India Govt. has released National Guidelines on Responsible Business Conduct. Responsible Business Conduct is a globally recognized concept founded on the idea that businesses can perform better when engaged in re-vitalizing the society from which they extract resources for production.
The National Guidelines on Responsible Business Conduct, 2018 (NGRBC), which is an improvement over the existing National Voluntary Guidelines on Social, Environmental & Economic Responsibilities of Business, 2011 (NVGs), are a means of nudging businesses to contribute towards wider development goals while seeking to maximize their profits. The NGRBC is dovetailed with the United Nations Guiding Principles on Business & Human Rights (UNGPs).
The NGRBC intends to not just make companies more responsible and accountable but also to create a whole ecosystem to ‘Protect1, ‘Respect1 & ‘Remedy’ as envisaged in the UNGPs.
Some of the key terms used in this document are described here. These descriptions are only indicative. They have been selected based on a review of Indian and international definitions, and their applicability in the context of these Guidelines.
Being responsible and answerable for their actions, willing to explain them to others, and taking ownership of all repercussions if so required.
This is an alternative to a traditional linear economy (make, use, dispose), in which resources are used for as long as possible, the maximum value is extracted from them whilst in use, after which products and materials are recovered and regenerated at the end of each service life. The idea of a circular economy is called circularity. It is also referred to as “cradle-to-cradle”.
Negotiating between the employees’ organization and employer’s oorganization; management in good faith with a view to agree on terms and conditions of work and / or settlement of disputes and grievances of employees represented by a representative body of employees.
Refers to involvement of the business in violations of any of the Principles and Core Elements by third parties connected with its operations. It is generally made up of the following:
- An action or omission (failure to act) by a business, or individual representing a business, that ‘helps’
(facilitates, legitimize, assists, encourages, etc.) another, in some way, to perpetrate a violation;
- The business was or should have been aware that its action or omission could provide such
- Complicity may be direct, beneficial or silent.
A person or business that buys products or services for personal use, resale or use in production and manufacture. It also includes the user of the product or service other than the buyer.
Corporate Social Responsibility (CSR)
Corporate Social Responsibility (CSR) means and includes but is not limited to
(i) Projects or programs relating to activities specified in Schedule VII of the Indian Companies Act 2013; or
(ii) Projects or programs relating to activities undertaken by the board of directors of a company (Board) in pursuance of recommendations of the CSR Committee of the Board as per declared CSR Policy of the company, subject to the condition that such policy will cover subjects enumerated in Schedule VII of the Act.
An organization’s practice of reporting to all stakeholders on its economic, environmental and social impacts. It also presents the organization’s values and governance model and demonstrates the link between its strategy and its commitment to sustainable development.
Unjust or prejudicial treatment of people, especially on the grounds of, but not limited to, caste, creed, sex, race, ethnicity, age, colour, religion, disability, socio-economic status or sexual orientation.
An understanding that every individual is unique and therefore embracing and respecting the differences on account of, but not limited to, caste, creed, sex, race, ethnicity, age, colour, religion, disability, socio-economic status or sexual orientation.
A person employed, directly or by or through any agency (including a contractor), whether for remuneration or not, for carrying out activities of the organization or any part thereof, incidental to or Description and connected with those activities, in pursuance of the organization’s stated objectives. It would also include those who undertake these activities outside of the business’s premises including their own homes.
An approach which recognizes the need, plans and delivers a fair and equivalent opportunity across stakeholders to engage gainfully from their interactions with the business.
Individual or collective behaviour that is in accordance with accepted written and / or unwritten codes of principles and values that govern decisions, actions and conduct within a business in the context of a particular situation and is consistent with accepted norms of behaviour.
Fair Living Wages
A wage sufficient for a family to meet its basic needs and which provides some ability to deal with emergencies.
Freedom of Association
Workers and employers, without distinction whatsoever, have the right to establish and, subject only to the rules of the organization concerned, to join organizations of their own choosing without previous authorization.
