Our CSR Concept

The Jus Semper Global Alliance's mission is to contribute to global social justice by creating, at the micro-level, the ethos necessary to make all stakeholders of the global market system work to achieve equal terms of participation, so that all participants have the same opportunities to live a dignified life and benefit from a new and sustainable economic paradigm. We believe that creating this ethos is far more a matter of political will than of economic logic. Thus, we need a clear and compulsory framework with its inherent costs and benefits in order to bring about the necessary political will from the part of corporations. In this way, our CSR concept incorporates six fundamental characteristics:

Sustainability and Democratic Accountability

The purpose of Corporate Social Responsibility (CSR) is to make corporate business activity and corporate culture become sustainable in its three dimensions: economic, social and environmental. The only pathway with a future is that which makes all stakeholders sustainable. Corporations cannot flourish in detriment of a stakeholder, and, in general, of the welfare of all ranks of society. Thus, corporations must abandon their zero-sum game mentality and adopt a sustainable business culture that benefits all stakeholders in an equitable manner.

It is indispensable to bear in mind that the end of democratic societies is to procure for all its members the right and the access to a dignified welfare state and to the opportunities to freely develop their individual skills to carve out a livelihood. The market, in any case, must be only a vehicle to accomplish it and not an end. Therefore, this legitimate end constitutes the essence of true democracy and the fundamental public interest of a truly democratic society, and, thus, the private interest cannot prevail over the public interest. In this way, individualism stops where communal solidarity starts and real democracy asserts those limits as a function of its ontological reason.1 The common good is its raison d'être and, thus, is the superior interest, which limits the domains of the private interest. Consequently, the accumulation of capital must only be plausible and desirable as long as it does not harm the common good. This is the principle of sustainability and democratic accountability in a real democracy. Therefore, corporations must become fully accountable for the impact of their activity. If Darwinian Capitalism has prevailed, it is because of the perverse will of the centres of power to enforce a mock democracy.

TOP

Living Wage: Indivisible from Social Justice and central to economic and social sustainability

For corporations, the level of labour endowments is usually used as a key strategic element in the pursuit of increased shareholder value and market competitiveness. It is also often the key business motivation for new foreign direct investment in the South by transferring jobs from North to South at extremely cheap labour costs. However, fair labour endowments are also a key strategic element in the sustainability of the market system. The market system cannot enjoy sustainability if labour exploitation remains a core business strategy. Nonetheless, since the arrival of Neoliberalism, the pressure of the stock market has imposed an extremely short-term -quarterly- business strategy to corporations. This blocks any possibility of long-term sustainability and imposes a zero-sum game that centres business strategy in the lowest possible operating costs, especially labour costs.

In consequence, in economic terms, the development of the conditions for equitable and stable reproduction of capital is disabled in order to fulfil the demands of the stock market. This is the classic supply-side "extremely one-sided" neoliberal paradigm; but, if most other stakeholders have to lose in favour of international financial markets, the loss eventually expands to the supply side of the system. That is, if the regime of reproduction of wealth and of its accumulation is systematically centred on the supply-side, as is currently occurring, there is no possibility of developing a stable growing economy over a long period of time. The multiplying effects of an expanding economy fuelled by the generation of aggregate demand -which increases the probability of sustainable growth- simply cannot emerge if the financial markets impose a supply-side paradigm. We can attest to this with the increasingly recurrent periods of recession and the increasing and concurrent widening of the gap between rich and poor in both poor and rich countries alike. Thus, there is no possibility of a sustainable economy without the existence of a permanent balancing act between supply-side and demand-side economics. To be sure, a balanced approach would be a far more productive business strategy for the private sector than the current one. The "short-termism" of the stock market is the overwhelming obstacle to sustainability. Thus, only by civil society forcing this change of mentality in a rationale manner, can we aspire to build a sustainable "market" system. In this way, CSR needs to be centred on the gradual development of fair labour endowments, for, beyond the obvious fact that a living wage is the fundamental element in the achievement of social justice, fair labour endowments are also the major contributor, in a corporation's economic impact, to the generation of aggregate demand. Therefore, the consistent growth of aggregate demand is a key and very desirable element in the sustainability of a market system. For this reason, our CSR concept is centred on the gradual achievement of living wages North and South as an inextricable element of both social justice and sustainability.

