Innovation in Corporate Social Responsibility: Sustainable Business Agreements in The Netherlands

Abstract

Human rights have long been the unique domain of States. This changed with the emergence of multinational companies that span the world. As a result of these companies engaging with suppliers and third parties, global supply chains have emerged. The responsibility for compliance with fundamental rights within those chains appears to be a problem. On the one hand it is unclear where responsibilities lie, and on the other hand the enforcement of regulations is problematic because activities go beyond national boundaries—and thus jurisdictions. As a result, regulation through (international) treaties or (national) legislation is increasingly inadequate. Whether there is a connection or not, in recent decades multinational companies have taken more responsibility for human rights. A new development in the Netherlands for setting standards in this area is regulation through so-called “CSR Covenants”. This article explains what these CSR Covenants—sustainable business agreements—are and examines their impact on the enforcement of fundamental labour rights.