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close this bookBusiness Responsibility for Environmental Protection in Developing Countries - Report on the International Workshop, Heredia, Costa Rica, 22-24 September 1997 (UNRISD, 1998, 56 p.)
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The Politics of Corporate Environmentalism: Civil, Legal or Self-Compliance for Sustainable Development?

David F. Murphy and Jem Bendell

This paper investigates the importance of business relations with civil society - NGOs, social movements, activist and community groups - in promoting greater business responsibility for environmental protection and sustainable development in developing countries. The authors describe a variety of relationships between business and civil society, from direct action protest and confrontation to dialogue and partnership. They explore the potential of emerging models of non-regulatory, civil compliance to promote responsible business practice and sustainable development. In order to examine these issues, the authors present three case studies from the timber trade, the sporting goods industry, and the petroleum and chemical industries.The first case study identifies NGO protests in Europe against the timber trade in the late 1980s and early 1990s as a driving force for subsequent business-NGO partnerships and the creation of a new global forest management standards council. These developments are contrasted with the ongoing role of protest against the forest industry, illustrated by the international campaign of the Tupinikim and Guaraneoples in Brazil against the pulp and paper company Aracruz Cellulose.

The second case study describes the joint efforts of industry associations, member firms, local manufacturers, United Nations agencies, and development NGOs to elaborate strategies to prevent and eliminate child labour in the production of hand-stitched soccer balls in Pakistan. The role of civil society protest is identified as a major catalyst for this new partnership project and as a necessary conduit for future change. The case concludes with an overview of ongoing protest against sporting goods companies and other industrial sectors concerning their environment, health and safety (EHS) practices in developing countries.

The third case study reviews business-NGO relations in both the petroleum and chemical industries. The case begins with a brief history of NGO protest against these industries in the North. For a Southern perspective, the specific experiences of Shell in Nigeria and Union Carbide in India are noted. In the Shell example, the significant role of protest by NGOs and activist companies such as the Body Shop is emphasized. This protest is identified as a major contributing factor in the adoption by Shell of new policies on sustainable development and human rights. The Union Carbide example demonstrates the limits of voluntary self-regulation and suggests that a range of civil society responses are needed, from public opinion tribunals and dialogue with business to non-violent resistance and, in some cases, violent rebellion.

The case studies illustrate the growing influence in the 1990s of “third wave” environmentalism and the social market activities of development NGOs, in the North, over global and national corporations. The cases also reveal a growing market-orientation of Southern NGOs in the late 1990s. Much of the impetus for this re-positioning of NGOs in both North and South is the perceived decline in the role and capacity of nation states and international laws to regulate business activities. The importance of information technology in facilitating new NGO alliances and market-oriented strategies is also noted. Business is also increasingly using the Internet to disseminate information about corporate social and environmental policies. One of the more significant implications of both new corporate policies and the changing role of NGOs is the emergence of so-called hybrid organizations. Such hybrids usually combine a strong market orientation with a social commitment and high ethical standards. Examples include new global standard-setting bodies, activist companies and not-for-profit monitoring and verification firms. The paper goes on to outline some common themes from the success stories of NGOs and companies working in partnership to promote sustainable development. The paradoxical, yet key, role of protest in generating these partnerships is described. The socio-political context, particularly the protection of civil liberties, appears to be significant in facilitating civil compliance. In the North, NGOs and business are beginning to identify short- to medium-term solutions to environmental conflict involving local communities in the South. Civil compliance is a key mechanism in many such cases. Although it is not seen as a replacement for government or inter-governmental regulation, civil compliance appears to offer greater business accountability to stakeholders than self-regulation. With ongoing dialogue, more sustainable business strategies and regulatory alternatives may be identified and implemented in the longer term. The capacity and desire of Southern NGOs to collaborate with global or national business in similar ways is less clear. There is a need for research and field work to explore the prospects for new or enhanced business-NGO co-operation in the South.

The paper provides a critique of the growing reliance on both self-regulation and civil compliance for sustainable development, drawing upon the deep green, eco-feminist and socialist perspectives. Although preferable to self-regulation, civil compliance cannot and should not become the primary instrument for monitoring business behaviour. The authors suggest two ways in which international policy makers can respond:

(i) in the short term, there must be support for NGOs, activists and community groups by ensuring their rights to organize and protest, while also supporting progressive and responsible business through appropriate financial incentives;

(ii) in the long term, a system of “global private regulation” that would employ a non-price index of value (covering ethical, environmental and social concerns) paid for by the market, should be developed internationally and eventually become a “licence to trade”.

In reflecting upon the role of civil compliance and business-NGO partnerships in promoting sustainable development, the authors draw upon theoretical debates concerning development, progress, sustainability, globalization, governance, markets and power. Questions for further consideration and research are posed throughout the paper.