Principles for Business

Introduction
The Caux Round Table believes that the world business community should play animportant role in improving economic and social conditions. As a statement of aspirations,this document aims to express a world standard against which business behavior can bemeasured. We seek to begin a process that identifies shared values, reconciles differingvalues, and thereby develops a shared perspective on business behavior acceptable toand honored by all.
These principles are rooted in two basic ethical ideals: kyosei and human dignity. TheJapanese concept of kyosei means living and working together for the common goodenabling cooperation and mutual prosperity to coexist with healthy and fair competition.
"Human dignity" refers to the sacredness or value of each person as an end, not simply asa mean to the fulfillment of others' purposes or even majority prescription.
The General Principles in Section 2 seek to clarify the spirit of kyosei and "human dignity,"
while the specific Stakeholder Principles in Section 3 are concerned with their practicalapplication.
In its language and form, the document owes a substantial debt to The Minnesota
Principles, a statement of business behavior developed by the Minnesota Center for
Corporate Responsibility. The Center hosted and chaired the drafting committee, which
included Japanese, European, and United States representatives.
Business behavior can affect relationships among nations and the prosperity and wellbeing of us all. Business is often the first contact between nations and, by the way in which
it causes social and economic changes, has a significant impact on the level of fear or
confidence felt by people worldwide. Members of the Caux Round Table place their firstemphasis on putting one's own house in order, and on seeking to establish what is rightrather than who is right.

Section 1. Preamble
The mobility of employment, capital, products and technology is making businessincreasingly global in its transactions and its effects.
Law and market forces are necessary but insufficient guides for conduct.
Responsibility for the policies and actions of business and respect for the dignity andinterests of its stakeholders are fundamental.
Shared values, including a commitment to shared prosperity, are as important for a global
community as for communities of smaller scale.
For these reasons, and because business can be a powerful agent of positive socialchange, we offer the following principles as a foundation for dialogue and action bybusiness leaders in search of business responsibility. In so doing, we affirm the necessity
for moral values in business decision making. Without them, stable business relationships
and a sustainable world community are impossible.

Section 2. General Principles
Principle 1. The Responsibilities Of Businesses:
Beyond Shareholders toward Stakeholders
The value of a business to society is the wealth and employment it creates and themarketable products and services it provides to consumers at a reasonable pricecommensurate with quality. To create such value, a business must maintain its own
economic health and viability, but survival is not a sufficient goal.
Businesses have a role to play in improving the lives of all their customers, employees,
and shareholders by sharing with them the wealth they have created. Suppliers andcompetitors as well should expect businesses to honor their obligations in a spirit ofhonesty and fairness. As responsible citizens of the local, national, regional and global
communities in which they operate, businesses share a part in shaping the future of thosecommunities.
Principle 2. The Economic and Social Impact of Business:
Toward Innovation, Justice and World Community
Businesses established in foreign countries to develop, produce or sell should also
contribute to the social advancement of those countries by creating productive
employment and helping to raise the purchasing power of their citizens. Businesses also
should contribute to human rights, education, welfare, and vitalization of the countries inwhich they operate.
Businesses should contribute to economic and social development not only in thecountries in which they operate, but also in the world community at large, through effective
and prudent use of resources, free and fair competition, and emphasis upon innovation intechnology, production methods, marketing and communications.

Principle 3. Business Behavior:
Beyond the Letter of Law Toward a Spirit of Trust
While accepting the legitimacy of trade secrets, businesses should recognize that sincerity,candor, truthfulness, the keeping of promises, and transparency contribute not only to theirown credibility and stability but also to the smoothness and efficiency of business
transactions, particularly on the international level.
Principle 4. Respect for Rules
To avoid trade frictions and to promote freer trade, equal conditions for competition, andfair and equitable treatment for all participants, businesses should respect internationaland domestic rules. In addition, they should recognize that some behavior, although legal,
may still have adverse consequences.
Principle 5. Support for Multilateral Trade
Businesses should support the multilateral trade systems of the GATT/World Trade
Organization and similar international agreements. They should cooperate in efforts topromote the progressive and judicious liberalization of trade and to relax those domestic
measures that unreasonably hinder global commerce, while giving due respect to national
policy objectives.
Principle 6. Respect for the Environment
A business should protect and, where possible, improve the environment, promotesustainable development, and prevent the wasteful use of natural resources.
Principle 7. Avoidance of Illicit Operations
A business should not participate in or condone bribery, money laundering, or othercorrupt practices: indeed, it should seek cooperation with others to eliminate them. It
should not trade in arms or other materials used for terrorist activities, drug traffic or otherorganized crime.

