and environmental impact in their annual reports, the
Netherlands linking fi nancial support schemes for
large companies to compliance with the OECD Guidelines
for Multinational Enterprises and the Danish Government
establishing the Copenhagen Centre (a CSR
focused research institution).
What is this emphasis on CSR all about? Are we
looking at just the fl avour of the month? At the latest
hype or fad of a development community increasingly
disillusioned with the performance and capacities
of the public sector? Or do we see the seeds of a
genuinely new role model for business and corporate
behaviour? Are businesses, in particular transnational
corporations (TNCs), really looking beyond the shortterm
dictates of the market and moving from shareholder
value to shared values?
It has been observed that the globalisation process
has gradually disconnected fast-moving international
networks of production and fi nance from a lagging
system of global policies and institutions. A disequilibrium
is thus created between the economic domain
proper and the broader framework of shared values.2
In a closely connected development, as pointed out
by Harvard economist Dani Rodrik, “international
economic integration is taking place against the
background of receding governments and diminished
social obligations”.3 Does this imply that we are witnessing
the emergence of increasingly hybrid governance
structures in which social needs are no longer
the exclusive realm of the state? While the social dimension
has been an inherent feature in the European
brand of post-war market economies (“social market
economy” in Germany; “planifi cation” in France), we
can now witness attempts to anchor responsible business
practices in the corporate world itself, within a
context of voluntary action.
The present paper reviews recent trends in CSR
theory and practice and, in doing so, places special
emphasis on their relevance for small and medium
enterprises (SMEs) and on the context of economic
development in developing countries. It is argued that
at the end of the day, CSR will only prevail and remain
an important force if SMEs can be effectively engaged
and if CSR can be shown to impact on the development
agenda, i.e. fi rst and foremost on enhancing