Open Access Research Article
CORPORATE SOCIAL CONTRACT; A NEW CONCEPT AND ITS RELATION WITH CORPORATE GOVERNANCE AND CORPORATE SOCIAL RESPONSIBILITY
Published Paper
Article Details
CORPORATE SOCIAL CONTRACT; A NEW
CONCEPT AND ITS RELATION WITH CORPORATE GOVERNANCE AND CORPORATE SOCIAL
RESPONSIBILITY
AUTHORED BY
- NIKHIL A S
Assistant
Professor
Kristu
Jayanti College of Law
Bengaluru,
Karnataka.
INTRODUCTION
Corporate Governance could be defined
as the the process and rules under which a company is managed on the behalf of
shareholders and stakeholders. Since corporate governance also provides
the framework for attaining a company's objectives, it encompasses practically
every sphere of management, from action plans and internal controls to performance
measurement and corporate disclosure.
Corporate social responsibility (CSR) is a self-regulating business model that
helps a company be socially accountable—to itself, its stakeholders, and the
public. By practicing corporate social responsibility, also called corporate
citizenship, companies can be conscious of
the kind of impact they are having on all aspects of society, including
economic, social, and environmental. But corporate social contract is
relatively a new concept the earlier concept of social contract is intermingled
with that of the corporate governance and corporate social responsibility. This
research work deals with the connecting process that exists between corporate
governance, corporate social responsibility and corporate social contract.
MEANING, SCOPE AND DEFINITION OF CORPORATE GOVERNANCE
Corporate Governance is a term that
defines the processes, customs, laws, policies and institutions that direct the
way in which the corporations act, administer and control their position. The
primary aim of the concept of corporate governance is to ensure fairness,
accountability and transparency among the companies. In short words, it is the
system in which companies are directed and controlled.[1]
The scope of corporate governance has
increased from time to time as the companies lay their grassroots deep and
create a corporate world. Corporate governance do act as a medium to ensure
that the companies no longer extend their autonomy to create a monopoly by
restricting their powers. The scope of corporate governance can be determined
the unconcerned factors which can affect the factors of the publically traded
firms, which could be either external or internal. A lot of influences
determine the scope of corporate governance to how far the scope has widened.
The internal influences arise from within the company and external factors are
those which would further be classified into private sector influences and
public sector influences. The customers, competitors, shareholders, employees,
union, bankers and financiers etc. being some examples of the private sector
influences and trade practices, anti monopoly,labour and equal opportunities,
arbitration courts etc. being the public sector influences.[2] It
basically sums up how far the corporate governance has evolved as concept where
the scope is wide. Thus the benefits of extending the scope being;
1. Better economic growth and more
success rate of the company
2. Increasing the share price of the
company
3. Build up the goodwill of the company
4. Lowers the cost of capital that is
required for investment
MEANING AND SCOPE OF CORPORATE SOCIAL RESPONSIBILTY
The origin of corporate social
responsibility can be traced back to the Roman laws in the early centuries
where it mostly involved philanthropic work such as asylums, hospitals and
orphanages. Later, in the seventeenth century corporations were seen as an
instrument of social development by the English crown. By 1920’s and 1930’s ,
balancing the profit maximization was an issue raised by the business
shareholders in the corporations for which they had to maintain a cordial relationship
with the labor force , the community which lead to the concept that the
managers have the duty to maintain the social relations of the company. When it
reached the 1940’s, the responsibility of the companies were in limelight that
it was established as a norm. After the World War II, the concept of social
responsibility was further enhanced. There were changing attitudes of corporate
social responsibility and actions going beyond philanthropic activities. It was
in 1953, Howard .R. Bowen introduced certain principles which would term down
the set of responsibilities where he further postulated that a businessman’s
decesions and actions affect their stakeholders, customers and employees
affecting their quality of life as a whole.[3]Later
