"The Enterprise of Responsibility:" Reviewing Birgit Spiesshofer, "Responsible Enterprise: The Emergence of a Global Economic Order" (Munich: CH Beck, Oxford: Hart, 2018)

I am delighted to set out below some thoughts on a recently published book on corporate social responsibility (CSR). The book, Responsible Enterprise: The Emergence of a Global Economic Order (Munich: CH Beck, Oxford, Hart, 2018), is authored by Birgit Spiesshofer, who has worked as a lawyer  who since 2002 has served, inter alia, as Chair of the CSR committees of the International Bar Association, the Council of Bars and Law Societies of Europe, and the German Lawyers Association.

Publisher materials describe the book this way:

This fundamental work analyses the great variety of normative processes encompassed by the term ‘Corporate Social Responsibility’ (CSR) and subjects them to a syste­ matic and critical examination. Domestic and supranational legislation, international law and transnational private law instruments – supplemented and superseded by soft law and informal steering by private and public organi­sations – are the ‘smart mix’ from which a global order for enterprise responsibility is emerging.

The author relates these processes to fundamental consi­derations on the conception of enterprise, the justification and scope of enterprise responsibility and public­ private governance. She reveals that the informalization of norm­ creation and its transfer to the executive and private actors raises fundamental questions of national sovereignty, democratic legitimation and rule of law. A new conception of ‘law’ is also required.

The book links theory and practice and focuses, inter alia, on the following issues:
⇢Fundamentals of the CSR discussion
⇢CSR conceptions of the United Nations, the OECD, ISO, the EU and their interplay with national legal structures
⇢Sector-specific CSR-conceptions (mining, finance, textile, legal profession)
⇢New conceptions of enterprise and group responsibility
⇢Transnational public­ private governance and innovative norm creation
⇢The new CSR world order – a ‘legal internet’?

My review of the book, "The  Enterprise of Responsibility," follows.

The Enterprise of Responsibility: Book Review (Birgit Spiesshofer, Responsible Enterprise (Munich: CH Beck, Oxford, Hart, 2018)
Larry Catá Backer

 

           Birgit Spiesshofer's new book, entitled Unternehmerische Verantwortung: Sur Entstehung einer globalen Wirtschaftsordnung (CH Beck 2018), the English translation of which was published by Hart as  Responsible Enterprise: The Emergence of a Global Economic Order (RE), sets out for itself an ambitious project. It seeks to map a complex intermeshed network of legal (and governance) orders around the social responsibility of economic actors.  And then it attaches that complex of governance orders around an equally complex set of intermeshed relationships that themselves comprise an object onto which legal responsibility may be assigned. Those objectives, in turn, require a delicate weaving of domestic and international law intermeshed with strands of public and private governance frameworks onto fabrics of ownership and contract relations within global production chains that themselves define a singularity that is understood in everything but traditional law as the enterprise. What results is a step forward in bringing the coherence of legal systemicity on complex relationships that otherwise remain in a Hobbsian state of nature, bellum omnium contra omnes. And yet here, what holds these dynamic concepts together is not the state, nor law, but the market and the institutionalized structures of management.  This approach is both profound and profoundly relevant to the actual state of contemporary regulatory governance in which states remain powerful but not the singular regulatory actors within the structures of global production.

                  RE weaves the threads of this complex supra and intra-national threads together on a foundation of a small number of key premises.  The first touches on the concept of CSR itself.  The second touches on the notion of enterprise (that is, of the regulatory object) and its relation to the cluster of concepts, methods and processes of CSR reimagined. The result is the construction of a regulatory universe in which law becomes principle, CSR becomes the means for defining and making coherent a regulatory ecology in which the state becomes one of many actors, law one of many tools for the operation of the system, and the enterprise becomes the space—the territory—within the borders of which CSR functional responsibility systems may be erected.  The CSR-enterprise then serves as the nexus (rather than the state) in which contextually appropriate responses can be derived from the operations of globally diffused production in which implementation will vary but which will reflect “shared values and behavioral requirements that can be fed from culturally diverse sources.” (RE, p. 13).   

