Code of Conduct
In January, 2015 the Myanmar Garment Manufacturers Association ratified a Code of Conduct for our 300+ member companies. This Code of Conduct is meant as a guide and framework for responsible business practices in Myanmar’s apparel sector.
MGMA can help with explaining the rules and values outlined in our Code of Conduct. Constructive criticism is welcomed and should be sent to: [email protected] so that we can consider your suggestions when the Code is due for revision in December.
Factories wishing for significant help with implementing social compliance practices may be able to work with the industrial engineering team from the EU-Funded SMART Myanmar project or one of our other international partners. MGMA can help make arrangements and contacts.
Code of Conduct & Corporate Social Responsibility
Code of conduct
A code of conduct is a set of rules outlining the social norms, religious rules and responsibilities of, and or proper practices for, an individual. In its 2007 International Good Practice Guidance, “Defining and Developing an Effective Code of Conduct for Organizations”, the International Federation of Accountants provided the following working definition:
“Principles, values, standards, or rules of behaviour that guide the decisions, procedures and systems of an organization in a way that (a) contributes to the welfare of its key stakeholders, and (b) respects the rights of all constituents affected by its operations.”
A common code of conduct is written for employees of a company, which protects the business and informs the employees of the company’s expectations. It is ideal for even the smallest of companies to form a document containing important information on expectations for employees. The document does not need to be complex or have elaborate policies, but the file needs a simple basis of what the company expects from each employee.
Corporate Social Responsibility
Corporate social responsibility (CSR, also called corporate sustainability, sustainable business, corporate conscience, corporate citizenship, conscious capitalism, or responsible business) is a type of international private business self-regulation. While once it was possible to describe CSR as an internal organisational policy or a corporate ethic strategy, that time has passed as various international laws have been developed and various organisations have used their authority to push it beyond individual or even industry-wide initiatives. While it has been considered a form of corporate self-regulation for some time, over the last decade or so it has moved considerably from voluntary decisions at the level of individual organisations, to mandatory schemes at regional, national and even transnational levels.
Considered at the organisational level, CSR is generally understood as a private firm policy. As such, it must align with and be integrated into a business model to be successful. With some models, a firm’s implementation of CSR goes beyond compliance with regulatory requirements and engages in “actions that appear to further some social good, beyond the interests of the firm and that which is required by law”. The choices of ‘complying’ with the law, failing to comply, and ‘going beyond’ are three distinct strategic organisational choices. While in many areas such as environmental or labor regulations, employers may choose to comply with the law, or go beyond the law, other organisations may choose to flout the law. These organisations are taking on clear legal risks. The nature of the legal risk, however, changes when attention is paid to soft law. Soft law may incur legal liability particularly when businesses make misleading claims about their sustainability or other ethical credentials and practices. Overall, businesses may engage in CSR for strategic or ethical purposes. From a strategic perspective, the aim is to increase long-term profits and shareholder trust through positive public relations and high ethical standards to reduce business and legal risk by taking responsibility for corporate actions. CSR strategies encourage the company to make a positive impact on the environment and stakeholders including consumers, employees, investors, communities, and others. From an ethical perspective, some businesses will adopt CSR policies and practices because of ethical beliefs of senior management. For example, a CEO may believe that harming the environment is ethically objectionable.
Proponents argue that corporations increase long-term profits by operating with a CSR perspective, while critics argue that CSR distracts from businesses’ economic role. A 2000 study compared existing econometric studies of the relationship between social and financial performance, concluding that the contradictory results of previous studies reporting positive, negative, and neutral financial impact, were due to flawed empirical analysis and claimed when the study is properly specified, CSR has a neutral impact on financial outcomes. Critics questioned the “lofty” and sometimes “unrealistic expectations” in CSR. or that CSR is merely window-dressing, or an attempt to pre-empt the role of governments as a watchdog over powerful multinational corporations. In line with this critical perspective, political and sociological institutionalists became interested in CSR in the context of theories of globalization, neoliberalism and late capitalism. Some institutionalists viewed CSR as a form of capitalist legitimacy and in particular point out that what began as a social movement against uninhibited corporate power was transformed by corporations into a “business model” and a “risk management” device, often with questionable results.
CSR is titled to aid an organization’s mission as well as serve as a guide to what the company represents for its consumers. Business ethics is the part of applied ethics that examines ethical principles and moral or ethical problems that can arise in a business environment. ISO 26000 is the recognized international standard for CSR. Public sector organizations (the United Nations for example) adhere to the triple bottom line (TBL). It is widely accepted that CSR adheres to similar principles, but with no formal act of legislation.