Relates to “how” an organization makes decisions, how it operates to achieve its objectives and how stakeholders have their say in the processes.
The formalized individual or group of individuals charged with the ultimate responsibility of oversight of a business. This would refer to the equivalent of the Board for companies, the partners for partnership firms and the owner of the business for sole proprietorships.
Grievance Redressal Mechanism
Mechanism for any stakeholder individually or collectively to raise and resolve reasonable concerns affecting them without impeding access to other judicial or administrative remedies. The mechanism should be:
Clear, transparent and have independent governance structures
- Based on dialogue and mediation
Wide range of offensive behaviour that is unwanted by the recipient and which the perpetuator knows or ought to know is threatening or disturbing.
Intellectual Property (IP)
Refers to creations of the mind, such as inventions, literary, musical and artistic works, and symbols, names, images, and designs used in commerce, for which the IP owners are granted certain exclusive rights under the
corresponding national IP laws. Common types of IP include patents (inventions), copyrights, trademarks, industrial designs, software, geographic indications and trade secrets, etc.
All work or service that is extracted under the menace of penalty. Also includes terms such as forced labour, bonded labour and modern slavery.
Participation of Workers
Situation where workers are involved in some way in the decisionmaking process of a business organization. Worker participation can take many forms. There might be a consultative council in the company where trade unions and management meet regularly to discuss points of mutual interest. Workers can be organized in quality circles and meet regularly in small groups to discuss ways in which their work could be better organized.
When human activities may lead to morally unacceptable harm that is scientifically plausible but uncertain, actions shall be taken to avoid or diminish that harm. Morally unacceptable harm refers to that which may threaten human health, or is seriously and effectively irreversible or inequitable to present or future generations, or imposed without sufficient consideration of the human rights of those affected.
Any good and/or service produced for introduction to trade or commerce, possessing intrinsic value and capable of delivery to a consumer in tangible form, intangible form or a combination thereof.
Product Life Cycle
This refers to all the stages of a product from extraction or acquisition of raw materials through manufacturing and processing, distribution and transportation, use and reuse, recycling and disposal. In the case of services, it refers to all activities and processes from the design to delivery.
Individual or group concerned or interested with or impacted by the activities of the businesses and vice-versa, now or in the future. Typically, stakeholders of a business include, but is not limited to, its investors/shareholders, employees (and their families), customers, communities, value chain members and other business partners, regulators, civil society actors, and media.
The outcome achieved by balancing the social, environmental and economic impacts of business. It is the process that ensures that business goals are pursued without compromising any of the three elements.
Being aligned with the tenet of meeting the needs of the present without compromising the ability of future generations to meet their own needs.
This refers to any indigenous technical, ecological, scientific, medical or cultural knowledge which is not necessarily documented but is in use by or generally known to communities. Typical examples include antiseptic properties of neem, turmeric, etc.
Being open about decisions and activities that affect society, the environment and the economy, and the willingness of businesses to communicate information in clear, accurate, honest, timely and complete manner.
Refers to both the supply chain as well as the value created by the distribution channel for end-use customers. It also includes business partners and those employed by value chain partners who may work out of their own premises.
Vulnerable and Marginalized Groups
Group of individuals who are unable to realize their rights or enjoy opportunities due to adverse physical, mental, social, economic, cultural, political, geographic or health circumstances. These groups in India can be identified on the basis, inter alia, of the following:
- Gender and transgender (women, girls et al.)
- Age (children, elderly et al.)
- Descent/identity/ethnicity (caste, religion, scheduled castes, scheduled tribes, et al.)
- Occupation (displaced, landless small/marginal farmers, migrant workers, et al.)
- Persons with disability
- Political or religious beliefs
Place(s) where activities of the organization are carried out in pursuance of its stated objectives.
Broad concept including proper balancing of “work” (career and ambition) on one hand and “life” (pleasure, leisure, family and spiritual development) on the other. Related, though broader, terms include “lifestyle balance” and “life balance”