ABSTRACT

In recent years the term ‘corporate social responsibility’ (CSR) has become increasingly commonplace. There has been a growing awareness of the global impact and effect of corporate behaviour, not just on company shareholders, but on many other stakeholders. There has also been an increased willingness to consider a greater variety of persons and groups as ‘legitimate stakeholders’, with interests that deserve to be taken into consideration when corporate decisions are made. In part, the concept of CSR has gained increased currency in response to, or as a reaction against, the ‘shareholder primacy’ doctrine, which typically places the profi t-seeking interests of company shareholders ahead of all others in the corporate decision-making process. Concerns about the effects of socially ‘irresponsible’ behaviour by powerful corporations have led to greater dissatisfaction with a view that shareholders’ interests must always be paramount, and given an increased impetus to the CSR movement. At the same time, the global reach of transnational corporations (TNCs) is ever expanding. This chapter will examine the nexus between globalisation, TNCs and CSR in order to demonstrate that the ease with which TNCs conduct their international businesses is actually providing a fi llip to the CSR movement, drawing greater attention to the resulting social and environmental injustices in a manner that is increasing the likelihood that TNCs will act in a socially responsible manner. This is despite the diffi culties faced in regulating TNCs under national and international law. The challenges in regulating TNCs will be identifi ed, and the legislative and non-legislative initiatives that are being used to address those challenges will be discussed in the context of globalisation and CSR – in particular, the reformulation of directors’ duties, the use of foreign direct liability laws, the promotion of international norms, codes of conduct and triple bottom line reporting will be reviewed and analysed.