Tag Archives: Corporate Governance

Social Responsibility Research in Total Quality Management and Business Excellence (Taylor & Francis Online)

 

This is a pre-publication version of an academic paper, entitled; “Measuring the corporate managers’ attitudes toward ISO’s social responsibility standard”, that was accepted by Total Quality Management and Business Excellence (Print ISSN: 1478-3363 Online ISSN: 1478-3371).

How to Cite: Camilleri, M.A. (2018). Measuring the corporate managers’ attitudes toward ISO’s social responsibility standard. Total Quality Management & Business Excellence. (forthcoming). http://dx.doi.org/10.1080/14783363.2017.1413344


Abstract

The International Standards Organisation’s ISO 26000 on social responsibility supports organisations of all types and sizes in their responsibilities towards society and the environment. ISO 26000 recommends that organisations ought to follow its principles on accountability, transparency, ethical behaviours and fair operating practices that safeguard organisations and their stakeholders’ interests. Hence, this contribution presents a critical review of ISO 26000’s guiding principles. Afterwards, it appraises the business practitioners’ attitudes towards social responsibility practices, including organisational governance, human rights, labour practices, the environment, fair operating practices, consumer issues as well as community involvement and development. A principal component analysis has indicated that the executives were primarily committed to resolving grievances and on countering corruption. The results suggested that the respondents believed in social dialogue as they were willing to forge relationships with different stakeholders. Moreover, they were also concerned about environmental responsibility, particularly on mitigating climate change and sustainable consumption. In conclusion, this paper identifies the standard’s inherent limitations as it opens up future research avenues to academia.

Keywords: ISO 26000; International Standards Organisation; Social Responsibility; Organisational Governance; Human Rights; Labour Practices; environmental responsibility; fair operating practices; consumer issues; community involvement.


Introduction

The International Standard Organisation’s ISO 26000 provides guidance on social responsibility issues for businesses and other entities. This standard comprises broad issues, comprising labour practices, conditions of employment, responsible supply chain management, responsible procurement of materials and resources, fair operating practices, recommendations for negotiations with interested parties as well as collaborative stakeholder engagement among other issues (Helms, Oliver, & Webb, 2012; Castka & Balzarova, 2008a, 2008b, 2008c). ISO 26000 is aimed at all organisations, regardless of their activity, size or location. Its core subjects respect the international norms and assist organisations on accountability, transparency and ethical behaviours.

The social responsibility standard has emerged following lengthy partnerships’ agreements and negotiations between nongovernmental organisations (NGOs) and large multinational corporations (Helms et al., 2012; Boström & Halström, 2010; Castka & Balzarova, 2008a, 2008b, 2008c). Prior to ISO 26000, there were other certifiable and uncertifiable, multistakeholder standards and instruments; the Forest Stewardship Council (FSC), Greenpeace, Rainforest Alliance and Home Depot, among others (Balzarova & Castka, 2012; Castka & Corbett, 2016a). At the time, many organisations adopted voluntary environmental and social standards, as well as eco-labels such as ISO’s 14000, FSC, Fair Trade or the US Department of Agriculture’s USDA Organic Labelling. Like ISO 26000, their regulatory guidelines and principles encourage organisations and their stakeholders to become more socially responsible and environmentally sustainable. However, despite there are many standards and regulatory instruments, private businesses do not always provide credible information on their eco-labelling (Darnall, Ji, & Vazquez-Brust, 2016).

For this reason, environmental NGOs are putting pressure on national governments for more stringent compliance regulations on large undertakings to adhere to certified standards or ecolabels (Schwartz & Tilling, 2009). This approach could possibly inhibit the businesses and other organisations to reveal relevant information about their social responsibility and stakeholder engagement (Castka & Corbett, 2016b). Notwithstanding, there is still limited research and scant empirical evidence on how businesses are resorting to ISO 26000’s principles in their responsible managerial practices (see Hahn, 2013; Hahn & Weidtmann, 2016; Claasen & Roloff, 2012; Castka & Balzarova, 2008a, 2008b)Therefore, this contribution provides a review of the socially responsible standard’s guiding principles and appraises the executives’ attitudes towards ISO 26000. Firstly, it examines relevant theoretical insights and empirical studies on the managerial perceptions towards responsible organisational behaviours. Secondly, it sheds light on the development of ISO’s standard on social responsibility and its constituent elements. Thirdly, this paper reveals the managers’ perceptions of ISO 26000’s core topics, including organisational governance, human rights, labour practices, the environment, fair operating practices, consumer issues as well as community involvement and development. This research uses a principal component analysis (PCA) to obtain a factor solution of a smaller set of salient variables from ISO 26000’s core issues. The findings identify specific socially responsible activities which are being emphasised by the companies’ executives. The results suggest that the respondents were committed to improving their relationships with employees, marketplace as well as political and community stakeholders.

