The Economist in 2000 reported that although Shell did not suffer actual profit
loss from boycotts in reaction to incidents in Nigeria, its corporate workforce was so
demoralized and its reputation so badly damaged that the company changed its
strategies and direction anyway. Today Shell is reportedly considered to be one of
the models of corporate citizenship. ROGER COWE (2001, p. 6) writes that for a
growing number of companies reputational risk is considered as important as the
risk of fire or physical catastrophe.
Legal action by civil society organizations has also induced corporate
accountability in the social, political and environmental spheres. International law
and regulations have allowed for companies to be sued that do not conform to
human rights and environmental standards.
According to reports (OLIVEIRO and SIMMONS: 2002, p. 87), socially
responsible investing has skyrocketed, according to. In the 1990s, the amount of
money invested with socially responsible funds rose from $40 billion to $2.2 trillion
between 1985 and 2000 in the US. By 2000, $1 in every $10 invested in the UK and
the US was linked to some kind of social criteria. Since 1999, US investors have
been able to track the Dow Sustainable Group Index, and in the UK investory can
follow socially responsible companies on the FTSE4good index.
Standard setting and monitoring are the areas in which civil society activity has
increased the most in recent decades. The Global Reporting Initiative (GRI) was
formulated in response to the growing outcry against corporate human rights and
environmental rights abuse. The GRI is supported by major corporations throughout
the world and is building a consensus for a voluntary standard of corporate reporting
requirements that transcends specific industrial sectors or geographic areas.
Civil society has assumed a central role in monitoring the implementation of
agreed standards. Global civil society organizations can report on the extent to
which companies or whole industries are enforcing codes and standards. This is
especially important in developing countries that often do not have the resources to
monitor companies on a regular basis. Lessons are still being learned on the best
ways to monitor the variety of corporations and industries in a number of countries
and here the flexibility of civil society is an advantage. While civil society is now
filling an important gap by monitoring and setting standards, in the future it may be
better for this work to be led in partnership with official international agencies or
governments.
54