Governance Strategy in Corporate Social Responsibility: Relational ...

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corporate social responsibility (CSR) and governance, which helps explain .... The best ones will do so. ..... campaigns and media influence are also analyzed.
Governance Strategy in Corporate Social Responsibility: Relational Approach and European Governments Laura Albareda, Josep M. Lozano and TamykoYsa

CSR PAPER 29.2007

DECEMBER 2007 CSRM – Corporate Social Responsibility and Sustainable Management

Laura Albareda, Josep M. Lozano and Tamyko Ysa, Institute for Social Innovation ESADE Business School (University Ramon Llull-URL)

This paper can be downloaded without charge at: The Fondazione Eni Enrico Mattei Series Index: http://www.feem.it/Feem/Pub/Publications/CSRPapers/default.htm

The opinions expressed in this paper do not necessarily reflect the position of Fondazione Eni Enrico Mattei Corso Magenta, 63, 20123 Milano (I), web site: www.feem.it, e-mail: [email protected]

The special issue on Corporate Social Responsibility Papers: The potential to contribute to the implementation and integration of EU strategies (CORE) collects a selection of papers presented at the Marie Curie Conference CORE organised by FEEM. The CORE conferences Series addresses the question of the goals achievement of the EU strategies. The main EU strategies (Lisbon, Sustainability, Integration) can be successful if their implementation involves adequately and effectively the business sector, non-profit partnerships and networks, local communities and civil society. In this setting CSR holds the potential to stimulate corporate contributions to the implementation and integration of the mentioned EU strategies and can be tested as a policy tool. This batch of papers has been presented at the second Core Conference: The potential of CSR to support the implementation of the EU Sustainability Strategy. CORE is financed by the European Commission, Sixth Framework Programme and it is coordinated by Fondazione Eni Enrico Mattei (FEEM). Further information is available at www.core-project.net

Conferences: • The potential of CSR to support the implementation of the EU Lisbon Strategy Milan, June 22-23, 2006 • The potential of CSR to support the implementation of the EU Sustainability Strategy Milan, June 14-15 , 2007 • The potential of CSR to drive integration in an enlarged Europe Nottingham, June19-20, 2008 • The potential of CSR to support the integration of core EU strategies Darmstadt, 15-16, 2009 Partners of the CORE network: • Fondazione Eni Enrico Mattei, Milano, Italy • Oeko Institut, Freiburg , Berlin, Darmstadt, Germany • University of Nottingham, Nottingham, UK

Governance Strategy in Corporate Social Responsibility: Relational Approach and European Governments Summary The paper starts a conversation in the literature about the challenge of interweaving corporate social responsibility (CSR) and governance, which helps explain the changing role of government in advanced democracies faced with wicked issues. In recent years, CSR has become a priority issue on government and international agency agendas. This empirical research report, provides explanatory keys on how governments, and more specifically the EU-15 countries, have designed and implemented their CSR policies and which type of interactions have developed with the different stakeholders. We analyse and map how, under the umbrella term of governance, the stakeholders in CSR public policy interrelate. A four ideal typology is built up, concerning the roles played by public and private actors, legal frameworks, incentives, governance structures and the ways all of these evolve. The findings can help establish a starting point for dialogue – which involves the business community, universities, government agencies and consumer groups – about their future development in decision making on these policies. CSR governments’ strategy may be of various kinds: The kind of CSR policy employed affects how the relationship between public and private actors is managed. Those who set policies, whether for public or private institutions, may find some important lessons in these relational approaches. Keywords: Corporate Social Responsibility, Governance, Public policies, PublicPrivate Partnership, Welfare state JEL classification: M14

Address for correspondence: Laura Albareda Institute for Social Innovation ESADE Business School (University Ramon Llull-URL) Barcelona, Spain E-mail: [email protected]

3 GOVERNANCE STRATEGY IN CORPORATE SOCIAL RESPONSIBILITY: THE ROLE OF GOVERNMENTS IN EUROPE

THE “SO WHAT” OF THE ANALYSIS OF GOVERNMENT ACTIVITIES IN CSR The purpose of this paper1 is to analyze differences in the approaches adopted by European government policies in the light of their ideals and four different models of government action are put forward. Our proposal’s theoretical coherence stems from the fact that CSR is not a new and isolated item for inclusion on the political agenda. On the contrary, it forms part of the current debate on the role of companies in society, clearly shaping the current challenges to the welfare state and its governance, and the socio-economic development of each country. This initial hypothesis has been given a relational reading, which emphasizes the strategy of dialogue and collaboration between company, government and the organs of civil society. Today, CSR is already present on the political agendas. Governments have become CSR enablers or drivers. Supporting business efforts, in the midlate 1990s, some pioneer governments, such as those in Denmark, the UK and Australia, began to promote CSR through their policies and programmes. At the beginning of this century, those initiatives merged with actions developed by different international organizations, like the UN Global Compact or the European Commission, which began to promote and to endorse CSR, recognizing public policies as a key driver to encourage a greater sense of CSR. An important social challenge facing all these governments is to provide a response to the new role of companies in economic development, with the social and environmental problems this entails. Furthermore, the European Commission expects the national CSR policies to tie in with both community policies and international codes and standards. Many European governments have started to develop and design actions and policies based on and around CSR. In general, they have preferred not to introduce compulsory CSR policies as such. Instead, they have chosen to work towards the furthering and facilitating of CSR, developing common standards and information practices on

