Corporate Social Responsibility and Multilateral Organizations

Published: Last Edited:

This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.

In recent years, one of "fashion" phrases related to the organizational performance is "sustainable development". The term was officially appeared in a report called "Our Common Future" submitted to the United Nations by the World Commission on Environment and Development (the Brundtland Commission) in 1987. In this report, WCED defined the phrase as (the) "development which meets the needs of the present without compromising the ability of future generations to meet their own needs" ( Since then, sustainable objectives has become the main concern of many organizations in the world, and occurred in their long term strategy.

To be sustainable, companies and organizations work hard to balance and improve the triple bottom line which focuses on the social and environmental impacts in relation to organization's economic performance; and Corporate Social Responsibility (CSR) is an effective mean to achieve this objective.

Definition of CSR:

There are many definitions about Corporate Social Responsibility. From the view of the society, CSR involves the "economic, legal, ethical, and discretionary expectations that society has of organizations at a given point in time" (Carroll and Buchholtz 2003, p. 36). Meanwhile, from the view of the corporation itself, CSR is a tool to "win the truth and loyalty of constituents around the world" by "taking ownership of the effect its activities have on customers, employees, shareholders, communities, and the environment in all part of its operations" (Argenti, P. A., 2009, p.106). Despite the different sources of opinions, in general, CSR involves fair trade practices for suppliers and purchasers, employee empowerment (especially women), green decisions and processes, and sustainable sources of production.

Forms of CSR:

There are various ways in which the corporations illustrate their social and environmental responsibility. Charities and donations are one of various activities of CSR. The improvement of public's awareness and conscience has leveraged the scope and performance of CSR into higher level. Today, launching environmental protection campaigns, developing new healthy and safe product, and better obeying and/or applying standards and requirements regarding to human rights are all examples of modern CSR activities.

Why does CSR matter?

To the corporations:

Although there has been no concrete proof about the relationships between behaving ethically and social responsibly and profitability; CSR has positive effects on reputation risk management, brand differentiation, talent attraction and retention, government's supporting (i.e. subsidies, licenses, and limit interventions) (Argenti, P. A., 2009, p.112)

To the stakeholders:

CSR offers opportunities for the wellbeing through high value products/services (customers), good working conditions (employees), transparency of performance (investors), and the communal betterments contributing (civil society, environment, and government).


Roles of multilateral organizations and media in changing attitudes of stakeholders towards CSR

MultiLATERal Organizations:

Definition of Multilateral Organization:

Global Energy Network Institute defines a multilateral organization as "the collection of three or more nations to work on issues that are relevant to all of the countries within the organization" ( They are normally Non-Governmental (and Non-Profit oriented) Organizations (NGOs). The active area of NGOs spread in wide range, from environmental issues to social concerns (i.e. such as human rights, working condition, child labor, discrimination, and so on). Those international multilateral organizations having significant role in promoting CSR include: United Nations (UN), International Labor Organization (ILO), Greenpeace International, United Nations Educational, Scientific, and Cultural Organization (UNESCO), World Health Organization (WHO), Food and Agriculture Organization of the United Nations (FAO), Amnesty International, and Fairtrade Labelling Organizations International (FLO).

NGOs' course of actions:

Each multilateral organization is established to pursue specific objectives; yet, in general, they serve the same missions which are: ensuring the "right" performance of the organization, protecting and nurturing the sustainable development of the society, improving the living conditions of the community, and correcting malpractices (of the enterprises and corporations) through lobbying the government.

Due to the fields of concerns, the NGOs' main targets are normally the corporation and government.

Monitoring and changing corporations' behavior - "naming and shaming":

NGOs keep close eyes on the performance of the corporations to make sure that their performance follows the established standards and is not violent the wellbeing of the society. When there is malpractice, NGOs will promote special activities to "correct" them.