TOP

Holistic CSR tridimensional coverage

TLWNSI is not a developer of CSR standards. TLWNSI uses the tools that other organisations have developed for the planning, reporting, assurance and certification of a corporation's activity in the world, for we support and desire the full tridimensional compliance of MNCs with social, economic and environmental standards. Despite the fact that there will never be a voluntary CSR standard that can replace the moral and democratric underpinning of a yet-to-be-developed legally-binding CSR framework, we believe that until we suceed in such endeavour corporations can use the current initiatives and frameworks, such as the ETI Base Code, the UN Global Compact, the Global Reporting Initiative (GRI), SA8000, or Accountability AA1000, a process framework designed to complement the GRI guidelines.

However, for reasons explained in the generic CSR page on this site, we add the element of fair labour endowments through our gradual wage equalisation program to the CSR tools that have already been made available by various organizations of GCS. We believe that gradually achieving living wages will have many positive effects on many other aspects of sustainability. Nonetheless, we believe that corporations must act responsibly in all three dimensions and work to secure their sustainability by incorporating each individual issue into their own framework of best business practices from inception. Corporations can choose to use any of the frameworks previously mentioned, but they must include our living wages gradual equalization program from the start. Thus, our strategy is holistic and calls for compliance of all CSR dimensions with the incorporation of the living wage as the fundamental criterion. If a corporation refuses to include the living wage standard, we would deem it as a completely irresponsible and unsustaianble entitiy even if it scores well in all other indicators. Our living-wage standard is a "sine qua non" indicator of true sustainability and of responsible business practice.

Mandatory full compliance and individual reporting

TLWNSI requires mandatory compliance with its CSR program. Currently, most CSR processes are offered as voluntary tools that corporations can use with full flexibility in their reporting. For instance, if a company decides to report only on the social dimension, but avoids the environmental and economic dimensions, that is currently acceptable; or if a company prefers to consolidate its reporting instead of performing individual reporting, on a country-by-country basis, that is also still acceptable. In contrast, TLWNSI does not allow consolidation and requires corporations to include all three dimensions, with living wages as the fundamental criterion.

Certification and Endorsement

Corporations adhering to TLWNSI and complying with our CSR concept will enjoy a certification and endorsement before Civil Society and their consumers. Those corporations refusing to provide the political will necessary to develop a sustainable system will simply become alienated, through systematic denunciation, as Global Civil Society and consumers become aware about their destructive business practices. On the other hand, those who provide the will and work with Civil Society will directly benefit from a certification and endorsement before Global Civil Society and their consumers, which will bring both short-term and long-term benefits to their business and all other stakeholders.

TOP

Uniqueness of TLWNSI's CSR

Gradual wage equalisation based on home country's salaries. Since the beginning of the 1990s, a growing interest has built up to stop MNCs from pursuing a strategy of investing in Third World countries, centred on the availability of cheap labour and loose or non-existing legislation for environmental protection. However, TLWNSI is the first to concentrate specifically on the goal of closing the gap between First World and Third World workers of multinational corporations, performing the exact same job or equivalent to the one performed in the MNCs' operations in their home country. The major unique feature of this concept is the idea of using the MNCs' home country's salaries as the point of reference and the benchmark to close the gap -and then applying realistic criteria to actually determine the living wage that they should be paying in the first place.

Use of PPPs mechanism. TLWNSI is the only initiative proposing the Purchasing Power Parities (PPPs) mechanism, which is annually updated by the World Bank, to assess wages and set long-term living wage goals. PPPs are not a perfect measure by any means. There are no perfect methods to assess the living wage of a worker in a country at a specific point in time, but PPPs provide a rational method to determine the differences in cost of living and determine realistic purchasing power. Moreover, the North-South wage gap is so wide that PPPs are a good indicator to establish a reasonable living wage as a long-term goal. Lastly, using data from the World Bank has the added strategic value that it cannot be attacked and disregarded by corporations as something made up, for it is coming directly from the institutions of the Washington Consensus.

Mandatory. Of all the CSR concepts, none, that we are aware of, addresses the issue of a living wage as mandatory. Thus, in contrast with other initiatives, if an MNC complies with all requirements except living wages, it will not be regarded as a responsible company but rather all the contrary.

1. Cornelius Castoriadis. Philosophy, Politics, Autonomy. Essays in Political Philosophy, (1991 Odéon - Oxford University Press) 27-37

TOP