                  RE considers and rejects value of current debates over the definition of CSR as fundamentally unable to provide any measure of determinacy and clarity (Ibid. 6).  In its place RE reimagines CSR not as a singular concept capable of definition but rather a s system for regulating the contextually relevant approaches to its application. Quite remarkably, RE transforms CSR from a concept to a system of regulatory governance. RE first posits that CSR is itself a complex of norms and tools made coherent within a set of ordering key concepts (Schlüsselbegriff), denoting social and political learning processes that point in the right direction (RE, p. 6-7). It also characterizes CSR as a leitmotif, a set of guiding principles with a coherent and replicable character (RE 7-78).  Thus, CSR as the essence of regulatory governance in the sense of defining a space within which concepts may be developed and deployed guiding by a set of limiting normative principles (“RE, p. 8 (“normative cultural expectations for enterprises”)) against which the value of the application is judged. This approach liberates CSR from the constraints of the increasingly quaint debates about its character as law or of the existence, value, authenticity and legitimacy of governance techniques in the societal sphere or which exhibits the modern data driven characteristics of incentives based managerialism now increasingly important in the regulatory toolkits of states and other governance actors (RE, p. 9-11).

                  RE also confronts the equally thorny issue of the enterprise as a container of legal concepts into which the regulatory enterprise that is CSR is to be poured. RE starts from the traditional and substantially exhausted debates about enterprise liability, with respect to which Germany certainly has had a long and interesting (though not wholly successful) history. RE inverts the traditional arguments in a new and interesting way.  Rather than start from the premises and ancient principles of legal personality and the functional effects of the connections and linkages (through ownership or contract) that cobble together an enterprise around objects of global production, RE takes the position that CSR itself creates the enterprise. Thus, rather than start with the notion of the enterprise as the foundation of the constriction of CSR, RE posits that one starts from CSR (as concept, leitmotif, and normative expectation (as a markets-structuring natural law, in effect) to constructs the enterprise itself from the structures of production that pose the potential for CSR harms (RE, p. 12); (“A functional-teleological broadly understood conception of enterprise is to be derived from international CSR norms that covers all organizations with commercial operations, including from the nonprofit sector.”)). The implications are clear, and broadly hinted throughout the text: the enterprise, then is constructed as the territory within which legal-regulatory regimes of CSR may be transforms from concept and leitmotif to operation.  It is the regulatory space within which contextually functionally relevant implementation may be effectuated to give effect to shared values.  The enterprise, thus constructed, is both the object of governance (obliged for CSR regimes) and the source of governance (the regulator of conduct that conforms to CSR expectations).

                  It is on these powerful conceptual foundations that RE builds its analysis and develops, consequentially, its approach to governance. CSR is constructed out of socio-cultural shared normative values that find expression in a host of authoritative expressions in national and international law as well as in a host of constructions of societally influential frameworks developed by public and private institutions. The enterprise is constructed out CSR—that is the implications for global production out of CSR itself constructs the territory within which CSR itself can be relevant as a mechanics of behavior management. The mechanics of that management then folds back onto the techniques of governance asserted by all governance actors working individually but whose actions are aligned by their fidelity to the core principles of CSR.

                  To those ends, Part A of RE represents a detailed and quite comprehensive exploration of the sources and drivers of CSR, that is of those efforts that represent, in composite what may appear to be the emerging consensus of CSR as concepts, as leitmotif and as principle. In seven chapters RE ranges broadly from socio-cultural roots of the concept in the West through their contemporary institutional manifestation by public international organizations, private international organizations, the state, enterprises, and the legal profession itself. It then offers a meta-framework grounded in enterprise, responsibility and governance, that sets the stage for the construction of RE’s “responsible enterprise” framework in Part B (RE chapters 9-11).

