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UNIDO’S approach: overcoming the challenges CSR poses on SMEs

Governments have not yet reached consensus on common approaches to CSR, which has meant that the “rules” are being set de facto by the companies embracing it, and these are mostly large Transnational Companies (TNCs). As a result, SMEs, especially those in developing countries and countries in transition, find themselves confronted with approaches to CSR that are often very incompatible to their economic and social contexts. Yet, they cannot afford to ignore CSR, since the very same TNCs that are pushing the CSR agenda hardest are also their clients. This situation attracted the attention of UNIDO, which for many years has been at the forefront of supporting the development of small and medium enterprises in developing countries and economies in transition.

Recognizing the need of meeting the specific requirements of SMEs with regard to CSR, UNIDO became the fifth core UN agency in the Global Compact in 2003. It was primarily within this context that UNIDO has formulated its approach for the promotion of CSR as a means towards increased productivity and competitiveness of developing economies.

UNIDO further has a leading role within the UN system in terms of supporting environmentally and socially responsible entrepreneurship through its training capacities and support tools for enterprises and through the UNIDO/UNEP network of National Cleaner Production Centres (NCPCs).

In its CSR Projects, UNIDO usually targets one or more of the following levels:

  • Micro-level: Assistance on the micro-level involves direct support to a group of companies belonging to the same sector, region, cluster, supply chain, etc. Due to limited outreach and up-scaling effects, this level is targeted only on a pilot basis for demonstration and CSR case building purposes.
  • Meso-level: Support on this level focuses on business support and advisory institutions (public or private) that aim at expanding their service portfolio and strengthening their institutional capacity. In this context, UNIDO provides assistance to these intermediary institutions to foster the uptake CSR concepts in their sphere of influence.
  • Macro-level: On the macro level, UNIDO involves in the field of CSR related policy work with a view to support government institutions in determining what public policies best support a country’s private sector in its efforts to apply socially and environmentally responsible business practices.

At the heart of UNIDO’s CSR programme is the Responsible Entrepreneurs Achievement Programme (REAP), which supports SMEs in implementing responsible business practices by building up a worldwide network of trained and qualified UNIDO CSR consultants.