January 22, 2015

Our Mini-Theme: Corporate Social Responsibility is Now Legal

Headlines are rife with firms that are “going green” and otherwise incorporating corporate social responsibility (CSR) into their business practices. Businesses are increasingly recognizing not only the tactical advantages of CSR, but are also treating it as a strategic priority critical to the future success of their enterprises. For example, KPMG has found that 83 percent of people surveyed trust a firm more if it is socially responsible. Investors are also responding to the changing marketplace, with one dollar out of every nine dollars under professional management in the United States now involving an element of “socially responsible investment.” In response, the Economist Intelligence Unit has found that CSR has risen sharply in global executives’ priorities. Yet until relatively recently, although many firms took advantage of tax-related and other marketplace incentives for greening their operations and supply chains, regulatory compliance was not high on the list of forces shaping the CSR movement. That is now changing. 

Although a growing number of firms have been adopting CSR programs and policies over the course of the last decade as voluntary measures with reference to various rationales, we are now witnessing a transition from voluntary CSR measures to hard law by means of the codification of CSR-related societal norms and the advent of CSR-related law and regulations in the United States and around the globe. From the SEC’s conflict minerals rules, to California’s Transparency in Supply Chains Act, to the recently adopted European Union directive requiring nearly 7,000 companies in the EU to report on non-financial sustainability matters – it is impossible to ignore the fact that CSR is now inherently legal. 

Business Law Today, in conjunction with the ABA’s Corporate Social Responsibility Law Task Force, is pleased to introduce the emerging and increasing important practice area of corporate social responsibility law by publishing five articles covering five different fields within this practice area: CSR stakeholder engagement; CSR disclosure and reporting; cleantech, energy, and environmental sustainability; labor and workers’ rights; startup CSR and social entrepreneurship; and CSR law for the corporate counsel. These fields correspond to recently established committees within the CSR Law Task Force, with each committee contributing an article to this special publication. Topics include investor interest in nonfinancial information, the business case for environmental sustainability, the evolving legal requirements policing human trafficking and child labor in supply chains, recent developments in sustainability reporting, and the benefits of CSR stakeholder engagement.

This special issue serves as the launch vehicle for these new substantive committees of the CSR Law Task Force, the creation of which represents the next crucial step in the ABA Business Section’s ongoing commitment to be a clearinghouse, thought leader, and primary source of education and training in the field of CSR Law. We encourage readers with any interest in this practice area to take the step of joining the CSR Law Task Force, as there is much important work to be done. The committee chairs will be introducing the work of their committees at the 2015 Business Law Section Spring Meeting in San Francisco, so we hope to see you there. You may also contact Ashley Walter at awalter@fenwick.com or 206-389-4556 if you have any questions regarding membership in the CSR Law Task Force.