Section 3. Stakeholder Principles
Customers
We believe in treating all customers with dignity, irrespective of whether they purchase ourproducts and services directly from us or otherwise acquire them in the market. We
therefore have a responsibility to:•provide our customers with the highest quality products and services consistent with
their requirements;•treat our customers fairly in all aspects of our business transactions, including ahigh level of service and remedies for their dissatisfaction;•

make every effort to ensure that the health and safety of our customers, as well as
the quality of their environment, will be sustained or enhanced by our products andservices;•

assure respect for human dignity in products offered, marketing, and advertising;and respect the integrity of the culture of our customers.

Employees
We believe in the dignity of every employee and in taking employee interests seriously. We
therefore have a responsibility to:•provide jobs and compensation that improve workers' living conditions;•provide working conditions that respect each employee's health and dignity;•

be honest in communications with employees and open in sharing information,
limited only by legal and competitive constraints;•

listen to and, where possible, act on employee suggestions, ideas, requests andcomplaints;•engage in good faith negotiations when conflict arises;•

avoid discriminatory practices and guarantee equal treatment and opportunity inareas such as gender, age, race, and religion;•promote in the business itself the employment of differently abled people in placesof work where they can be genuinely useful;•protect employees from avoidable injury and illness in the workplace;•encourage and assist employees in developing relevant and transferable skills andknowledge; and•

be sensitive to the serious unemployment problems frequently associated withbusiness decisions, and work with governments, employee groups, other agencies
and each other in addressing these dislocations.

Owners / Investors
We believe in honoring the trust our investors place in us. We therefore have aresponsibility to:•apply professional and diligent management in order to secure a fair andcompetitive return on our owners' investment;•

disclose relevant information to owners/investors subject to legal requirements andcompetitive constraints;•

conserve, protect, and increase the owners/investors' assets; and•

respect owners/investors' requests, suggestions, complaints, and formalresolutions.

Suppliers
Our relationship with suppliers and subcontractors must be based on mutual respect. We
therefore have a responsibility to :•seek fairness and truthfulness in all our activities, including pricing, licensing, andrights to sell;•ensure that our business activities are free from coercion and unnecessarylitigation;•

foster long-term stability in the supplier relationship in return for value, quality,competitiveness and reliability;•

share information with suppliers and integrate them into our planning processes;•

pay suppliers on time and in accordance with agreed terms of trade; and•seek, encourage and prefer suppliers and subcontractors whose employment
practices respect human dignity.

Competitors
We believe that fair economic competition is one of the basic requirements for increasing
the wealth of nations and ultimately for making possible the just distribution of goods andservices. We therefore have a responsibility to:•foster open markets for trade and investment;•

promote competitive behavior that is socially and environmentally beneficial anddemonstrates mutual respect among competitors;•refrain from either seeking or participating in questionable payments or favors tosecure competitive advantages;•respect both tangible and intellectual property rights; and•refuse to acquire commercial information by dishonest or unethical means, such asindustrial espionage.

Communities
We believe that as global corporate citizens we can contribute to such forces of reform andhuman rights as are at work in the communities in which we operate. We therefore have a
responsibility in those communities to:•respect human rights and democratic institutions, and promote them whereverpracticable;•recognize government's legitimate obligation to the soc
iety at large and support
public policies and practices that promote human development through harmonious
relations between business and other segments of society;•collaborate with those forces in the community dedicated to raising standards ofhealth, education, workplace safety and economic well-being;•promote and stimulate sustainable development and play a leading role inpreserving and enhancing the physical environment and conserving the earth'sresources;•

support peace, security, diversity and social integration;•

respect the integrity of local cultures; and•be a good corporate citizen through charitable donations, educational and culturalcontributions, and employee participation in community and civic affairs.