Impact of Corporate Social Responsibility on International Corporations as Exemplified by Broad-Based Black Economic Empowerment in the Republic of South Africa

Master's Thesis , 2014 , 105 Pages , Grade: Summa Cum Laude

Law - Miscellaneous

This Master’s thesis examines the impact of “Corporate Social Responsibility” (CSR) on international corporations. Therefore, it extensively investigates this voluntarily concept, which focuses on the commitment to social, environmental and economic responsibility from different angles. At first, the paper analyses the conceptual development, as well as the different understandings of CSR and its demarcation from related terms. It describes in detail the common principles and guidelines underlying the concept of CSR as a legal basis and furthermore, it expands explicitly the main dimensions of CSR.

The present study primarily aims to give an overview of the pros and cons of CSR and the impact of its implementation on international corporations. In the absence of an unanimously agreement, the discussion regarding this issue is still going on between corporations, interest groups, states and business institutions all over the world.

Finally, this Master’s thesis particularly examines the approach to CSR in the Republic of South Africa as a currently significant emerging market. Due to the nation’s challenging historical background, its government launched a programme, namely the Black Economic Empowerment (BEE) and in further development the Broad-Based Black Economic Empowerment (B-BBEE), to redress the inequalities of apartheid. The study describes the development of these programmes and analyses the main issues of B-BBEE, such as content, enforceability and future amendments.

Inhaltsverzeichnis (Table of Contents)

• Section 1: INTRODUCTION
  • I. Overview
  • II. Personal Statement
  • III. Gender-Neutral Formulation
• Section 2: BASICS OF CSR
  • I. Conceptual Development and Geographical Origin of CSR
  • II. The Role of Public Authorities and Other Stakeholders
• Section 3: DEFINITION OF TERMS
  • I. Definitions of CSR
  • II. Demarcation between CSR and Related Concepts
    • 1. Corporate Citizenship
    • 2. Corporate Social Performance
    • 3. Corporate Governance
    • 4. Sustainable Development
  • III. Excursus: Morality and Ethics
    • 1. Morality
    • 2. Ethics
• Section 4: LEGAL BASIS - PRINCIPLES AND GUIDELINES
  • I. OECD Guidelines
  • II. United Nations Global Compact
  • III. Global Reporting Initiative
  • IV. ISO 26000
  • V. ILO Declarations
    • 1. Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy
    • 2. Declaration of Fundamental Principles and Rights at Work
  • VI. United Nations Guiding Principles
• Section 5: DIMENSIONS OF CSR ACTIONS
  • I. Overview
  • II. Triple-Bottom-Line
    • 1. Social Responsibility
      • 1.1. Internal Dimension
      • 1.2. External Dimension
    • 2. Environmental Responsibility
    • 3. Economic Responsibility
• Section 6: IMPACT OF CSR ON INTERNATIONAL CORPORATIONS
  • I. Today's Role of CSR
  • II. Pros and Cons of CSR
    • 1. Pros of CSR
    • 2. Cons of CSR
    • 3. "SWOT-Analysis"
  • III. Impact on the Profitability
    • 1. The Business Case for CSR
    • 2. Interaction between CSR, CSP and CFP
      • 2.1. Corporate Financial Performance
      • 2.2. Relation between CSP and CFP
• Section 7: HISTORICAL BACKGROUND OF B-BBEE
  • I. The System of Apartheid
  • II. Transition to Democracy
  • III. Composition of the Population in South Africa
• Section 8: DEVELOPMENT FROM BEE TO B-BBEE
  • I. Affirmative Action
    • 1. Principle of Equality
    • 2. Content of Affirmative Actions
    • 3. Justification of Affirmative Actions
  • II. Black Economic Empowerment (BEE)
  • III. Broad-Based Black Economic Empowerment (B-BBEE)
• Section 9: CONTENT AND ENFORCEABILITY OF B-BBEE
  • I. B-BBEE Act
  • II. B-BBEE Strategy
  • III. Codes of Good Practice
  • IV. Scorecards
    • 1. Generic Scorecard
      • 1.1. Direct Empowerment
        • 1.1.1. Ownership
        • 1.1.2. Management Control
      • 1.2. Human Resources Empowerment
        • 1.2.1. Employment Equity
        • 1.2.2. Skills Development
      • 1.3. Indirect Empowerment
        • 1.3.1. Preferential Procurement
        • 1.3.2. Enterprise Development
      • 1.4. Socio-Economic Development
    • 2. Qualifying Small Enterprises (QSE) Scorecard
    • 3. Exempt Micro Enterprises (EME)
    • 4. Scorecard Overview and Calculation
      • 4.1. Scorecard Overview
      • 4.2. Calculation of the B-BBEE Status
  • V. Transformation Charters and Sector Codes
• Section 10: B-BBEE AMENDMENT BILL 2013
  • I. Objectives
  • II. Amendments
    • 1. Overview
    • 2. Generic Scorecard
    • 3. Qualifying Small Enterprises (QSE) Scorecard
    • 4. Exempt Micro Enterprises (EME)
    • 5. Scorecard Overview and Calculation
      • 5.1. Scorecard Overview
      • 5.2. Calculation of the B-BBEE Status

Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)

This Master's thesis examines the impact of Corporate Social Responsibility (CSR) on international corporations, focusing on the example of Broad-Based Black Economic Empowerment (B-BBEE) in South Africa. The thesis aims to provide a comprehensive analysis of the legal framework, principles, and guidelines governing CSR, and to explore the practical implications of these principles for multinational companies operating in the South African context.