                  RE starts with the conceptual universe within which states have sought to develop law and societal actors have sought to discipline behavior within their functionally differentiated communities. Chapter 1 encounters the ideal of the honorable businessman in western thought (RE, pp- 17-19) and lex mercatoria (ibid.,19-24) as baseline conceptions and governance frameworks—as principle and system which provides the patterns on which the rest is built.  RE correctly notes the conceptual importance of uniform concepts of societal obligation that is differentiated only in the manner in which compliance is itself a matter of context. RE notes the relevance of these social codes as a baseline organization market in both Western and Chinese social organization. Lex mercatoria represents the possibilities of flexible implementation of societal codes in a functionally distinct concept.  It provides the operational mechanism to the social codes standards of conduct.  RE, however, may to too quick to agree with those who consider these as impulses to CSR as conceptual skins without wine.  There appears to be plenty of both here in in the other approaches and instruments considered. This is especially evident when RE turns to contemporary conceptual forms.  One ought to have little problem with the notion embraced by RE of corporate economic responsibility as rooted in its fidelity to the interests of its investors which must be undertaken within the larger framework of its legal responsibility, those political expectations to the nation expressed through law, but also undertaken in accordance with the expectations of the social communities within which it operates (e.g., its ethical responsibilities) (RE, pp. 24-30). And indeed, there is great value in reminding the reader that CSR is itself a polycentric concept—with the emphasis on legal responsibility more a reflection of the politics of hierarchies of power than of the actual pull of fidelity in the direction of economic, political and social communities each expressed in its own way.  In this way one might, usefully reconcile the notions of Milton Friedman to that of emerging notions of triple bottom line responsibility. From this emerges the framework adopted by RE—enterprise, responsibility and governance, that is a regulatory object (conceptualized as an entity), an allocation of risk and liability, and a regulatory structure through which remedies grounded in liability might be realized against enterprises—elaborated in the following chapters.

Chapters two through seven then take us deeply into the conceptual and operational frameworks of the great contemporary efforts to systematize the governance of CSR. Here the search is for both consensus (the great binding elements that produce coherence of principle art some great level of generalization—though one ought to keep in mind Clifford Geertz’s caution about the value of generalization at so high a level that it becomes useless). RE starts with CSR conceptions of the United Nations. That provides a witch’s brew of conflicting normative and methodological approaches reflecting the oftentimes sharp shifts between developed and developing states and between the Western and Soviet blocs. RE quite correctly situates those debates and the alternative construction of normative narrative “against the background that the traditional instruments of international law. . . have shown themselves to be insufficient with regard to the challenges of global business activities.” (RE, p 31). RE starts with the urtext of international law-governance, the Draft UN Code of Conduct on Transnational Corporation (Ibid., pp.32-35), the model traditional international legal approach.  It then veers to the model at the other end of the governance spectrum, the UN Global Compact (Ibid., pp. 35-40). The former set up a legal framework for CSR governance, the later set up a multi-level networked system that conjoined societal and public governance but in a way that avoided substantial discipline by either. This binary has marked the UN approach since.  RE does an excellent job of analyzing the repetition of the pattern through contemporary times in the context of considering he normative, if ancient, question of the possibility of world law around issues of the human rights obligations of business (Ibid., 41-45). Some of the story is well known—the tragedy that is the story of the UN Norms as the heir of the impulse that produced the Code of Conduct (Ibid., 46-56).   It bears emphasizing that this is a dual edged tragedy—the inability of portions of the international sector to accept the reality of the profound opposition to the construction of a global law of corporations, however narrowly tailored; and the contradictions inherent in a strong embrace at the state level of the core principle of corporate autonomy and enterprise wealth maximization against the equally strong desire to shift liability within clusters of economic organizations engaged in concerted production activity. The bulk of the chapter, quite correctly was devoted to a deep analysis of the efforts that lead to the UN Guiding Principles, as heir of the impulse that produced the UN Global Compact, and the construction of what passes for its post endorsement institutional architecture within the periphery of the UN Geneva organization (RE pp. 56-131).

The UN-CSR conceptions are, of course, foundational for the construction of conceptual and organizational frameworks for CSR—but of course one quite narrow in scope.  The UN in this respect is a functionally differentiated organization whose mandate tends to focus on one key aspect of CSR—its human rights dimension but has less of value to say to issues of sustainability or charity.  For all that the chapter nicely develops the contribution of UN efforts to CSR, though in sometimes contradictory directions. This is particularly important for the regulatory structure of RE that emphasizes enterprise, responsibility and governance. Most interesting is the way in which RE elaborates the drift of UN approaches toward privatization and also toward informationalization.  That, of course, follows genera trends in governance, increasingly grounded in delegations of governance to private organizations and on the increasing reliance on data driven metrics.