in the 60’s, it concentrated into academic research and theoretical focus and
had a tangible impact on the society. Certain principles have been laid down by
Reverand Leon S Sullivan, popularly known as the global Sullivan principles in
order to protect the company’s social, economic and political interests and
make the company responsible for their doings.[4]
CORPORATE SOCIAL RESPONSIBILITY IN INDIA
India was the first country which
made the corporate social responsibility mandatory. As per the Companies Law
Amendment Act of 2013, companies having net worth of Rupees Five hundred crore
or annual turnover of Rupees Thousand Crore or net profit of five crore in a
financial year to spend at least 2 percent of the average net profits of the
companies CSR policy.[5]Also
certain national voluntary guidelines has been laid down by the Ministry of
Corporate Affairs regarding the Corporate Social Responsibility.[6]
Inter Relationship
Between Corporate Governance and Corporate Social Responsibility
Corporate Social Responsibility of a
company is a pivotal measure which would determine how well the company is been
governed. Corporate social responsibility determines how the company is being
responsible to the society; socially, economically and environmentally. When
the stakeholder prospective became a part and parcel of the corporate social
responsibility, the earlier phase of philanthropic notion of corporate social
responsibility gradually shifted into stakeholder participation model. In
India, even some objectives of corporate governance and corporate social
responsibility are similar such as;
1. Being transparent so that the public
trust and confidence are being rebuild
2. Establishment of a strong band
reputation of the company
3. Establishing and maintaining a good
relationship between the stakeholders and the company
4. Contribution to the development of
the region where the company has been functioning
5. To maintain a strong market position
by addressing the concerns of various stakeholders[7]
On the global perspective, as the
number of corporate scandals increased alarmingly, some of them being the
scandals associated with Enron, Worldcom and Lehmann brothers, have undermined
the confidence of public as well as the investors alike. As a result of these
scams ,certain suggestion have been put forward in order to maintain the
balance between the corporate governance and corporate social responsibility.
Companies has to be more transparent and provide a timely and intelligible
disclosure regarding the financial statements and disclosure practices. In
order to ensure good governance of the company and assuring accountability,
responsibility and transparency, managers of the company are more likely to
implement corporate social responsibility practices. Large companies tend to
have high level of systematic risk and hence companies will disclose corporate
social information to reduce risks and reassuring the investors that the
company has been governed well and is transparent enough with the social
responsibilities.[8]
CORPORATE SOCIAL CONTRACT; AN EMERGING CONCEPT
THE CONCEPT OF SOCIAL CONTRACT
The concept of social contract
emerged during the 18th and the 19th centuries. It is a
theory which points out the relationship between the ruler and his subjects,
defining the rights and duties of each. The earlier concept of this theory were
born into anarchic state of nature with no rules or orders to control
themselves. Then when reason came into place, a society was formed and as a
result, a government there by which a contract came in to place between the ruling
and the ruled.[9]
Originated in Greece, the idea was
further developed by Englishmen Thomas Hobbes and John Locke and Englishmen
Jean Jacques Rousseau. The theories even differed where some justified the
sovereign and some were intended to protect the individual’s rights. There was
no government or law to regulate them, which resulted in oppression and agony.
To overcome these hardships, two agreements were made;
1. Pactum Unionis
As per this agreement,
people sought protection of their personal life and property. Subsequently,
society was formed and people respected each other and lived in harmony
2. Pactum Subjectionis
As per this agreement,
people pledged together and subjected to obey an authority and surrendered the
whole or part of the freedom and rights to an authority. That particular
authority granted them protection of life and liberty.
THE CONCEPT OF SOCIAL CONTRACT BY
THOMAS HOBBES
The concept of social contract by
Thomas Hobbes was first published on Leviathon, published in the year 1651.
According to him, prior to social contract, men lived in a state of nature.
