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Persuasive Authority Beyond the State: A Theoretical Analysis of Transnational Corporate Social Responsibility Norms as Legal Reasons Within Positive Legal Systems

  • Michael Torrance

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The practice of law has been challenged by the promulgation of transnational norms associated with “corporate social responsibility” (“CSR”), arising beyond the State, with little or no connection to traditional sources of positive law. These phenomena, which we will refer to as “transnational CSR norms,” are increasingly important guides to behaviour for corporate actors, despite the fact that adherence to such norms is not “required” by positive legal systems. Perhaps for this reason, transnational CSR norms are typically poorly understood and possibly underutilized in the practice of law. The purpose of this paper will be to determine, by recourse to legal theory, whether, and if so how, transnational CSR norms may be related to positive legal systems, and therefore to the practice of law. In so doing, we will seek to develop a theoretical understanding of the role transnational CSR norms can, do, and ought to play within processes of legal reasoning, particularly from the theoretical starting points offered by analytical/ positivist, and discursive theories of law.

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References

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1 Including but not limited to international standards of environmental performance, human rights, health and safety, employment/labour relations, and community and aboriginal relations, created and implemented by private actors without the direct involvement of the State. This definition will be elaborated upon below.

2 Remi Clavet, Governance, International Law & Corporate Social Responsibility, in International Institute for Labour Studies 1 (2008).

3 Id.

4 Id.

5 Duplessis, Isabelle, Soft International Labour Law: The Preferred Method of Regulation in a Decentralized Society, in Governance, International Law & Corporate Social Responsibility 7, 12 (2008).

6 Id. at 27.

7 Keith Culver & Michael Giudice, Legality's Borders xvi (2010).

8 Id. at xx.

9 Id. at xxiv.

10 Joseph Raz, Practical Reason and Norms 150-154 (1999); Culver, & Giudice, , supra note 7, at xxx.

11 Joseph Raz, The Concept of a Legal System: An Introduction to the Theory of Legal System 212 (1970) [hereinafter Raz, Concept].

12 Joseph Raz, The Authority of Law 63, 153 (1979) [hereinafter Raz, Authority].

13 Id. at 99.

14 Id. at 153.

15 Id. at 63.

16 Id. at 148.

17 Meidinger, Errol, Multi-Interest Self Governance through Global Product Certification Programmes, in Responsible Business: Self-Governance and Law in Transnational Economic Transactions (Olaf Dilling et al. eds., 2008).

18 Porter, Tony & Ronit, Karston, Self-Regulation as Policy Process: The Multiple and Criss-Crossing Stages of Private Rule-Making, 39 Pol'y Sci. 41–72 (2006).

19 Olaf Dilling, Herberg, Martin & Winter, Gerd, Private Accountability in a Globalising World, in Responsible Business: Self-Governance and Law in Transnational Economic Transactions 4 (Olaf Dilling et al. eds., 2008) [hereinafter Dilling et al., Private Accountability].

20 Culver, & Giudice, , supra note 7.

21 Michael Kerr, Richard Janda & Chip Pitts, Corporate Social Responsibility: A Legal Analysis (2009); Dilling, et al., Private Accountability, supra note 19, at 3.

22 Dilling, et al., Private Accountability, supra note 19, at 2.

23 Id. at 5.

24 Id.

25 Clavet, supra note 2.

26 Private Accountability, supra note 19.

27 Id.

28 Guido Palazzo & Andreas Georg Scherer, Corporate Legitimacy as Deliberation: A Communicative Framework, 66 J. Bus. Ethics 71 (2006).

29 Porter, & Ronit, , supra note 18.

30 Black, Julia, The Development of the Global Markets as Rule-Makers: Engagement and Legitimacy, in Law and Financial Markets Review 218 (2008) [hereinafter Black, Development].

31 Id. at 218.

32 Palazzo & Scherer, supra note 28.

33 Black, Development, supra note 30, at 225.

34 Black, Julia, Legitimacy and the Competition for Regulatory Share, LSE Law, Society and Economy Working Thesis no. 6/2009, 2 [hereinafter Legitimacy].

35 Id. at 19.

36 Dilling, et al., Private Accountability, supra note 19, at 5.

37 Id. at 6.

38 Id.

39 Peer Zumbansen, The Evolution of the Corporation: Organization, Finance, Knowledge and Corporate Social Responsibility, 5 CLPE Research Thesis 1, no. 6/2009.

40 Id.

41 Scott, Colin, Regulation in the Age of Governance: The Rise of the Post-Regulatory State, in The Politics of Regulation 145 (Jacint Jordana & David Levi-Faur eds., 2003) [hereinafter Scott, Regulation].

