Glossary term
Responsible Business Conduct (RBC)
Subject: Sustainability and ESG, Human Rights, Labour and Supply Chain
Also known as: RBC, Responsible business
Responsible business conduct means running a business so that it avoids and addresses harm to people, society and the environment in its own operations, supply chains and business relationships, while still pursuing profit.
Explanation
The idea groups together topics that were once handled separately: human rights, labour practices, environmental impact, bribery, consumer interests and tax. It is an expectation set out most clearly by the OECD and the United Nations. The main working method is risk-based due diligence: find where harm could happen, stop or reduce it, track whether it worked, say what was done, and repair damage that did occur. It reaches beyond the company's own sites to suppliers and other partners. RBC overlaps with corporate social responsibility, but the emphasis differs. CSR often means voluntary good works, while RBC starts with managing negative impacts of the core business. Regulators drafting due diligence laws reuse its vocabulary, so a company fluent in RBC rarely starts from zero.
Example
A food retailer sources cocoa and palm oil through many middlemen. Under its RBC programme it maps where the raw materials come from, rates each source by risk of child labour and deforestation, visits the highest-risk farms, and funds training for farmers. It reports each year what it found and what it changed.
Not to be confused with
- Corporate Social Responsibility (CSR)
- CSR can mean voluntary community or charity work. RBC is about managing the negative impacts of the core business itself.