Exporting Corporate Social Responsibility through Free Trade Agreements: Improving Coherence in The EU’s New-Generation Trade and Sustainable Development FTAs

Corporate Social Responsibility (“CSR”) is at the cutting edge of changing industrial practices. As such, it is at the forefront of the transition to sustainability. CSR can be both a national or regional policy and an organizational policy. The European Union(“EU”) is the leading jurisdiction in terms of CSR and of a broader society-wide sustainability policy. With its immense market and political power, the EU is able to export its CSR policy priorities. Applying its policies extraterritorially through the inclusion of Trade and Sustainable Development (“TSD”) provisions in its Free Trade Agreements (“FTAs”) is an exercise of that power and a significant step in achieving global industrial sustainability. This Article argues that the EU requires certain specific institutional reforms to achieve its TSD objectives. Using a theory of coherent regulatory systems, empirical evidence and argumentation, this Article proposes a series of reforms that reflect the underlying normative change in FTAs from exclusively trade and finance focused agreements to those which include social and environmental objectives. This change requires other modifications in the regulatory system, as for example, inclusion of parties beyond trade and finance specialists, parties and institutions such as civil and business groups, domestic courts built on broadly accepted and well understood standards. We argue that the reform of FTAs with more robust private party rights, private standards and better use of the domestic courts would improve socially and environmentally responsible business practices in the EU and around the world with a positive impact on sustainability.