4 the subject, together with spaces for dialogue and partnership. The role of governments and public administrations in this process is both fundamental and irreplaceable. As Aaronson and Reeves (2002b) recalled, these policies can contribute to greater clarity and awareness when examining the large number of voluntary approaches taken by the corporate sector over recent years. The concept of CSR is linked to problems raised by economic globalization and its affect on challenges, the so-called wicked issues, including: crisis and change in the welfare state (Midttun, 2004); new forms of governance (Moon, 2002, 2004); society, corporate and government relationships (Gribben et al., 2001); and, new corporate imperatives and new social demands (Zadek, 2001b). This approach postulates that the social governance of our interdependent world requires a series of developments. It requires a new vision of how companies contribute to society, a new relationship between political and corporate actors, and the ability to reach a shared diagnosis and perspective on the main challenges to our companies, which will enable us to contextualize that vision and that relationship. As Rome has pointed out (2005), every country's approach to CSR encapsulates a series of different elements: political and institutional structure; political style and processes; social structure; emphasis on a voluntary approach or acceptance of state guidelines and control; local and national views of the role of companies; the role and posture of NGOs and civil associations in society; the kind of educational system and the values it transmits; what is expected of their leaders; and historical traditions. All this means that companies and countries must be increasingly aware of the need to formulate their own approach to CSR. CSR does not now simply affect relationships between company and society. It has become a way of rethinking the role of companies in society, which takes governance and sustainability as its core values. To represent the thinking on what governments can do to drive CSR as a dilemma about the pros and cons of legislation is to take an essentially impoverished and sterile line. Legislation is only one element out of many, and in a large number of cases not even the most useful or important. What is required is an overall political framework. We should be asking what needs to

5 be done to promote and encourage increasingly responsible and sustainable companies and organizations. Does a discourse on CSR based on political institutions make sense? It does. Particularly if we take as reference for any discussion the two key words appearing in the subtitles of the European Commission

documents:

promotion

(from

the

perspective

of

political

institutions), and contribution (by the corporate sector). This directly links a commitment to CSR with a commitment to corporate excellence, quality, continuous improvement, innovation, differentiation, competitiveness and internationalization. This is something neither companies nor governments can achieve on their own. On the contrary, success will only come from a growing capacity to bring their individual institutional expertise to bear in a joint approach to the development of CSR. The governance of our complex societies will be impossible if we cannot turn the sense of responsibility of their many stakeholders into a sense of coresponsibility. This is where the recognition of the political dimension of CSR development comes in. Because the issue of CSR and the role of the company in society do not require companies to stop being companies, or to take on functions to which they are not suited (or for which they have no legal remit). It simply asks them to be fully and wholly companies, but twenty-first century companies. Indeed, as Frederick indicates (2006: 121) “corporations are being offered an opportunity to match their own operation to these public expectations. The best ones will do so. The others may wish they had if, in failing to heed the normative messages, they encounter rising hostility and increased governmental intervention in their affairs. For public policy makers, these agreements betoken a growing consensus among the world’s peoples over what is thought to be morally desirable action by governments”. In relational approaches, the development of cross-sector proposals (dialogues, partnerships and networks) is one of the objectives of CSR’s role of promoting government. From here on, the paper is structured as follows. First, we present the development of the literature review of the roles played by governments in promoting CSR. Secondly, we introduce the methodology developed to build an analytical framework based on governance theories.

6 Thirdly, we describe the four government CSR approach models based on the behaviour of EU-15 countries.

THE

ROLE

OF

GOVERNMENTS

IN

STIMULATING

CORPORATE

RESPONSIBILITY The first documents to introduce the debate on governments’ CSR role date from the last few decades of the 20th century. Most of these texts put forward the need for governments to actively promote CSR as a response to the social and environmental problems caused by corporate action within a globalized economic context. Another aspect considered in the understanding of CSR public polices was the soft policy approach introduced by Joseph (2003). Most CSR policies do not affect regulations but constitute an approach to “law politics” in which the role of government is viewed as collaborative and facilitating through the use of soft tools and means –always in collaboration with the private sector. Relevant documents that incorporate governments’ vision, with particular emphasis being placed on Europe, include the official documents on CSR published by the European Commission: the Green Paper “Promoting a European

Framework

for

Corporate

Social

Responsibility”

(European

Commission, 2001) and “Communication: Corporate Social Responsibility: A Business contribution to sustainable development” (European Commission, 2002). Combined, these two documents provide the keys to understanding a global perspective on the role of public authorities in CSR development, as well as an insight into the public initiatives governments can undertake. The European Commission holds that the action of European governments should be: (i) to improve CSR knowledge; (ii) to facilitate the exchange of experiences and good practices, increasing knowledge about the impact of CSR on business and society; (iii) to develop CSR experience and good practice exchanges among businesses and societies; (iv) to develop CSR management skills; (v) to foster CSR among SMEs; (vi) to promote convergence and transparency in CSR practices and tools; (vii) to launch multi-stakeholder CSR forums, and (viii) to integrate CSR in public policies (European Commission, 2002).