Literature review

The managerial perceptions of social responsibility

Several empirical studies have explored the managers’ attitudes towards and perceptions of corporate social responsibilities (Carollo & Guerci, 2017; Eweje & Sakaki, 2015; Moyeen & West, 2014; Fassin, Van Rossem, & Buelens, 2011; Pedersen, 2010; Basu & Palazzo, 2008; Nielsen & Thomsen, 2009 and Perrini, Russo, & Tencati, 2007, among others). A number of similar studies have gauged corporate social responsibility by adopting Fortune’s reputation index (Fryxell & Wang, 1994; Griffin & Mahon, 1997; Stanwick & Stanwick, 1998), the KLD index (Fombrun, 1998; Griffin & Mahon, 1997) or Van Riel and Fombrun’s (2007) RepTrak. Such measures required executives to assess the extent to which their company behaves responsibly towards the environment and the community (Fryxell & Wang, 1994). Despite their wide usage in past research, the appropriateness of these indices is still doubtful. For instance, Fortune’s reputation index failed to account for the multidimensionality of the corporate citizenship construct, and is suspected to be more significant of management quality than of corporate social performance (Waddock & Graves, 1997). Fortune’s past index suffered from the fact that its items were not based on theoretical arguments, as they did not appropriately represent the economic, legal, ethical and discretionary dimensions of the corporate citizenship construct.

Other academics, including Pedersen (2010), identified a set of common issues that were frequently used by managers when describing societal responsibilities. This study reported that managers still had a relatively narrow perception of societal responsibilities. Generally, they believed that CSR involves taking care of the workforce, and to manufacture products and deliver services that the customers want, in an eco-friendly manner. The managers who participated in Pedersen’s (2010) study did not believe that they had responsibilities towards society on issues such as social exclusion, Third World development and poverty reduction, among other variables. In a similar vein, Eweje and Sakaki (2015) pointed out that corporate social responsibility involved volunteering, diversity in the workplace and work–life balance. They contended that these are important areas that merit more attention, particularly for those businesses that are willing to prove their credentials. Moreover, Moyeen and West (2014) noticed that sustainable development and environmental issues often remained on the periphery of the managers’ understandings and perceptions of CSR

ISO’s social responsibility standard

In 2010, the development of ISO 26000 has represented a significant milestone in integrating socially and environmentally responsible behaviours into management processes (Toppinen, Virtanen, Mayer, & Tuppura, 2015; Hahn, 2013). ISO 26000 was developed through a participatory multi-stakeholder process with an emphasis on participatory decision-making and

democracy (Hahn & Weidtmann, 2016). For instance, the International Labour Organization (ILO) had established a Memorandum of Understanding (MoU) to ensure that ISO’s social responsibility standard is consistent with its very own labour standards. In fact, ISO 26000’s core subject on ‘Labour Practices’ is based on ILOs’ conventions on labour practices, including

Human Resources Development Convention, Occupational Health and Safety Guidelines, Forced Labour Convention, Freedom of Association, Minimum Wage Fixing Recommendation and the Worst Forms of Child Labour Recommendation, among others. Moreover, ISO’s core subject on ‘human rights’ is based on the Universal Declaration of Human Rights (adopted by the UN General Assembly in 1948).

The standard comprises seven essential areas in the realms of social responsibility: organisational governance, human rights, labour practices, environment, fair operating practices, consumer issues, and community involvement and development (ISO, 2014). ISO’s goal is to encourage organisations to integrate their guiding principles on social responsibility into their management strategies, systems and processes. Therefore, ISO 26000 assists in improving environmental, social and governance communications and also provides guidance on stakeholder identification and engagement (Camilleri, 2015a). It advises the practising organisations to take into account their varied stakeholders’ interests. According to Castka and Balzarova (2008a, p. 276), ‘ISO 26000 aims to assist organisations and their networks in addressing their social responsibilities as it provides practical guidance on how to operationalise CSR, by identifying and engaging with stakeholders and enhancing credibility of reports and claims made about CSR (Hąbek & Wolniak, 2016). Therefore, this standard has the potential to capture the context-specific nature of social responsibility.

ISO 26000 has been characterised as an evolutionary step in standard innovation because it is suitable for organisations of all sizes and sectors. This standard has unique features regarding authority and legitimacy (Hahn, 2013). Its guidelines describe social responsibility as ‘the actions a firm takes to contribute to “sustainable development”’ (Perez-Baltres, Doh, Miller, & Pisani, 2012, p. 158). Hahn (2013) suggested that ISO 26000 offers specific guidance on many facets of CSR, as it helps responsible businesses in their internal and external assessments and evaluations. Furthermore, when the organisations adopt ISO 26000, they could signal their social responsibility credentials and qualities to their marketplace stakeholders (Graffin & Ward, 2010). This way they may also reduce information asymmetries among supply chain partners (King, Lenox, & Terlaak, 2005).

