OVERVIEW OF ISO 26000 SOCIAL RESPONSIBILITY AND THE BENEFITS TO INDUSTRIES

1. OVERVIEW OF ISO 26000 SOCIAL RESPONSIBILITY AND THE BENEFITS TO INDUSTRIES • SEMINAR STANDARD 2011: STANDARDS TOWARDS INCREASING MARKET COMPETITIVENESS-13 DECEMBER 2011 • ORGANISED BY MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY • MALAYSIA • SPEAKER: AB RAZAK SALIM • SIRIM

2. Brief process of ISO 26000 ISO 26000 FRAMEWORK Highlight on clauses Benefits of social responsibility OUTLINE PRESENTATION

3. BRIEF PROCESS OF ISO 26000

4. How did the ISO 26000 effort get started? Industry Stds Committeefor Petroleum and Gas DEVCO Env. Mgt Consultants of CV COPOLCOReport COPOLCO SwedishIndustry Association AGReport Sept. 2002 April 2004 May 2001 Jun 2002 June 2004 MoUsestablished 4 Workbegins

5. Who has been participating in the process? 99 countries represented through their NSBs 42 liaison organisations (including MoUs with ILO,UNGC and OECD) 450 experts and 210 observers from 6 stakeholder categories (Industry, Government, Consumers, Labour, NGO,SSRO) (2010) 5

6. ISO 26000 writing process STAGE 6 International Standard (IS) STAGE 5 Final Draft Intern. Stand. (FDIS) Stage 2: Building consensus among individual experts STAGE 4 Draft Intern. Standard (DIS) STAGE 3 Committee Draft (s) (CD) Stage 3-5: Building national consensus/vote, D-liaison backing STAGE 2 Working Draft (s) (WD) STAGE 2 Working Draft (s) (WD 4.3) STAGE 2 Working Draft (s) (WD) STAGE 1 New Work Item Proposal (NWIP) PUBLICATION -1 NOV 2010 6

7. ISO 26000 FRAMEWORK

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10. HIGHLIGHT ON CLAUSES 1-SCOPE • SCOPE- • PROVIDE GUIDANCE TO ALL TYPES OF ORGANISATION, REGARDLESS OF SIZE OR LOCATION • ENCOURAGE ORGANISATION TO GO BEYOND LEGAL COMPLIANCE • NOT A MANAGEMENT SYSTEM • NOT INTENDED FOR CERTIFICATION OR REGULATORY OR CONTRACTUAL USE

11. CLAUSE 2 • Terms and definitions ~27

12. Organisation (2.12) -Entity or group of people and facilities with an arrangement of responsibilities, authorities and relationships and identifiable objectives

13. International norms of behaviour (2.11) expectations of socially responsible organizational behaviour derived from customary international law, generally accepted principles of international law, or intergovernmental agreements that are universally or nearly universally recognized

14. Supply chain (2.22) • Sequence of activities or parties that provides products or services to the organisation

15. Value chain (2.25) • Entire sequence of activities or parties that provide or receive value in the form of products or services

16. Value & supply chain Sector Association Shareholders Banks / Insurance Partners Value chain Supply chain Workers Industry Organization Sub-Suppliers Suppliers Customers Consumers Raw material providers Waste services Government Media Citizens NGO’s Employees IN/ID - YYYY-MM-DD Title / Titre –

17. Sphere of Influence2.19 •Definition: range/extent of political, contractual, economic or other relationships through which an organization has the ability to affect the decisions or activities of individuals or organizations

18. Social , Economic and Environment Sphere of influence Partners Shareholders Sector association Banks / Insurance Value chain Supply chain Workers Customers A Industry Organization Sub- Suppliers A Suppliers A Distributors Consumers Sub- Suppliers B Suppliers B Customers B Waste services Raw material providers Employees Government Media Citizens NGO’s 18 18 18

19. Assessment on an organization's SOI: • ownership and governance • economic relationship • legal/political authority • public opinion

20. CLAUSE 3-Understanding social responsibility • Essential characteristics of SR Willingness of an organisation toincorporatesocial and environmental considerations in its decision making and be accountable for the impacts of its decision and activities on society and environment.

21. Relationship between social responsibility and sustainable development -Sustainable development-meeting the future needs of society without jeopardizing the ability of future generations to meet their needs -Social responsibility- focus on organisation and its responsibilities to society and environment -objective of organization's SR should be to contribute to sustainable development

22. CLAUSE 4Principles of Social Responsibility • Accountability • Transparency • Ethical behaviour • Respect for stakeholder • Respect for the rule of law • Respect for international norms of behaviour • Respect for human right

23. CLAUSE 3-Understanding social responsibility Fundamental of SR Identifying and engaging with stakeholders is central to SR.