Take Shell as an example. In 1995, Shell was licensed (by the UK government) to sink the Brent Spar - an oil storage facility - in the North Sea. Learnt about the issue, Greenpeace carried various activities to stop the decision implementing, included leafleting, occupations, and protests (Greenpeace International, 2007). Within 2 months, the protests spread from UK to other countries in Europe, and significantly damaged Shell's sales. As a result, Shell had to announce its reversal of decision of sinking Brent Spar. Moreover, in the same period, Shell faced another problem related to environmental damage in Nigeria. The issue was soon declared in global level by NGOs and new anti-Shell protests were created. Learning from these two crises, Shell started to make essential transformation, initiating with the launch of "Society's Changing Expectation" project in 1996. Since then, the corporation has kept researching and producing renewable energy as well as reducing carbon dioxide emissions to minimize their contribution to global warming. Nowadays, Shell is known as one of the leaders in corporate citizenship worldwide (Frynas, 2009, p.7, 22-23).

Another example regards to Nestlé. In 1970s, Nestlé suffered a damaged boycott held by the American-based Infant Formula Action Coalition (INFACT). This organization blamed Nestle for malpractices in marketing the infant formula in lesser developed nations. Started in the United States, the boycott then spread to Australia, Canada, New Zealand, and Europe. The boycott was last for about six years, from 1977 to 1983, and called off once Nestlé agreed to stop using misleading advertising methods, as well as to promote the breast feeding (Soule, S. A., 2009, p.109; Wikipedia, 2010).

Support the Sustainable Development of Corporations:

The globalization in recent decades does not benefit the whole world as many people have believed. Besides the profit-related strengths, globalization has spread the environmental pollution, waste of resources or "throwaway culture", regional unemployment, and culture disappearance (Crane A & Matten D., 2007, p.21). Recognize these problems; international multilateral organizations pay their concerns on developing, administrating, and promoting standards, codes, and certifications which then help to ensure the sustainable development of the business as well as the human beings. Such standards as ISO 14001, SA8000, AA1000, and GRI were developed by NGOs and widely applied by many organizations in the world (McIntosh et al, 2003, p.77).


The 14000 family provides the framework to manage the environmental issue. Belonging to the 14000 series, ISO14001 aims to improve the awareness and understanding of not only the organization's workforce but also its external stakeholders regarding to the environmental responsibility, and eventually change their behavior in producing and consuming the product / service. The major concerns of ISO14001 include nature environment, waste, energy consumption, nuisance, external safety and so on (McIntosh et al, 2003, p.105, Martin R., 1998, p.27;


This set of working standards expressing the human rights of the workforce around the world. The requirements of SA 8000 consists of child labor, forced and compulsory labor, health and safety, freedom of association and right to collective bargaining, discrimination, disciplinary practices, working hours, remuneration, and management system (SAI, 2008, p.3). One advantage of SA 8000 is that the standard can be embedded into the organization's culture, and eventually change the managers and employees' behaviors.


These are the requirements about ethical performance of the organizations. The core principles of AA1000 are inclusive, materiality, and responsiveness. The purpose of this standard is to ensure the organizations' commitment on social and ethical accounting, auditing, and reporting (McIntosh et al, 2003, p.113, After such scandals of Enron, WorldCom, Tyco, et cetera, AA1000 become a popular standard that help to protect the investors and stakeholders from the intransparency of the organization's performance.

Global Reporting Initiative (GRI):

GRI provides the guidelines for "the transparent and reliable exchange of sustainability information" between the organization and its stakeholders. The report's contents involve the deep analysis of the organizations' economic and environmental and social impacts during the operation. The value of GRI lies on helping to define the organizational performance benchmark regarding to norms, codes, standards, and voluntarily initiatives (

Contribute to the betterment of the community:

Corporate Social Responsibility is not mere charity. One of main focuses of the sustainable development is to ensure the prosperity of the organization goes in hand with the development of the community. To do this, NGOs have alliances with enterprises and corporations to promote additional certifications - in form of "labels" - that have direct impacts on the society. One of those well-known labels is FairTrade label.