7 Apart from these Commission documents, other key materials included the responses submitted by European governments to the public debate arising from the Green Paper in 2001. These showed how each government viewed CSR in relation to other stakeholders and laid out their programmes for action. An initial compilation on the practices carried out by governments can be found in a conference document that the Italian government prepared indicating how European governments described their public action on CSR (European Conference on Corporate Social Responsibility. The role of Public Policies in promoting CSR, Venice, 14th November 2003). Pioneering research on the analysis of the roles adopted by governments in CSR promotion includes the World Bank’s report on “Public Sector Roles in Strengthening Corporate Social Responsibility: A Baseline Study” (Fox et al, 2002), which puts forward four public sector roles: mandating, facilitating, partnering and endorsing (view table ”Public sector roles”). Furthermore, it constructs and develops a significant matrix of possible activities for the public sector to play in each role, depending on the aspect of CSR being dealt with. Amongst research based on geographical comparative analysis of government behaviours in European and North American administrations, the work of Aaronson and Reeves (2002a and 2002b) and the comparative report Government and Corporate Social Responsibility (CBSR, 2001) shed some light on the relevance of cultural differences and elements in the development of national CSR models. Aaronson and Reeves (2002a) analyze the differences between Europe’s acceptance of the role of government in promoting CSR and the less accepting US attitude in this regard. One of the key points in European governments is how well they cooperate with the business sector. Conversely, American companies display a poor level of acceptance of CSR in public policies. They argue that the difference resides in their respective business cultures. Along these lines, Moon (2004) analyzes the CSR policy adopted by the British government when he suggests that it assumed CSR policies in response to a crisis in social governance and legitimacy affecting the country. Midttun (2004) views the development of CSR within the context of changes in the

8 welfare state, based on a comparative analysis of three models. Gribben et al. (2001) presents the role of governments in the creation of new models of social partnership to resolve social problems, coordinating with companies, social organizations and local governments. Guarini & Nidasio (2003) also analyze the role of CSR in public-private partnerships as models of governance. Bendell & Kearins (2004) refer to the political dimension of CSR and its application to company administration and management to meet the demands of society. Lepoutre et al. (2004) also present a review of the roles of governments in the CSR debate. Their analysis reviews the strategic roles to be played by governments managing institutional uncertainty (activate, orchestrate and modulate) and present common tools for public action managing strategic uncertainty (public information campaigns, organizational reporting, labelling, contracts, agreements and incentives). And Nidasio (2004) focuses on comparing the framework models for reporting developed by four European governments: Italy, Belgium, the Netherlands and France. Today, theories on CSR frequently include a global overview of its contribution to governance.

THE CONSTRUCTION OF AN ANALYSIS MODEL. A BOTTOM-UP APPROACH: FROM PROGRAMMES TO POLICIES. This paper departs from the assumption that planning and implementing public policies on CSR now goes beyond the traditional relationship of government action (public administrations) with the private sector (companies). It includes all the social actors: public sector, private sector, society, and most importantly the intersections between these, in relational collaboratives. For a broader and less dualist view on the issue, we worked from a relational model proposed by Mendoza (1991, 1996). Mendoza’s analytical model focuses particularly on the interrelation, collaboration and partnership between the different actors: companies, governments and society. This means that CR public policies cannot simply be analyzed in the light of relationships between governments and business sectors. Added value lies in exploring the intersections between public and private sectors (including forprofit and non-profit sectors) and in broadening the areas surrounding the boundaries between these three sectors. This triangulation approach is adopted

9 in the research framework for analyzing CR public policies and allows us to gain a complete vision of possible models and impacts. The relational focus is thus applied to public policies, classifying administration policies, programmes and actions by means of the following scheme2 (see figure: “Relational model for CR public policy analysis”):

Insert figure 1

Administration-administration In this classification, we have included public administrations, including the Commission, that integrate CR principles into their own management systems and their relationships with stakeholders. Especially noteworthy is the public policy adopted by the administration as regards its own CR: the idea of generating leadership through internal CR policies. This could involve engaging socially responsible companies for good and service supply, adopting internal CR policies (gender equality and no discrimination) or environmental policies, as well as applying CR in foreign and trading policies as well as in development co-operation.

Administration-company Governments (or their respective agencies) can adopt different policies that have a direct or indirect influence on company activity and development. These include labour and social policies, company and economic policies, fiscal and funding policies, educational and training policies, as well as policies relating to agriculture, fishing and rural development. We would like to highlight the following CR public policies adopted by the administration: the promotion of consistence and transparency in CR practices and instruments adopted by companies (management norms, codes of conduct, accountability, audits, reports, fair trade labels, social labels, socially responsible investments, etc.), in

10 addition to fostering CR experience and best practice exchanges among companies.

Administration-society Under this heading, we include governmental activities aimed at society and favouring CR, such as carrying out campaigns and actions that reveal CR’s positive impact on society, supporting civil society’s initiatives intended to promote CR, informing and educating social actors about CR, and establishing programmes to interrelate stakeholders.

Administration-company and society or relational CR This is the most innovative action framework the CR field as well as the least studied one. It features the public policies or programmes that involve working in cross-sector partnerships to promote or develop CR, the creation of forums and areas for CR experience and best practice exchanges, the establishment of independent institutions for analysing, developing and applying CR, and the promotion of consistence and transparency in CR practices and instruments.

