Corporate responsibility involves a notion that companies have some level of responsibility (but not necessarily liability) for social issues that include human rights. But the parameters of such responsibility are unclear. What human rights are relevant to companies? What are the limits on a corporation’s ‘responsibility’ for human rights? To whom is such responsibility owed? Does corporate responsibility involve anything more than a voluntary assumption by companies to act ‘ethically’? This article examines the concept of corporate responsibility and its relationship with international human rights law. It then focuses on the particular Australian derivation of corporate responsibility in light of the two recent federal government inquiries in 2005–06. The article concludes by arguing that if corporate responsibility is to be given meaning, it urgently requires greater articulation of both the concept and its limits. A common framework that identifies the rights relevant to business and the limits of a company’s responsibility to implement them is required and greater regulatory guidance is needed in setting parameters for corporate reporting on nonfinancial issues. While companies must ultimately take responsibility for what they do and the decisions they take, governments have a key role in providing a framework that articulates the limits of corporate responsibility and clarifies the reporting requirements for non-financial issues that may materially affect corporate performance.
Corporation and Enterprise Law
Date of this Version
Justine Nolan, "Corporate Responsibility in Australia: Rhetoric or Reality?" (July 2007). University of New South Wales Faculty of Law Research Series. Working Paper 47.