Photo: Misha Wolsgaard

Is it now on the radar of the standard setters?

In mid-February, the United Nations Global Compact (UNGC) and the Business & Human Rights Resource Centre hosted a joint webinar on the link between corporate taxation and human rights, and the role of business and responsible taxation in securing sustainable development across the globe. The seminar is an example of how prominent a role responsible taxation has taken in the international discussions on Corporate Social Responsibility (CSR). As the main UN organ to engage with the private sector on corporate responsibility, and with more than 8,000 participating private companies, the UNGC is currently one of the main hubs for international dialogue on corporate social sustainability issues, which makes their interest in the topic even more interesting.

This summer, from June 8.- 9. 2016 the OECD forum for responsible business conduct (RBC) will also have taxation and responsible business conduct on their agenda for the two day seminar in Paris. The OECD RBC guidelines for MNEs, which include a chapter on taxation, is the basis for the forum, and it is timely to discuss the relevance of this chapter in light of the recent years political attention to the issue of corporate tax planning of MNEs. The prominent role that taxation and responsible business conduct has been ordained at the seminar, is yet another confirmation that responsible corporate taxation is a topic which is being discussed, way beyond the borders of Europe.

Are new standards emerging?

The UNGC webinar clearly highlighted how the UN, human rights researchers, private companies, and NGOs alike is  in the process of developing guides, principles, and case studies on how companies can engage in responsible tax issues, without falling into some of the pitfalls of  regulatory uncertainty, competition issues, and bad reputation. As an example, the UNGC already includes corporate tax issues in some of their core resources on corporate social behavior (Business for the rule of law framework, Children’s rights and business principles, A Guide for anti-corruption risk assessment).

Furthermore, the webinar contained a presentation from the business and Human right Resource Center, who has created a knowledge hub on the topic, which they have researched since 2009. The Canadian mutual investment fund, NEI, gave a presentation on the UN PRI newly released guidance on how to engage with investee companies on responsible tax. Finally, the NGO ActionAid presented a report they have released jointly with Oxfam and Christian Aid named “Getting To Good”.

Timely attention to the issue

The attention to the issue comes at an important time where a divide in large cooperation’s work with tax and CSR is very present. On one hand we start to see that large companies such as Danish Mærsk and Dong Energy has incorporated tax issues as part of their CSR reporting, and who in  their 2015 Sustainability Reports state that tax issues are actually rated among the most important CSR topics not only among investors but also at the board of directors. On the other hand, a newly published report by the Accounting review found that companies who perform the most CSR also make the most strenuous efforts to avoid paying tax—and that those with a high CSR score also spend more on lobbying tax issues.

Thus, the webinar and the upcoming session at the OECD RBC forum marks important steps for the international dialogue on responsible corporate tax, and places the issue square on the UNGCs agenda at a time where the UNGC are rapidly adapting to the SDGs, as well as a new sustainability agenda. Furthermore, it showcased a lot of the great progress and current work that is being developed on the issue from researchers, the private sector, and NGOs.