All this confirms that CSR is part of a global trend driven by private and public actors, which aims to push companies to adopt binding rules and standards in areas such as human rights, the fight against corruption and environmental protection. It is therefore crucial that managers and directors of national and transnational companies involve legal experts and in-house legal advisors in the design and implementation of their CSR policies. For these reasons, CSR, which consists of a business relationship and an impact relationship, is closely linked to the legal responsibilities of companies and, therefore, its realization depends on responsibility. For example, the duty of an accountant in an accounting firm is to keep records of the firm`s finances. The obligation requires them to keep fair accounts and calculations, to report misleading transactions, conflicts of interest and others. In the event of a breach of this obligation, the accounting officer shall be liable for his actions. However, if accountability is not ensured, it is difficult to take action against them or hold them accountable. In particular, due to a lack of accountability, it is difficult to assess who, for what, to whom and to what extent they are accountable. It is important to hold someone accountable for the breach of liability, as it has a deterrent effect and obliges others to act legally and morally. The framework in Figure 4 suggests that corporate responsibility is essential to meet the obligations arising from the business relationships and interdependencies of the companies that form their CSR. The lack of regulation poses significant challenges for companies in implementing their CSR commitments. Voluntarism has led to vague ideas about the extent of corporate social responsibility.
As Osuji (2011) suggests, “the lack of regulatory intervention has led to a lowering of independent CSR development by addressing social issues related to financial performance.” For these reasons, many researchers consider CSR in its current form to be seriously flawed. As Aaronson (2005) suggests, “responsible corporate behaviour in developing countries is an issue that cannot be left to the voluntary discretion of professionals, but must be addressed by stricter regulations” and therefore “is a legally binding responsibility where attention should really be focused”. A new group of exchanges is attempting to determine the need to regulate CSR for corporate responsibility (Abah, 2016; Amao, 2013; Buhmann, 2011; Okoye, 2016; Osuji, 2011; Osuji, 2015; Thirarungrueang, 2013). As Osuji (2011) suggests, “regulation is neither incompatible nor incompatible with ethical CSR.” This literature suggests that without regulation, CSR may not be implemented by companies, while stakeholders are vulnerable to negative externalities resulting from irresponsible business activities. On 1 April 2014, India became the first country to legislate on corporate social responsibility. The rules of Section 135 of the Indian Companies Act require companies with a certain turnover and profitability to spend 2% of their average net profit over the past three years on CSR. McInerney, T. (2007). Regulation before responsibility: towards binding standards of corporate social responsibility. Cornell International Law Journal, 40, 171.
Thirarungrueang, K. (2013). Rethinking CSR in Australia: time for binding regulation? International Journal of Law and Management, 55(3), 173-200. Although corporate social responsibility is a form of soft law, there is an international trend towards a more legally binding law. Specifically, the United Nations endorsed the United Nations Guiding Principles on Business and Human Rights (“Guiding Principles”) in 2011. The UN Guiding Principles “provided the first global standard for preventing and managing the risk of adverse human rights impacts related to the conduct of business.” The principles form a legal framework with specifically defined rights, obligations and causalities, have been adopted almost everywhere and apply to all companies, large and small. Therefore, companies should have CSR programs that are “advocated” for human rights, as the UN Guiding Principles inform the content of sound business practices, which has critical implications for cross-border civil and commercial litigation. In other words, the UN Guiding Principles create transnational corporate tort liability vis-à-vis third parties. As Dillard (2013) suggests, “the ethics of responsibility” and “the ethics of human rights responsibility” reflect corporate commitments. According to this view, society and businesses each have interdependent rights and obligations because they are part of society and constantly interact with each other. Corporate duty is fiduciary and this ethical obligation binds companies in terms of corporate social responsibility and human rights (Dillard, 2013).
They have a responsibility for injustice (Young, 2006) and for this unjust enrichment through violations that violate the rights of others. For example, advertising a cosmetic product can have several negative externalities. Providing the right information and giving precise instructions are commercial obligations to consumers. This includes their business relationship. In addition, the company is obliged to take care not to cause environmental damage during the manufacture of the product. This includes their interdependence. While legal liability requires companies to manage the business in accordance with local laws, moral responsibility requires that they fulfill obligations arising from the business relationship and impact. CSR is directly linked to this moral responsibility through business relationships and impact relationships.
Footnote 3 Okoye, A. (2009). Theorizing Corporate Social Responsibility as an Essentially Controversial Concept: Is a Definition Needed? Zeitschrift für Wirtschaftsethik, 89(4), 613-627. Alamgir, F., & Banerjee, S. B. (2019). Controversial Compliance Regimes in Global Production Networks: Perspectives from Bangladesh`s Garment Industry. Interpersonal relations; Studies towards the Integration of the Social Sciences, 72(2), 272-297.
Responsibility is an obligation and a duty to do what one is supposed to do. Such an obligation may be ineffective if it is not responsible for its non-performance or breach. Accountability is important in the context of law and accountability. Barry and Shaw (1979) defined responsibility as “a duty or function assigned to a person by reason of the nature of his or her position, function or work.” In this sense, responsibility includes the obligations associated with a job or function in addition to the main functions of a role. Therefore, moral obligations in the context of responsibility may be associated with the functional obligations of a role (Bivins, 2006). Therefore, moral responsibility refers to “the multiple facets of this function – both the processes and the outcomes (and the consequences of the actions carried out within this set of obligations)” (Bivins 2006). As Jansen (2013) suggests, responsibility encompasses everything required by law, as well as what is morally indispensable. According to him, there is a moral responsibility to act in a way that prevents the rights of others from being unjustifiably endangered (even if such acts are not illegal per se). This allows victims of injustice to obtain redress from wrongdoers while obtaining justice (Goldberg & Zipursky, 2006). For these reasons, there is a responsibility for obligations to protect the rights of others.