42 Kerr, Janda & Pitts, supra note 21; Dilling, et al., Private Accountability, supra note 19.

43 Dilling, et al., Private Accountability, supra note 19, at 3.

44 Scott, Colin, Reflexive Governance, Meta-Regulation and Corporate Social Responsibility: the “Heineken Effect,” in Perspectives on Corporate Social Responsibility 182 (Nina Boeger et al. eds., 2008) [hereinafter Scott, Reflexive Governance]; Kerr, Janda & Pitts, supra note 21.

45 Reflexive Governance, supra note 44, at 181; Parker, Christine E., Meta-Regulation: Legal Accountability for Corporate Social Responsibility, in The New Corporate Accountability and the Law (Doreen McBarnet, Aurora Voiculescu & Tom Campbell eds., forthcoming).

46 Zumbansen, Peer, Transnational Law, in Encyclopedia of Comparative Law 738–54 (Jan Smits ed., 2006).

47 Id.

48 Id.

49 Scott, Regulation, supra note 41.

50 Raz, Authority, supra note 12, at 42.

51 Id. at 43.

52 Kahler, Miles & Lake, David A., Governance in a Global Economy: Political Authority in Transition, 37 Pol. Sci. & Pol. 409–14 (2004).

53 Arendt, Hannah, What is Authority?, in The Portable Hannah Arendt (2000); Bruce Lincoln, Authority: Construction and Corrosion (1994).

54 Lincoln, supra note 53, at 4.

55 Id. at 6.

56 Id. at 1, 11.

57 Sinclair, Timothy J., The New Masters of Capital: American Bond Rating Agencies and the Politics of Creditworthiness 63 (2005).

58 Id. at 65.

59 Id. at 85.

60 Id. at 66.

61 Id.

62 Hallstrom, Kristina Tamm, Organizing International Standardization: ISO and the IASC in Quest of Authority 34 (2004).

63 Id.

64 Id. at 35.

65 Scott, Regulation, supra note 41.

66 Sinclair, supra note 57, at 67.

67 Berman, Paul Schiff, Global Legal Pluralism, 80 S. Cal. L. Rev. 1155, 1178 (2007).

68 Berman, Paul Schiff, A Pluralist Approach to International Law, 32 Yale J. Int'l L. 301, 327 (2007).

69 Hallstrom, supra note 62.

70 Maximillan Weber, Theory of Social and Economic Organization (A. R. Anderson & Talcott Parsons trans., 1947).

71 Hallstrom, supra note 62, at 37.

72 Id.

73 Id.

74 John Boli and George M. Thomas, Constructing World Culture: International Nongovernmental Organizations Since 1875, 273 (1999).

75 Id. at 279.

76 Raz, Authority, supra note 12, at 63, 153.

77 Id.

78 Id. at 88.

79 Id. at 107.

80 Id.

81 Id. at 89.

82 Id. at 113.

83 Id. at 114.

84 Id. at 93.

85 Id. at 97.

86 Id. at 112.

87 Id.

88 Id. at 89.

89 Id. at 112.

90 Id.

91 Id. at 108.

92 Id. at 110.

93 Id.

94 Id. at 51.

95 Id. at 144.

96 Id. at 62.

97 Id.

98 Id. at 14.

99 Id. at 17.

100 Id. at 24.

101 Id.

102 Id. at 22.

103 Id. at 51.

104 Id. at 204.

105 Id. at 219.

106 Id. at 52.

107 Id. at 63.

108 Id. at 147.

109 Id. at 48.

110 Id. at 42.

111 Id. at 48.

112 Scott, Reflexive Governance, supra note 44; Scott, Regulation, supra note 41.

113 Scott, Reflexive Governance, supra note 44; Scott, Regulation, supra note 41.

114 Scott, Reflexive Governance, supra note 44; Scott, Regulation, supra note 41;.

115 Dilling, et al., Private Accountability, supra note 19, at 4.

116 Id. at 5.

117 IFC Sustainability – Environmental and Social Standards, International Finance Corporation, http://www.ifc.org/ifcext/sustainability.nsf/Content/EnvSocStandards (last visited 17 Aug. 2011)

118 International Organization for Standardization, http://www.iso.org/iso/home.htm (last visited 17 Aug. 2011).

119 Forest Stewardship Council, http://www.fsc.org/ (last visited 17 Aug. 2011).

120 Meidinger, Errol E., Environmental Certification Programs and U.S. Environmental Law: Closer than You May Think, 31 Envt'l L. Rep. 10,162, 10,165, 10,167 (2001) [hereinafter Meidinger, Environmental].