Three different levels of government action on CSR were analysed, with each level incorporating the earlier one. The initial analysis dealt with the issues and instruments used by governments in their initiatives for promoting CSR. This involved researching each country and building a database on the issues, policies and instruments applied by governments in promoting CSR. The second level consisted of looking at stakeholders and contexts. This perspective considered the relationships between the actors involved, and any interrelationships and co-responsibilities created. It required a study of the environment, cultural context and socioeconomic tradition of the country in which the government framework for CSR had evolved. Thirdly, for a more systematic and dynamic analysis, the research also covered strategic and relational aspects, the models for the conception and development of the CSR discourse and the design of public policies. By combining these data, the following comprehensive map was created (see figure: “Implemented public policies, programmes and actions promoting CSR”) about the actions that UE-

11 15 governments are implementing in their CSR promotion policies. Undoubtedly, these policies, programmes and projects are going to become increasingly sophisticated as the different actors mature and assess their projects

Insert figure 2

.The application of the relational model to public policies on CSR gave an overview of government action, taking into account both actors involved and their contexts: profiles and models for action adopted by the governments; public programmes and policies; discourses compiled by governments on the CSR concept, including the dissemination, means and organizations used; and the incorporation of CSR into the organizational structure. How CSR policy was assimilated into government structures and public policies was analyzed examining the following elements in the construction of CSR strategies and their implementation: National public policy on CSR: vision, mission and objectives; how the policy is named within the country, the origin of the political discourse, the chronological evolution of the policy-making, the localization of the discourse and the policy. Government departments assuming liabilities on CSR policies. Institutional and relational support from existing international agreements on CSR: Conventions of the ILO, OECD guidelines for multinational companies,

United

Nations

Global

Compact,

participation

in

international bodies on CSR issues. Regulation in its diverse forms. Positioning in the relationship between voluntary action and legislation.

12 Organizational structure for CSR policies: centralized/decentralized, transversal/sectoral, multi-stakeholder. Creation of new entities. And finally: significant actors in the process, turning points and objectives, environment

(socioeconomic,

political

and

cultural

context,

administrative tradition).

CORPORATE

SOCIAL

RESPONSIBILITY

KEY

VARIABLES

IN

A

RELATIONAL APPROACH Based on the revision of CSR, political science and public management literature, and a previous initial analysis of three countries, the following key variables were selected, which explain the actions of governments that allow to draw a comparison between the different countries. In the first block – CSR in Government – ten variables were analyzed (for each of the variables several examples are highlighted of the programmes and policies included. However, this is only a sample and not an exhaustive list): 1. Leadership by example: with the presence of the administration in an area traditionally considered the monopoly of business, the referent of the example is key. It is included in these variables: action plan for government offices; work-life balance policies/equal opportunities/ethical investment/antifraud and corruption policies; and accreditation for good employer practices. 2. Creation of internal departments. The public administration sometimes conveys the relevance and hierarchy of its policies through the constitution of structures. Other examples considered include: the creation of knowledge centres; the creation of monitoring organizations and control systems. 3. Coordinating government bodies. With the creation of departments when dealing with these wicked issues this is not sufficient. In order to achieve the maximum number of possible outcomes, a cross-cutting collaboration between the different departments is necessary. This includes: a CSR minister responsible for coordinating activities; cross-government CSR programmes; and CSR feasibility studies for new legislation. 4. Capacity building. The integration of new policies requires the generation of knowledge, as well as training to match the profile of public workers to the new requirements. In this variable, are included actions such as: the funding

13 for research and innovation programmes; financial assistance for companies implementing CSR programmes; the publication of guidelines and good practice documents. 5. Public expenditure. Policies cannot be sustainable without the specific allocation of resources or them being linking to hot issues in policies. Thus, it is necessary to analyze whether the following are applied: social and environmental

criteria

in

supplier

policies;

ethical

purchasing

and

outsourcing; CSR policies for public contracts. 6. Public campaigns. Linked to the generation of knowledge and training is the diffusion of this information: the promotion of the positive impact of CSR on business and society; public opinion polls; CSR awards, communication campaigns and media influence are also analyzed.

Within this section international issues are of particular importance, due to the influence they can have on accelerating national internal processes. Thus, three variables analyzed are connected with this: 7. International events. Is the government carrying out activities in which to share good practices, which also facilitate benchmarking? The following events are included here: organization of international conferences on CSR; European Commission events; or European conferences on CSR. 8. Transferring

international

debate

to

local

contexts.

Regionalization

processes and local autonomy make it necessary for national governments to attain sufficient multilevel management if they want to make an impact. The following are analyzed here: agreements between national and local government; seminars on geographic or thematic areas; and the consideration of regional and local policies. 9. International instruments and agreements. We consider this to be a key variable because it measures the transposition in accordance with international regulations, that governments are introducing. This includes: the promotion of global regulatory frameworks; the development of international certification systems; the creation of evaluation and certification bodies.

