Building CSR into the Supply Chain

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SAN FRANCISCO, Calif. -- Firms that work directly with factory managers to help suppliers take ownership of corporate social responsibility issues have a better chance of effectively addressing concerns about labor practices, the environment and worker health and safety, according to a new report by Business for Social Responsibility (BSR).

Concerns about corporate social responsibility (CSR) issues involving the supply chain prompt many companies to devote their energies to monitoring factory conditions.

A series of pilot projects shows, however, that efforts are better spent in partnering with factory leaders to provide suppliers with skills, knowledge and systems that enable them to cope with CSR issues as they emerge, BSR said in releasing its report.

The organization's "Pilot Summary Report: Building Capabilities to Implement CSR Management Systems at ICT Suppliers in China" is based on recently completed pilot projects that sought to break through barriers to improving factory conditions.

The World Bank Group's investment climate advisory service, the Foreign Investment Advisory Service (FIAS), the Electronic Industry Citizenship Coalition (EICC), the Global e-Sustainability Initiative (GeSI) and the Shenzhen Electronics Industry Association (SEIA) partnered with BSR on the projects.

Their collaboration produced an initial report in 2007 that identified causes of poor factory conditions and provided recommendations about how customers, suppliers, government and civil society in China can work together to improve the situation.

The pilot projects took the findings from the earlier report to the next step.  The latest report summarizes those efforts and outlines tactics and strategies for companies that want to build capacity in their supply chains.

BSR intends to apply lessons learned from the pilot projects to other industries and countries. "The challenges with capability building identified in these reports are not unique to the ICT sector or to China, and many of the recommendations can be applied to a wide variety of sectors and geographies," said Laura Commike Gitman, BSR's  director for advisory services. "The project partners look forward to building on these lessons to help focus future capability-building efforts."

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