TNC Code of Conduct or CSR? A Regulatory Systems Perspective

There is an increasing emphasis on codes in both international private law and specifically in efforts to encourage businesses to take on a greater share of the social costs of their activity. This chapter argues in the first instance the view that codes by themselves are inadequate to the task. While from an institutional perspective, they may be of some use driving changes to the norms of the institutional environment, from a legal point of view, they are but one piece of a regulatory system. Codes set out the norms and as such provide a foundation upon which a regulatory system stands. And, as all regulatory systems are aimed at guiding behaviour to achieve certain desired ends they are norm based. Codes that are not integrated into a coherent regulatory system suffer from their status as a stand-alone solution, are orphaned and destined for obscurity. Thus for codes to be effective, they must be embedded within a regulatory system that includes the necessary administrative and institutional infrastructure. The chapter develops a second line of argument that CSR can be best understood as form of international private business regulation. As such, CSR requires a coherent set of norms and appropriate complementary regulatory system components including some form of code. The chapter proceeds by first examining codes and taking an example of a code-only approach through an analysis of ISO 26000. It then turns to examine the design of regulatory systems and the place of codes within such systems. Next it lays out the landscape of CSR (problems of politics) and provides a well-justified definition. Finally it concludes with a summary of issues to be addressed in moving ahead with effective TNC conduct regulation.