ISO 26000 provides a unilateral understanding of social responsibility across the globe. It acknowledges that ‘social responsibility should be an integral part of the businesses’ core strategy (ISO, 2014). A wide array of social responsibility practices and stakeholder management issues are addressed in ISO 26000. This standard aims to unify and standardise social responsibility; it also acknowledges that each organisation has a responsibility to bear that are relevant to its business (Hąbek & Wolniak, 2016; Hahn, 2013). Notwithstanding, there are different industries, organisational settings, regional or cultural circumstances that will surely affect how entities implement the ISO standards ‘recommendations on responsible behaviours’.

The corporate culture is an important driver for socially responsible activities. Therefore, CEOs play a key role in giving their face and voice to their corporate sustainability agenda (Waldman et al., 2006; Caprar & Neville, 2012). Hence, ISO 26000 can be used as a vehicle for CSR communication. Hąbek and Wolniak (2016) suggested that this standard is rooted in a quality management framework, as it holds potential to enhance the credibility of the corporations’ social responsibility claims. Similarly, Moratis (2015) argued that the concept of credibility relates to scepticism, trust and greenwashing. Other research has demonstrated that some stakeholders have used standards to enhance their credibility, learning and legitimacy (Hąbek & Wolniak, 2016; Boström & Halström, 2010). Consequently, the organisations that are renowned for their genuine CSR credentials could garner a better reputation and image among stakeholders. This will ultimately result in significant improvements to the firms’ bottom lines. An organisational culture that promotes the sustainability agenda has the potential to achieve a competitive advantage, as businesses could improve their long-term corporate financial performance (Eccles, Ioannou, & Serafeim, 2012) via the development of valuable, rare and non-imitable organisational resources and capabilities (Barney, 1986). Eccles et al. (2012) analysed the financial performance of firms with either high or low sustainability orientation. The authors found that firms with a high sustainability orientation were associated with distinct governance mechanisms for sustainability, longer time horizons and deeper stakeholder engagement, as they dedicated more attention to non-financial disclosures. Their adoption of the sustainability standards, such as ISO 26000, can also be interpreted as a signal of a responsible corporate culture (Waldman et al., 2006).

On the other hand, many academic commentators argue that ISO 26000 has never been considered as a management standard. The certification requirements have not been incorporated into ISO 26000’s development and reinforcement process, unlike other standards, including ISO 9000 and ISO 14001(Hahn, 2013). In its present form, ISO 26000 does not follow a classical plan–do–check–act–type management system approach as it is the case for ISO 14001 (Hahn, 2013). Arimura, Darnall, and Katayama (2011) reported that the facilities that were certified with ISO’s 14000 were 40% more likely to assess their suppliers’ environmental performance and 50% more likely to require that their suppliers undertake specific environmental practices. Nevertheless, Arimura, Darnall, Ganguli, and Katayama (2016) argued that although ISO 14001 was a certifiable standard, the facilities that were adopting it were no more likely to reduce their air pollution emissions than noncertified ones.

Rasche and Kell (2010) admitted that the responsibility standards can never be a complete solution to the perennial social and environmental problems; they argued that the standards have inherent limitations that need to be recognised. Certain prestandardisation preparations may have created boundaries which have restricted the stakeholders’ influence. Suchman (1995) described the pre-standardisation phase as an effort which embedded new structures and practices into already legitimate institutions. During the pre-standardisation discussions among stakeholders, there were differing opinions and not enough consensus over ISO 26000’s certification (Mueckenberger & Jastram, 2010). Other authors declared that the certification of standards does not necessarily lead to improved performance (Aravind & Christmann, 2011; King et al., 2005). The development of ISO 26000 involved lengthy, multi-stakeholder corroborations that did not necessarily ensure legitimacy or guarantee that the standard could be considered as an enforceable instrument for industry participants. Balzarova and Castka (2012) also pointed out that the scope of the ISO 26000 standard was unclear as the actual implications for social and environmental improvement were still unknown. Many stakeholders, including chief executives, should have been in a position to leverage their arguments during the pre-standardisation arrangements (Balzarova & Castka, 2012). The responsible businesses could have discussed possible avenues for the standard’s reinforcement. For instance, those organisations that are in complete compliance with ISO 26000 are not required to disclose their social responsibility reports and to make them readily accessible to stakeholders (Balzarova & Castka, 2012). This contentious issue could lead organisations to not fully conform themselves to this uncertifiable standard.