Chapter 3 then applies the same analytical lens to the construction of the OECD’s CSR conceptions (Ibid., 133-164).  That analysis deliberately contrasts the inability of the UN to reach consensus to that f the OECD’s smooth development of a model it has now begun to push more aggressively on the world stage.  Of course, that contrast merely provides evidence of the obvious.  The OECD represents a group of states whose interests, outlooks, norms and sense of community converge.  They are most likely to produce normative projects that reflect the consensus.  And it opens a sensitive issue—can the OECD stand in as a proxy for the global community or does it merely aggregate the power of states that are the home of most of the apex corporations that control global production and reflect their interests? That issue remains contentious, though the contention is somewhat subdued in the face of the power of OECD states and their ability to cram down their perspectives through their relationships with other states. That, after all has been the pattern of G20 states since the financial crisis of 2007 and the emergence of the governance template of the Financial Stability board—creating normative frameworks and operational mechanics under the leadership of the vanguard of OECD states which are then naturalized in global relations as these states base their own interactions with other states on those norms and mechanics.  This is not so much a criticism as an admission of a reality that theorists and others ignore at their own peril where they seek to develop and implement workable governance systems the subjects of which are important to such states.   Thus, it comes as no surprise that RE finds some comfort in a fairly well-developed approach to CSR conceptions of enterprise, of responsibility and of governance through its sophisticated, coordinated and ideologically unified approach to governance. This production, however, does come with a number of weaknesses.  It is a voluntary system in the sense that it is not connected to domestic legal orders.  On the other hand, that detachment provides substantial flexibility in the creation of endogenous private governance systems within MNEs, rather than an unfortunate reliance of exogenous imposition of standards and methods form public actors. And its remedial architecture, dependent in part on states, is deliberately debilitated through its NCP architecture.

Chapter 4 then turns to the construction of international private systems with a focus on the work of the International Organization for Standardization (ISO) (Ibid., pp.165-208)). The focus on ISO 26000 (CSR) is nicely framed; especially its discussion of the ways in which these standards are intermeshed with those developed in the UNGP.  Issues of comparative legitimacy are well explored (e.g., pp. 173-74). The discussion of ISO 26,000’s approach to enterprise is particularly interesting, especially the ISO’s courage to extend coverage to nonprofit organizations.  Yet it remains imprisons by a conceptual principle that appears to require an entity-object to animate law-regulation within governance systems.  To its credit, RE does an excellent job of highlighting the obsession with enterprise in the quest to develop CSR normative and institutional structures.  But, again, it remains unclear other than through as recourse to history custom and tradition why it is that a regulatory system founded on responsibility for actions be mediated through legal construct-receptacles, rather than to assert the obligation directly on and through the activity itself.   Yet the receptacle concept is essential for the construction of the ISO regulatory universe.  That is made clear by the definition of the scope of the social responsibility of the entity constructed for that purpose—a combination of positive and negative impacts of the entity guided by all generally accepted normative principles whether they are legal or societal in character. To that extent, it overcomes the UN’s weakness by extending responsibility beyond the narrow confines of human rights. Where the ISO excels is in the construction of technical standards.  But that is al the source of its weakness—and the weakness of all complex organizations built on large administrative organs. It is hard to criticize ISO for complex standards in the face of the standards that states routinely generate and which serve as often as not as traps for the unwary and as large spaces within which the clever may act strategically to the detriment of the objectives that brought such systems to complexity in the first place.  Yet the utility of ISO for developing a template for public private coordination, and for the polycentric deployment of hard and soft law reflects a significant contribution to the construction of the CSR regulatory universe as norm and as mechanics.

