Towards Effective Models and Enforcement of Corporate Social Responsibility in Ethiopia

Abstract

Corporate Social Responsibility (CSR) is a concept whereby companies regard stakeholder interests in reaching corporate decisions on voluntary basis. Even though CSR is not alien to Ethiopians who are known for their philanthropic and charitable activities, there is no law that expressly requires CSR standards and thresholds. Provisions of the 1960 Commercial Code and other domestic laws show that Ethiopian companies have the option to comply with CSR in their core business strategy and decision making. To that end, companies, have either individually or at sector level, developed model codes of conduct and guidelines including CSR projects and initiatives. However, these are inadequate and they do not guarantee effective CSR behavior among companies. There is thus the need to adequately integrate CSR practices into their core business decisions, and meet the interests and legitimate expectations of their employees, creditors, customers, local communities, and the environment. I argue that the alternatives to ensure effective CSR regulation in Ethiopia are adopting the Enlightened Shareholder Value (ESV) which recognizes a CSR framework tighter than the existing shareholder primacy model, or the Responsible Stakeholder Model (RSM) which adopts more subtle and lighter principles than stakeholder model to demand CSR compliance.

Sustainable Finance in Africa: A Comparative Overview

“…Ethiopian banks have not yet introduced internal policy documents that deal with corporate social responsibilities and related issues. 114 Although the NBE has issued a Banking Risk Management Guideline that all banks must observe, 115 However, the guideline needs to mention climate change and related risks. This indicates that NBE has not yet started to give due attention to potential risks such as climate change and related risks.…”

Revisiting Ethiopia’s Approach to International Arbitration: Latest Trends and Future Prospects

“…9 Like any other contracts, the validity requirements of a contract such as consent, capacity, object and form need to be complied with. 10 When it comes to the form of an arbitral submission, the Civil Code under its Art-3326(2) requires the arbitral submission to be made in the form 'required by law to dispose without consideration of the right to which it relates.' So, if the arbitral submission relates to the contracts of guarantee, insurance contracts, contracts relating to immovable properties or contracts with a public administration, arbitral submissions relating to these transactions should be made in written form and be registered in case of contracts with public administration and contracts relating to immovables.…”

“…The right to appeal in arbitration should not be limited contractually by the parties because:-i) it is against Article 20(6) of the Constitution, Proclamation No 454/2005 and Proclamation No 25/96 which make out the right and ii) it is also against the public policy and confines the parties' right to due process of law. 10 Even a finality clause excluding appealability of an arbitral award to a regular court is declared by the Federal Supreme Court Cassation Bench as unconstitutional in the case of Danni Drilling and National Mineral Corporation Pvt. Ltd Co. 1 Writing an online critic of this judgment one author accurately suggested that:…”

“…On the other hand, there is no guarantee that the award of an international arbitral tribunal under ICSID will be fully accepted and implemented by Ethiopian authorities creating high chances of the risks of enforcement of investment awards. 10 This trend could evidently affect the international transactions and investments involving Ethiopian state and Ethiopian businesses.…”

“…9 Cordero-Moss, supra note 24, at 370. 10 Office of the United States Trade Representatives, National Trade Estimate Reports (2009). 11 a)if the arbitral submission is not valid, signed under incapacity; b) the 'party against the award is invoked was not given prior notice and was not heard'; c) the award contains decisions beyond the scope of the submission to arbitration; d) the composition of the arbitral tribunal was not in accordance with the parties' agreement; e) the award is not yet binding on the parties or has been set aside by a compete authority; f) the subject matter of the dispute is incapable of being submitted to arbitration under the law at the country of enforcement ; and, g) the recognition and enforcement of the award is contrary to public policy.…”