Fairtrade and Business

Business is ever more powerful, not just in mature markets like the UK but in emerging economies such as Asia and Latin America where multinational firms and other companies can also achieve dominant positions.  Many interest groups are concerned about human rights, climate change and environmental protection and recognise the need to engage with the business world in order to make ethical investments and other ethical decisions.

Firms are starting to realise that they must be more accountable, transparent, responsible and sustainable if they are to have a long-term future. This applies to anyone who is trading, not just large firms.

Diocese of Chelmsford

Chelmsford is a ‘Fairtrade diocese’. In addition the Chelmsford Diocesan Board of Finance, which manages the financial affairs and holds the assets of the diocese, has investment policies that are governed by ethical and long-term considerations:

• Ethical investment - which ensures that investments are held in companies that have high standards of corporate governance and behaviour and that act with integrity, accountability and transparency in a responsible way towards all stakeholders and have good environmental policies.
• Long-term considerations - decisions are made with due regard to their pastoral impact and long term effect. This may result in a more cautious approach to investment decisions than might be found in decisions which are based wholly on commercial grounds.

Fairtrade

The Diocese of Chelmsford is committed to a policy of promoting the principles and practice of Fairtrade in the interests of global economic, social and environmental justice. The Fairtrade Mark guarantees farmers a fair and stable price for their products and gives small farmers a stronger position in world markets. Farmers and plantation workers have the opportunity to improve their lives and greater respect is paid to the environment. For information about Fairtrade visit www.fairtrade.org.uk and www.tradingfairly.co.uk .

Ethical Investment

The Diocese of Chelmsford has adopted the ethical investment policy of the Church Commissioners. This includes not investing in companies that supply armaments or promote pornography or home credit companies ('doorstep lenders') or in any company whose main business is in gambling, the supply of alcohol or tobacco products.

The Ethical Investment Advisory Group develops and coordinates ethical investment policy for the Church Commissioners.

The Diocese of Chelmsford will refuse advertising and sponsorship which does not comply with this ethical investment policy.

Church members can see how their Churches are putting Christian principles into investment practice at www.churchinvestorsgroup.org.uk . 

Sponsorship

No sponsorship is accepted that does not comply with the Diocese's ethical investment policy.

Supporting social enterprise

The Diocese of Chelmsford supports netCUDA, the credit union development agency, and the Essex Savers credit union. Credit unions helps people to save for the future, obtain money management advice and access emergency loans and loans at competitive rates in times of need. For example, Essex Savers gave loans to people caught out by the collapse of the Christmas club and hamper firm, Farepak. Click for more information about the role of the Diocese in campaigning for fairer finance.

The importance of the ‘triple bottom line’

How firms treat their employees, pensioners, suppliers, consumers, investors, regulators, communities and pressure groups has become increasingly important. Businesses today have to deliver an outstanding ‘triple bottom line’ of social, environmental and economic performance if they are to enhance their corporate reputation and brand value.

So firms not only put health and safety and equal opportunity programmes in place as the law requires, but many make voluntary charitable donations and encourage employee volunteering.  They may secure external accreditation such as the ISO 14001 certification for their environmental management systems. They may also formulate policies on animal welfare. Risk to reputation is a serious matter impacting profitability.

What makes a ‘good’ company?

Businesses that are good ‘corporate citizens’ work in a proactive way beyond the minimum requirements of the law to maximise the wealth of all key stakeholders. They uphold high standards of governance, transparency and accountability and manage social, environmental and economic issues and processes. They consult stakeholders to identify their concerns, set ‘key performance indicator’ monitoring systems and targets, embed social responsibility into ‘skills competencies’, have their social and environmental results independently audited, and report their results openly.

How to tell how good a company is – monitoring ‘corporate social responsibility’ (CSR)

Businesses generally advocate voluntary pathways towards corporate social responsibility in preference to legislation. They favour economic incentives that encourage best practice, and oppose mandatory controls that might stifle innovation and competitiveness. However, CSR is a developing area for legislation.

The Companies Act 2006 requires quoted companies by October 2008 to provide information in their business reviews about:

• Environmental matters.
• The company’s employees.
• Social and community issues.
• Significant supply chain relationships.

The Department for Environment, Food and Rural Affairs has issued guidelines to help businesses address their environmental impacts.

Firms can become more socially responsible in a number of ways:

• Transparency – disclosing important information to stakeholders.
• Responsibility – correcting mistakes.
• Accountability – setting measurable targets for reports to stakeholders.
• Engagement – regular two-way flows of information and views with stakeholders.
• Innovation – Including stakeholders’ needs in research and development programmes.

The government and a number of organisations are taking a look at corporate social responsibility, how to put it into practice and how companies are measuring up. Visit the following websites for more information:

www.csr.gov.uk
DTI - sustainable development and environment
CSR Academy
FTSE4Good
Business in the Community
Corporate Responsibility Coalition
ACCA UK Awards for Sustainability Reporting
Christian Aid – trade justice
Amnesty International business group
Friends of the Earth - corporates
World Wildlife Fund – doing business with business
Article 13
AccountAbility
Transparency International
CorporateRegister.com
Corporate Watch

Make Your Mark

The Make Your Mark campaign fosters social enterprise among young people.

Print this page
Bookmark this page