FairTrade certification mark is issued by the Fairtrade Labelling Organizations International (FLO). This is a substitute for the traditional trade which builds up win-win relationship between producers and consumers. To producers, the Fairtrade provides them chances to cover the costs of sustainable production through better deals and improved terms of trade. To customers, Fairtrade "delegates" them the power to reduce the poverty through daily shopping. There are important features relate to this label:

The fairness: the fair trade price ensures the long term growth of the producers (i.e. especially the farmers), and in return, the customers are supplied with high added-value products / services.

The community's improvement: a Premium included in the price is reinvested in the communal fund which is used (by farmers and workers) for social, economical and environmental purposes.

Take, a pioneer social enterprise in Viet Nam, as an example. Practice under Fairtrade label, the company has been actively worked to establish the strong connection between the farmers and the consumers. To the farmers, the company pays the price at 5% higher than the market price, and involves them in the post-harvesting process (i.e. husking, sifting, and packaging) in order to increase their income as well as the production capacity and selling power. To the customers, the company supplies high added value products which are eco-friendly (and chemical free) and high nutrition. In addition, a premium in price is invested back into the community to improve the access to the sanitary water, toilets, and libraries for children (

Lobby for modifications in law

Through holding strikes or protest campaigns, NGOs gradually pressure the governments to solve the problems related to social, environmental and economic areas. For example, Kyoto Protocol has proved its strong impact on the performance of a country as a whole. Promoted by the Unityed Nations Framework Convention on Climate Change (UNFCCC), Kyoto Protocol is an international agreement signed up between countries in an effort to reduce the global warming. This agreement represents the common recognition of the governments on the environmental issues; as well as their willingness in solving them. To ratify this protocol, the country must develop own rules and manage to reduce the greenhouse gas emissions caused by the industrial zones. If they fail in obtaining the common objectives, the country is subject to a sanction. According to the large part of the world, Kyoto Protocol is both environmental and political achievements.

Besides, more and more governments take part in the CSR activities to protect the healthy operations of their country in term of the triple bottom line. For instant, the European Commission started adopting new strategy on CSR since July 2002 with the hope to make the CSR "more transparent and more credible", so that from multinational to small businesses could gain benefits (Smith, N. C., 2003, p.4).

Media and CSR practices:

Due to the wide performance scope, media main targets are customers, employees, investors, and governments. With the core function is to disseminate information, media has critical role in raising problems, (working with NGOs in) enforcing special changes in organization's behavior, influencing stakeholders' behavior, and reducing the violation to the environment, social and ethical values.

Notify issues to the public:

Media acts as a watchdog to monitor and inform citizens about what is happening in those corporations behind a product/service. Thank to media network, corporations' malpractices have been publicized and correct actions have been taken. Back to the case of Shell organization, when media learnt about the issue, they quickly spread the news across Europe, and contribute to the boycott occurs in wide region. Nike also faced the same situation as Shell when the media revealed the child labor abuse in the factories of Nike's subcontractors in Pakistan, Vietnam, and Indonesia. In latest few years, Chinese toys industry also suffers significant damage when media alerted the lead paint hazard and tiny magnet in Chinese made toys (MSNBC, 2007;, 2008).

Enforce changes in corporation's performance:

Together with informing people about what is happening inside the corporations, media also coordinates with the NGOs to put pressure on the corporations towards making correction. Take the case of Vedan - a used-to-be famous Monosodium Glutamate producer in Vietnam - as a critical example. Since the fact about the wrong operations of the Vedan's factory, which results in the "death" of Thi Vai, was revealed two years ago, media networks (i.e. newspaper, TV, and social networks such as internet) has play significant role in putting the end to the existence of the organization. Searching Vedan on Google, there are 781,000 results; moreover, the case has been frequently appeared in well-known newspapers and magazines such as Youth News, Thanh Nien, Nguoi Lao Dong, Sai Gon Giai Phong, Saigon Times, and so on. Since 2008, Vedan has suffered a damaged long lasting boycott in all regions of Vietnam. Today, Vedan's sales has dropped dramatically and there are few shops in whole Vietnam sell its products. Moreover, under the pressure of media, Vietnamese government has held an investigation about Vedan and recently Vedan has been filed for a course with the damage is hundreds of billions VND. (Dantri, 2010; TuoitreOnline, 2010; TienphongOnline, 2010)

