Calls for the European Parliament Committee responsible to establish a Working Group on CSR, which should regularly discuss the findings and recommendations at Committee meetings;

CSR issues specific to the European Union

40.   Recommends to all companies to apply the provisions laid down in title III of the Council Regulation (EC) N. 2157/2001 of 8 October 2001 on the Statute for a European Company as well as in Directive 2001/86/EC of 8 October 2001 with regard to the involvement of employees;

41.   Calls on the Commission to guarantee the application of corporate social responsibility throughout all services of general interest, and to promote the role of various services of general interest in combating social exclusion and ensuring minimum standards of service delivery; urges the Commission to incorporate these aspects in the proposal for a framework directive on services of general interest, which must be drafted as quickly as possible;

42.   Calls on the Commission to incorporate the notion and principles of corporate social responsibility in the annual Employment Guidelines and into the upcoming evaluation of the European Employment Strategy; and calls on Member States to integrate the principles and social objectives of corporate social responsibility in to their bi-annual national plans for combating social exclusion; and in their annual National Action Plans on employment proceeding from the horizontal objective of high-quality work;

43.   Calls for the Social Fund to be used to promote CSR in management training and for other employees, including support for certification procedures and for more socially responsible restructuring; and for the Regional Fund to be made more accessible to companies wishing to pursue private investment opportunities in the most disadvantaged communities and regions; in particular promoting EU funding for ‘community development finance institutions’ that specifically support local employment initiatives that otherwise find it hard to access finance from commercial bank sources;

44.   Emphasises that developing the knowledge and skills of all employees is a crucial part of corporate social responsibility; calls for action to be stepped up further to guarantee life-long learning both at Community and national levels; skills audits as part of company annual social and environmental reports as well as national skills audits are key factors here;

45.   Points out that not-for-profit local public services play a vital role in meeting the needs of the victims of social exclusion and that social economy enterprises have accumulated a wealth of experience in the area of social responsibility. Calls on the Commission to take steps to fully recognise the co-operative and voluntary sectors of the economy in the Treaties establishing the Union and to complete an inventory of the experience and implementation of social responsibility in the non-profit sector;

46.   In particular recommends that Social Economy Enterprises and especially workers and social co-operatives explore the possibility to adopt the ‘Bilan Sociétal’, as a tool that allows the possibility to take account of social, economic and environmental aspects, as well as stakeholders’, sub-contractors’ and providers’ behaviour;

47.   Urges the Social Partners to reach agreement in response to the Communication on Restructuring, and the Commission to bring forward a legislative proposal as a matter of urgency if this is not achieved;

48.   Calls on all large companies – as proposed in the Gillenhammer report on responding to change – to draw up in consultation with employees’ representatives public annual social reports containing structured information about practices and policies relating to employment and working conditions; calls on the Commission to adopt an initiative to encourage the drawing-up of such annual social reports;

49.   Emphasises that companies have a responsibility for preventing their employees from being worn down and ejected from the labour market; prevention through guaranteeing a healthy and safe physical and mental working environment must therefore play a central part in all initiatives to promote corporate social responsibility;

CSR issues specific to Europe's relations with third countries

50.   Reiterates its request to the Commission and the Council and the Convention on the Future of Europe to make proposals, as a matter of urgency, to develop the right legal basis for establishing a multilateral framework for European companies’ operations world-wide;

51.   Calls on the Commission to investigate the possibility of creating a European Ombudsman for European enterprises operating in developing countries with respect to CSR;

52.   Welcomes the Commission's intention to support the active promotion of the OECD Guidelines for Multinational Enterprises, invites the Commission to swiftly implement contact points for the OECD Guidelines for Multinational Enterprises in all its delegations in third countries where EU based companies operate – as provided for in the EU 2002 budget for Latin American, Asian and South African countries – , to make sure the presence of staff sufficiently trained in CSR matters, and to include the result of the work of those contact points in the regular reports of the Delegations to the EU institutions, including the EP; further calls on the Commission to implement the findings of its Conference held in May 2001 with regard to the OECD Guidelines, in particular to develop best practices amongst Member States (for example in relation to the conduct of National Contact Points); to convene meetings at the EU level among NCPs with social partners and NGOs represented, to survey experience with the Guidelines among European Companies, to co-ordinate European input to the OECD meetings on the Guidelines, and to assist accession countries -both so they adhere to the Guidelines and give support to new adherents like Estonia and Lithuania;

53.   Calls on the Commission and the Council to take into account the Parliament's position with respect to the implementation of core labour standards and the promotion of international social governance in all areas of Community external activity with particular attention to the application of labour and social standards in international multilateral and bilateral agreements;

