European Parliament demands the inclusion of CSR in Trade Agreements

On the 25th November the European Parliament adopted a report of the French Socialist Harlem Désir, demanding the inclusion of CSR clauses into trade agreements signed by the EU. The CSR clauses should include inter alia "a requirement for companies to commit to free, open and informed prior consultation with local and independent stakeholders before a project that impacts upon a local community commences" and the trade agreement should contain provisions to "encourage transnational judicial cooperation, to facilitate access to the courts for the victims of the actions of corporations within their sphere of influence, and, with that aim in mind, to support the development of appropriate judicial procedures and sanction infringements of the law by corporations".

 

The report recognises that "CSR agreements have hitherto proved insufficient, particularly in the mining sector". The rapport calls upon the Commission to explore the possibility of establishing a harmonised definition of the relations between the "parent company and all undertakings in a relationship of dependency with respect to that company, whether those undertakings are subsidiaries, suppliers or sub-contractors, in order to establish the legal liability of each of them".

 

Moreover the report contains two paragraphs calling "on the Commission to advocate the incorporation of a CSR dimension into multilateral trade policies, both in the international forums which have supported the concept of CSR, in particular the OECD[1] and the ILO[2], and in the WTO" and "to explore, within these same forums, the elaboration of an international convention to be drawn up to establish the responsibilities of ‘host countries’ and ‘countries of origin’ as part of the fight against the violation of human rights by multinational corporations and the implementation of the principle of extra-territoriality". The goals mentioned in these paragraphs are no doubt worth supporting, unfortunately the language is rather generic and the goals far-fetched, it is therefore unlikely that these paragraphs will manage to make any concrete impact in the foreseeable future.

 

The original draft proposal had gone further than the final report, explicitly mentioning the possibility of holding transnational corporations accountable in front of European courts. Unfortunately, the conservative majority in the European Parliament managed to water down this part of the report.

 

The approval of the report does not automatically mean that CSR clauses will from now onwards have to be included into trade agreements. The Parliament will have to negotiate this with the Commission and the Council, which are both reluctant. The Commission already stated that it does not see the inclusion of CSR clauses into trade agreements as the right way forward and that CSR should remain voluntary. The Council is mainly concerned with guaranteeing the access of European companies to markets and raw materials and sees CSR as an unwelcome obstacle, which makes life more complicated for European companies, particularly in these times of economic crisis.

 

 

 

Thomas Lazzeri