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Multinationals unlikely to be held liable for CSR violations due to lack of transparency, research finds

Author: Anna Louise Vytopil, Utrecht University, Published on: 14 March 2016

"Contractual Control in the Supply Chain: On Corporate Social Responsibility, Codes of Conduct, Contracts and (Avoiding) Liability", 2015

This research…focuses on the extent of the legal responsibility and liability for CSR violations in the supply chains of MNCs in the Netherlands, England and…United States…[T]his research provides valuable insights into those companies that aim to improve the CSR performance in their supply chains…It concludes that…MNCs that used…vague [CSR] measures were often voluntary in nature…[I]t is unlikely that an MNC will be held liable for damage caused by CSR violations…unless it takes on obligations that…go outside of that which would normally be expected from the MNC…or unless…behavior of the MNC gives rise to a liability claim….[T]he law as it currently stands does not have…much to offer when it comes to…long‑term improvement for CSR in supply chains...[S]ince legislation is limited to transparency requirements for MNCs…and governments do not attempt to carve out a clear duty of care for MNCs, the law is unlikely to bring about the revolution that is perhaps necessary to prevent further disasters from occurring. [Also refers to Nike.]

Read the full post here

Related companies: Nike