54.   Calls on the Council and the Commission not only to present a firm proposal for applying the human rights clause, to include, in particular, clear, precise and verifiable mechanisms for monitoring and assessing the human rights situation, in trade agreements with third countries by establishing appropriate compliance mechanisms, and by ensuring that all human rights, social rights, including the right to organise and the right to strike, and all actors are covered, including EU companies, but also systematically to require their application and to report publicly thereon; also asks that sustainability and gender impact assessments be established as part of the process of developing trade policy;

55.   Draws attention to the fact that the 1968 Brussels Convention as consolidated in Regulation 44/2001[16] enables jurisdiction within the courts of EU Member States for cases against companies registered or domiciled in the EU in respect of damage sustained in third countries; calls on the Commission to compile a study of the application of this extraterritoriality principle by courts in the Member States of the Union; calls on the Member States to incorporate this extraterritoriality principle in legislation;

56.   Asks the Commission to include a reference to CSR and eventually its future Directive relating to CSR into all its proposals for the mandates governing negotiations of co-operation and trade agreements with third countries;

57.   Considers that the objective of any WTO negotiations on a multilateral framework for cross-border investment must be to ensure that such investment helps raise standards of living, provokes sustainable development, promotes respect for human rights and contributes to a fairer distribution of the benefits of the global economy. Insists therefore that such rules must reflect the corporate social responsibilities of international investors as regards for example, social and environmental standards, transparency and probity, anti-competitive behaviour and technology transfer;

58.   Calls on the Commission and the Council to promote the adoption of equivalent measures outside the European Union by Governments, the United Nations and other multi-lateral bodies, such as the Framework Convention on Corporate Accountability to be considered at the World Summit on Sustainable Development;

59.   Calls on the Commission to bring forward specific proposals to promote the contribution of EU companies towards transparency and good governance world-wide, including through the setting up of a blacklist to prevent the tendering for public contracts by EU companies responsible for bribery, for corruption in an EU court of law, similar to that operated by the World Bank, and for non-compliance with minimum applicable international standards (ILO core labour standards, OECD guidelines for multinational companies); and to establish a compliance panel to ensure that companies awarded contracts in the context of EC public procurement or provided with financial guarantees such as export credit guarantees comply with EU human rights obligations and development policies and procedures as well as minimum standards according to the above mentioned ILO and OECD Guidelines in the execution of those contracts; companies on the blacklist would be ineligible for EU contracts or awards for a period of three years;

60.   Calls on the Commission to include in its White Paper specific proposals to address the role that business can play in relation to conflict prevention world-wide, including the extension of the Voluntary Principles on Security and Human Rights within the European Union and the de-linking of arms purchases and natural resource sales, including the application of the certification schemes such as the Kimberly Process for conflict diamonds;

61.   In countries with which the EU has established formal relations, through trade or cooperation agreements, in particular as part of the Cotonou Agreement, it must seek to jointly include the subject of corporate social responsibility in their official agenda;

62.   Reiterates its call in its Resolution of 13 December 2001[17] on the Commission Communication on Conflict Prevention (1999), to address the question of the influence which private and public undertakings have in unstable regions by creating a legally binding framework with sanctions for companies that contribute to conflict;

63.   Instructs its President to forward this resolution to the Council and Commission.

• [1] OJ C 104, 14.4.1999, p. 180
• [2] Adopted texts on 25.10.2001, item 14
• [3] Adopted texts on 13.11.2001, item 12
• [4] OJ L 156, 13.6.2001, p. 33
• [5] Not yet published
• [6] OJ C 223, 8.8.2001, p. 6
• [7] OJ C 197, 12.7.2001, p. 180
• [8] OJ L 250, 19.9.1984
• [9] Not yet published
• [10] Adopted texts on 31.5.2001, item 10
• [11] Adopted texts on 17.1.2002, item 1
• [12] OJ L 114, 24.4.2001, p. 1
• [13] Not yet published
• [14] OJ L 12, 16.1.2001, p. 1
• [15] Not yet published
• [16] OJ L 12, 16.1.2001, p. 1
• [17] Adopted texts, item 15

EXPLANATORY STATEMENT

Introduction

Through its Green Paper on Corporate Social Responsibility the European Commission launched a wide consultation aimed at drawing on existing experience and innovative approaches to CSR to inform a European framework for CSR. Though it was aimed at inspiring wide debate on CSR at a European level, the Green Paper lists a large number of current initiatives whilst suggesting a largely voluntary and good practice approach to the issue.