Different industry representatives were (and are still) concerned that costly certification requirements could overburden organisations, particularly in emerging economies. The organisations’ stakeholders, including their employees, may be against the introduction of new standards as they could affect their firms’ bottom lines. When the standards are enforced, industry stakeholders need to comply with their requirements. The companies will usually have to absorb the cost of compliance with the standards (Delmas, 2002). Moreover, the standards may also lead to the creation of trade barriers and to significant increases in production costs (Montabon, Melnyk, Sroufe, & Calantone, 2000). Notwithstanding, when introducing new standards, the standard setters’ external audits could reveal regulatory non-compliance among adopting organisations (Schwartz & Tilling, 2009; Delmas, 2002). As a result, the industries’ implementation of a new standard such as ISO 26000 could be time-consuming because it may require holistic adaptations to change extant organisational processes. The standardisation of social responsibility has also been criticised for being costly and thereby difficult to implement, especially among the smaller companies (Toppinen et al., 2015).

Ávila et al.’s (2013) survey indicated that ISO 26000’s themes were under-represented, particularly those involving labour practices and the environment. The authors posited that the organisations that were supposedly following ISO 26000 have often faced difficulties in incorporating the social responsibility throughout all organisational mechanisms, processes and decisions. Ávila et al. (2013) argued that the businesses’ unsatisfactory engagement with consumer issues was even more serious, as they justify the organisations’ existence. It may appear that Ávila et al.’s (2013) research participants were only concerned about their corporate image (as they were supposedly implementing the social responsibility concept and its premises). Evidently, these firms were less interested in undertaking necessary actions to ensure truthful and fair compliance with ISO 26000.

Methodology

This research has explored the senior executives’ stance on ISO’s social responsibility standard. The respondents were all employed by listed companies in a small European member country. They were expected to indicate their attitudes towards and perceptions of ISO 26000’s core topics, including organisational governance, human rights, labour practices, the environment, fair operating practices, consumer issues as well as community involvement and development. The questionnaire’s design, layout and content were consistent with the social responsibility standard. Respondents were asked to indicate the strength of their agreement or disagreement with ISO 26000’s subjects. The survey instrument made use of the five-point Likert scaling mechanism, where a numerical value was attributed to the informant’s opinion and perception. The responses were coded from 1 (strongly disagree) to 5 (strongly agree) with 3 signalling indecision. Such symmetric, equidistant scaling has provided an interval level of measurement.

An online questionnaire link was sent electronically by means of an email, directly to the senior executives of all companies that were listed on the Malta Stock Exchange. There were numerous attempts to ensure that the questionnaire has been received by all email recipients. Many steps were taken to ensure a high response rate, which included reminder emails and numerous telephone calls. Eventually, there was a total of 374 (out of 1626) respondents who have willingly chosen to take part in this research. This sample represented a usable response rate of 23% of all targeted research participants. The surveyed respondents gave their socio-demographic details about their ‘role’, ‘age’, ‘gender’ and ‘education’ in the latter part of the survey questionnaire. The objective of this designated profile of owner-managers was to gain a good insight into their ability to make evaluative judgements in taking strategic decisions on social responsibility matters. Table 1 presents the profile of respondents who participated in this study.

 

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Following the data gathering process, the researcher carried out descriptive statistics to analyse the distribution and dispersion of the data. Afterwards, factor analysis (FA) data reduction techniques were used to achieve the desired reliability, timely and accurate assessment of the findings. Unless an instrument is reliable, it cannot be valid. The FA was developed to explore and discover the main construct or dimension in the data matrix. The primary objective of this analysis was to reduce the number of variables in the data-set and to detect any underlying structure between them (Hair, Anderson, Tatham, & Black, 1998). Therefore, FA identified the interrelationships among variables. FA extracted components to obtain a factor solution of a smaller set of salient variables which exhibited the highest variation from the linear combination of original variables (Hair et al., 1998). It then removed this variance and produced a second linear combination which explained the maximum proportion of the remaining variance. The first step was to decide which factor components were going to be retained in the PCA. This approach was considered appropriate as there were variables that shared close similarities and highly significant correlations. The criterion for retaining factors is that each retained component must have some sort of face validity and/or theoretical validity, but prior to the rotation process, it was impossible to interpret what each factor meant. The first component accounted for a fairly large amount of the total variance. Each succeeding component had smaller amounts of variance. Although a large number of components could be extracted, only the first few components will be important enough to be retained for interpretation.

The SPSS default was set to keep any factor with an eigenvalue larger than 1.0. If a factor component displayed an eigenvalue less than 1.0, it would have explained less variance than the original variable. Once the factors have been chosen, the next step was to rotate them. The goal of rotation was to achieve what is called a ‘simple structure’, with high factor loadings on one factor and low loadings on all others. The factor loading refers to the correlation between each retained factor and each of the original variables. With regard to determining the significance of the factor loading, this study had followed the guidelines for identifying significant factor loadings based on the specific sample size, as suggested by Hair et al. (1998).