14 10. Foreign trade policy and international development. The greatest amount of maturity in public CSR policies is the power to agree with the companies that are going to develop behaviour similar to that carried out in their own country in third-party countries. This includes: CSR integrated into foreign affairs policies for international markets and international development; the promotion of good CSR practice in overseas operations (human rights, labour standards, anti-corruption, environment etc); CSR linked to foreign investment policy and international relations. To this end, the profiles and action models adopted by European governments were analyzed3; public actions identified and the speeches made by government officials on CSR examined by (a) studying how they were broadcast as well as measures and organizations used, and (b) analyzing how CSR had been introduced to governmental structure. This information was grouped by country and incorporated in specific reports made by each country analyzed4. In order to have a comparative analysis of public policies and the corresponding programmes for the development of CSR we match the available information on the profile of each country with the relational model applied to public policies on CSR. From this perspective, the thematic and instrumental approaches are fully integrated in a strategic-relational approach. We then asked ourselves whether any of these elements define models for action. And we defend an affirmative answer to this question. Thanks to the literature review and field work, we have been able to cluster the characteristics of the different countries’ variables into clusters, using the criteria mentioned above: government CSR public policy (vision, objectives, strategies and priorities), internal government CSR structure (position of political figure, organizational structure, centralized or decentralized), CSR responsibilities at different levels of government (cross-cutting policies, regional/decentralized government, local government), the scope of CSR policy (domestic versus international), and the role of other organizations, and finally the context of the environment (socioeconomic, political tradition). This clustering led to the following results.

15 EUROPEAN MODELS OF PUBLIC POLICY GOVERNANCE FOSTERING CSR Applying this relational and strategic approach, the analysis concludes with the identification among the EU-15 countries of four models for government action in the development of public policies promoting CSR. As a result, a denomination is suggested that offers a key for interpreting each model, indicating its dominant, but not exclusive, perspective.

Insert table 1



The partnership model, applied by countries in Northern Europe in their approach to public policies on CSR. Denmark, Finland, the Netherlands and Sweden. In these countries, with their strong welfare state tradition, governments have shifted from acting as a strong welfare state, taking responsibility for social issues, to a facilitative role, sharing the increasing costs of addressing social issues with private and public partners. Countries whose tradition historically favours social negotiation, where relationships between government and companies is positive, based on aspects of cooperation. Public policies on CSR are considered to fall within the area of social and employment issues. Local governments are heavily involved in channelling the formation of partnerships that encourage

the

concept

of

social

co-responsibility

between

administrations, companies and social organizations. As Kjaer (2003) has already suggested for partnership models, on CSR issues we feel that the Netherlands is closer to the Nordic than the continental model. •

The business in the community, applied to the Anglo-Saxon countries and their way of applying public policies on CSR. The United Kingdom and Ireland. These two countries base their policies on a consolidated and well-organized private sector and civil society. Their government action is therefore conceived as facilitating or mediating, a more liberal

16 and less normative view of the role of the state. Government actions on CSR are focussed on supporting the private sector and facilitating economic and sustainable development and economic regeneration in support of the private sector. Soft Invervention policies to encourage companies involvement in governance challenges is one of the main focus of CSR public policies. These countries pursue the solution of social problems like unemployment and social exclusion through CSR policies where companies are involved. This is the result of a crisis in governance, where governments attempt to promote spaces for corporate action. Centralized policies linked to local authorities. Government has based its application of CSR on soft law. •

The Sustainability and citizenship model. applied by continental countries as Germany, Austria, Belgium and Luxembourg. A very special social context, combining economic crisis with the political challenge of reform of the welfare state. Although initially placing greater emphasis on sustainability. it seems as an updated version the the existing social agreement and government focuses CSR on the sutaianble Develpment Strategies. CSR as a concept is not in itself a main axis, but is incorporated into the national strategy for Sustainable Development that includes. France is the European country with the most regulatory approach to CSR. The French political tradition is more closely linked to the value of standardization and legislation, thus differentiating it from the preceding model. CSR. This is a very centralized model.



The agora model. Applied to Mediterranean countries as Italy, Spain, Portugal and Greece. Countries who addressed to CSR after the European Commision initative in 2001.. While some of their governments are already applying CSR initiatives, many are still only at the discussion stage with the concept and its possible application in public policies. In these countries, governmental action has been supported by the drafting of reports and studies on CSR, analysing the development of CSR in more proactive European governments and the CSR public policies

17 undertaken. These elements of public dialogue provide consensus on whether or not governmental action has been defined or made specific through tangible political initiatives, especially in Spain, Greece and Portugal. In these countries, it seems that the governments adopt a positive attitude towards CSR. •

INTERWEAVING CSR POLICIES AND WELFARE STATE REGIMES Despite inherent limitations in classification attempts, as our comparative research proceeded, we began to detect some links between individual country’s policies fostering CR and their welfare state regimes (EspingAndersen, 1999, 2000; Heclo 1981). Esping-Andersen’s welfare regime classification distinguishes three types of welfare regimes: liberal, social democratic and continental regimes. The difficulties in fitting the Mediterranean countries into this initial triad led him to add a fourth type, the Mediterranean welfare regime, characterised by its delayed development and family’s significant role in welfare provision.

The liberal welfare regime is found in Anglo-Saxon countries. It is based on the liberal tradition of minimising the role of the state, individualising risks and encouraging commercial solutions for welfare provision. Social policies are marginal, in line with a narrow definition of social risks to be dealt with by public action. Within the European Union, this type of welfare regime is found in the U.K. and Ireland.