This report seeks to identify specific priorities in an EU framework for CSR, which should comprise a mix of voluntary and regulatory initiatives, in line with the emerging international consensus. The proposals brought forward by this report are based on previous parliamentary resolutions and extensive consultation undertaken by the Rapporteur (see Appendix) and indeed by the Commission itself.

Global Context

Over the past five years corporate social responsibility has become one of the major issues facing the international community. The restructuring of the world economy since the 1970s has brought greater efficiency and productivity to the global market but it has also been the cause of intensified social degradation - in developing and industrialised countries - as well as increasing environmental destruction. With globalisation came an increasingly vocal message from trade unionists, environmental and human rights campaigners, policy makers and business leaders that the situation was not sustainable either in terms of business objectives or human development.

The European Response

The European Community responded as early as 1993 with a call to business from the President of the European Commission, Jacques Delors, to take part in the fight against social exclusion. In 1999 the European Parliament adopted a its Report on EU standards for European Enterprises operating in developing countries, and in March 2000 the European Council in Lisbon made a special appeal to companies' sense of social responsibility regarding best practices for lifelong learning, work organisation, equal opportunities, social inclusion and sustainable development. Following the prioritisation of CSR as an issue to be addressed under the Belgian Presidency, the Commission published its Green Paper on promoting a European Framework for Corporate Social Responsibility. We now have an historic opportunity to drive forward the debate.

Defining Corporate Social Responsibility

In its introduction, the Green Paper states:

"Corporate social responsibility is essentially a concept whereby companies decide voluntarily to contribute to a better society and a cleaner environment[1]"

This definition is fundamentally flawed for two reasons. Firstly, it undermines the very idea of global governance. Secondly it indicates that the only approach to CSR is a voluntary one.

International law exists to promote and safeguard the protection of human life and the environment. It is not for companies to decide whether they wish to 'contribute' to this.

The Green Paper states:

"Although the prime responsibility of a company is generating profits, companies can at the same time contribute to social and environmental objectives (…)[2]"

This implies that CSR is an optional extra add-on to normal business activities. In reality, it must become a mainstream part of all business activity.

Many companies have taken voluntary action to implement their own codes of conduct and to ensure they honour their social and environmental responsibilities. This should be both praised and encouraged. However, there are countless examples which show that the voluntary approach in itself is inadequate and needs to be reinforced by complementary legislative measures.

Voluntary action itself flows from the interaction of consumer pressure, media pressure, industry peer pressure, competitivity pressures and the threat of new regulations and taxes. European action including relevant legislative proposals can help enhance this interacting set of pressures.

CSR applies both the listed and public (state owned) companies. It applies to multinational enterprises and small and medium sized companies. Our expectations of MNEs and SMEs may differ on account of their relative strength and resources. SMEs may require different time scales to achieve certain objectives according to their capabilities, and may effectively be addressed through the supply chains of larger companies. However, this is not to say that they should not be fully required to fulfil recommendations and legal requirements established at a European level. In most European countries the majority of people are employed by SMEs. This makes them prime players in the CSR debate and means their needs and roles can not be under exaggerated.

Codes of conduct and social reporting

Social reporting is an integral part of providing for proper respect of international accepted social, labour and environmental standards. Transparency is the only means of assuring accountability. At present only a minority of companies produce annual social reports, and do so without a common methodology or reporting standard.

Recent European initiatives aimed at encouraging companies to report have met with little success. The Commission Communication on environmental reporting by companies and Commission requests for companies to voluntarily undertake social reporting, in response to the Gillenhammar report in 1998 and in the Communication to the Göteborg European Council 2001, are examples of this.

A European Directive is needed to resolve this problem. The Directive would set out a timetable for SMEs and MNEs reporting annually on the social and environmental impacts of their activities in Europe and beyond according to minimum reporting standards. These standards could be based upon those set out by the Global Reporting Initiative, which have received international acclamation in their global application. Reporting should apply to every unit of a company: i.e. the entire supply chain and the Commission should seek to develop specific guidelines with the GRI on a supply chain reporting protocol.

In relation to European private and collective pension funds, the Directive should instruct all pension funds to publicly state their ethical policy, similar to legislation already introduced in the UK, Belgium, the Netherlands and Germany.

Companies' codes of conducts and annual reports could be registered with a European Forum for CSR, which will also serve to verify reports. All pension funds could also be required to register their ethical policies.

In an environment where news stories of corporate injustice are far from uncommon, these measures would help to restore consumer trust and would serve to put pressure on companies whose behaviour fails to meet internationally agreed standards.