Man’s state of nature was of fear and selfishness. Man has a natural desire for
security and order. In order to procure self protection and self preservation,
man entered into a contract. For that purpose, he voluntarily surrendered all
his rights and freedoms to some authority. This lead to the postulation of
concept of ruler or monarch, who shall be the absolute head.
THE CONCEPT OF SOCIAL CONTRACT BY JOHN LOCKE
John Locke’s state of nature is
different of that from Hobbesian point of view. He says that state of nature is
not as miserable as what Thomas Hobbes has postulated. His postulation is more
concentrated on the property that state of nature being good and reasonable,
the property was not secured. Man had all the liberty to choose his life as he
sees best for himself. How ever, men did not have any license to do as he
pleases. People are presumed to be equal in such a state of nature and equally
capable of discovering and being bound by the state of nature. It could be said
as pre political but not pre moral.
THE CONCEPT OF SOCIAL CONTRACT BY JEAN JACQUES ROUSSEAU
Jean Jacques Rousseau gave new
interpretation to the concept of social contract. According to him, social
contract is not a state of nature but a hypothetical construction for reason.
Humanity faced some changes as time evolved. People began to live in families
and division of labor was introduced. Subsequently, the concept of private
property was invented by the people which, in the words of Rousseau, was a fall
from grace from the state of nature. For this purpose, they surrendered their
whole power not to an individual but to a community as a whole.[10]
THE CONCEPT OF CORPORATE SOCIAL CONTRACT
A company may have contractual
obligations between different entities. It could be with the stakeholders,
different units of the company and even with the employees of the company. Thus
corporate social contract can be defined as the contract that has been entered
into by the company and various entities associated with it where the company
is bound to maintain a social relationship with them. The corporate social
contract can be analyzed in various contexts. Some of them are;
1. Corporate Interests
In order to protect the
interests of the company, various contracts would be entered by the company
with that of different entities which would arise to some dilemmas. These
dilemmas will enlighten the company on what solutions should be adapted to
maintain a cordial social relationship between the various entities and the
company. The dilemmas being;
I.
Dirty
Hands Dilemma
In this dilemma, the
tensions between the individual stakeholders and the company is concerned.
II.
Many
Stage Dilemma
Corporate interest takes
a main role in this dilemma. Corporate interest could be different from person
to person and the interpretation would be different for each person. When the
opinions among the society differ, there occurs a dilemma
III.
Entangled
Hands Dilemma
Entangled Hands Dilemma
is the problem that arises when there is a conflict of opinion between the
manager and employee. Their interests may differ which leads to chaos.
2. Contract in terms of business context
Where there are conflicting interests
in a corporation in one hand, there is also an inter relationship between these
interests. For determining these
interests, two models have been postulated; one the market model and the next one
being the contract model. Market model provides that despite the conditions
prescribed, a balance between morality and self interest will ensue itself.
Contract model resolves the tension between self interest and morality. In this
model, the parties are free to enter into a contract and the problems between
them will be solved in mutual interests through an agreement. Thus the contract
model is actually brought up as problem solving effort between the different
players of a company.
3. Corporation as a citizen
The presumption of a company being in
the same status as that of a citizen plays an important role in defining the
concept of corporate social contract. The comoany is bound to contribute to a
society. As it may vary to the interests of that of the society, the company
has the responsibility to maintain a cordial balance between itself and the
public. This will be achieved if the company ensures that there is a mutually
responsible social contract between the company and the society where company takes
up the role of a citizen and functions as such.
CORPORATE SOCIAL CONTRACT AND CORPORATE GOVERNANCE
Corporate social contract and
corporate governance are two concepts in which the former plays an essential
role in the proper functioning of the latter. The concept of social contract
that has been la can be interlinked on showing how far the term of corporate
governance has been evolved in terms with corporate social contract.
