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ACCA Strategic Professional · Strategic Business Leader · Stakeholder analysis and organisational social responsibility

Orlo Textiles is criticised because its overseas suppliers use unsafe working conditions, although Orlo itself complies with all laws in its home country. The board argues that supplier conduct is not its concern. Which view of CSR does the criticism rely on?

The criticism relies on the view that CSR goes beyond legal compliance and covers the conduct of the supply chain the company influences. Orlo's lawful behaviour at home does not remove responsibility for unsafe supplier conditions, because stakeholders expect accountability for wider impacts.

  1. AThat responsibility extends beyond legal compliance to the conduct of the supply chain it influencesCorrect
  2. BThat responsibility is limited to complying with domestic law
  3. CThat CSR is relevant only to companies in the primary sector
  4. DThat CSR is the responsibility of regulators rather than companies

Explanation

Modern CSR views accept that companies are accountable for their wider impacts, including supply chains they influence, beyond legal minimums. The board's position matches the narrow compliance view that critics reject. CSR is not limited to primary sector firms or delegated to regulators.

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