A European Forum for CSR

Since the call for a European monitoring platform was first made in the European Parliament's 1999 Resolution on European Enterprises operating in developing countries, academics and social partners in particular, as well as others have rallied around the idea, affirming now - more than ever - that there is a great need for such a body.

Nonetheless, it is now necessary to discuss the precise role and function of such a Platform. Multi-stakeholder dialogue would be its first duty. However, in addition companies and others could be invited to register their codes of conducts with the Platform, which would in turn check that all Codes comprised of basic labour, social and environmental standards, already agreed at an international level. Companies might then register their reports on social and environmental impacts, on an annual basis following appropriate European legislation to make this mandatory.

The Platform would require appropriate budgetary allocations. Its board would consist of representatives from the business, NGO, Trade Union and academic communities, including developing country representatives. It would be managed by a secretariat and would operate as a Commission Office.

A better role for stakeholders

A stakeholder, in the CSR context, might be defined as a company’s employees, suppliers and customers, communities in which its operations are located and all other pertinent factors.

Employees remain the leading stakeholders in company activities. Trade unions have played a crucial role in negotiating corporate responsibility agreements with company federations, in the food, commerce and textile industries.

Non-governmental organisations have voiced concern that the traditional social dialogue excludes them from genuine multi-stakeholder discussions. Meanwhile trade unions properly resist any attempt to dilute their negotiating rights in the workplace.

This report suggests that it is appropriate to utilise the Social Dialogue to foster discussion about companies’ wider social and environmental obligations. The European Works Council Directive should be amended, during its next revision, to oblige Works Councils to oversee wider CSR responsibilities, whilst the Social Partners could be invited through the sectoral dialogue to consider negotiating further CSR agreements.

However, in addition the Commission should, through the European Platform, publish guidelines and examples of best practise in stakeholder dialogue. It should provide funding for training managerial staff in private and publicly owned companies how to better incorporate CSR thinking into their managerial structures and activities.

European enterprises should be instructed by the Commission to appoint a board member responsible for CSR. It may be useful for companies to convene a Stakeholder Council or to include a stakeholder representative on its Board, EU Corporate Governance rules should be reviewed in this context to examine these and other opportunities to promote stakeholder participation, including encouraging shareholder activism through strengthening the rights of minority shareholders.

Mainstreaming CSR in all areas of Community policies and programmes

Coherence is imperative to the success of the Commission's CSR policy.

It is particularly disappointing that the Commission has so far missed various opportunities to mainstream CSR throughout all policy areas. One example is the current review of procurement rules, where the potential to link public contracts to higher corporate social and environmental standards has currently not been fully utilised. The decision of the Dutch Government to link access to export credits to compliance by companies with the OECD Guidelines, shows that voluntary standards can be easily linked with public sector financial support. The European Commission should immediately introduce such arrangements into all private sector financial support including investment promotion via the Commission itself and the European Investment Bank, with clear monitoring and complaints mechanisms.

Commission CSR awards ceremonies are planned this year and in future years, equivalent to the Fortune List in the USA. These were not agreed by Parliament or Council and should be carefully considered in the light of criticisms of tokenism and potential lack of rigour in examining company practice.

A role for the European Parliament

The European Parliament Development Committee currently holds annual hearings on European Enterprises operating in developing countries. These have been shown to be extremely useful both in terms of assuring public accountability of companies and also bringing to light some of the difficulties companies face in implementing their ethical policies in developing countries.

In addition, it is now proposed that a working group on CSR be established in the European Parliament’s Employment and Social Affairs Committee. Budgetary appropriations should be allocated so that two annual missions can be arranged. The missions would be to sectors rather than countries. For example, the working group delegation might chose to look at the chocolate industry and might visit European Company plants in Europe and the developing world. Following the missions public statements could be made on the delegation's findings and recommendations. On a more regular basis the working group could invite different stakeholders from Europe and beyond to give presentations. The working group would also be able to monitor policy developments in the European Parliament, where there may be a need to raise CSR concerns.

CSR issues internal to the European Union

It is very worrying that little progress in the area of company restructuring activities has been made, particularly following the Gillenhammar Report (1998). The European Commission's Communication to the Social Partners on Special Restructuring (January 2002) remains open to consultation until the end of the year. The Commission, in its White Paper on CSR should commit itself to bringing forward new legislative proposals as a matter of urgency, if consensus cannot be achieved.