Chapter 5 then turns to the European Union (Ibid., 209-218).  That is hardly surprising because of the tenacity of a political ideology that finds it useful to continue to see in the EU not a state but a sort of sui generis international organization –that is to the conception of the EU as the first (and perhaps last) international state.  For all that the discussion is useful and provides a window on the value—in transnational governance—for the sometimes sadly undervalued work of the EU institutions. One ought to take seriously the profound observation of the EU as “a legal and political hub in global CSR governance.” (Ibid., 217).  RE nicely weaves together the constitutional elements of the EU and its regulatory efforts into a CSR fabric with some potential. There is praise for the so-called “smart mix” of hard and soft law and instruments. One worries, however, about a regulatory program that is understood in terms of its own self-praise. It may be clear to its creates that the mix chosen is smart, but that smartness may be lost on others—and the judgement actually presumes an adherence to a particular approach to the normative foundation of that mix that may not be present. What works for the EU and may be globally generalized, but may not be applicable to the same effects beyond the specific contexts of the EU and the realization of its interests globally. Yet, it too contributes to the consensus developing around CSR.    It appears that there is a hunger for smart mixes, whatever that means. Yet for some, smart mixes appear to suggest an effort to bend autonomous and polycentric systems to a single set of ordering forms. It remains to be seen whether or to what extent that ambition can be realized on a global scale.   

In Chapter 6 RE then turns from the soft law and normative projects of the international sphere to the more hard-nosed yet limited efforts to embed CSR (of some sort) within the domestic legal orders of states (Ibid., pp. 219.240).  States, like the EU are heavily invested in smart mixes of hard and soft law and institutions. RE engages nicely with that complex of mostly traditional approaches that find transnational CSR as both an opportunity and a threat. It considers opportunity in the movement of national systems toward transnationalization of their governance.  One sees that most clearly in efforts like that of the Norwegian Pension Fund Global or in efforts to embed international standards in the interpretation of national law. And yet that transnationalization may pose as a screen behind which these states continue to advance their national interests now clothed in the language concepts and structures of a transnational framework that itself reflects the preferences of transnationalizing domestic legal orders.  It considers the threat in the form of the impulse to extraterritorialism of national approaches to CSR.  This is well known—not as a threat to the extraterritorializing states but to those states into which such extraterritorial power is projected. Of course all of this done for the best of all reasons—to advance a good cause.  But for some states the price is quite steep and that may effectively undermine the construction of global CSR regimes. It remains unclear to some whether the answer to weak governance in the global south is the substitution of  the laws of one state for that of the other.  Perhaps in that context internationalization of law provides the key—especially in the context of CSR.  RE then quite correctly notes the distinction between internationalizing judicial mechanisms and internationalizing national law.

Chapter seven then turns form an analysis of institutionally connected systems to CSR conceptions in sector specific context.  Four critical sectors are considered, including mining, finance, textiles and law (Ibid., pp. 241-366). RE draws some quite important insights form that extended analysis.  The first is the dual character of enterprises as both the object of regulatory projects and as a regulator in their own right. It is here as well that RE encounters concretely the notion that the object of regulation may not be the enterprise but the processes of production overseen by clusters of enterprises whose joinder is a function of that participation.      Yet that whisper of potentially transformational change is disciplined through the entity receptacle ideology that lies at the core of what RE rightly understands as the enterprise prong of CSR conceptualizations. The second is the importance of context.  Here one better understands the insight of John Ruggie and his UNGP vision in action on the relevance of context for the elaboration of the specifics of responsibility. The third, and potentially the most significant for the objectives of RE is the insight that the “complexities and tensions of transnational polycentric CSR governance manifests themselves in the sector-specific CSR conceptions.” (Ibid., 366). Despite the best efforts of “smart-mix” theories, the realities of multi sourced and multilayered governance orders—that might be coordinated but which cannot be collapsed—can as easily compete; that more than anything else, drives the CSR governance project. RE’s answer is to focus more on soft law than on extraterritoriality is right.  Yet what that suggests is that what passes as soft law is merely another way of describing a universe of compulsory rules that may be assumed by enterprises in ordering their own internal constitution or that are made mandatory through contract, but that do not derive directly from nor are they expressed as law.

