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CSR: a new definition, a new agenda for action

CSR at DG EnterpriseThe European Commission’s new strategy on corporate social responsibility (CSR), part of a package of measures on responsible business (see attached IP/11/1238), aims to help enterprises achieve their full potential in terms of creating wealth, jobs and innovative solutions to the

many challenges facing Europe's society. It sets out how enterprises can benefit from CSR as well as contributing to society as a whole by taking greater steps to meet their social responsibility.

What is corporate social responsibility (CSR)?
In its new Communication, the European Commission has put forward a simpler definition of CSR as "the responsibility of enterprises for their impacts on society" and outlines what an enterprise should do to meet that responsibility.
Although there is no "one-size-fits-all" and for most small and medium-sized enterprises the CSR process remains informal, complying with legislation and collective agreements negotiated between social partners is the basic requirement for an enterprise to meet its social responsibility.
Beyond that, enterprises should, in the Commission's view, have a process in place to integrate social, environmental, ethical human rights and consumer concerns into their business operations and core strategy in close cooperation with their stakeholders. The aim is:

Important features of the new definition are:

Corporate social responsibility concerns actions by companies over and above their legal obligations towards society and the environment. Certain regulatory measures create an environment more conducive to enterprises voluntarily meeting their social responsibility.
This is the first time in 10 years that the Commission has changed its definition of CSR. Its previous definition was: “a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis.” The new definition is consistent with internationally recognised CSR principles and guidelines, such as the OECD Guidelines for Multinational Enterprises, the ISO 26000 Guidance Standard on Social Responsibility and the United Nations Guiding Principles on Business and Human Rights. It should provide greater clarity for enterprises, and contribute to greater global consistency in the expectations on business, regardless of where they operate.

What EU policy actions will cover corporate social responsibility?
The new CSR policy presented today puts forward an action agenda for the period 2011-2014 covering 8 areas:

A report on the implementation of this action agenda will be published in time for a review meeting scheduled for mid 2014.

Why is corporate social responsibility important today?
A strategic approach to CSR is increasingly important to a company's competitiveness. It can bring benefits in terms of risk management, cost savings, access to capital, customer relationships, human resource management, and innovation capacity. It also encourages more social and environmental responsibility from the corporate sector at a time when the crisis has damaged consumer confidence and the levels of trust in business.

What progress has been made at EU level and what challenges remain?
European policy on CSR to date has contributed to progress in the field of CSR. Indicators of progress include:

Despite this progress, important challenges remain. Many companies in the EU have not yet fully integrated social and environmental concerns into their operations and core strategy. Accusations persist of the failure of a small minority of European enterprises to respect core labour standards and human rights. Only 15 out of 27 EU Member States have national policy frameworks to promote CSR.
The new strategy introduces important new elements which can help further extend the impact of European efforts to encourage corporate social responsibility.

More information:

Download this file (IP-11-1238_EN.pdf)IP-11-1238_EN.pdf[IP/11/1238 - More responsible businesses can foster more growth in Europe]27 kB
Download this file (MEMO-11-732_EN.pdf)MEMO-11-732_EN.pdf[MEMO/11/732 - FAQ - Financial reporting obligations for limited liability companies]29 kB
Download this file (MEMO-11-734_EN.pdf)MEMO-11-734_EN.pdf[MEMO/11/734 - FAQ - Proposal for Directive on transparency requirements for listed companies]36 kB
Download this file (MEMO-11-735_EN.pdf)MEMO-11-735_EN.pdf[MEMO/11/735 - FAQ - Social Business Initiative]35 kB