The term company or the institution
of company has evolved from time immemorial. During the Roman Period, they were
not having a very wide concept of a legal person or a corporation. There were
not even stocks or bonds and real estate was rarely put up for sale. Thus, the
state of nature of men was free and although commerce in Rome flourished, there
was no authority which would be taking care of it. Thus for the self interest
and benefit of their own cause, merchants were just concerned about themselves
and not much responsible to the society or the people they are engaging in a trade
within. This period can be compared to the state of free nature in the social
contract. Later the concept of institutionalization and that of a corporation
came into prevalence. In England, for merchant advertising to do on overseas,
the organizations were called companies. Later, the East India Company came
into establishment. But, a statutory corporate firm was first bought into
public scenario was by United Kingdom, when they enacted the Bubbles Act in
1720. Later in United States of America, many statutes came into prevalence,
namingly the Joint Stock Companies Act,1844, the Limited Liability Act of 1855
and the Companies Act of 1862. A series of statutes followed where as of now
the Companies Act of 1948 is being followed in England. In India, the Companies
Act of 1956 was the first legislation post independence where the previous
control and establishment of the companies were controlled by the East India
Company. From the perspective of the corporate social contract, the company
became under the authority of a statute where from a free state of nature, was
bound under statutory protection. Thus, protection or preservation of the right
of a person where the rights has been surrendered to the authority as
postulated by Thomas Hobbes in his social contract theory, the companies binds
under the statute and be under their surveillance so that they would be
eventually protected in case of any mishap. And to govern the company in a fair
and transparent manner, these statutes have to be abided accordingly. Thus
corporate social contract is interlinked with the concept of corporate
governance.
CORPORATE SOCIAL CONTRACT AND CORPORATE SOCIAL
RESPONSIBILITY
Corporate Social Responsibility is
the concept where companies are responsible to the society for which they have
to ensure that they responsibly interacts with the society in terms of social,
economical and environmental responsibilities. It, in terms of contract, is an
interaction between the society where by which the company has more liability
and responsibility to meet when there is more interaction with the society.
Prior start of the corporate social responsibility was for the purpose of
philanthropic activities which later was made within the ambit of social
responsibility.
Corporate social contract and corporate
social responsibility can be interlinked on how corporate social responsibility
can be seen as a contract between the company and the society. Comparing with
the evolutionary perspective of the social contract theory of Hobbes, Locke and
Rousseau, social responsibility was a discretionary but not mandatory from the
part of the companies to abide to it. From time to time, many principles and
conventions have been put in force regarding the importance of corporate social
responsibility; a few of them being United Nations Global Compact[11],
Sustainable development goals[12],
Brundtland report[13],
Johanassberg declaration on health and sustainable development etc. Corporate
social responsibility can bet narrowed down as a contract between the company
and various facets of the society. Corporate social contract can be seen as a
contract that has been made between the society and the company where there is
a quid pro relationship. In Shell Case[14],
it was held that company should recognize five areas of responsibilities which
include responsibilities to shareholders, customers, employees, business
partners and societies at large. This, in perspective of a social contract, can
be taken up as an agreement where there is a moral obligation from the part of
the company to maintain a responsible contractual terms between the company and
the entities associated with it. Moving on to the evolutionary background of
corporate social contract interlinked with corporate social responsibility, at
the earlier stages of the corporate social responsibility, where it was more
oriented to philanthropic work, there was no mandatory provisions to contribute
some amount for the cause of social responsibility, it could be compared to the
state of nature with no rules or order. Later people gathered together and
formed societies which can be compared to the formation of corporations. Later,
as per the “pactum subjectionis” principle laid down in the social contract
theory, where an authority came and people surrendered their rights to it, in
this case, it being the statutes, principles and the conventions. Corporate
Social Responsibility can be moreover related to Jean Jacques Rousseau’s
version of social contract where the powers have been surrendered by the people
to the community as a whole. Here, the company limits its powers and extends
the notion of responsibility to contribute to the community at large a benefit
from their shares so that the community will be benefited. In return, the
community will protect the interests of the company by aiding in their
functioning process and increasing their brand name.