The social democratic welfare regime is virtually synonymous with the Nordic countries (Denmark, Sweden, Finland). Its key differentiating factors include the universal nature of welfare benefits, global risk coverage, generous subsidy levels, egalitarian orientation between generations and sexes, and residual private welfare services. The Nordic countries have undoubtedly pushed the limits of universalism farther than any other country. Furthermore, rights are

18 linked to individuals and based on citizenship -while British and Dutch pensions (1998) are based on contributions made.

The conservative welfare regime -that of continental Europe- is characterised by a mix of different social benefits linked to social status and the role of families. Throughout most of continental Europe, liberalism has a genuinely marginal role, and, until after the Second World War, socialism was typically excluded. Earlier social policies looked to monarchic statism, traditional corporatism and Catholic social doctrine for inspiration. Emphasis on compulsory social security complemented by ad-hoc and effectively residual pension plans for social strata lacking employment relationships renders private market welfare provision marginal. Another important feature of conservatism is its reliance on the family. It combines social protection, skewed in favour of male family heads, with the caregiver role allotted to the family –ultimately responsible for the welfare of its members (the principle of subsidiarity). Typical examples of this regime include countries like Austria, Belgium, France, Germany, the Netherlands and Luxembourg.

Finally, we can define the Mediterranean welfare regime as an offshoot of the conservative regime, with a more pronounced reliance on the family. Public structures for welfare providers are, therefore, thinner on the ground and welfare production is overwhelmingly family-based, relying particularly on women, who shoulder most of the work of caring for the entire family. Though to very different degrees, Spain, Italy, Greece and Portugal share this regime, in which informal solidarity networks make up for the system’s deficits.

GOVERNANCE

AND

CORPORATE

SOCIAL

RESPONSIBILITY:

KEY

ELEMENTS

Four key ideas arise from our research.

Firstly, that the voluntary-compulsory dichotomy as a tool to analyze the role of governments on CSR is too restrictive. Extending our framework for analysis to

19 a relational format opens out a wide range of possibilities and opportunities for governments and public administrations to influence, intervene, enable, steer and promote a sounder implantation of CSR within the culture of their organizations (whether public, private or non-profit). By analysing the spaces where these three sectors interrelate, and the spaces where synergy or extension of their boundaries can occur, we can create knowledge that may help administrations to make better decisions.

Secondly, the deregulation of public services, the increasing power of companies over governments, the welfare state crisis, drive for national competitiveness and sustainable development policy are some of the key drivers for governments to promote CSR. A measure of the levels of economic growth, unemployment, inequality in income distribution, population ageing, competitiveness/innovation and ecological impact are ways of identifying the political challenges that governments may attempt to address through CSR policy.

Third, we have seen how each country reconstructs its public policies on CSR from its own social, cultural and political traditions. The almost total concurrence of European welfare regimes and the developing CSR policies of the EU-15 is no coincidence. In some countries, CSR has been used as a lever or even an excuse to strengthen relationships with other sectors. In others, to reinforce the figure of the state and its regulatory auctoritas. But overall, it reflects the effect on public policy of the challenges currently being faced by these countries, which depend on the pre-existing deficits and limits of each welfare state.

Fourth, Governments need to manage a complex set of relationships between sectors. An understanding of the increasingly interdependent political, regulatory and commercial exchanges between sectors, and the perceptions and challenges from different stakeholders are important considerations for developing CSR policy. This led the government to be broker between sectors. It is generally accepted that government should assume the role of mediator,

20 creating a common framework across sectors to promote CR, encouraging and leading multi-stakeholder dialogue.

A challenge for future research is the work still to be done on models for the action and behaviours of CSR public policies on multi-level governance, and relationships between local, regional, national, European ang global levels.

21

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Corporate

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Policy

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Dimension

to

Corporate

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Responsibility

and

its

Management”. Paper presented at the Inter-disciplinary CSR Research Conference. University of Nottingham, ICCSR, 22-23 October. CBSR (2001), Government and Corporate Social Responsibility. An Overview of Selected Canadian, European and International Practices, Canadian Business for Social Responsibility, Vancouver. Crane, A. and Matten, D. (2004), Business Ethics. A European Perspective. Managing Corporate Citizenship and Sustainability in the Age of Globalization, Oxford University Press, Oxford. DTI (2001), Business and Society Developing Corporate Social Responsibility in the UK, UK Government, Department of Trade and Industry, London. DTI (2003a), Business and Society. Corporate Social Responsibility Report 2002, UK Government, Department of Trade and Industry, London. DTI (2003b), Corporate Social Responsibility - A Draft International Strategic Framework, UK Government, Department of Trade and Industry, London. European Commission (2001), Green Paper: Promoting a European Framework for Corporate Social Responsibility, COM (2001) 366-final, Brussels. European Commission (2002), Corporate Social Responsibility: A Business Contribution to Sustainable Development, COM (2002) 347-final, Brussels. Fox, T., Ward, H. and Howard, B. (2002), Public Sector Roles in Strengthening Corporate Social Responsibility: A Baseline Study, The World Bank, Washington.