Influence Stakeholders' values and beliefs:

With the support of advanced technologies, media network offers access for people to develop their understanding about the on-going world. Besides, media also raise waves of concerns on specific issues which then influencing the citizens' behavior.

Take the food industry as an example. One of hot issues in the last decade relates to the Genetically Engineering (GE) or Genetically Modification (GF) of food. For years, people believe that GM food is a good solution for the poor countries with economic issues. However, with the intervention of media, people have been educated about the advantages and disadvantages of GM foods on the health of the human beings. Via active works of media channels, consumers reanalyze and reassess the value of GM foods. In fact, more and more people have switched their interest to the organic product nowadays.

In addition, media also changes the attitude of the investors in making their business investment. According to a report of INSEAD's Centre for the Management of Environmental Resources, investors consider CSR as a major indicator when assessing the non-financial risks (Management Issues, 2003). It practice, just compare the number of investors who are interested in nuclear power, tobacco, or alcohol industries with those who invest in Microsoft, Shell or IKEA and we can see the clear movement of investors' attitudes towards CSR.

In addition, media also has power to influence the employees' attitude and performance. According to a report made by British Telecommunication in 2004, 49% of its workforce stated that the corporate civilization reputation made them proud to work for the company. In addition, the Chairman of British American Tobacco also once admitted that the number of people who would not work for them had been increasing despite the fact that the company has good working conditions (Vogel D., 2005, p. 58).

Reduce the violation to the social, ethical and environmental values:

Media has helped corporations to educate and promote stakeholders actions towards the CSR. For example, Timberland - the footwear, apparel, and accessories producing and selling company - has held the "Be an Earthkeeper Hero" which stimulates people to produce videos about protecting the environment and share them on - a social network which connects the change agents (i.e. the people that help the world) to the backer. Through this videos contest, Timberland promotes residents' effort and commitment to the environment stewardship (CSR Wire, 2008;

Relates to the global warming, media plays vital role in raising public concern and stimulating reactions from the citizens. Many films about the end of the world have been created in the hope to warn people about the environmental issues. Besides, series of articles, reports, videos about the greenhouse gas, the shortage of natural resources, and the irresponsible management of companies regarding to the environmental damage have been frequently appeared in televisions, newspapers, books, and social networks such as Facebook, Twitter, Myspace, and Youtube. Those campaigns like Earth Hour (with the attendance of the world famous actors and actresses) have actually changed people's attitude and behaviors towards the surrounding environment.

Furthermore, media also contributes to the revolution and development of human beings. Media has raised moral considerations about the discrimination in Africa, the recent wars in Afghanistan and Iraq, the sex slave and child labor abuse in the Third World nations, the financial malpractice in giant corporations, et cetera. Through disseminating the truths "behind the stage", triggering waves in communities, and supporting the NGOs operation, media has contributed to the betterments of the world.



Corporate Social Responsibility directly relates to people and corporations' view about the ethics and virtues. However, the way something (or some action) is claimed as ethical or unethical strongly depends on the set of values and beliefs of the "judge". For example, child labor abuse is considered as a crime in developed countries; yet, in poor nations, child labor means an additional source of income for household!

Furthermore, each constituent in a society has his/her own interests and concern toward a particular company. For instant, to investors, their main concern concentrates on the positively high ratio of return on investment (ROI); to customers, the quality of product and the convenience in consuming it are essential factors; to employees, a good working conditions with opportunities for achievements and success is important; and to the government, ensuring that the corporation is contributing to the development of the economy and society is their core objective.

