The responsibility of corporate social responsibility in SMEs

This paper aims to draw attention to the responsibility of CSR in SMEs.

Examining the emergence of the global and Indian CSR discourse and India's industrial and SME domain in particular in the context of global value chains and SME policy, this conceptual paper looks at the deficiencies in the present approaches. Drawing upon existing literature on global value chains, codes of conduct and multi‐stakeholder initiatives, it articulates the special challenge posed by the issues of labour rights and humane working conditions.

This paper suggests that SMEs by themselves cannot take up this responsibility and that the codes of conduct of transnational corporations would also be of limited utility and an active governmental role is necessary.

The paper calls for a change in political culture that looks at humane labour practices as a necessary condition for work and not as a liability in the pursuit of investments to provide a counterweight to the race to the bottom that has been triggered through export‐oriented growth in SMEs.