CORPORATE SOCIAL CONTRACT; GLOBAL SCENARIO
During the modern industrial era at
the beginning of the 19th century, the influence of the joint stock
corporations with limited liability boomed as a new social order was shaping
up. Earlier industrialists such as Carniegie, Rockfeller and Melon laid the
foundation of the modern corporations. The concept of social contract was a
part and parcel of the United States constitution. It includes infringement of
rights of other members, to obey just laws, to comply with and enforce
contracts, to serve on juries and defend the community. Generally, the
corporate social contract is implemented through 3 major ways;
1. Abiding The Norms
The company tries to
validate their reason for being abiding to the norms; for example the ILO
Declaration on principle rights at work, the UN Global Compact ,the OECD
guidelines for multinational enterprises, Corporation 20/20 and Purpose of
corporation project being some which the company portrays that they abide by.
Thus it creates an inherent responsibility within the company and the public
that beyond self interest the corporations work together to abide the rules and
regulations.
2. Creating a new long term wealth
Companies tend to create
a long term wealth where the pronouncements of the company will be static
without any addition so that they tend to observe how the public reacts to it.
By such observance, they tend to extend their business principles to the public
and create a long term contract with the society if it is adaptable and
acceptable by them
3. Expanding the Partnership and
alliances
A company alone should
not be the primary provider of social goods. There must be multitude of
alliances such as computer literacy, health services and job retraining
mechanisms. Hence, there occurs a social contract where for certain
procurements the company is submitting some of its responsibilities to the
allies. The corporation will have better access to the public goods rather than
being part of the government. Three
major factors are responsible for this.
a) Innovation and management skills of
the companies
b) Local knowledge and trust associated
with citizens
c) Policy frameworks that encourage
promising partnerships outsourcing the government
CORPORATE SOCIAL CONTRACT IN INDIA
The company legislation in India is
closely followed by the company legislation in England. The first legislation
that was passed regarding companies law was the company’s act of 1844. Later, the
concept of limited liability was introduced in the Companies Act of 1857.
Later, in 1866, the companies act was passed for consolidating and amending the
act. It was continued till 1913.Later the Companies Act came which was further
amended on 2013,which is the present legislation in India. There were
amendments in between the period; the major ones being the First and Second
amendment of 2002.
The concept of social contract has
been mentioned in a plethora of Judgments. In Jilubhai Nanabhai Kachar and
Others .v. State of Gujarat[15],
the Court interpreted the Right to Property Under Indian Constitution within
the ambit of theory of social contract, where the social contract theory
involved protection of the property with recognition of the power of the ruler
to act in public interest or emergency and compared it with the Constitutional
provison where the Court interpreted constitutional right of property in India
is treated as inviolable except for law of public good and on payment of
compensation.
In IC Golaknath .v. State of Punjab,
it was held that the Directive Principles of State Poilcy is in terms with the
theory of social contract which enjoins to bring about a social order in which
justice; social, economical and political and social contract theory acts a
pathway to do so.[16]
In Ashwani Gupta .v. Government of
India and Ors., it was held that social contract establishes legal
equality and encourages minimum restriction of individual’s freedom by state.[17]
In Indira Nehru Gandhi .v. Raj
Narain,[18]
it was held that social contract is a means of achieving welfare in a society
composed of individuals.
In a plethora of judgments, it has
been defined how the concept of social contract is inter related with the
Constitution and how it amounts to public welfare and social order. Although
not expressly defined in any statute, the concept of corporate social contract
can be read down with the various aspects mentioned down in the Companies Law
(Amendment Act of 2013). The provisions of public offering mentioned in the
companies act can be termed down as corporate social contract; where the
company tries to raise funds by issuing it to the public. Again the concept of
Jean Jacques Rousseau comes into place where the power of the company is being
submitted to the community as a whole. The interpretation of the term authority
in the concept of social contract can
also be laid down in the issuing of shares where the share holders with
preference shares has the right to get the payment of the dividend , whose payment
takes priority of the ordinary shares. There is a social contract that has been
entered up between the share holders where the authority is vested more within
the preference share holders.
