IMAGO

What is a social responsibility audit?
What is a social responsibility audit?
Posted by on March 18, 2021 in Topics about audits
0 Comments

What is an audit?

The area is confusing and here is a simple introduction of corporate social responsibility. An audit is a commonly used term describing the official inspection of an organization.

There is an ever growing variety of assessments that emerge to inspect companies and the most common types of audits are: compliance audits, financial audits, internal or external audits, tax audits, operational audits, information system audits, payroll audits, technical audits, quality audits, etc.

What is a compliance audit?

The compliance category includes corporate social responsibility, environmental, ethical, ISO audits, among others. The goal of a compliance audit is to control internal systems and procedures and show compliance with the applicable assessment and the legal requirements.

What is a Corporate Social Responsibility Audit? 1

This audit is a “continuing commitment to behave ethically and contribute to economic development while improving the quality of life of the workforce, their families, the local community, and society at large”2. Its practice in business was sporadic until one event in 2013 brought social responsibility to the forefront.
In Dhaka, Bangladesh, a multi-level garment factory called the Rana Plaza collapsed on 24 April 2013, killing more than 1,100 workers and leaving hundreds injured and traumatized3. It stands out among tragedies because well-known international companies were among those who did business with Rana Plaza because of its low labor costs. Changes in labor practices around the world were precipitated by this tragedy and benefited large numbers of factory workers, although a lot remains to be done.
Social responsibility audits helped spread the importance of ethical practices in the workplace. Working conditions improved when social assessments were performed as compliance with requirements meant that workers evolved in safer environments.

1 The term CSR is used for corporate social responsibility.
2 CSR Definition: www.wbcsd.org.
3 Photo by Dhaka Tribune, 25 April 2013.

What is an audit scope?

The audit scope is the extent and boundaries of an audit: it is mandatory for ISO audits as well as for some CSR certifications. The scope defines “what the organization decides to have certified“ meaning that some departments of a company can remain out of scope. Ethical, social and environmental audits generally do not have a scope because all employees are included in the audit, thus it covers the whole facility.

What is a CSR audit process?

All social responsibility audits follow similar protocols, confirming employees’ wellbeing in the workplace. The CSR audit process includes five sections:

  • The opening meeting with the auditor and the auditee’s management team;
  • The facility tour of indoor and outdoor facilities chaperoned by manager(s);
  • Employee interviews including about 10% of the workforce;
  • Document review with the management team and departments heads;
  • The closing meeting when the auditor presents the conclusions and the next steps.

The rising interest for CSR

ISO 26000 standard includes a chart of seven core subjects to guide companies willing to modify their approach towards a more sustainable one.

The seven core subjects are:

  • Accountability,
  • Transparency,
  • Ethical behavior,
  • Respect of stakeholder interest,
  • Respect for rule of law,
  • Respect for international norms of behavior, and
  • Respect for human right.

The year 2020 provided ample examples of global distress, underlining the unsustainability of the current state of affairs. Various initiatives at national and international levels emerged to sensitize populations in ways to modify wrongful habits while implementing more respectful plans.

The rising importance of ethics

Some corporations already applied ethical values in their workplace while the Rana Plaza disaster accelerated a process that started in 2011 when the United Nations established ten human right principles, mandating all businesses to prevent abuse in the workplace4. In 2013, the International Labor Organization set up four fundamental employment principles5:
  • Effective abolition of child labor6,
  • Elimination of discrimination at work,
  • Elimination of forced labor, and
  • Freedom of association and the right of collective bargaining.
While ethical awareness expanded globally, large corporations started respecting employees’ rights in compliance with international regulations, and some expanded their requirements to their suppliers, thus confirming their wish for compliance throughout their supply chain.

4 https://www.unglobalcompact.org/what-is-gc/mission/principles
5 www.ilo.org/declaration/en
6 Photo by TXB Center for Health and Human Rights at Harvard University

The benefits of a CSR audit

Audits are usually considered a burden because they require preparation and cause apprehension and unease among auditees. However, it is important to underline their positive connotations:

  • Certifications are a ‘stamp of approval’ showing compliance with mandatory requirements, legal procedures or industry-specific requisites;
  • The audit process leads to improvements that would otherwise not be addressed;
  • The auditor’s expertise opens new opportunities.

Building CSR within a management system

The company willing to expand its CSR reach is encouraged to build from within with external help. Some companies may need customized services whether others may be successful with a more generic approach. Five steps are required for building a social responsibility structure:
  • Define internal goals within industry-specific CSR requirements;
  • Evaluate the interest of employees, customers, stakeholders and suppliers;
  • Build a CSR department;
  • Monitor the implementation of new procedures;
  • Apply lessons learned to improve ROI7.
7 ROI stands for Return On Investment.

Where to start?

The field of social responsibility is rapidly expanding and an efficient entry into the corporate social responsibility world starts with the ISO 26000 training program: it offers a detailed description of actions which are becoming indispensable to maintain a sustainable environment, while rules expand their impact on businesses among different continents.

This short introduction to the social responsibility audit context is further presented in Journal of a social auditor written during the 2020 confinement. Based on research and personal experience, the book narrates the auditing processes spanning a range of industries in the Americas and Western Europe. It provides answers to the auditing frequently asked questions; further information about the book can be found at Imago Editorial

Writing Journal of a social auditor increased my awareness on the complexity of the auditor’s role and the attention to detail required in this line of business. Forthcoming articles will address sensitive issues arising in the auditing world from both the auditor and the auditee’s perspectives. Should you wish to share a particular subject of concern, contact us at info@imago-int.eu.

Related Articles

0 Comments

Leave a reply

Your email address will not be published. Required fields are marked *

*