22 Frederick, W. C. (2006) Corporation, be good! The story of Corporate Social Responsibility. Dog Ear Publishing, Indianapolis, USA. Greve, C. (2003) “Public-Private Partnerships in Scandinavia”, International Public Management Review, vol. 4, n. 2, pp. 59-68. Gribben, C., Pinnington, K. and Wilson, A. (2001), Governments as Partners: The Role of the Central Government in Developing New Social Partnerships, The Copenhagen Centre, Copenhagen. Guarini, E. and Nidasio, C. (2003), "CSR Role in Public-Private Partnerships: Models of Governance", paper presented at the research track 6 “The Policy Framework/The Societal Context” in the 2nd Annual Colloquium of the European Academy of Business in Society, Copenhagen. Hardis, J. (2003) "Social Multipartite Partnerships – When Practices Do Not Fit Rhetoric". Paper presented at the European Academy of Business in Society. Copenhagen. Joseph, E. (2003), A New Business Agenda for Government, Institute for Public Policy Research, London. Kjaergaard, C. and Westphalen, S. (2001), From Collective Bargaining to Social Partnerships: New Roles of the Social Partners in Europe, The Copenhagen Centre, Copenhagen. Lepoutre, J., Dentchev, N.

and Heene, A. (2004), “On the Role of the

Government in the Corporate Social Responsibility Debate”, paper presented at the research track 7 “Policy Making and the Role of Government” in the 3rd Annual Colloquium of the European Academy of Business in Society, Ghent. Lozano, J.M., Albareda, L., Ysa, T., Roscher, H. and Marcuccio, M. (2005), Los gobiernos y la responsabilidad social de las empresas. Políticas públicas más allá de la regulación y la voluntariedad, Granica, Barcelona. Mendoza, X. (1991), “Algunas reflexiones acerca de la 'transición al mercado' de los servicios sociales”, Jornades Públic-Privat i Benestar Social, Barcelona.

23 Mendoza, X. (1996), “Las transformaciones del sector público en las sociedades avanzadas. Del estado del bienestar al estado relacional”, Papers de Formació, No. 23, Diputació de Barcelona. Midttun, A. (2004), “Realigning Business, Government and Civil Society: The C(S)R Model Compared to the (Neo)Liberal and Welfare State Models”, Paper presented at the research track 7 “Policy Making and the Role of Government” in the 3rd Colloquium of the European Academy of Business in Society, Ghent. Moon, J. (2002), “Business Social Responsibility and New Governance”, Government and Opposition, 37, pp. 385-408. Moon, J. (2004), “Government as a Driver of Corporate Social Responsibility: The UK in Comparative Perspective”, ICCR Research Paper Series, n. 20-2004, The University of Nottingham, pp. 1-27. Moon, J.; Sochaki, R.: (1996) “The Social Responsibility and New Governance”. Government and Opposition, n. 27, pp. 384-408. Morsing, M. (2005) “Inclusive Labour Market Strategies”. In: Habisch, A.; Jonker, J.; Wegner, M; Schmidpeter, R. (eds.) Corporate Social Responsibility Across Europe. Berlin: Springer. Nidasio, C. (2004), “Implementing CSR on a Large Scale: The Role of Government”, paper presented at the research track 7 "Policy Making and the Role of Government" in the 3rd Colloquium of the European Academy of Business in Society, Ghent. Rosdahl, A. (2001) The Policy to Promote Social Responsibility of Enterprises in Denmark. Discussion Paper from Host Country Expert. Danish National Institute of Social Research. Copenhagen, 17-18 September. Rome N. (2005) “The Implications of national agendas for CSR” in Habish, A.; Jonker, J.; Schmidpeter, R. (eds), Corporate Social Responsibility Across Europe, Berlin, Springer Zadek, S. (2001a), The Civil Corporation: the New Economy of Corporate Citizenship. London, Earthscan, Stirling. Zadek, S. (2001b), Third Generation Corporate Citizenship, The Foreign Policy Centre and AccountAbility, London.

24 FIGURES AND TABLES

Figure 1. Relational model for CR public policy analysis

Governments

1 2

3 4

Businesses

Civil Society

1. CSR in governments 2. CSR in government-business relationships 3. CSR in government-society relationships 4. Relational CSR

.

25 Figure 2. Implemented public policies, programmes and actions promoting CSR

P u b lic ad min istratio n s an d C S R

A d m in istratio n s

C o mp an y

S o ciety

R elatio n al

P u b lic p o licies •Le a d e rs h ip b y e xa m p le (i nte r na l C S R p o lic ie s ) •L i nk i n g p u b lic s p e nd i n g to s o c ia lly re s p o ns i b le c o m p a n ie s •P a rtic ip a t io n i n in te r na tio na l e v e nts •T ra ns fe r o f i nte r na tio na l d e b a te o n C S R to t he na t io na l a n d lo c a l c o nte x t •F o s te ri n g i n te r na ti o na l ins t ru m e n ts a nd a gre e m e nts •E xte r na l p o lic y , t ra d e a nd d e v e lo p m e n t c o o p e ra tio n p o l ic y •D e v e lo p m e nt o f te c h nic a l k no w h o w fo r i m p le m e n ti n g C S R i n c o m p a n ie s •C o o rd i na t io n o f C S R p o lic ie s in a d m i nis t ra tio ns •P u b lic c a m p a i g ns •C re a tio n o f i nte r na l d e p a rt m e nts

