Edited by John R. McIntyre, Silvester Ivanaj and Vera Ivanaj
Chapter 11: Understanding the Self-regulation Potential of Voluntary International Initiatives for Corporate Conduct: The Role of Sponsor Goals
Glen Taylor and Petra Christmann 1. INTRODUCTION A multitude of voluntary international initiatives has emerged over the past 25 years with the aim of establishing guidelines, rules and standards for firms’ social and environmental conduct and performance in the global economy. These initiatives include generic and industry-specific codes of conduct, management system standards and performance standards. These voluntary international initiatives have been proposed as a tool for firm self-regulation to improve firms’ global social and environmental conduct and performance. Which factors determine whether such initiatives are effective tools for firm self-regulation? To begin to answer this question we suggest that an initiative needs to satisfy two requirements to be an effective tool for firm self-regulation: first, adoption of the initiative needs to have a significant positive impact on the social and/or environmental conduct and performance of firms; and second, the initiative needs to be widely adopted by many firms. Organizations with differing missions and goals act as sponsors taking the lead in the formation of different initiatives. We suggest that the goals of the sponsoring organization affect the effectiveness of an initiative as a tool for firm self-regulation by shaping the design of the initiative in terms of the requirements specified and by affecting the initiative’s adoption rates. We develop a typology of initiatives based on sponsor goals and examine whether the different types of initiatives are likely to have requirements that lead adopting firms to improve their environmental and/or social conduct or performance and whether they are likely to...
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