Analysis

The survey questionnaires’ responses were imported directly into SPSS. After filtering responses and eliminating unusable or incomplete survey observations, a total of 374 valid responses were obtained. The managers of the listed companies were required to indicate their level of agreement with ISO 26000 core subjects. Reliability and appropriate validity tests have been carried out during the analytical process. Cronbach’s alpha was calculated to test for the level of consistency among the items.

Principal component analysis

Bartlett’s test of sphericity revealed sufficient correlation in the data-set to run a PCA since P< .001. The Kaiser–Meyer– Olkin’s Test (which measures the sampling adequacy) was also acceptable, as it was well above 0.5. With respect to scale reliability, all constructs were analysed for internal consistency by using Cronbach’s alpha. The composite reliability coefficient (Bagozzi & Yi, 1988) was 0.79, well above the minimum acceptance value of 0.7.

PCA has been chosen to obtain a factor solution of a smaller set of salient variables, from a much larger data-set. A varimax rotation method was used to spread variability more evenly among the constructs. PCA was considered appropriate as there were variables exhibiting an underlying structure. Many variables shared close similarities as there were highly significant correlations. Therefore, PCA has identified the patterns within the data and expressed it by highlighting the relevant similarities (and differences) in each and every component. In the process, the data have been compressed as it was reduced in a number of dimensions without much loss of information. From SPSS, the PCA has produced a table which illustrated the amount of variance in the original variables (with their respective initial eigenvalues), which were accounted for every component. There was also a percentage of variance column which indicated the expressed ratio, as a percentage of the variance (for each component). A brief description of the extracted factor components, together with their eigenvalues and their respective percentage of variance, is provided in Table 2 . The sum of the eigenvalues equalled the number of components. Only principal components with eigenvalues greater than 1 were extracted, and they accounted for more than 63% variance before rotation. The PCA analysis yielded 17 extracted components from ISO 26000’s 37 variables. These factor components were labelled following a cross-examination of the variables with the higher loadings. Typically, the variables with the highest correlation scores had mostly contributed towards the make-up of the respective component.

total variance

Discussion and conclusions

Many stakeholders, particularly the regulatory ones, from the most advanced economies are increasingly inquiring about the corporations’ responsible behaviours. Very often, multinational businesses are resorting to the NGOs’ tools and instruments, such as process and performance-oriented standards in corporate governance, human rights, labour, environmental

protection, anti-corruption as well as health and safety, among others (Camilleri, 2015a). In this light, ISO 26000 standard has been chosen to investigate company executives’ stance towards social responsibility practices.

This empirical research suggests that the respondents’ responsible and sustainable behaviours were both internally and externally focused. The managers indicated that they were paying attention to their human rights issues, labour and fair operating practices. Table 2 reported that the executives gave due importance to resolving grievances and anti-corruption within their organisation. This finding is consistent with other contributions which link CSR with the human resources management literature (Currie, Gormley, Roche, & Teague, 2016; Hahn, 2013; Wettstein, 2012; Pedersen, 2010; Ewing, 1989). The workplace conflict may be intrinsic to the nature of work, because employees and managers may have hard-to-reconcile competing interests (Currie et al., 2016). Ewing (1989) argued that companies develop grievance procedures to help them in their due processes. The author maintained that its development leads to better morale and productivity, fewer union interventions and less likelihood of being sued. However, grievance procedures could incur operating costs, often consume large amounts of previous time from executives and may open the door to chronic malcontents.

This study evidenced that the corporations’ managers were clearly against corrupt practices. Today’s listed businesses are increasingly expected to explain how they are fighting fraudulent activities and bribery issues. This study was conducted in a European Union jurisdiction which mandates a ‘comply or explain’ directive on non-financial reporting (Camilleri, 2015b). The European corporations are expected to be as transparent as possible, to disclose material information and to limit the pursuit of exploitative, unfair or deceptive practices (Camilleri, 2015b). Moreover, large organisations that are operating in member states (that have ratified the ILO’s conventions on labour rights) are morally and legally bound to promote fair operating practices and to engage in social dialogue. The findings suggest that the respondents were committed to forging relationships with different stakeholders, including suppliers and market intermediaries, the wider communities at large, as well as political groups, among others. Porter and Kramer (2011) contended that capable local suppliers foster greater logistical efficiency and ease of collaboration in areas, such as training, in order to boost productivity. Therefore, the success of every company is affected by supporting stakeholders and the extant infrastructure around it. The big businesses’ stakeholder engagement is rooted in institutional theory, as they are capable of aligning themselves with their broader context (Brammer, Jackson, & Matten, 2012). In fact, this study has also measured the respondents’ attitudes on social engagement (including the creation of jobs and skills development, the conditions of employment and the individuals’ civil and political rights) and on the subject of discrimination towards vulnerable groups, among other contingent topics. Moreover, the listed companies’ executives also indicated that they were concerned on environmental sustainability, particularly on global climate change. The corporations’ managers did not explain how they were committed to reduce the carbon footprint or prevent the emission of greenhouse gases. However, they may use new technologies, including renewable energy, water use and conservation. Alternatively, they could change older equipment to reduce pollution and make it more efficient and economical. The results suggest that respondents respected property rights, they utilised and consumed sustainable resources, and were concerned on protecting the natural environment.

