Business Respect - CSR Dispatches No#54 - 20 Apr 2003

An email newsletter with news and discussion focusing on corporate social responsibility globally, looking at the companies in the news and the emerging issues. Linked to the website at http://www.businessrespect.net and produced every two weeks.

This web page provides news stories and articles from the newsletters. Newsletters also include links to features on the internet, Mallen's blog, and other resources.

In this issue, we review GlaxoSmithKline's recent social and environmental report.

Welcome

Having published every other weekend without fail for two years, we decided that the assembled readership would perhaps bear with us if we enjoyed the sunniest Easter break for years and published just two days later. Dreadful inconsistency we know, but at least it will halve the number of 'out of office' messages that come flooding back every time an issue goes out!

Another day later and we could have reported on the proceedings with the Nike v Kasky case (see Business Respect 47 for the most recent coverage of this case). Opponents of Nike in this instance have taken to the depressingly colourful slogan of opposing 'Nike's Right to Lie', which seems a straightforward misrepresentation of the issues in that case. Such misrepresentation, of course, would be a considerable problem were the critics held to the same stringent standards that they wish for the company - but there you go.

You don't have to be a fan of Nike to want to see the company win on this occasion. The likely consequences of a Kasky victory will be to set back the corporate accountability movement immeasurably by making any kind of corporate disclosure a vastly higher risk activity than it currently is. Nike may be the only one that has so far pulled back from its reporting activity, but we know of a number of others (some very credible in terms of their commitment) who are watching the outcome nervously.

The fact is that most commentators believe the court will find for Nike. The real implications may lie in the detail of the terms for that finding.

In the mean time, the poll on the website, which you'll recall focuses on the social responsibilities of Wal-Mart continues to break records as the most popular poll so far. Just a few weeks after being posted, 382 people have voted. The current results are:

The most important social responsibility a company like Wal-Mart can observe is:

Keeping its prices low 60 (15.71%)
Treating its employees well 106 (27.75%)
Minding its impact on local communities 216 (56.54%)

Still time to make your view known, though!

News

US: Limits placed on punitive damages

The US Supreme Court has overturned a $145m punitive damages award levied on State Farm Insurance Co and in so doing has established a clear direction on how such penalties should be handled in future.

Brazil: Cataguazes Papel executive arrested for toxic spill

One of the directors of Cataguazes Papel, the pulp and paper factory at the centre of one of Brazil's worst environmental disasters, has been arrested and others are on the run from the police.

Sony prepares for 'shock and awe' game

Sony has patented the term "Shock and Awe" as a trademark for use in a computer game on its PlayStation 2 platform.

FTSE4good boosts human rights criteria

FTSE4Good - the ethical index attached to the FTSE Group - has announced a more stringent set of human rights criteria for its socially responsible index series.

Unaccountable lobby groups ‘threaten credibility of CSR’  

The UK's Investor Relations Society has published a new survey that it says suggests that the credibility of corporate social responsibility is being undermined by the demands made on companies by 'CSR lobby groups'.

British American Tobacco pressed over Burma

British American Tobacco came under renewed pressure over its presence in Burma during its AGM, with the deputy chairman Kenneth Clarke challenged to justify apparent contradictions in previous statements about the regime.

Calpers urges GlaxoSmithKline to cut AIDS drugs prices

The California Public Employees Retirement System (Calpers), the US's largest pension fund, has urged GlaxoSmithKline to review its policy of charging for AIDS drugs in developing countries.

Human Rights Watch: Iraq's oil must meet humanitarian needs

Human Rights Watch has called for Iraq's oil, post-war, to be managed in a transparent and accountable manner that "meets humanitarian needs and ensures respect for human rights".

Australia: No major review in competition law

A review of Australian competition law that had raised the possibility of major changes in the area of the misuse of market power has concluded that no such change should take place.

Canada: Climate change vote for Imperial Oil shareholders

Imperial Oil shareholders are to vote on a resolution that would require the company to spell out potential financial liabilities associated with its greenhouse gas emissions, and to put in place a plan that would reduce this liability.

Philippines: Business group seeks 10-year strike ban

The Federation of Filipino Chinese Chamber of Commerce and Industry has said that it will create three million jobs over the next two years if the government bans nationwide strikes for the next ten.

Citigroup and Rainforest Action Network declare 'ceasefire'

Citigroup, which over the last few days has been the target of vigorous campaigning by the Rainforest Action Network, has released a joint statement with the organisation declaring a 'ceasefire', and saying that they have entered an extended period of dialogue.

South Africa: Mbeki speaks against corporate apartheid lawsuits

President Thabo Mbeki has said that the South African government does not support litigation in the US courts against companies alleged to have benefited from apartheid.

Dominion $1.2bn settlement with Environmental Protection Agency

Dominion has said that the cost of its settlement with the EPA won't affect its earnings, cash flow or capital spending plans - but will result in a considerably better outcome for the environment.

Australia: Rows break out over promised Corporate Responsibility Index

Australia's top businesses have been asked to co-operate with a new rating index on corporate social responsibility, produced by a new company backed by the former Liberal leader John Hewson, RepuTex.

Article

GlaxoSmithKline - Seeking a cure for public mistrust

Author: Mallen Baker, dated 20 Apr 2003

There is a real dilemma facing a company like GlaxoSmithKline. On the one hand, the company makes demonstrably socially desirable goods - medicines. The company's products save and enhance lives. How absurdly easy, then, for the company to unite around a mission to improve the quality of life, and to fire up some of the best talent in the world to make a profit in this cause.

Previous edition - No 53 | Following edition - No 55

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Special Feature

photo of cash

Social responsibility and finance - on the precipice

In a recent article, the BBC's economics editor Robert Peston highlighted the fact that in 2012 the chances are that the economy - punch drunk as it is from the various flavours of debt crisis it has been pummelled with over the course of the year - will be hit by the collapse of a major bank and / or government.