The Board of directors and the Key
managerial personnel also becomes the part of the social contract where company
is taken as a community and the powers have been vested within the authorized
personnel under them elected by the community
The concept of corporate social
responsibility being mandatory in the Companies Law (Amendment Act ) of 2013
can also be interpreted with in the meaning of corporate social contract, where
the company as a whole is involving as a part of the community and aiding them
in the process by being responsible to the society as whole, socially,
politically and environmentally.
CORPORATE SOCIAL CONTRACT AND STAKE HOLDER THEORY
STAKEHOLDER THEORY
The theory focusses on the view of
capitalism that defines the interconnected relationships between a business and
its consumers, supplies, investors and others who have a stake in the
organization. In 1984, Edward Freeman detailed the stakeholder theory. It says
that the stakeholder ecosystem, the theory says, involves anyone invested and
involved in within the meaning of stakeholder system, which includes every
political groups, governmental organizations, communities and so on.
BENEFITS OF STAKEHOLDER THEORY
The stakeholder theory has the
following benefits;
1. Impact on employees and customers
One of the advantages of stakeholder
theory is it includes greater productivity across the organization. If
employees feel that they are being valued, they tend to work more.
2. Increase in investment
Investors, being the stakeholders, invests more if they find
substantial advantage while joining hands with the company. As the value of
company grows and investors are connected with the other company, they are more
likely to add advantage to the production of the company.
3. Ethical Benefits
More than moral benefits, there are profits derived from the
company. Companies find the mental workforce increased as their job
satisfication is increased
DRAWBACKS OF STAKEHOLDER THEORY
There are certain drawbacks for the
stakeholder theory.
1. Conflict of interests
Various stakeholders have various interests which may not go
hand in hand with the interests of the others, which will lead to conflicts
2. Power levels and influence of
stakeholders
The power levels and the influence of stakeholders may differ
as seeming the most powerful ones would not have the power to influence the
others. Thus, it may amount to chaos.
STAKEHOLDER THEORY AND CORPORATE SOCIAL CONTRACT
The stakeholder theory has been seen
as always contradicting a social contract approach on business ethics. Friedman
has made two approaches regarding the social contract in relation with stakeholder theory. They
are:
1. Macro social contracts
2. Micro social contracts
Macro social contracts consists of
norms that consist of universal values. These norms should be obeyed by
everyone in all circumstances. Micro social contracts should be in conflict
with the macro social contract.
Micro social contracts must be
acceptable to the clear majority of the community. When single individuals
disagree with the norms of the community, they have the rights to leave it. It
reflects a community’s particular goals, environment, resources etc.
Friedman’s definition of managers are
also of two categories; one being the deontological norms and second the
normative obligation of the stakeholder expectation to maximize profit.
Deontological norms are comparable to hyper norms because they likewise apply
to all corporate executives independently of the particularities of the company
they manage. As a consequence, managers are obliged to fulfill certain set of
obligations.
The social contract theory and
Friedman’s approach are remarkably similar. Managers need to obey the universal
hyper norms of the macro social contract and community specific norms of
various micro social contracts. Therefore, the latter should not violate the
former. A similar relationship occurs between the de ontological norms and the
normative obligation of the stakeholder expectation, which are crucial for
profit maximization.
The stakeholder theory is in conflict
with the concept of social contract postulated by Friedmann because the
interests of stakeholders may differ and may not be in terms with that of the
other stakeholders. Reaching them to a consensus and proceeding them further
for the purpose of attaining corporate social contract is a complex dilemma and
is hard to achieve considering the circumstances.