Structural funds should also be used to support good corporate practice in Europe. Provisions should be made to make the Regional Fund more accessible to companies wishing to pursue private investment opportunities in the most disadvantaged communities and regions. Meanwhile the Social Fund could play a stronger role in supporting training for socially responsible restructuring.

CSR issues specific to Europe's relations with third countries

European enterprises have an enormous impact on the lives of millions of people living in third countries across the world.

Currently international liability of European corporations is confined to the 1968 Brussels Convention concerning jurisdiction in European courts where subsidiaries operating in third countries are responsible for (extreme) cases of negligence, leading to manslaughter or other serious harm.

However, almost all contributors to the debate agree that the international dimension represents both the biggest challenge and potential in promoting corporate social responsibility.

Therefore the Parliamentary resolution recommends a series of actions: to develop a legal base for a new multilateral framework, as previously demanded by the Parliament itself, to integrate CSR principles in all EU Trade, CFSP and Development policies, to take specific actions in relation to a possible new EU Ombudsman on corporate responsibility, on conflict-prevention and anti-bribery; and to contribute to developing global CSR initiatives, especially bearing in mind planned WTO negotiations on global rules for cross-border investment.

The European Commission should be asked to co-finance training in promoting global standards in conjunction with the International Labour Organisation training centre in Turin, and targeted at managers and trade union representatives with direct responsibility for trade, investment and sourcing activities in third countries.

• [1] European Commission of the European Communities Green Paper: 'Promoting a European Framework for Corporate Social Responsibility', July 2001, paragraph 8
• [2] European Commission of the European Communities Green Paper: 'Promoting a European Framework for Corporate Social Responsibility', July 2001, paragraph 11

OPINION OF THE COMMITTEE ON INDUSTRY, EXTERNAL TRADE, RESEARCH AND ENERGY

12 April 2002

for the Committee on Employment and Social Affairs

on the Commission Green Paper on Promoting a European framework for Corporate Social Responsibility

(COM(2001) 366 – C5‑0161/2002 – 2002/2069 (COS))

Draftsman (*): Carlos Westendorp y Cabeza

(*) Hughes Procedure

PROCEDURE

The Committee on Industry, External Trade, Research and Energy appointed Caroline Lucas draftsman at its meeting of 22 November 2001.

The committee considered the draft opinion at its meetings of 25 February 2002 and 26 March 2002.

Prior to taking the final vote, Mrs Caroline Lucas stated that given the fact that the amendments adopted had changed her initial position on the subject, she therefore could not continue as draftsman. The Committee then appointed its chairman, Carlos Westendorp y Cabeza, draftsman.

At the last meeting it adopted the following conclusions by 26 votes to 22, with no abstentions.

The following were present for the vote: Carlos Westendorp y Cabeza, chairman; Yves Piétrasanta and Jaime Valdivielso de Cué, vice-chairmen; Caroline Lucas, rapporteur; Nuala Ahern, Konstantinos Alyssandrakis, Sir Robert Atkins, Luis Berenguer Fuster, Ward Beysen (for Elly Plooij-van Gorsel), Guido Bodrato, David Robert Bowe (for Gary Titley), Massimo Carraro, Gérard Caudron, Giles Bryan Chichester, Willy C.E.H. De Clercq, Concepció Ferrer, Francesco Fiori (for Paolo Pastorelli), Neena Gill (for Norbert Glante), Michel Hansenne, Roger Helmer (for Werner Langen), Hans Karlsson, Bashir Khanbhai, Peter Liese (for Peter Michael Mombaur), Rolf Linkohr, Erika Mann, Hans-Peter Martin (for Harlem Désir), Marjo Matikainen-Kallström, Eryl Margaret McNally, William Francis Newton Dunn (for Nicholas Clegg), Angelika Niebler, Reino Paasilinna, Samuli Pohjamo (for Colette Flesch), John Purvis, Alexander Radwan (for Godelieve Quisthoudt-Rowohl), Bernhard Rapkay (for Olga Zrihen Zaari), Daniela Raschhofer, Imelda Mary Read, Mechtild Rothe, Christian Foldberg Rovsing, Paul Rübig, Umberto Scapagnini, Konrad K. Schwaiger, Esko Olavi Seppänen, Claude Turmes, W.G. van Velzen, Alejo Vidal-Quadras Roca, Dominique Vlasto and Myrsini Zorba.

SHORT JUSTIFICATION

The Commission's Green Paper COM (2001) 366 on promoting a European framework for corporate social responsibility could be a significant step towards further encouraging the CSR debate in Europe.

