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Denver Journal of International Law and Policy

Preview: Towards a More Realistic Vision of Corporate Social Responsibility Through the Lens of the Lex Mercatoria

As Volume 40, Issue 4 of the Denver Journal of International Law and Policy is off to the printers, we are previewing the articles contained within.  Here is a brief overview of Towards a More Realistic Vision of Corporate Social Responsibility Through the Lens of the Lex Mercatoria, by Jon Bellish.

Globalization has led to a shift in power away from states and towards the private sector, which has resulted in multinational corporations becoming among the most powerful international actors. This phenomenon has had many positive consequences, but it has also resulted in human rights, labor, and environmental abuses in developing nations. Such abuses are inconsistent with the way these multinationals behave at home and have led to a subsequent call for increased corporate social responsibility (“CSR”). Though there is substantial agreement as to the contents of CSR norms, there is little such accord where enforcement is concerned. Some have suggested that binding CSR norms will ultimately emerge from multinational corporations themselves along the lines of the lex mercatoria. This article seeks to counter that argument by suggesting that, even if the traditional narrative of the lex mercatoria is true — an assertion upon which considerable doubt has been cast — modern multinational corporations are not likely to take the lead in developing such norms. This is because, while lex mercatoria norms tend to increase profits and reduce liability, CSR norms tend to shrink margins and expose corporations to an additional form of liability. From this assertion, the article concludes that political and macroeconomic developments are likely to overtake legal and normative developments, particularly those emanating from the corporate suite, in leading to corporate responsiveness to a broader community of stakeholders.

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University of Denver Sturm College of Law