Responsabilidad Social ONU

How Corporations Are Using a Shift to Strategic Philanthropy to Promote

Human Rights While Improving Their Business Environment1

A Good Practice Note endorsed by the United Nations Global Compact Human

Rights Working Group on 3 September 2012

Prepared by Priyanka Dahiya, Milu Hoppenbrouwer, Chuki Obiyo, and Christine

Evans

Outline Summary

Executive Summary 3

I. Background 3

I. Strategic Philanthropy Defined 5

Traditional corporate philanthropy or Version 1.0 5

Social investment or Version 2.0 5

Strategic philanthropy or Version 3.0 5

Criticisms of Strategic Philanthropy 6

Support for the Shift to Strategic Philanthropy 6

II. Core Competencies 7

Identify Core Competencies 7

Use Core Competencies 7

III. Charitable Efforts 8

Consider Human Right Issues at Each Stage of the Corporation’s Value Chain 8

Determine the Gaps between Human Rights Needs and the Corporation’s Human

Rights Efforts 9

1 Grateful acknowledgement is given to all those who were interviewed for and commented on this note, as

well as Professors David Scheffer and Caroline Kaeb of Northwestern University School of Law and UN

Global Compact Advisor and Good Practice Project Leader Professor Chip Pitts of Stanford Law School.

The UN Global Compact is a strategic policy initiative for businesses that are committed

to aligning their operations and strategies with ten universally accepted principles in the

areas of human rights, labour, environment and anti-corruption. In June 2006, the Global

Compact Board established a Human Rights Working Group. The goal of the working

group, whose inaugural chair was Mary Robinson, former UN High Commissioner for

Human Rights and President of Ireland and currently is chaired by Mr. Pierre Sane, is to

provide strategic input to the Global Compact’s human rights work. The following is one of

an ongoing series of notes on good business practices on human rights endorsed by the

working group. Rather than highlighting specific practices of individual companies, Good

Practice Notes seek to identify general approaches that have been recognized by a

number of companies and stakeholders as being good for business and good for human

rights.

2

Link Select Human Rights Efforts Directly to Corporation’s Core Business Interests

10

IV. Improving Business Environment 12

Define the Corporation’s Business Environment 12

Measure Improvement of the Business Environment 13

V. Contributing to Meeting Social Needs 15

Manage the Risks of the Corporation’s Investment 15

Maximize the Social Return on Investment 16

VI. Conclusion 17

3

Executive Summary

Corporations, including multinational corporations, increasingly are embracing

the dual challenges of maximizing profits while also promoting the protection of

human rights. The latter is at the core of corporate social responsibility and it

holds the promise of being good for business. Corporate strategic philanthropy

plays a central role in this dual mission of profitability and responsibility.

Strategic forms of philanthropy leverage unique corporate capabilities to promote

human rights. More specifically, strategic philanthropy seeks to combine a

corporation’s core competencies with its charitable efforts in order to improve the

corporation’s business environment while meeting social needs that promote

human rights or other social, environmental, or governance goals. How does a

corporation promote human rights through philanthropy in a way that produces a

benefit to its business? The four elements of strategic philanthropy relating to

human rights are to identify core competencies, evaluate charitable efforts,

improve the business environment, and meet social needs to promote human

rights. The Note provides the context for and offers recommendations relating to

each of these elements while demonstrating how corporations are using the shift

from traditional philanthropy to strategic philanthropy in the most valuable and

measurable way.

I. Background2

Since 2008, the United Nations human rights framework3 and more recently the

Guiding Principles on Business and Human Rights4 set the baseline standard for

what is expected of all business enterprises in all situations respecting human

rights. This responsibility requires corporations to avoid infringing on rights and to

address negative impacts that do occur. Beyond this baseline standard, the UN

framework encourages business enterprises to undertake other commitments or

activities to support and promote human rights, which may contribute to the

overall enjoyment of those rights. This additional commitment is expected of any

participants in the UN Global Compact. They have agreed not only to respect

human rights but also to support them.5

2 This Good Practice Note only records footnotes considered necessary and appropriate for this document.

3 See UN Framework at http://www.unglobalcompact.org/Issues/human_rights/The_UN_SRSG_and_the

_UN_Global_Compact.html.

4 Report of the Special Representative of the Secretary-General on the Issue of Human Rights and

Transnational Corporations and Other Business Enterprises, John Ruggie, Guiding Principles on Business

and Human Rights: Implementing the United Nations “Protect, Respect and Remedy” Framework, March

21, 2011, available at http://www.ohchr.org/documents/issues/business/A.HRC.17.31.pdf.

5 “Principle 1: Businesses should support and respect the protection of internationally proclaimed human

rights….” UN Global Compact, The Ten Principles, available at

http://www.unglobalcompact.org/AboutTheGC/TheTenPrinciples/index.html.

4

In recent years, all corporations, whether they are Global Compact participants or

not, have increasingly found themselves caught between critics demanding ever

higher levels of corporate social responsibility and investors who apply pressure

to maximize profits. As a response, a growing number of corporations have

begun to shift from traditional forms of philanthropy involving charitable

contributions towards more strategic forms of philanthropy that leverage unique

corporate capabilities to promote human rights.6 Strategic philanthropy promises

...