CONCLUSION
Social contract is concept that has
been in prevalence for ages. It has evolved through various philosophers such
as Thomas Hobbes, John Locke and Jean Jacques Rousseau actively has said about how
the concept of social contract and how it has evolved from time to time. It
mainly talked about how a general will is being transferred to a community us a
whole from a free state of nature. The institutionalization of company evolved
years later and then arose the concept of corporate social contract. Even
though there is no express definition of the term corporate social contract in
any Indian statutes or statutes elsewhere, various general concepts that has
been used for the purpose of governing a company can be interlinked with the
term corporate social contract. The concepts such as corporate governance and
corporate social responsibility being the two important terms and concepts that
could be linked with corporate social contract. While interpreting various
provisions of the Companies Law (Amendment Act), 2013 and the decesions made by
judiciary, the concept of how far the corporate social contract has evolved can
be summed up. The research also points out that corporate social contract does
not go hand in hand with the stakeholder theory as they have conflicting
interests. The hypothesis of corporate social contract being a good parameter
to check the well functioning of corporate governance and corporate social
responsibility is hence proved but it has to be interpreted with the
functioning and analysis of those concepts. Thus, corporate social contract is
a highly philosophical concept which checks how far the company is involved
with the society and their responsibilities and benefits henceforth.
BIBILIOGRAPHY
PRIMARY SOURCES
STATUTES
The Companies Law (Amendment) Act,
2013
Working
Time (Amendment) Regulations 2001
Race
Relations Act (Statutory Duties) Order 2001
Disability
Discrimination Act 1995 (2005)
The
Companies Act, 1844
The
Limited Liability Act, 1855
Companies
Act, 1862
The
Companies Act, 1956
CASE LAWS
Shell
oil Co. v. Canada (Commissioner of Patents)
Pepsi Co., Inc. And Ors .v. Hindustan Coca Cola Ltd.
And Anr
Wallmart v Dukes
Jilubhai Nanabhai Kachar and Others
.v. State of Gujarat
Ashwani Gupta .v. Government of
India and Ors
Indira
Nehru Gandhi .v. Raj Narain
SECONDARY SOURCES
ONLINE
ARTICLES
Kaptain
MJ Wempe, The Corporation As Social Contract (SSRN Electronic
Journal 2002)
accessed 6 February 2020
Imao
O, Corporate Social Responsibility, Social Contract, Corporate
Personhood And Human Rights Law: Understanding The Emerging Responsibilities Of
Modern Corporation (Australian Journal of Legal Philosophy 2008)
accessed 7 February 2020
Mannar
B, 'Corporate Governance And Corporate Social Responsibility: The Indian
Context' (2020) 9 International Research Journal of Research Art and Commerce
accessed 8 February
2020
Friend
C, Social Contract Theory (Internet Encyclopedia of
philosophy)
Steib
J, Assessing Freeman's Stakeholder's Theory (3rd edn, Springer
2009)
accessed 8 February 2020
Seema Sharma, Corporate Social Responsibility In
India- The Emerging Discourse & Concerns (4th edn, Indian
Journal of Industrial Relations 2020)
accessed 8 February 2020
WEBILIOGRAPHY
[1] Report of the Cadburry Committee,
The financial aspects of the corporate governance (ISBN 085258913,1992)
para.2.6
[2]
Turnbull.S, “Corporate Governance: Its scope, concerns and
theories”(1997)PL 180
[3] Bowen HR, Social responsibilities of the businessman(1953),University of
Iowa Press
[4] Express our support for
universal human rights and, particularly, those of our employees, the
communities within which we operate, and parties with whom we do business Promote equal opportunity for our
employees at all levels of the company with respect to issues such as color,
race, gender, age, ethnicity or religious beliefs, and operate without
unacceptable worker treatment such as the exploitation of children, physical
punishment, female abuse, involuntary servitude, or other forms of abuse Respect
our employees' voluntary freedom of association Compensate our employees to
enable them to meet at least their basic needs and provide the opportunity to
improve their skill and capability in order to raise their social and economic
opportunities Provide a safe and healthy workplace; protect human health and