• The conceptual development and geographical origin of CSR
• The legal basis of CSR, including relevant international guidelines and principles
• The dimensions of CSR actions, encompassing social, environmental, and economic responsibility
• The impact of CSR on the profitability of international corporations
• The evolution and implementation of B-BBEE in South Africa, including its legal framework and practical application

Zusammenfassung der Kapitel (Chapter Summaries)

• Section 1: Introduction provides an overview of the thesis and its main objectives. It also outlines the personal statement of the author and establishes a gender-neutral formulation throughout the text.
• Section 2: Basics of CSR explores the conceptual development and geographical origin of CSR, along with the role of public authorities and other stakeholders in promoting this concept.
• Section 3: Definition of Terms clarifies the definition of CSR and distinguishes it from related concepts such as Corporate Citizenship, Corporate Social Performance, Corporate Governance, and Sustainable Development. It also includes an excursus on morality and ethics.
• Section 4: Legal Basis - Principles and Guidelines examines the legal framework surrounding CSR, focusing on international guidelines and principles such as the OECD Guidelines, the United Nations Global Compact, the Global Reporting Initiative, ISO 26000, ILO Declarations, and the United Nations Guiding Principles.
• Section 5: Dimensions of CSR Actions provides an overview of the different dimensions of CSR actions, including social, environmental, and economic responsibility. It also explores the concept of the Triple-Bottom-Line approach to CSR.
• Section 6: Impact of CSR on International Corporations analyzes the current role of CSR in the international business world, exploring both the advantages and disadvantages of implementing CSR practices. This section also examines the impact of CSR on the profitability of multinational companies, including the business case for CSR and the relationship between Corporate Social Performance (CSP) and Corporate Financial Performance (CFP).
• Section 7: Historical Background of B-BBEE provides a historical context for B-BBEE, tracing its origins back to the system of apartheid in South Africa and the transition to democracy. This section also examines the composition of the South African population.
• Section 8: Development from BEE to B-BBEE explores the evolution of B-BBEE from Affirmative Action to Black Economic Empowerment (BEE) and finally to Broad-Based Black Economic Empowerment (B-BBEE). It analyzes the principles of Affirmative Action and the rationale behind its implementation.
• Section 9: Content and Enforceability of B-BBEE delves into the legal framework governing B-BBEE, including the B-BBEE Act, the B-BBEE Strategy, the Codes of Good Practice, and the various scorecards used to assess B-BBEE compliance. This section also examines the role of Transformation Charters and Sector Codes in promoting B-BBEE.
• Section 10: B-BBEE Amendment Bill 2013 analyzes the objectives and specific amendments proposed in the B-BBEE Amendment Bill 2013, focusing on changes to the generic scorecard, the Qualifying Small Enterprises (QSE) scorecard, the Exempt Micro Enterprises (EME) scorecard, and the overall calculation of B-BBEE status.

Schlüsselwörter (Keywords)

This Master's thesis focuses on the intersection of Corporate Social Responsibility (CSR), international business law, and the South African context of Broad-Based Black Economic Empowerment (B-BBEE). Key terms and concepts include: multinational enterprises, ethical business practices, sustainable development, corporate governance, affirmative action, socio-economic empowerment, legal compliance, and the impact of CSR on profitability.

• College: University of Vienna
• Grade: Summa Cum Laude
• Author: Dr. Theresa Adamek (Author)
• Publication Year: 2014
• Pages: 105
• Catalog Number: V285098
• ISBN (eBook): 9783656850601
• ISBN (Book): 9783656850618
• Language: English
• Tags: Corporate Social Responisbility, CSR, Black Economic Empowerment, Broad-Based Black Economic Empowerment, B-BBEE, South Africa, Corporate Citizenship, Corporate Social Performance, Corporate Governance, Sustainable Development, OECD, United Nations Global Compact, Global Reporting Initiative, ISO 26000, ILO Declaration, United Nations Guiding Principles, Triple-Bottom-Line, Social Responsibility, Environmental Responsibility, Economic Responsibility, SWOT-Analysis, CSP, CFP, CG, Apartheid, Nelson Mandela, BEE, Affirmative Action, Codes of Good Practice, Scorecard, Direct Empowerment, Ownership, Management Control, Human Resources Empowerment, Employment Equity, Skills Development, Indirect Empowerment, Preferential Procurement, Enterprise Developent, Socio-Economic Development, Qualifying Small Enterprises Scorecard, Exempt Micro Enterprises, Transformation Charter, Sector Code