CSR principles and the Serbian legal framework

As mentioned in the previous AKT blog post about corporate social responsibility (CSR), CSR is primarily a voluntary implementation of ethical principles to business practice, thus making it a part of the so-called soft law framework.

In some ways, legal regulation of CSR might not be necessary as its values and goals arise from common sense. It has been widely accepted today that employees should be treated equally, with dignity and respect, paid fairly and on time, that they should be provided with safe and healthy working environment, and not overworked. However, if profit is the only incentive for companies, there is no guarantee that businesses will respect ethical labor practices, environmental protection, local community interests and consumer rights. That is why hard, positive legal frameworks in most countries (including Serbia) have regulated some of the critical areas – areas which can be considered a part of CSR in a broader sense. On the other hand, a number of CSR principles still remain in the sphere of voluntary obligations and soft law.

Hard law regulation of basic CSR principles may include:

Labor practices – some examples of basic ethical labor practices are prohibition of discrimination and prohibition of mobbing (workplace harassment). In Serbia these are regulated by the Labor law (https://www.paragraf.rs/propisi/zakon_o_radu.html), Law on prohibition of discrimination (https://www.paragraf.rs/propisi/zakon_o_zabrani_diskriminacije.html) and Law on prevention of mobbing (https://www.paragraf.rs/propisi/zakon_o_sprecavanju_zlostavljanja_na_radu.html). All three are in conformity with the relevant EU instruments in this field, as for example the Council Directive 2000/78/EC (https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32000L0078) establishing a general framework for equal treatment in employment and occupation. Law on prohibition of discrimination in articles 2 and 5-12 prohibits, among other, associative discrimination, hate speech and abusive behavior and harassment. Similarly, Labor law in articles 18- 23 broadly prohibits various forms of discrimination and harassment, including those based on gender, sexual orientation, age, race, pregnancy status and language.
Environmental protection – there are many ways in which the businesses and production can affect the environment, thus requiring considerable legislative regulation. Serbia as an EU candidate country had to adopt a large number of laws in this area that are aligned with extensive EU legislation, and has also ratified a number of important international conventions, such as the Convention on Access to Information, Public Participation in Decision-making and Access to Justice in Environmental Matters, usually known as the Aarhus Convention (https://www.unece.org/fileadmin/DAM/env/pp/documents/cep43e.pdf) and Kyoto Protocol (https://unfccc.int/resource/docs/convkp/kpeng.pdf). In 2009, Serbia adopted a “Green package” of 17 environmental laws, such as the Law on the protection of the environment (https://www.paragraf.rs/propisi/zakon_o_zastiti_zivotne_sredine.html), Law on waste management (https://www.paragraf.rs/propisi/zakon_o_upravljanju_otpadom.html) , Law on packaging and packaging waste (https://www.paragraf.rs/propisi/zakon_o_ambalazi_i_ambalaznom_otpadu.html), and Law on air quality protection (https://www.paragraf.rs/propisi/zakon_o_zastiti_vazduha.html).
Consumer protection – CSR presupposes a certain level of respect for consumers, their rights and interests. In that sense, the same as for environmental protection, Serbia as an EU candidate country had to regulate this area in accordance with EU acquis. Two main laws are the general Law on consumer protection (https://www.paragraf.rs/propisi/zakon_o_zastiti_potrosaca.html) and a more specific Law on the protection of users of financial services (https://www.paragraf.rs/propisi/zakon_o_zastiti_korisnika_finansijskih_usluga.html). As stated in article 2 of the Law on consumer protection some of the basic rights of consumers are: the right to product safety, information, free choice and legal protection. To further emphasize the importance of these principles, article 3 of the same law makes it clear that consumers cannot waive any of these rights.Of course, all of these legal provisions are general and quite often very hard to implement in practice. That is why they need to be accompanied by active judicial practice, and maybe even more importantly, to be promoted by various stakeholders such as government bodies, NGOs, media and local communities.
As noted above, a lot of CSR principles still remain voluntary initiatives and soft law projects.

On the global level, one of the most important soft law instruments for CSR is the UN Global Compact with its ten principles, that are divided into four main sectors: human rights, labor, environment and anti-corruption (https://www.unglobalcompact.org/what-is-gc/mission/principles). Also important are the networks of companies and NGOs that support the realization of these global initiatives, such as CSR Europe, which has over 40.000 members (https://www.csreurope.org/about-us).

Government of Serbia adopted a Strategy on development and promotion of CSR for the 2010-2015 period. Unfortunately, it has not been updated since. However, there are still important initiatives in promoting CSR principles beyond just the legal requirements. One of the most active entities is the Serbian Chamber of Commerce, which among other activities, participates as a national partner in the realization of UN Global Compact goals, awards companies for their efforts in implementing the CSR principles, and publishes relevant reports (https://www.pks.rs/PrivredaSrbije.aspx?id=525&p=0&). It has also founded a Council for CSR which has, among others, a task to initiate the adoption of a new national Strategy in this field. Another active organization is the Forum for responsible business that is a member of CSR Europe. On their website the Forum provides the most comprehensive report on CSR in Serbia (https://odgovornoposlovanje.rs/wp-content/uploads/2015/03/CSR-uSrbiji-165x237mm-WEB.pdf), case studies and news.

In the last couple of years, at least on the governmental level, ideas and goals of CSR have been somewhat put aside. Serbian government has not updated the Strategy on development and promotion of CSR since 2015. However, the general awareness of importance of CSR principles and goals in Serbia has hopefully made an irreversible imprint, and as Serbia progresses on its path of becoming an EU member these goals should come to focus again.

Iva Zivkovic