CORPORATE SOCIAL RESPONSIBILITY COMPLIANCE: ISSUES, TRENDS AND BEST PRACTICES

Transcription

1 CORPORATE SOCIAL RESPONSIBILITY COMPLIANCE: ISSUES, TRENDS AND BEST PRACTICES William N. Shepherd Vince Farhat November 20, 2012 Copyright 2011 Holland & Knight LLP. All Rights Reserved

2 Presentation Agenda Background: Corporate Social Responsibility (CSR) Compliance California Transparency in Supply Chains Act Recent Federal Initiatives Best Practices for CSR Compliance Questions & Answers 2

3 Corporate Social Responsibility (CSR) Compliance Increased Public Scrutiny of Corporate Supply Chains Human Trafficking Slavery Child Labor 2004 Kennedy School CSR Initiative Ethical Trade Initiative United Nations Global Compact Promotes 10 Principles Human Rights, Labor, Environment, Anti-Corruption 3

4 California Transparency in Supply Chain Act In September 2010, California Governor Arnold Schwarzenegger signed into law California Senate Bill 657, the California Transparency in Supply Chains Act of 2010 (the Act), which is codified in California s Civil Code and Revenue and Taxation Code and became effective on January 1, The stated purpose of the Act is to provide consumers with information regarding [companies ] efforts to eradicate slavery and human trafficking from their supply chains and to educate consumers on how to purchase goods produced by companies that responsibly manage their supply chains. 4

5 Transparency in Supply Chain Act (continued) On November 30, 2012, the California Franchise Tax Board will report to the Attorney General a list of all retail manufacturers/sellers (determined by an entity's California tax return) with annual gross worldwide receipts exceeding $100 million that "do business" in California. Companies that appear on this list must publically disclose on their websites the nature and scope of their corporate compliance efforts to eliminate human trafficking, slavery and child labor from their global supply chains. 5

6 Transparency in Supply Chain Act (continued) For any company that fails to abide by this requirement, the Act empowers the California Attorney General to bring injunctive relief to enforce compliance with the Act. The Act also permits a private plaintiff to bring a civil action (under Cal. Bus. & Prof. Code Sec ) against any business that fails to comply. Accordingly, all retail sellers and manufacturers that fall under the Act must take steps now to ensure that they are in compliance and do not become susceptible to civil liability. 6

7 The White House Office of the Press Secretary Recent Federal Initiatives For Immediate Release September 25, 2012 Executive Order - Strengthening Protections Against Trafficking In Persons In Federal Contracts EXECUTIVE ORDER American tax dollars must never, ever be used to support the trafficking of human beings. We will have zero tolerance. We mean what we say. We will enforce it. -President Barack Obama 7

8 Specific Prohibitions Prohibit Federal Contractors & Subcontractors No misleading recruitment practices re: wages, conditions, housing, or hazards No recruitment fees No confiscation of identity documents Must provide return flights Must permit full audits and inspection by Agency Mandatory Reporting notify Inspector General of any non-compliance 8

9 Compliance Requirements Must have a compliance plan on website at contract initiation date Contractor training Whistleblower Hotline Recruiting and Wages must meet host country standards Detect subcontractors who engage in violations and remediate or terminate Annual Certification 9

10 Other Areas of Activity National Association of Attorneys General American Bar Association pending resolutions to help victims HR 2759 to Federalize the California law Trafficking Victims Protection Act reauthorization 10

11 Best Practices for CSR Compliance Assess your Source Risk and Your Service Risk Apply Know Your Customer Due Diligence Models to Suppliers Actively audit these providers Engage your industry to follow suit Realize there is no Jury Nullification Argument Option 11

12 Other Ways to Show Your Commitment Global Business Coalition Against Trafficking Sister Gliceria Cruz Mission House Slaveryfootprint.org 12

13 Questions & Answers William N. Shepherd Phone: (561) Vince Farhat Phone: (213)