UNDP study calls for legislative reforms to promote responsible business conduct

• UNDB study outlines short-term, medium-term, and long-term actions to promote responsible business conduct 
• It proposes enacting laws to make CSR and responsible business practices mandatory
• It calls for forming a multi-stakeholder advisory body to oversee responsible business conduct implementation
• It highlights importance of aligning business practices with international standards 

To promote responsible business conduct, a study by the United Nations Development Programme (UNDP) has called for strengthening monitoring mechanisms and establishing accountability frameworks for businesses.  

The study titled "Adopting Responsible Business Conduct for Bangladesh's Growth Aspirations: Global Developments, Imperatives, and Policy Priorities"  outlines short-term, medium-term, and long-term actions to promote responsible business conduct (RBC). 

Among the long-term recommendations, the UNDP study – conducted to enhance understanding of the economic impact of RBC – emphasises the need for legislative reforms in Bangladesh.  

According to its executive summary, the study proposes enacting laws to make Corporate Social Responsibility (CSR) and responsible business practices mandatory. It also calls for the formation of a multi-stakeholder advisory body to oversee RBC implementation.  

The study highlights the importance of aligning business practices with international standards and developing a structured reporting system. This would enable companies in Bangladesh to demonstrate their commitment to safeguarding both people and the environment from the potential negative impacts of their operations.  

On Monday, UNDP organised a panel discussion at The Westin Dhaka in Gulshan, titled "Stakeholder Dialogue on Responsible Business Conduct for Bangladesh's Growth Aspirations."

 During the event, economist M Masrur Reaz presented key insights from the study, while the discussion was moderated by Harpreet Kaur, Business and Human Rights Specialist at UNDP.  

In his presentation, Reaz stressed that to remain competitive in the global market and secure GSP+ benefits, Bangladesh must encourage responsible business practices through both public and private sector initiatives. 

He pointed out that private investment has significantly contributed to the country's economic growth and job creation. Implementing RBC principles is crucial for attracting both local and foreign investors, fostering ethical business practices, promoting sustainable development, and aligning with international standards.  

Reaz, also chairman of Policy Exchange Bangladesh, further explained that Bangladesh needs to adopt RBC due to evolving global policies influenced by the Sustainable Development Goals (SDGs), international human rights standards, and regulatory frameworks from the European Union and the United States. 

Incorporating RBC by following the UN Guiding Principles on Business and Human Rights (UNGPs) and aligning with the EU's mandatory human rights laws could help Bangladesh expand its trade. 

RBC also plays a vital role in ensuring supply chain transparency, meeting international buyer requirements, and enforcing human rights standards in corporate reporting, he added.  

The study additionally suggests that Bangladesh could develop a National Circular Economy Vision and Strategy, similar to initiatives in Thailand and Cambodia, with a particular emphasis on the Ready-Made Garments (RMG) sector.  

During the panel discussion, speakers highlighted RBC's potential to drive green growth. They emphasised the urgent need to tackle environmental challenges, promote social inclusion, and ensure decent working conditions for a fair and sustainable transition. 

RBC encourages businesses to integrate environmental concerns into their strategies, strengthen existing laws and policies, and address legal and regulatory gaps that could otherwise contribute to environmental damage.  

Moreover, RBC can help businesses manage climate risks, align with changing consumer preferences for sustainably sourced products, and attract more investment from financial institutions in green initiatives. It also provides a robust institutional framework for effective policy implementation, enforcement, and monitoring.