RE takes the insights developed in the first seven chapters, to evaluate CSR discourse and the questions that this development may raise in chapter 8 (Ibid., 367-370). RE here summarizes the insights derived in Part A’s effort to derive norm and system from the polyphony of emerging regulatory voices that together appear to outline the forms of CSR norms, principles and premises. CSR first exists as a set of regulatory vectors beyond corporate or institutional governance with the “purpose of guaranteeing sustainable and responsible business conduct to protect human beings, the environment and the integrity of the market economy.” (Ibid., p. 379). The normative conception operates exogenously on the enterprises that are its object. And that produces an interesting conundrum. The CSR enterprise is not interested in the management of the internal operations of the enterprise—it means to bend that governance t the realization of its objectives—mostly exogenous to the needs and concerns of the principal stakeholders within the enterprise itself.  Thus, CSR touches on the principles of the enterprises role in society rather than the forms and principles around its self-constitution. And yet self-constitution is an essential element for the authentic undertaking of enterprise regulation within the production process it oversees. There is paradox here of sorts.  Enterprise governance provides the ideological basis form which the enterprise “sees” the world.  That world view is an essential element for its ability to internalize, interpret and transpose exogenous norms within the clusters of enterprises and relationships that produce the multinational enterprise in an identity with the global production process for the oversight and exploitation of which it was formed.  An enterprise tends to reproduce its inward expression outward.  Yet the principles of CSR have as its object in part the goal of overcoming that identity (the traditional welfare maximization world view) and replace/supplement it with another. It is in that context that only the sophisticated approach of the OECD, with its interconnected guidance for corporate governance, for the operation of state owned enterprises and for the multinational enterprise provides a normative structure.

In this sense RE’s chapter 8 seeks to reduce CSR to both norm and system –a global social market economy (RE, p. 367) around the key parameters of enterprise, responsibility and governance. Yet that construction of CSR system produces a set of issues that are identified in Chapter 8 and that serve as the framework within which Part B of RE is organized. RE identifies the key systemic qualities of CSR around the terms rule jungling, legal internet and creeping law.  These are the operational characteristics of a system whose normative principles derive from a new transnational social contract among non-national communities of stakeholders in global production. That has transformed the stable state system into a polycentric network matrix of these governance actors.  CSR frames its principles around and realizes them through a constructed entity—the enterprise, also an object of consideration in Part B of RE. With respect to responsibility, RE quite correctly notes the way in which the global emergence of CSR both expands the reach of CSR principles while at the same time narrowing their scope to “specific constellations and aspects” that may reflect the interests of developed states. (Ibid., 368). And with respect to governance, RE notes the way that the CSR discourse has produced both transnational enterprises along with transnational NGOs. “In addition, an informationalization of norm development, its transfer to the executive and private parties, a creeping usurpation and transfer of competences under the heading of informal soft law and a far-reaching privatization of norm enforcement are to be observed.” (Ibid., 369).    

Part B then turns to the problem of the enterprise, responsibility and governance. In chapter 9 (Re, pp. 373-406), RE takes the position that the conception of the enterprise determines the locus of responsibility.  And it assumes that this locus must be in a “thing” even an intangible “thing” that represents the institutional organization of production.  That certainly accords with the consensus of international public and private actors, long used to understanding law as an interaction between command and object. As a consequence, RE focuses on the traditional and to some extent well-worn debate—unresolvable—about the extent to which one can construct an enterprise out of the linkages and connections between economic actors all bent to the realization of production.  Re walks the reader through the debates respecting the definition of enterprise in the CSR debates (Ibid., pp. 374-376), and the common debates about conceptions of the enterprise in common parlance (Ibid., 376-377), in its institutional or functional context (Ibid., p. 377), and in its context dependence (Ibid., pp. 377379). These are well crafted and thorough discussion of approaches that have achieved a certain level of consistency and strong advocates among influential members of stakeholder communities.   RE derives from this discussion the insight that “the concept of the enterprise is neither absytract nor static, but rather, following its function, to determine the subjective scope of a norm, it is to be defined ion a context dependent manner, and thus functionally-teleologically.” (Ibid., p. 379). This is then applied to the formulation of its own approach to the construction of the “enterprise” onto which “CSR responsibility is to be imposed” under a system of governance in which the enterprise sits at the center.  What follows from this conception of enterprise? First there is no need for an identity between enterprise and legal personality (Ibid., p. 379) Rather it attaches to activities rather than to entity—but that recasts enterprise from an object to a set of functions that can be ascribed to a mix of connected actors in accordance with rules of shifting and imposing obligation.  And that is the tension that RE cannot resolve if it is to maintain the centrality of the concept of enterprise as an organizing element of the governance of CSR principles.