Limitations and suggestions for future research

The extant literature has recognised this ISO 26000’s inherent limitations. For the time being, the businesses that are using this standard are not required to disclose material information on their social responsibility practices to stakeholders. One of the most contentious issues is that ISO 26000 still remains voluntary and uncertifiable. The practitioners may ultimately decide not to fully conform themselves with this standard, as they are not bound to do so. For this reason, ISO 26000’s role is still limited for regulators, standard-setting organisations and policy-makers.

In a nutshell, this paper has advanced an empirical study that explored the business executives’ appraisal of social responsibility practices. It has employed ISO 26000 as a comprehensive measure for organisational governance, human rights, labour practices, the environment, fair operating practices, consumer issues, and community involvement and development. Moreover, this contribution has critically analysed key theoretical underpinnings and previous empirical studies on the social responsibility standard. Further research may yield other conclusions about how responsible organisations and corporations could use this standard to appraise their social responsibility endeavours. Future studies could explore different stakeholders’ views, other than the corporation executives’ stance on ISO 26000 subjects. Academia could utilise ISO’s broad standard as a measure for social responsibility behaviours. Moreover, qualitative research could clarify in depth and breadth how organisations are mapping their progress and advancement in the implementation and monitoring of the standard’s responsible initiatives. Future research could identify certain difficulties in incorporating the social responsibility standard throughout the organisational systems and processes.

Acknowledgements

The author thanks this journal’s editor and his anonymous reviewers for their insightful remarks and suggestions.

Disclosure statement

No potential conflict of interest was reported by the author.

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Hahn , R. (2013). ISO 26000 and the standardization of strategic management processes for sustainability and corporate social responsibility. Business Strategy and the Environment. Retrieved from http://ssrn. com/abstract, 2094226

Hahn , R., & Weidtmann , C. (2016). Transnational governance, deliberative democracy, and the legitimacy of ISO 26000 analyzing the case of a global multistakeholder process. Business & Society, 55(1), 90–129. doi:10.1177/0007650312462666

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Hąbek , P., & Wolniak , R. (2016). Assessing the quality of corporate social responsibility reports: The case of reporting practices in selected European Union member states. Quality & Quantity, 50(1), 399–420. doi:10.1007/s11135-014-0155-z

Helms , W. S., Oliver , C., & Webb , K. (2012). Antecedents of settlement on a new institutional practice: Negotiations of the

ISO 26000 standard on social responsibility. Academy of Management Journal, 55, 1120–1145. doi:10.5465/amj.2010.1045

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ISO 14001 management standard. Academy of Management Journal, 48(6), 1091–1106. doi:10.5465/AMJ.2005.19573111

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corporate performance. Journal of Supply Chain Management, 36(1), 4–16. doi:10.1111/j.1745-493X.2000.tb00073.x

Moratis , L. (2015). The credibility of corporate CSR claims: A taxonomy based on ISO 26000 and a research agenda. Total Quality Management & Business Excellence, 1–12.

Moyeen , A., & West , B. (2014). Promoting CSR to foster sustainable development: Attitudes and perceptions of managers in a developing country. Asia-Pacific Journal of Business Administration, 6(2), 97–115. doi:10.1108/APJBA-05-2013-0036

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Special Offer > Get 20% off this Springer business textbook on Corporate Social Responsibility

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*This offer is valid from 1st April to 1st May 2017.

This business text-book can be purchased from Springer or Amazon.

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Responsible Investing: Making a Positive Impact

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Impact investing is one of the fastest growing and promising areas of innovative development finance (Thornley, Wood, Grace & Sullivant, 2011; Freireich & Fulton, 2009). This form of socially-responsible investment (SRI) also has its roots in the venture capital community where investors unlock a substantial volume of private and public capital into companies, organisations and funds – with the intention to generate social and environmental impact alongside a financial return.

The stakeholders or actors in the impact investing industry can be divided into four broad categories: asset owners who actually own capital; asset managers who deploy capital; demand-side actors who receive and utilise the capital; and service providers who help make this market work.

Impact investments can be made in both emerging and developed markets, and target a range of returns from below market to market rate; depending on the investors’ strategic goals. Bugg-Levine and Emerson (2011) argued that impact investing aligns the businesses’ investments and purchase decisions with their values. Defining exactly what is (and what is not) an impact investment has become increasingly important as it appears that the term has taken off among academia and practitioners.