The Green Paper is premised on a definition of CSR whereby companies integrate social and environmental concerns into both their business operations and their interactions with stakeholders on a voluntary basis. However, as various responses to the consultation process (including those submitted on behalf of industry) indicate, there is no uniform definition of CSR.

Indeed, it would appear erroneous to define CSR as only the voluntary part of companies' role, as a major part of companies' social and environmental impact is, rightly, regulated by law. The Green Paper includes within its scope many key areas such as health and safety, environmental impacts and human rights, where legal requirements are essential to ensure that acceptable minimum standards are safeguarded. In this context, CSR incorporates both legal requirements and voluntary best practice, and this should be acknowledged in the debate.

The EU is well placed to promote CSR due to its influence on the national, European and international level, and can ensure that CSR is seen as a key, strategic, cross-cutting issue across the EU. As well as setting an example of CSR best practice in all of its own operations, the EU should provide leadership in the areas of standards implementation and enforcement, in order to raise the level of corporate responsibility, rather than maintaining the status quo. By standardising and harmonising CSR policies, the EU could create a more fair and competitive business environment.

The EU and its member states are major contractors and purchasers of goods and services provided by the private sector, and often support the private sector through export credit insurance and other financial guarantees. This financial power provides them with powerful levers for encouraging CSR. As a purchaser of goods and services, the EU and its member states must be prepared to insist on responsible corporate behaviour from their suppliers, and to make access to EU funds conditional on such behaviour.

There should be a requirement for all companies to state their policy regarding social responsibility, human rights and environmental performance (even if the company's decision is not to have a policy on some or all of these issues). The EU’s support of the triple bottom line corporate reporting is welcomed. This type of reporting recognises all stakeholders, from communities to consumers. However, this can only be meaningful when all companies report to an agreed-upon standard within their given sector, and appropriate to organisational size. Without such a framework, those companies that do report will continue to do so based on loose and incomparable standards. For those where there is little incentive to do so, we further risk following the US trend of declining numbers of corporations reporting on their social and environmental impacts.

The recently revised OECD guidelines are the only multilaterally endorsed comprehensive framework of rules governing the activities of multinational enterprises. They run in parallel to the ILO Tripartite Declaration of Principles concerning Multinational Enterprises but go beyond employment and industrial relations issues to cover general policies for good corporate behaviour. Rather than developing further codes of conduct, the EU should draw on existing initiatives such as these and the UN Draft Fundamental Human Rights Principles for Business Enterprises.

The Global Reporting Initiative (GRI) exists as an example of one generally accepted standard that does not stifle companies' ability to report in different styles, appropriate to each sector and size of enterprise. It is neither a code of conduct nor a set of principles but it can, however, support all such codes and principles - Global Compact, OECD - and others by providing a rigorous, concrete accountability mechanism to assess company adherence to whatever code or principles it adopts.

In this regard, work currently being undertaken by the GRI could serve as a useful template for such reporting and verification standards. Moreover, the GRI has stated in its response to the consultation process that it would welcome the support of the Commission and Member States in the task of developing key indicators for social performance. The Commission should therefore actively support the work of the GRI in establishing the criteria for triple bottom line reporting, with a view to bringing forward a directive on social and environmental reporting within 5 years. A decision in this respect would be a significant EU step towards achieving sustainable business practice, and would make an important contribution towards the forthcoming Rio plus ten Conference in Johannesburg in September 2002.

CONCLUSIONS

The Committee on Industry, External Trade, Research and Energy calls on the Committee on Employment and Social Affairs, as the committee responsible, to incorporate the following points in its motion for a resolution:

1.   Requests the EU to further contribute to the development of CSR by raising public awareness of the nature and importance of CSR;

2.   The European Social Fund could play a more useful role in supporting training so as to make for more socially responsible restructuring;

3.   As valid CSR measures will ultimately accrue to the benefit of the companies concerned, suggests that the Commission encourage campaigns by corporate groupings themselves to increase awareness of the advantages, modalities and best practice in various business sectors and size categories;

4.   Calls on the Commission to ensure that workers, in particular, and their representatives are closely involved in developing and framing CSR approaches, since participation in framing policy is a key factor;

5.   Explicitly welcomes the Commission's initiative, and calls on it to promote model CSR projects in order to provide further encouragement for companies (and especially small and medium-sized firms) to make a commitment to social and environmental responsibility;