the environment; and promote sustainable development Promote fair competition
including respect for intellectual and other property rights, and not offer,
pay or accept bribes Work with government and communities in which we do
business to improve the quality of life in those communities -- their
educational, cultural, economic and social well-being -- and seek to provide
training and opportunities for workers from disadvantaged backgrounds. Promote
the application of these principles by those with whom we do business
[5] Company Law (Amendment) Act,
Section 135(1)
[6] Principle 1: Businesses should conduct and govern themselves with Ethics,
Transparency and Accountability
Principle 2: Businesses should provide goods and services that are safe and contribute to sustainability throughout their life cycle
Principle 3: Businesses should promote the well-being of all employees
Principle 4: Businesses should respect the interests of, and be responsive towards all stakeholders, especially those who are disadvantaged, vulnerable and marginalized
Principle 5: Businesses should respect and promote human rights
Principle 6: Business should respect, protect, and make efforts to restore the environment
Principle 7: Businesses, when engaged in influencing public and regulatory policy, should do so in a responsible manner
Principle 8: Businesses should support inclusive growth and equitable development
Principle 9: Businesses should engage with and provide value to their customers and consumers in a responsible manner
Principle 2: Businesses should provide goods and services that are safe and contribute to sustainability throughout their life cycle
Principle 3: Businesses should promote the well-being of all employees
Principle 4: Businesses should respect the interests of, and be responsive towards all stakeholders, especially those who are disadvantaged, vulnerable and marginalized
Principle 5: Businesses should respect and promote human rights
Principle 6: Business should respect, protect, and make efforts to restore the environment
Principle 7: Businesses, when engaged in influencing public and regulatory policy, should do so in a responsible manner
Principle 8: Businesses should support inclusive growth and equitable development
Principle 9: Businesses should engage with and provide value to their customers and consumers in a responsible manner
[7] DP Verma, Raj Paul, “Relationship
between corporate social responsibility and corporate governance” (2012) IOSR
Journal of Business and Management pp.24-26
[8] Jean Michael Sahut, Marta Peris
Ortiz, Frederick Tualon, “Corporate Social Responsibilty and Governance” (2019)
Journal of Management of Governance pp.901-912
[9] Encyclopedia Britannica, Social
Contract(18 March 2020)www.britannica.com/topic/social-
contract accessed
18 March 2020
[11] Principle 9- Businesses should
encourage the development and diffusion of environment friendly technologies
[12] Sustainable Development Goal 9-
Build resilient infrastructure, promote inclusive and sustainable
industrialization and foster innovation; Sustainable Development Goal 16-
Promote peaceful and inclusive societies for sustainable development, provide
access to justice for all and provide effective, inclusive and effective
institutions at all levels
[13] Brundtland. G.1987. Report of the
World Commission on Environment and Development: Our Common Future. United
Nations General Assembly Document A/42/427
[14] Okpabi and others .v.Royal Dutch
Shell pic and another Civ Case no A1
[15] Appeal(Civil) 2211-15 of 1994
[16] 1967 AIR 1643
[17] 2006 ACJ 1901
[18] 1975 SCR (3) 333
Article Information
CORPORATE SOCIAL CONTRACT; A NEW CONCEPT AND ITS RELATION WITH CORPORATE GOVERNANCE AND CORPORATE SOCIAL RESPONSIBILITY
Authors: NIKHIL A S
- Journal IJLRA
- ISSN 2582-6433
- Published 2023/09/19
About Journal
International Journal for Legal Research and Analysis
- Abbreviation IJLRA
- ISSN 2582-6433
- Access Open Access
- License CC 4.0
All research articles published in International Journal for Legal Research and Analysis are open access and available to read, download and share, subject to proper citation of the original work.
Disclaimer: The opinions expressed in this publication are those of the authors and do not necessarily reflect the views of International Journal for Legal Research and Analysis.