121 Id. at 10,166.

122 Id.

123 See sources cited supra note 45.

124 Raz, Authority, supra note 12, at 149.

125 Id. at 150.

126 Id.

127 Id.

128 Id. at 101.

129 Id.

130 Id.

131 Id. at 119.

132 Id.

133 Meidinger, Environmental, supra note 120, at 10,167.

134 Standards Council of Canada, Key Considerations in the Development and Use of Standards in Legislative Instruments: Understanding the Partnership of the Regulatory and Voluntary Standards Systems 3 § 3.3 (2006); see Stepan Wood & Lynn Johannson, Six Principles for Integrating Non-Governmental Environmental Standards into Smart Regulation, 46 Osgoode Hall L.J. 345, 364 (2008).

135 Wood, & Johannson, , supra note 134, at 371.

136 Meidinger, Environmental, supra note 120, at 10,170.

137 Technical Barriers to Trade, WTO Legal Texts (1994), http://www.wto.org/english/docs_e/legal_e/legal_e.htm (last visited 17 Aug. 2011); Stepan Wood, Green Revolution or Greenwash? Voluntary Environmental Standards, Public Law, and Private Authority in Canada, in New Perspectives on the Public-Private Divide 131 (Law Commission of Canada ed., 2003).

138 Meidinger, Environmental, supra note 120, at 10,169.

139 Such as the United States National Technology Transfer and Advancement Act of 1995, 15 U.S.C. § 3701 (1996) (requiring the agencies it governs to utilize voluntary standards unless doing so would be “inconsistent with law or otherwise impractical”); see Meidinger, Environmental, supra note 120, at 10,170.

140 Meidinger, Environmental, supra note 120, at 10,170.

141 Id. at 10,166.

142 Id. at 10,175; Wood, supra note 137, at 133.

143 Terms and conditions governing the appointment of a special adviser to the Minister of International Trade, to be known as the Extractive Sector Corporate Social Responsibility Counsellor, who may be appointed by the Governor in Council under the Public Service Employment Act, P.C. 2009–0422 ¶ 127.1(1)(c) (2009).

144 IFC Sustainability—Environmental and Social Standards, International Finance Corporation, http://www.ifc.org/ifcext/sustainability.nsf/Content/EnvSocStandards (last visited 17 Aug. 2011).

145 Voluntary Principles on Security and Human Rights, http://www.voluntaryprinciples.org/principles/index.php (last visited 17 Aug. 2011).

146 Reporting Framework, Global Reporting Initiative, http://www.globalreporting.org/ReportingFramework/ (last visited 17 Aug. 2011).

147 CSR Counsellor Mandate, Foreign Affairs and International Trade Canada (21 Apr. 2011), http://www.international.gc.ca/csr_counsellor-conseiller_rse/mandate-mandat.aspx?menu_id=57&menu=L.

148 Id.

149 Meidinger, Environmental, supra note 120, at 10,168.

150 Wood, supra note 137, at 52.

151 Meidinger, Environmental, supra note 120, at 10,171.

152 Id. at 10,172.

153 Webb, Kernaghan & Morrison, Andrew, The Law and Voluntary Codes: Examining the ‘Tangled Web,’ in Voluntary Codes: Private Governance, the Public Interest and Innovation 125 (Kernaghan Webb ed., 2004); Wood, supra note 137, at 135.

154 Meidinger, Environmental, supra note 120, at 10,171.

155 107 P.L. 204, 116 Stat. 745, 15 U.S.C.S. § 7201 (2010).

156 Webb, & Morrison, , supra note 153, at 147.

157 Parker, supra note 45.

158 Id. at 178.

159 Id. at 182.

160 Id. at 139.

161 Duplessis, supra note 5, at 27.

162 Raz, Authority, supra note 12, at 49.

163 Id. at 50.

164 Id. at 70, 71.

165 Teubner, Gunther, The King's Many Bodies: The Self-Deconstruction of Law's Hierarchy, 31 Law & Soc'y Rev. 763, 768 (1997).

166 Parker, supra note 45; Scott, Reflexive Governance, supra note 44, at 176.

167 Parker, supra note 45; Scott, Reflexive Governance, supra note 44, at 176.

168 Raz, Authority, supra note 12, at 115.

169 Id. at 120.

170 Id. at 97.

171 Culver, & Giudice, , supra note 7, at 61.

172 Raz, Authority, supra note 12, at 51.

173 Id. at 62, 80.

174 Id. at 59.

175 Id. at 97.

176 Culver, & Giudice, , supra note 7, at 64.

177 Id. at 65.

178 Teubner, supra note 165.

179 Similar conclusions were drawn in Culver & Giudice, supra note 7, at 115.

180 Id. at 146.

181 Theodor Viehweg, Topics and Law 19 (Peter Lang ed., W. Cole Durham, Jr. trans., 5th ed. 1993).

182 Id. at 24.

183 Friedrich V. Kratochwil, Rules, Norms, And Decisions: On the Conditions of Practical and Legal Reasoning in International Relations and Domestic Affairs 219 (1989).

