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* Standard disclosure involves a ˜reasonable™ search for all documents
that either support or adversely affect either side™s case; and
* Specific disclosure can be ordered at the request of the parties, which
relates to specific documents or classes of documents.
In order to decide whether or not a search is reasonable relevant factors
have to be considered such as:
The number of documents involved;
*
The nature and complexity of the matter;
*
The significance of any document that is likely to be located; and
*
The ease and expense of retrieval.
*
Accordingly experts appear to have accepted that standard disclosure
ought to include a search of active data on a computer system. In such
instances it would seem advisable that where there are documents in pro-
ceedings whose provenance is disputed these should be identified at an
early stage and agreement reached as soon as possible or orders sought for
their preservation in their original format. Moreover there may need to be
searches for residual copies, if any, in the case of a disputed document,
bearing in mind any time and cost implications. Once the document has
been identified and located it should be copied in a forensically sound
manner in order to preserve its metadata. In commercial cases, for
instance, a procedure may be agreed upon as regards the extraction and
production of the document. Moreover in fraud cases, for example, the
courts may well be sympathetic to applications for the specific disclosure
of document metadata.
Conclusion
The above considerations highlight in a vivid way the importance of ethi-
cal business practice and appropriate due diligence in connection with the
handling of documents in the business as part of usual business policy.
Regardless of the value of the hidden information encoded into most elec-
tronic documents “ metadata “ for the purposes of litigation, clearly
today™s business climate demands an increasing level of sophistication in
working with IT having regard to risk management. As has been noted
elsewhere, the information set out here is of a general nature: any particu-
lar concerns should be referred to an expert in order to obtain appropriate
specific advice.




Useful web links
The International Institute for Sustainable Development have produced an
assessment tool kit that takes organisations through the sustainability prod-
uct design process. It is available from http://www.iisd.org/pdf/eetoolkit.pdf
PART
C
Overview of the Social Aspects of
Business Risks
Social risks are as varied as the communities and cultural groupings from
which they emanate. We use a SERM system to estimate that 5.1% of market
value is at risk from these types of internal and external issues including:
Social and ethical risk overview (Chapter 12);
Cultural risk management (Chapter 13);
Human rights and resource issues inside the workplace (Chapter 14);
Human rights outside the workplace (Chapter 15);
Health and safety in the workplace (Chapter 16); and
Health and safety of customers and product liabilities (Chapter 17).
Part C “ Overview of the Social Aspects of Business Risks
270




Sustainable
Success




External
Stakeholder
Pressures and
Opportunities




A Sustainable Enterprise Risk Management System (SERM)
and Improved Competitive Performance




Social Environmental
Economic
Performance Performance Performance
Performance




Social Environmental
Economic
Processes
Risk Management Risk Management
Risk Management




People and
Organisational Vision and Objectives
Plans



The net risk to market value from these issues is outlined in the pie chart below:
Human Rights
Community
(external),
Investment,
0.3%
0.3%
Health “ Historic
Liabilities, 1.2%
Health External
(public), 0.4%


Safety Internal
(workforce),
Safety External
0.5%
(public), 1%
Human
Rights/Resources
Health Internal
(internal), 0.7%
(workforce),
0.7%
12
Social and business ethic risk
overview
12 Social and business ethic risk
overview



CHAPTER OVERVIEW
This chapter provides an overview of the socio-economic and business
ethic risks an organisation faces, assessing their impact upon profitability.
All business activities could be viewed from an ethical viewpoint, in effect
what stakeholders perceive to be ˜right™ or ˜wrong™, but we are reviewing
just a few elements of this wide area of risk.
In this chapter whereas there is a brief overview of some of the social
and ethical risk issues, most are covered in more depth in other chapters
indicated in brackets:
* Risks from a lack of community involvement (in this chapter);
* Human resources and workforce human rights, including the avoidance
of forced or child labour (Chapter 14);
* Wider human rights issues outside of the organisation, including the
avoidance of suppliers (Chapter 15); and
* Health and safety for staff, and historic liabilities (Chapter 16) and cus-
tomers (Chapter 17).
Other issues that have large ethical dimensions but which are not covered
in this section are:
Involvement in bribery and corruption (Chapter 7);
*
The use of corporate power (Chapter 10);
*
Business and marketing practices (Chapter 10);
*
New technologies impacts (Chapter 11);
*
Natural resource degradation risks (Chapter 18 and 19); and
*
Corporate governance and ethical codes of corporate behaviour (Chapters
*
21, 22 and 23).




The social aspects of business risk
Social risks are as varied as the communities and cultural groupings from
which they emanate. The average risk to market value is estimated at 5.1% of
Chapter 12 “ Social and business ethic risk overview 273



market share for the risks highlighted below, mostly from health and safety of
staff and customer issues. Many mistakes are made by organisations that are far
removed from their marketplaces, physically or culturally or both. SERM
reviews these types of risks as well as external issues such as product safety,
human rights and employment law.
The chart below shows the total social and ethical risks broken down by cat-
egory by (net) risk to market value for the top 500 companies in the EU and US.

Human Rights
Community
(external),
Investment,
0.3%
0.3%
Health “ Historic
Liabilities, 1.2%
Health External
(public), 0.4%


Safety Internal
(workforce),
Safety External
0.5%
(public), 1%
Human
Rights/Resources
Health Internal
(internal), 0.7%
(workforce),
0.7%


We also look closely at the risks associated with the impact on the smooth
running of operations, from social, cultural and ethical issues. We have
included an overview of human rights and health and safety issues which are
covered in the other chapters in this part of the book. Experience demonstrates
that the list is growing exponentially, as well as the costs and claims for reim-
bursement. A brief overview of relevant risks and the chapter number where
they are covered in more depth follows:



Social and ethical risk Net (residual) Covered
risk to value in

Community investment 0.3% Chapter 12
Cultural risk Not available Chapter 13
Human rights/resources (internal) 0.7% Chapter 14
Human rights (external) 0.3% Chapter 15
Health internal (workforce) 0.7% Chapter 16
Safety internal (workforce) 0.5% Chapter 16
Health external (public) 0.4% Chapter 17
Safety external (public) 1.0% Chapter 17
Health and safety “ historic liabilities 1.2% Chapter 17
Total 5.1%
Part C “ Overview of the Social Aspects of Business Risks
274



The business context
The business community is increasingly acknowledging the risks from operat-
ing within a society and managing these in such a way that both businesses and
society benefit. Some of the most enduring businesses and brands have this
principle of mutual progression at the heart of their business models.
There are a number of financial and non-financial ethical issues which
require attention from organisations™ risk management and due diligence sys-
tems, including issues covered in the other sections, for example: anti-money
laundering provisions, tackling bribery and corruption, the integrity of the
organisation and its trustfulness as well as honestly abiding by codes, princi-
ples and standards if publicly committing to them.
In trying to perceive the business environment through the eyes of the wider
society and stakeholders, management should gain a perspective on the risks
and how to deal with them in a broader social context. The business case
includes managing and avoiding the following risks:
Social and ethical incidents, or a reduction in the number of incidents and/or
their impact;
Non-compliance convictions, criminal prosecutions and enforcement notices;
Enforcement actions for remedial work;
Civil claims;
Damage to reputation and brand; and
Stakeholder pressure.
Media coverage of the research on these issues highlights that there are benefits
to be gained from incorporating the following types of risk into an organisa-

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