ƒE m p lo y m e n t a nd s o c ia l is s u e s p o lic y • E n v iro n m e nta l p o l ic y •T a x a nd fu n d i n g p o l ic ie s ƒE d u c a tio n a nd tra i n i n g p o l ic ie s ƒR u ra l b u s i ne s s p o lic y ƒA g ric u ltu re , fis he r ie s a nd ru ra l d e v e lo p m e nt p o l ic ie s ƒC o ns u m e r d e fe nc e p o lic y

•Le g is la tio n (c o m p u ls o ry ) •R e gu la t io n (b y re s tr ic tio n ) •D ire c tiv e s a nd gu id e li ne s (s o ft la w ) •F is c a l a nd fu nd i n g fra m e w o rk •T o p ro m o te c o n v e r ge nc e a nd tra ns p a re nc y i n C S R i ns tru m e n ts a nd p ra c tic e s •T o c a ta ly s e a nd fa c ilita te v o lu n ta ry C S R i nitia tiv e s , e xc ha n ge o f e xp e rie nc e s a nd go o d p ra c tic e s •P ro m o tio n o f C S R i n c o m p a nie s : m a k e k no w n p o s i tiv e i m p a c t •T o e xp o rt C S R i n c o m p a ny a ttitu d e s in te r na tio na lly •P o lic ie s o f a tte nti o n to ne e d s a n d c ha ra c te ris t ic s o f S M E s i n C S R •T o fo s te r c o m p a ny re la ti o ns hip s w i t h t he m a rk e t a n d s ta k e ho ld e rs (i m p a c t o n c u s to m e rs , s u p p lie rs , e m p lo y e e s , c a p ita l p ro v i d e rs ) •T o fo s te r s o c ia l a c tio n b y t he c o m p a n y •T o d ra w u p b u s i ne s s re s tru c tu ri n g p o lic ie s

•R e gu la t io n (b y re s tr ic tio n ) •D ire c tiv e s a nd gu id e li ne s (s o ft la w ) •T o d is s e m i na te t he p o s itiv e i m p a c t o f C S R i n s o c ie ty •T o s u p p o rt C S R p ro m o tio n i n itia ti v e s o f c iv il s o c ie ty •T o info r m a nd e d u c a te a ll s o c ia l a c to rs about C S R •T o p ro m o te a nd fa c il ita te R e s p o ns i b le C o ns u m p ti o n •T o p ro m o te a nd fa c il ita te S o c ia ll y R e s p o ns ib le Inv e s t m e n t •T o p ro m o te a nd fa c il ita te t he p a rtic u la r i nte re s ts o f a ll s ta k e ho ld e rs i n C S R te r m s

• W o r k i n i nte rs e c to ria l p a rt ne rs hip • F a c ilita t i n g • P ro m o tio n o f s o c ia lly re s p o ns ib le i nv e s t m e nt • C o o rd i na t io n o f a c tio ns b e tw e e n c iv il s o c ie ty a nd t he b u s i ne s s s e c to r • P ro m o tio n o f re s p o ns ib le c o ns u m p tio n • P ro m o tio n o f t he in te re s ts o f a ll s ta k e ho ld e rs (p ro d u c e rs , e m p lo y e e s , c o ns u m e rs , i nv e s to rs ) • In fo r m a nd e d u c a te a ll s o c ia l a c to rs • E nc o u ra ge m e n t, c re a tio n a nd s u p e rv is io n o f m e c ha nis m s fo r e v a lu a tio n a nd a c c o u nta b il ity • E nc o u ra ge m e n t o f e xc ha n ge o f e x p e rie nc e s a nd go o d p ra c tic e s • P ro m o tio n o f c o n v e r ge nc e a nd tra ns p a re nc y i n C S R p ra c tic e s a nd i ns tru m e n ts

26

Table1. Models of government action in the development of CSRendorsing public policies in EU-15 counties Model

Characteristics

Partnership

Partnership as strategy shared Denmark, between

Countries

sectors

for

meeting the

socio-employment challenges.

Business

in

community

the Soft

intervention

policies

Finland,

Netherlands,

Sweden.

to Ireland, the United

encourage company involvement Kingdom. in

governance

affecting

challenges

the

community

(entrepreneurship and voluntary service). Updated version of the existing Germany, Sustainability citizenship

Austria,

and social agreement and emphasis Belgium, on

a

strategy

of

sustainable Luxembourg.

development.

Regulatory. Agora

France.

Creation of discussion groups for Italy, Spain, Greece, the

different

achieve CSR.

social

public

actors

consensus

to Portugal on

27

1

This research was made possible thanks to the support of the Ministry of Economy and Finance of the

Regional Government of Catalonia. 2

Given the definition of the study object, focused on governments, the actions between the private, for-

profit and non-profit sectors do not form part of this analytical framework. 3

Sources of information on government actions are based on the reports and discourses offered by the

governments themselves. 4

For further information on the results for each country please see: Lozano, Albareda, Ysa, Roscher,

Marcuccio (2005) Los gobiernos y la responsabilidad social de las empresas. Políticas públicas más allás de la regulación y la voluntariedad. Barcelona: Granica.