Corporate Social Responsibility and Labour Standards in Africa

Markus Demele

An empirical and normative approach towards German Direct Investments and the ILO´s Decent Work Agenda

I. Introduction

Corporate Social Responsibility (CSR) is generally associated with investments from internationally operating Transnational Corporations (TNCs). There are, of course, CSR-initiatives arising from indigenous companies and other actors within Africa. As in other places, these initiatives currently have overlapping responsibilities and spheres of influence. These include, to name just a few: The Centre for Corporate Governance-Kenya, The African Leadership and Progress Network, Business Action for Africa, The Business Ethics Network of Africa, The African Institute of Corporate Citizenship, The Africa Corporate Sustainability Forum, The Private Enterprise Foundation Ghana, The Foundation for the Development of Africa and hundreds of regional initiatives all over the continent (Extending Service Delivery Project, 2006, pp. 6–9).

Clearly there is an arena of indigenous enterprises and other actors who start CSR initiatives. In South Africa and Nigeria in particular, companies that operate in different branches all over the continent have started smaller or larger projects to deal with HIV/AIDS or other issues involved in the development debate. But if we want to better understand the development and future of CSR in Africa on a large scale, we need to look at the big transnational or, even better, transcontinental companies (TNCs) operating in Africa. Their CSR initiatives, in so far as they exist, have a much bigger impact than the average projects of smaller companies in one country. While it is true that formal employment is of little importance compared to the huge informal sector accounting for up to 80% of Africa’s working population, in terms of absolute numbers TNCs still play a major role in African countries.

The London-based International Institute for Environment and Development states: "The international CSR agenda is dominated by OECD-based NGOs, investors, consumers, businesses and business associations. (2005, p. 4)" If one is willing to take this as a working hypothesis, it is reasonable to look at the extent of TNCs in Africa and their investment behaviour. There is no better way to do this than by analysing the Foreign Direct Investment (FDI) flowing towards African countries. Only the cumulative numbers of German investment for the whole continent are included in this analysis.