184 Id. at 38.

185 Id. at 42.

186 Id. at 247.

187 Id.

188 Id. at 186.

189 Id. at 33.

190 Id. at 34.

191 Id. at 34.

192 Id. at 33.

193 A similar sociological premise was adopted in Dilling et al., Private Accountability, supra note 19, at 1.

194 Kratochwil, supra note 183, at 24.

195 Id. at 24.

196 Id. at 25.

197 Id. at 24.

198 Id. at 24.

199 Id. at 181; Chaim Perelman & L. Olbrechts-Tyteca, The New Rhetoric: A Treatise on Argumentation 8 (1969).

200 Perelman & Olbrechts-Tyteca, supra note 199, at 55.

201 Id. at 55.

202 Kratochwil, supra note 183, at 181.

203 Chaim Perelman, Justice, Law, and Argument: Essays on Moral and Legal Reasoning 77 (1980).

204 Kratochwil, supra note 183, at 181.

205 Id.

206 Id. at 36, 181.

207 Id. at 36.

208 Perelman, supra note 203.

209 Viehweg, supra note 181, at 65.

210 Kratochwil, supra note 183, at 53.

211 Viehweg, supra note 181, at 102–07.

212 Perelman, supra note 203, at 160; Wordnet, Princeton, http://wordnetweb.princeton.edu/perl/webwn?s=praxis (last visited 17 Aug. 2011).

213 Perelman, & Olbrechts-Tyteca, supra note 200, at 58.

214 Kratochwil, supra note 183, at 32; Perelman & Olbrechts-Tyteca, supra note 199, at 310.

215 Perelman, supra note 203, at 122.

216 Perelman, & Olbrechts-Tyteca, supra note 199, at 45.

217 Id. at 61.

218 Perelman, supra note 203, at 130.

219 Id. at 122.

220 Kratochwil, supra note 183, at 213.

221 Id. at 205.

222 Id. at 35.

223 Id. at 213.

224 Id. at 36.

225 Perelman, & Olbrechts-Tyteca, supra note 199, at 62.

226 Viehweg, supra note 181, at 27; id. at 38.

227 Perelman, & Olbrechts-Tyteca, supra note 199, at 37–38.

228 Viehweg, supra note 181, at 41.

229 Kratochwil, supra note 183, at 205, 208.

230 Perelman, supra note 203, at 120.

231 Kratochwil, supra note 183, at 212.

232 Id. at 183.

233 Perelman, supra note 203, at 128, 129.

234 Kratochwil, supra note 183, at 228.

235 Perelman, supra note 203, at 122.

236 Id.

237 Id. at 120.

238 Id.

239 Id. at 123.

240 Id. at 132.

241 Id. at 139.

242 Kratochwil, supra note 183, at 210.

243 Id. at 209.

244 Perelman, & Olbrechts-Tyteca, supra note 199, at 4.

245 Kratochwil, supra note 183, at 204.

246 Levit, Janet Koven, Bottom-Up International Lawmaking: Reflections on the New Haven School of International Law, 32 Yale J. Int'l. L. 393, 415 (2007).

247 Kratochwil, supra note 183, at 193.

248 Id. at 186.

249 Id. at 40.

250 Id. at 40.

251 Kratochwil, supra note 183, at 40; Perelman, supra note 203, at 129.

252 Viehweg, supra note 181, at 41.

253 Id.

254 Scott, supra note 41; Scott, Reflexive Governance, supra note 44.

255 Private Accountability, supra note 19; Kerr, Janda & Pitts, supra note 21.

256 Scott, Reflexive Governance, supra note 44; Scott, Regulation, supra note 41.

257 Perelman, & Olbrechts-Tyteca, supra note 199, at 309.

258 Raz, Authority, supra note 12, at 43.

259 Lincoln, supra note 53.

260 Id. at 6.

261 Id.

262 Sinclair, supra note 57, at 63.

263 Id. at 66.

264 Id.

265 Hallstrom, supra note 62, at 35.

266 Palazzo, & Scherer, , supra note 28.

267 Id.

268 Black, supra note 30, at 225.

269 Weber, supra note 70.

270 Dilling, et al., Private Accountability, supra note 19.

271 Zumbansen, supra note 39.

* Michael Torrance is a lawyer for Norton Rose Group whose practice includes advice on corporate governance and global business practices in relation to social and environmental risks, corporate responsibility, and sustainability. He can be contacted at

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Persuasive Authority Beyond the State: A Theoretical Analysis of Transnational Corporate Social Responsibility Norms as Legal Reasons Within Positive Legal Systems

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