But that is not the issue that is RE’s focus.  Instead the problem of the enterprise is not its identify with activity, but rather whether there are principled ways of defining a collection of activity as enterprise in ways that can distinguish between those enterprises onto which CSR responsibilities ought to be exposed and those that it may not. For RE that line can be drawn between commercial ventures and certain elements of the non profit sector (Ibid., 380-393). The object of Chapter 9, then, is not top theorize an enterprise in the process sof production, but to try to advance the conventional discussion about the place where lines ought to be drawn between organizations ot which CSR naturally applies and to which it ought not apply. It starts from the traditional conventional focus on commercial activity and then does an excellent job of making the case that CSR ought to be applied to all organizations.  That insight nicely fits into the development of the conceptual structures of CSR—a structure whose principles ought to be equally applicable to activities whether to not they produce profit.

But then that raises a related issue—if the normative conceptions of CSR suggests a broader application to all organizations that engage in activities that affect those areas of behavior within CSR, then should it also extend to groups of enterprises engaged in a common activity (Ibid., 393-404).  RE nicely examines the conventional analytical approaches to that issue suggested by the politics of the application of traditional veil piercing and agency rules (Ibid., 394-396). And yet it is here that the potential for substantial enlargement of the reach of group liability may be emerging, especially in common law systems.  The recent cases of Lubbe v. Cape PLC[2000] UKHL 41, Chandler v Cape Plc [2012] 1 WLR 3111, and Lungowe v. Vedanta (UK Court of Appeals 2017), suggest the contours of an emerging system of supply chain negligence liability that itself may help shape the rules of risk and liability within enterprise groups.  Beyond that RE’s discussion of the functional concept of enterprise, enterprise liability, operator responsibility, duty of care to third parties and contract (Ibid., pp. 396-404) rounds out the discussion in a way that provides conceptual possibilities for adopting a functional conception of the enterprise and additional group responsibility.  And yet there is still little to suggest from the normative development of CSR in Part A any substantial movement away from strongly held principles of corporate autonomy and the protection of the character of contractual relations.  Indeed, the move toward a conception of CSR as a framework exogenous to the enterprise on which it is imposed continues to suggest a weakness in arguments that would embed CSR liability within an enterprise constructed under principles that make such embedding incompatible with core notions of internal corporate governance. RE provides the reader a great service in that respect. Accepting RE’s convincing argument, then, suggests the further need to think of ways to move CSR from exogenous to an endogenous element of governance.  

The last two chapters of RE then focus on the remaining organizing elements of CSR—responsibility (Chapter 11, RE pp. 407-467) and governance (Chapter 12, RE pp. 468-548). With respect to responsibility, RE correctly frames the concept of responsibility as the basis for the determination of the elements of the obligation. “The terms responsibility, accountability and liability are used in the CSR debate partially as loose synonyms or in different meanings” (Ibid., p. 414) that produces questions of responsibility requiring answers in context: who, for what, according to what standards, how, to whom, and why? That brings responsibility back into the normative framework of CSR itself.  Thus, RE makes the case, quite convincingly, that CSR normativity is difficult to separate from the issue of responsibility.  RE nicely analyzes the trend since the 1990s toward an increased adoption of socio-political responsibility by enterprises.  That trend is geared toward shareholder value maximization in the Anglo-American sphere but more broadly toward issues of sustainability and stakeholder concerns in Germany. E.U. governance also tends towards a broader governance responsibility.  RE notes the foundational character of the requirement to obey law as a basis for enterprise responsibility. But it also nicely embeds that responsibility to comply with law within emerging structures of regulatory governance in which incentives toward behavior are seen as a function of competition and market forces. At the same time, political responsibility of enterprises flows both from their economic power and from their ability to allocate resources among different and now competing producers of law. That responsibility, in turn provides the basis for the structural management of behavior through the CSR normative framework. Yet RE quite correctly notes that this is not an invitation to Western style universalism.  Rather it reminds us of the contextual nature of the CSR normative project and its invitation to intercultural dialogue as enterprises move from norms to implementation.