6.   Believes that, rather than developing further codes of conduct, the EU should focus on ensuring better compliance with existing codes; therefore welcomes the Commission’s intention to support the active promotion of the OECD Guidelines for Multinational Enterprises, in that such practices will be better implemented on a global rather than a purely EU basis; in particular, it should ensure that the National Contact Points, which supervise the implementation of the Guidelines, provide an effective mechanism for holding companies to account, and that contact points are swiftly established in the EU delegations of those countries where European companies operate, as provided for in the 2002 budget;

7.   Calls on the Commission to develop actual yardsticks for assessing CSR as a sustainability concept for companies in Europe, and to carry out regular benchmarking on the basis of best practice;

8.   Stresses that, given the varied benefits and requirements of CSR, which depend on sector, size and resources, companies should be left to decide, in conjunction with their stakeholders, how and to what extent they should implement CSR measures;

9.   Reaffirms its call to the European Commission to set an example of CSR best practice in all of its own operations;

10.   Calls on the Commission to carry out and publicise cost/benefit studies and evaluations of CSR by company size and sector, with particular regard to the impact on SMEs;

11.   Calls on the Commission to improve the effectiveness of human rights clauses in agreements with third countries;

12.   Calls on the Council and the Commission not only to present a firm proposal for applying the human rights clause, to include, in particular, clear, precise and verifiable mechanisms for monitoring and assessing the human rights situation, in trade agreements with third countries by establishing appropriate compliance mechanisms, and by ensuring that all human rights, social rights, including the right to organise and the right to strike, and all actors are covered, including EU companies, but also systematically to require their application and to report publicly thereon; also asks that sustainability and gender impact assessments be established as part of the process of developing trade policy;

13.   Asks the Commission to maintain a register of blacklisted companies found guilty of corruption in an EU court of law. Companies on the blacklist would be ineligible for EU contracts or awards for a period of three years;

14.   Calls on the Commission and the Council to ensure that the rules governing the WTO multilateral negotiations reflect the corporate social responsibilities of international investors as regards, for example, social and environmental standards, transparency and probity, anti-competitive behaviour and technology transfers, and to promote the adoption of equivalent measures outside the European Union by governments, the United Nations and other multilateral bodies.

OPINION OF THE COMMITTEE ON WOMEN'S RIGHTS AND EQUAL OPPORTUNITIES

18 April 2002

for the Committee on Employment and Social Affairs

on the Green Paper: Promoting a European framework for corporate social responsibility

(COM(2001) 366 – C5‑161-2002 – 2002/2069(COS))

Draftsman: Rodi Kratsa-Tsagaropoulou

PROCEDURE

The Committee on Women's Rights and Equal Opportunities appointed Rodi Kratsa-Tsagaropoulou draftsman at its meeting of 22 January 2002.

It considered the draft opinion at its meetings of 27 March 2002 and 18 April 2002.

At the last meeting it adopted the following conclusions by 11 votes, with 5 abstentions.

The following were present for the vote: Anna Karamanou, chairman; Marianne Eriksson, Jillian Evans, Olga Zrihen Zaari, vice-chairmen; Rodi Kratsa-Tsagaropoulou, draftsman; Regina Bastos, Lone Dybkjær, Fiorella Ghilardotti, Koldo Gorostiaga Atxalandabaso, Lissy Gröner, Astrid Lulling, Thomas Mann, Maria Martens, Christa Prets, Eryl Margaret McNally (for Mary Honeyball) and Anne E.M. Van Lancker (for Joke Swiebel).

SHORT JUSTIFICATION

The objective of the Commission Green Paper is to initiate wider public discussion on ways in which the European Union can promote corporate social responsibility at European and international level. The notion of corporate social responsibility to society reflects the voluntary efforts made by companies to contribute to sustainable social and environmental development and arises from the increased role played by companies in our society as it is now evolving.

The Commission Green Paper does not make specific reference to corporate responsibility regarding equal treatment for women and men, although the European Council in Lisbon made a particular appeal to a corporate sense of social responsibility regarding issues such as equal opportunities. The opinion drawn up by the Committee on Women's Rights and Equal Opportunities should therefore seek to highlight these responsibilities and the major role which can be played by companies in achieving gender equality.

The draftsman considers it important from the outset to draw a distinction between statutory requirements and corporate social responsibility. Undertakings are required first and foremost to comply with the statutory requirements embodied in international, European and national law. They must be aware of their obligations and in this respect the government and the social partners have an important role to play, particularly with regard to SMEs. For example, statutory support mechanisms for SMEs must be introduced in Member States which have not yet done so. Similarly, companies must, in cooperation with worker representatives, keep women informed of their rights at work.

Beyond this, undertakings can voluntarily enter into commitments setting higher standards regarding social development in general and equal opportunities in particular. These commitments can be embodied in a code of conduct, i.e. a statement of values and business practices.