Due to the incoherence in society's perception towards the values of ethics and virtues, multilateral organizations and media have vital role in establishing standards and guiding people and corporations to achieve the long-term and healthy development. Although the forms and course of actions may vary (i.e. as the purposes of existence of these two parties are totally different), yet, they have significant contributed to changing and improving stakeholders' attitude towards the CSR.



Argenti, P. A., 2009. Corporate communication, 5 edn. McGraw-Hill/Irwin, NY.

Carroll, A. B. & Buchholtz, A. K., 2003. Business and society: ethics and stakeholder management, 5 edn. Thomson South-Wester, Australia.

Crane A & Matten, D., 2007. Business ethics. Managing corporate citizenship and sustainability in the age of globalization, 2 edn. Oxford University Press, NY.

Frynas, J. G., 2009. Beyond corporate social responsibility. Oil multinationals and social challenges. Cambridge University Press, NY.

McIntosh M., Leipziger D., Thomas R., & Coleman G., 2003. Living corporate citizenship. Strategic routes to socially responsible business. Prentice Hall, Great Britain.

Soule, S. A., 2009. Contention and corporate social responsibility. Cambridge University Press, NY.

Vogel, D., 2005. The market for virtue. The potential and limits of corporate social responsibility. The Brookings Institution.


Sustainable Development Commission. Definitions. [Online]

Available at:

[Accessed 3 November 2010]

Global Energy Network Institute. Multilateral organizations. [Online].

Available at:

[Accessed 4 November 2010]

Greenpeace International, 2007. The Brent Spar. [Online]

Available at (Published 21 June 2007). [Accessed 4 November 2010]

Wikipedia. Nestlé Boycott. [Online](Update 22 October 2010)

Available at

[Accessed 4 November 2010]

International Organization for Standardization. ISO 14000 Essentials.

Available at:

[Accessed 4 November 2010]

Business and Human Rights Resource Center. Social Accountability International SA 8000. [Online]

Available at (Published 2008)

[Accessed 4 November 2010]

AccountAbility. About us. [Online].

Available at

[Accessed 3 November 2010]

Global Reporting Initiative. What is GRI. [Online]

Available at

[Accessed 3 November 2010] About us. [Online]

Available at: [Accessed 6 November 2010]

Marketing working paper, London Business School, 2003. Corporate social responsibility: not whether, but how? [Online]. Available at [Accessed 4 November 2010]

MSNBC, 2007. Mattel issues new massive China toy recall. [Online]

Available at: (updated 14 August 2007)

[Accessed 7 November 2010], 2007. Recall has parents mulling toy boycott. [Online]

Available at: ""&HYPERLINK ""k=84811 (Publilshed 2 August 2007)

[Accessed 7 November 2010]

Dantri, 2010. "Đồng lòng" tẩy chay Vedan. [Online]

Available at (Published 9 August 2010)

[Accessed 8 November 2010]

TuoitreOnline, 2010. Vụ Vedan bồi thường thiệt hại: sá»›m chi trả tiền cho dân. [Online]

Available at: (Published 26 October 2010)

[Accessed 8 November 2010]

TienphongOnline, 2010. Chuyển cÆ¡ quan Ä‘iều tra vụ Vedan "giết" sông Thị Vãi. [Online]

Available at: (Published 20 September, 2010)

[Accessed 8 November 2010]

Management Issues, 2003. Investors interest in CSR is on the rise. [Online]

Available at: (Published 26 March 2003)

[Accessed 8 November 2010]

The Corporate Social Responsibility Newswire, 2008. "Be an Earthkeeper hero" video contest encourages people to showcase their eco-actions on youtube and [Online].

Available at (Published 27 June 2008)

[Accessed 3 November 2010]

Changents. [Online]

Available at

[Accessed 3 November 2010]