Multinationals in India fail on CSR
A report by the India Committee of the Netherlands has highlighted a jack of awareness and substance on corporate social responsibility in supplier relations between Dutch and Indian companies.
The report, funded by a range of Dutch government bodies and non-governmental organisations, looked at how successfully Dutch companies working in India were able to implement and monitor extraterritoriality programmes in relation to their Indian sub-contractors.
The 100 Dutch companies in India constituted the fifth highest source of direct foreign investment in India in 2003. Forty companies were approached for the report, on the condition that they were not named.
On human rights, for example, the report found that Dutch companies failed to speak out on large scale violations in the region of their operations, and did not have active policies on caste discrimination in employment and other areas.
While Dutch companies commonly practise some form of environmental sustainability management, the report concluded that these systems were not manifested further down the supply chain in India.
Gerard Oonk, co-ordinator of the India Committee of the Netherlands, told Ethical Corporation: "I think the research strongly suggests, backed up by numerous other reports, that CSR standards and practices are only very weakly developed. Even many labour and environmental laws are either insufficiently implemented or not at all. This is not new, but it has been assumed by many people that the [multinational enterprises] would do a lot better in that regard."
He called for government programmes, saying: "Having shown that violations of CSR norms are the rule rather than the exception, especially in the sub-contracting chain, we also feel this is an additional argument for governments to play a much more' pro-active role in CSR and to work toward internationally binding regulation."