The impact investments are usually characterised by market organisations that are driven by a core group of proponents including foundations, high-net worth individuals, family offices, investment banks and development finance institutions. Responsible entities are mobilising capital for ‘investments that are intended to create social impact beyond financial returns’ (Jackson, 2013; Freireich & Fulton 2009). Specific examples of impact investments may include; micro-finance, community development finance, sustainable agriculture, renewable energy, conservation, micro-finance and affordable and accessible basic services, including; housing, healthcare, education and clean technology among others.

Micro-finance institutions in developing countries and affordable housing schemes in developed countries have been the favorite vehicles for these responsible investments, though impact investors are also beginning to diversify across a wider range of sectors (see Saltuk, Bouri, & Leung 2011; Harji & Jackson 2012). Nevertheless, micro-finance has represented an estimated 50% of European impact investing assets (EUROSIF, 2014). This form of investing has grown to an estimated €20 billion market in Europe alone (EUROSIF, 2014). The Netherlands and Switzerland were key markets for this investment strategy, as they represented an estimated two thirds of these assets. These markets were followed by Italy, the United Kingdom and Germany.

Generally, the investors’ intent is to ensure that they achieve positive impacts in society. Therefore, they would in turn expect tangible evidence of positive outcomes (and impacts) of their capital. Arguably, the evaluation capacity of impact investing could increase opportunities for dialogue and exchange. Therefore, practitioners are encouraged to collaborate, exchange perspectives and tools to strengthen their practices in ways that could advance impact investing. The process behind on-going encounters and growing partnerships could surely be facilitated through conferences, workshops, online communities and pilot projects. Moreover, audit and assurance ought to be continuously improved as institutions and investors need to be equipped with the best knowledge about evaluation methods. Hence, it is imperative that University and college courses are designed, tested and refined to improve the quality of education as well as  professional training and development in evaluating responsible investments.

For evaluation to be conducted with ever more precision and utility, it must be informed by mobilising research and analytics. Some impact investing funds and intermediaries are already using detailed research and analysis on investment portfolios and target sectors. At the industry-wide level, the work of the Global Impact Investing Network (GIIN) and IRIS (a catalogue of generally accepted Environmental, Social and Governance – ESG performance metrics) is generating large datasets as well as a series of case studies on collaborative impact investments. Similarly, the Global Impact Investing Rating System (GIIRS) also issues quarterly analytics reports on companies and their respective funds in industry metrics (Camilleri, 2015).

For the most part, those responsible businesses often convert positive impact-investment outcomes into tangible benefits for the poor and the marginalised people (Garriga & Melé, 2004). Such outcomes may include increased greater food security, improved housing, higher incomes, better access to affordable services (e.g. water, energy, health, education, finance), environmental protection, and the like (Jackson, 2013).

Interestingly, high sustainability companies significantly outperform their counterparts over the long-term, both in terms of stock market and accounting performance (Eccles, Ioannou & Serafeim, 2012). This out-performance is stronger in sectors where the customers are individual consumers, rather than companies (Eccles et al., 2012).

It may be complicated and time-consuming to quantify how enterprises create various forms of humanitarian and environmental value, yet some approaches and analytical tools can help to address today’s societal challenges, including the return on impact investments in social and sustainability projects.

References

Bugg-Levine, A., & Emerson, J. (2011). Impact investing: Transforming how we make money while making a difference. innovations, 6(3), 9-18.
Camilleri, M. A. (2015). Environmental, social and governance disclosures in Europe. Sustainability Accounting, Management and Policy Journal, 6(2), 224-242.

Eccles, R. G., Ioannou, I., & Serafeim, G. (2012). The impact of a corporate culture of sustainability on corporate behavior and performance (No. W17950). National Bureau of Economic Research.

EUROSIF (2014). Press Release: 6th Sustainable and Responsible Investment Study 2014. Europe-based national Sustainable Investment Forums. http://www.eurosif.org/wp-content/uploads/2014/09/Press-Release-European-SRI-Study-2014-English-version.pdf (Accessed 14 May 2016).

Freireich, J., & Fulton, K. (2009). Investing for social and environmental impact: A design for catalyzing an emerging industry. Monitor Institute, January.

Garriga, E., & Melé, D. (2004). Corporate social responsibility theories: Mapping the territory. Journal of business ethics, 53(1-2), 51-71.

Harji, K., & Jackson, E. T. (2012). Accelerating impact: Achievements, challenges and what’s next in building the impact investing industry. New York, NY: The Rockefeller Foundation.

Jackson, E. T. (2013). Interrogating the theory of change: evaluating impact investing where it matters most. Journal of Sustainable Finance & Investment, 3(2), 95-110.

Saltuk, Y., Bouri, A., & Leung, G. (2011). Insight into the impact investment market: An in-depth analysis of investor perspectives and over 2,200 transactions. New York, NY: J.P. Morgan.