24. Stakeholder (2.20) - individual or group that has an interest in any decision or activity of an organisation

25. Stakeholder map Sector Association Shareholders Banks / Insurance Partners Consumers Customers Suppliers Industry Organization Media Government Volunteers Employees Workers Citizens NGO’s 25 IN/ID - YYYY-MM-DD Title / Titre –

26. CLAUSE 5: RECOGNIZING SR AND ENGAGING STAKEHOLDERS • Stakeholder engagement • Dialogue between organisation and stakeholders • Various forms~ meeting, conferences, workshops, public hearings, advisory committees, round table discussions

27. CLAUSE 6SR core subjects and issues

28. Community Human rights Involvement and development z i a n t i a o g n r a O l Labour The ORGANIZATION practices environment Consumer Fair operating issues practices 7 CORE SUBJECTS 28

29. GUIDANCE ON SR CORE SUBJECTS • Organizational Governance Issue • Decision-making processes and structures Std Pres Kit 29

30. SR core subjects • Human Rights Issues • Due diligence • Human rights risk situations • Avoidance of complicity • Resolving grievances • Discrimination and vulnerable groups • Civil and politics rights • Economic, social and cultural rights • Fundamental principles and rights at work Std Pres Kit 30

31. SR Core Subjects • Labour Practices Issues • Employment and employment relationships • Conditions of work and social protection • Social dialogue • Health and safety at work • Human development and training in the workplace Std Pres Kit 31

32. SR CoreSubjects • Environmental Issues • Prevention of pollution • Sustainable resource use • Climate change mitigation and adaptation • Protection of the environment and restoration of natural habitats Std Pres Kit 32

33. SR Core subjects • Fair Operating Practices Issues • Anti-corruption • Responsible political involvement • 3. Fair competition • 4. Promoting social responsibility in the sphere of influence • 5. Respect for property rights  Std Pres Kit 33

34. SR Core Subjects • Consumer Issues • Fair marketing, factual and unbiased information and fair contractual practices • Protecting consumers’ health and safety • Sustainable consumption • Consumer service, support and dispute resolution • Consumer data protection and privacy • Access to essential services • Education and awareness Std Pres Kit 34

35. SR Coresubjects • Community involvement and development • Community involvement • Education and culture • Employment creation and skills development • Technology development and access • Wealth and income creation • Health • Social investment Std Pres Kit 35

36. Due diligence • Human rights risk situations • Avoidance of complicity • Resolving grievances • Discrimination and vulnerable groups • Civil and politics rights • Economic, social and cultural rights • Fundamental principles and • rights at work Community involvement and development Organizational governance Labour practices Decision-making processes and structures • Community involvement • Education and culture • Employment creation and skills development • Technology development and access • Wealth and income creation • Health • Social investment Human rights • Employment and employment relationships • Conditions of work and social protection • Social dialogue • Health and safety at work • Human development and training in the workplace • Prevention of pollution • Sustainable resource use • Climate change mitigation and adaptation • Protection of the environment and restoration of natural habitats • Fair marketing, factual and unbiased information and fair contractual practices • Protecting consumers’ health and safety • Sustainable consumption • Consumer service, support and dispute resolution • Consumer data protection and privacy • Access to essential services • Education and awareness • Anti-corruption • Responsible • political involvement • 3. Fair competition • 4. Promoting social responsibility in the sphere of influence • 5. Respect for property rights The environment Consumer issues Fair operating practices NOT ALL ISSUES WILL BE RELEVANT FOR EVERY ORGANIZATION 36

37. 7Guidance on integrating social responsibility throughout an organization ~Practices for integrating social responsibility throughout an organization ~ Communication on social responsibility ~ Enhancing credibility regarding social responsibility ~ Reviewing and improving the organization’s actions and practices related to social responsibility 37

38. Role of communication -Raising awareness - Legal and disclosure requirement - Engage and create dialogue - Facilitate comparison, stimulate improvement - Enhance reputation

39. 7.5 Communication should be: • Complete • Understandable • Responsive • Accurate • Balanced • Timely • Accessible

40. Types of communication ~ examples - Meetings or conversation - Dialogues - Articles in media - Advertisement or public statement - Periodic public reporting

41. Reporting on social responsibility - Report on SR at appropriate intervals/ periodic basis - Report on core subject and relevant issues - Fair and complete picture, achievement and shortfall - Ways shortfall will be addressed

42. Enhancing credibility.. (7.6) • Stakeholder engagement ~ help build trust ~ the verification of organization's claim concerning its performance • Through participation in specific certification scheme eg environment, labour practices, processes

43. Social Responsibility(2.18) . Responsibility of an organization for the impactsof its decisions and activities on society and the environmentthrough transparent and ethical behaviour that: • contributes to sustainable development, including health and the welfare of society • takes into account the expectations of stakeholders • is in compliance with applicable law and consistent with international norms of behaviour • is integrated throughout the organizationand practiced in its relationships

44. Implementation Challenges • SR often not seen as commercially important, benefits are seen as “intangible” or “soft” and seek greater proof of hard financial benefits and how to measure them • Need financial and human resources • Need know-how and information • Large business faces external pressures e.g. reporting on CSR. SME are more interested in day to day survival.

45. Box 5 —Benefits of social responsibility for an organization These include: • enhancing the reputation of the organization and fostering greater public trust • enhancing employee loyalty, involvement, participation and morale; • improving the safety and health of workers; • preventing or reducing potential conflicts with consumers about products or services.

46. organization's ability to recruit, motivate and retain its employees; • achieving savings associated with increased productivity and resource efficiency, lower energy and water consumption, decreased waste • improving the reliability and fairness of transactions fair competition, and the absence of corruption

47. Conclusion A Pathway For the Future • Social Responsibility helps in achieving sustainable development. • The need for social responsibility behaviour is needed more than ever before from the huge environmental and social problems that the world face. • Industry activities have impacts on social responsibility

48. Thank you …