                  Lastly, RE tackles the question of governance within the context of a CSR normative space arranged through enterprises into which responsibility is assigned. The question of governance then provides RE with the opportunity to consider the question of the character of CSR as law (Ibid. Pp. 465-495).  RE does an excellent job of analyzing the trends, sometimes complex and incoherent, within which the question is understood and answers attempted.  RE speaks to the break from traditional state centric approaches (and the old and now tedious arguments respecting the hardness or softness of law—actually little more than a form of reminding the combatants of the centrality of the state in the constitution of law at the apex of a pyramid of authority and legitimacy). RE layers that with emerging pluralist and legal-anthropological concepts of law. RE places this analysis within a context that increasingly understands global law as an amalgamation of fragmented rule orders functionally differentiated overlapping and sometimes competing. None of these approaches, however, adequately capture neither the scope of CSR as rule system(s) nor its dynamic nature. That leaves open the question of the CSR concept of governance (Ibid., pp. 495-530). Here RE tackles the value of emerging concepts of governance by government, with government, and without government as viable legal orders that can both frame and affect the character of the rules that constitute CSR. Lastly, and quite ambitiously, RE tackles the question of legal constitutionalization and CSR (Ibid., pp. 530-548).  RE suggests that “CSR is paradigmatic for the present sate of global constitutionalization insofar as two lines of development manifest in the normative CSR debate.” (Ibid., p. 530. One touches on the erosion of national constitutions, and the other touches on the de-centering of the state in the political organization of production. CSR, then, RE argues, is an emanation of the internationalization and privatization of norm creation (Ibid., p. 547). That is certainly beyond argument now. These trends erode national constitutions, it is true, but only in a relative sense.  It does not change the character of national constitutions (as the highest and most authoritative expression of a polity), rather it situates them in a context in which they no longer always and necessarily constitute the highest and most authoritative expression of a governance community. CSR, then, fits in nicely with the rise of new constitutionalization that increasingly organizes transnational space and constitutes as authoritative sources of rules non-state actors organized to oversee and engage in global production. That ultimate connection between production, on the one hand, and CSR, enterprise, responsibility and governance, then shapes the world view within which CSR governance is possible. “The functional conception of enterprise and the essential features of the CSR responsibility and governance regimes can be seen as the basic elements of a ‘CSR constitution.’.” (Ibid., p. 548).    

Taken as a whole, then, RE represents an important investigation into the constitution of CSR.  It usefully centers CSR as a cluster of principles and concepts that might produce its own governance order. It situates CSR within the great contemporary currents of trends in the regulation of the conduct of actors undertaking economic activity—sustainability and human rights.   To that end alone RE is worth reading.  Its insights are powerfully and well developed. But more important is the way that RE provides a useful analytical approach by inverting the usual organization of analysis in the context of CSR.  Rather than start with the enterprise as the basis of analysis—that is that the enterprise produces effects that ought to be the object of regulation, RE starts from the premise that CSR exits irrespective of the receptacles into which it is poured.  That is, CSR exists as a coherent system of behavior norms  even in the absence of any enterprise onto which responsible for its normative objectives can be assigned and notwithstanding the possible variations in the forms of governance necessary to institutionalize that assignment of responsibility. This notion, that normative principle precedes the object responsible for its implementation in the context of its operation, and the notion that this object in the form of the enterprise is most usefully understood ad object rather than as the process to which responsible objects are dedicated provide substantial areas where further research would enrich the analysis already well undertaken in RE.