Corporate Social Responsibility (CSR)—A broad concept intended to cover how companies integrate social and environmental concerns into their operations and their interactions with stakeholders aside from legal requirements. Many other terms are also used to address such actions, including the “triple bottom line,” sustainability and corporate citizenship. “Corporate accountability” is a term often used to reference companies’ actions that are more closely linked to legal requirements.

Social Compliance System—One component of a company’s broader CSR, sustainability or accountability program. A social compliance system is an integrated set of policies and practices through which a company seeks to ensure maximum adherence to its code of conduct.

Model of a Social Compliance System

While systems may vary from industry to industry, a good social compliance system in any industry includes eight components, functioning in an integrated way.
Although the steps below are numbered for ease of understanding, social compliance is an iterative and ongoing process. Companies may choose to proceed through these steps in a different order, and typically should not expect to complete one step before undertaking another. At the same time, a system without all components―for example, an auditing system that operates in isolation from communication and training, remediation and other measures―is very likely to not be sufficient to address challenging social issues that can arise in global supply chains.

Engage stakeholders and partners

Assess risks and impacts

Develop code of conduct

Communicate and Train across your supply chain

Monitor compliance

Remediate violations

Independent Review

Report performance

It is important to note that most robust social compliance systems are designed to address the fundamental labor standards identified by the International Labor Organization (ILO)―covering freedom of association, collective bargaining, employment discrimination, child labor and forced labor―as well as other labor standards such as occupational safety and health, wages and hours of work