The draftsman calls for such codes of conduct to be drawn up regarding equal remuneration for work of equal value, measures to combat discrimination on recruitment, combining family and professional life, improving career prospects for women, basic and further training for women and measures to combat harassment at the workplace.

The acceptance of such commitments by companies in these areas may be of decisive importance for the following reasons:

-   the pay differential between women and men doing equal work is 25% in the private sector, compared with 9% in the public sector;

-   among young people in employment the percentage of women is higher than that of men while seniority and promotion are slower for women;

-   it is far more frequent for women than for men to interrupt their careers for family reasons. However, it is possible for companies to help counter this by setting up day nurseries, granting parental leave, introducing flexible working hours and allowing women to take part in training and reinsertion programmes;

-   finally, company restructuring primarily affects women, a fact which underlines the need for life-long training.

Finally, the draftsman considers that special mention should be made of respect for women’s rights by companies as an integral human rights issue, given that while women are the key to sustainable economic development in third countries, they are at the same time usually the most vulnerable and undervalued part of the workforce.

CONCLUSIONS

The Committee on Women's Rights and Equal Opportunities calls on the Committee on Employment and Social Affairs, as the committee responsible, to incorporate the following points in its motion for a resolution:

A.   having regard to the results of the European Council in Lisbon and in particular the appeal by the Council for a spirit of corporate social responsibility concerning improved practices, life-long training, the organisation of work, equal opportunities, social reintegration and sustainable development,

B.   whereas if ‘corporate social responsibility’ is actually to be practised, both a voluntary and a regulatory approach to the issue should be adopted,

1.   Points out that companies are required to implement fully statutory provisions concerning equal opportunities for men and women under the relevant international, European and national legislation; calls on companies to take voluntary measures to ensure a high level of equality between men and women (e.g. through positive action) in order to enhance female potential and guarantee that their subcontractors and suppliers uphold womens' rights and provide equal opportunities for men and women;

2.   Welcomes the initiative taken by the Commission is submitting its Green Paper on corporate social responsibility and calls on the Commission to draw up a directive establishing a European regulatory framework applicable in this area;

3.   Calls on the two sides of industry at European, national and sectoral level to agree on codes of conduct that uphold women's rights particularly regarding (1) equal pay for work of equal value, (2) the quality of women's employment, (3) measures to combat discrimination on recruitment, (4) the adoption of innovative and effective measures to combine family and professional life, (5) the improvement of career opportunities for women, (6) basic and further training opportunities for women enabling them to adapt to technological and economic developments, thereby facilitating their professional reinstatement, (7) health and safety issues and (8) combating duress, mobbing and sexual harassment at the place of work;

4.   Calls on the Commission to include in this proposal proactive encouragement for each company to present, in cooperation with workers' representatives, annual equal opportunities plans which provide information regarding the numbers of men and women at each of the company's organisational levels, possible measures to improve the situation in cooperation with employees' representatives, information for each sex regarding remuneration, promotion and training opportunities and proposals designed to ensure that work is better organised for the purpose of reconciling family and working life;

5.   Calls on the Member States to ensure that companies, in particular SMEs, are informed of and comply (in practice and not just on paper) with statutory Community or national requirements regarding equal treatment and opportunities for men and women and that, in cooperation with worker representatives, they ensure that their female employees are kept informed; expects the Member States to carry out the necessary checks on compliance by all companies with equality legislation;

6.   Calls on the Commission, in cooperation with Member States, to organise a European campaign in cooperation with the two sides of industry, aimed particularly at SMEs, to inform them about the acquis communautaire with regard to equal rights for men and women;

7.   Calls on the Commission to incorporate into the corporate social responsibility system both a method of reporting on, monitoring and evaluating the equal opportunities plans and the codes of practice submitted by companies, and also a systematic exchange of ‘good practices’;

8.   Calls on the Commission and the Member States to ensure that corporate social responsibility (and, in particular, the aspect relating to the promotion of women’s rights) is incorporated into the common foreign and security policy and the development cooperation policy; calls on undertakings to guarantee that respect for women’s rights as an integral human rights issue is established as a basic principle governing trade with, and investment in, third countries;

9.   Calls for the European Social Fund to promote corporate social responsibility (attaching particular importance to equal opportunities) as part of the training of company managers and those who represent the two sides of industry;

10.   Points out that the Commission has a particular responsibility to inform the candidate countries adequately about, and actively participate in the implementation of, the acquis communautaire with regard to equality.