Thornley, B., Wood, D., Grace, K., & Sullivant, S. (2011). Impact Investing a Framework for Policy Design and Analysis. InSight at Pacific Community Ventures & The Initiative for Responsible Investment at Harvard University.

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Mark Camilleri edited a book on sustainable and responsible business

Dr Mark Anthony Camilleri, Ph.D. (Edinburgh) has recently edited a business textbook entitled; ‘CSR 2.0 and the New Era of Corporate Citizenship’.
csr
This contribution is an authoritative reference source (for the latest scholarly research) on the ways in which corporate entities can implement responsible strategies that create synergistic value for both businesses and society. The authors (hailing from leading European universities) contend that responsible behaviors in the realm of business continue to remain a crucial component of organizational development.
By exploring core aspects of contemporary corporate strategies, businesses can create more value through social welfare and sustainable initiatives. This publication features an extensive coverage across a wide range of perspectives and topics, including corporate citizenship, corporate sustainability and responsibility, stakeholder engagement, business ethics, public spending, total responsibility management and social value co-creation, among others.
This publication is ideally designed for students, academics and researchers seeking current concise and authoritative research on the business case for corporate social responsibility.

Chapter 1 presents a thorough literature review on corporate social responsibility and its other related constructs, including corporate citizenship, stakeholder engagement and business ethics. Hence, this chapter reports on how CSR has evolved to reflect the societal realities.

Chapter 2 reviews the different definitions of the corporate responsibility paradigms and draws comparisons between related concepts. The author contends that organization studies; economic, institutional, cultural and cognitive perspectives are shaping the corporate responsibility agenda. She cleverly presents the benefits of integrating multiple perspectives and discusses about the possible research avenues in the realms of corporate responsibility.

Chapter 3 suggests that the field of CSR is ushering a new era in the relationship between business and society. The author puts forward a Total Responsibility Management (TRM) approach that may be useful for business practitioners who intend adopting CSR behaviors. This chapter posits that CSR strategies including managing relationship with stakeholders will contribute to the companies´success and will also bring community welfare.

Chapter 4 focuses on the national governments’ regulatory role of raising awareness on CSR behaviors among businesses. The author suggests that there is scope for the state agencies to promote CSR as a business case for companies. She provides an outline of the current state of “supranational regulative policies on public procurement” within the European Union context.

Chapter 5 uses a stakeholder perspective to encapsulate the CSR concept. The authors investigated social value cocreation (SVCC) through a qualitative study among different stakeholders (customers, employees, and managers). They implied that businesses ought to clarify their motives, by opening channels of communication with stakeholders. This way, there will be a higher level of SVCC with increased (stakeholder) loyalty toward the firms.

Chapter 6 sheds light on Porter and Kramer’s (2011) shared value proposition. The author explains how collaborative stakeholder interactions could lead to significant improvements in the supply chain.

Chapter 7 involved a longitudinal study that investigated how four different State Owned Enterprises communicated with Māori communities between 2008 and 2013. This study contributes to the extant research on the legitimacy theory and CSR communication with ethnic minorities in the Aotearoa (New Zealand) context.

Chapter 8 links the CSR paradigm with risk management. The author suggests that Serbian businesses ought to adopt corporate sustainable and responsible approaches in terms of their disaster risk reduction prior to environmental emergencies.

Chapter 9 involved a quantitative analysis that explored the CSR practices within the hospitality industry. The authors suggested that there were distinct social and environmentally responsible behaviors in different geographical areas. They argued that institutions can take their results into account when drawing up policies that are aimed at fostering responsible tourism practices.

Chapter 10 examined how CSR communication of self-serving motives can lead to more trust and credibility among stakeholders as well as corporate reputation. The authors implied that the marketers should be aware of how the public perceive CSR behaviors.

Chapter 11 reports that corporate (or organizational) storytelling is increasingly being used as a promotional tool to communicate CSR information to stakeholders. The authors present four companies that have used storytelling with the aims of transmitting values, fostering collaboration, leading change and sharing knowledge on responsible practices.

Chapter 12 relates corporate sustainability to the construct of emotional capital. The authors maintain that emotional capital enables businesses to attract and retain talent. They maintain that there are significant improvements to the firms’ bottom lines If they invest in responsible human resources management.

Chapter13 suggests that the transition from the CSR to CSR 2.0 requires the adoption of five new principles – creativity, scalability, responsiveness, glocality and circularity. The authors posit that these principles ought to be embedded within the organizations’ management values and culture. The authors propose a new framework that can be used to manage the processes of socially responsible organizations.

Chapter 14 investigated the banks’ behaviors during the economic crisis in Turkey. The authors reported on the bank’s CSR strategies as they supported small and medium sized enterprises, as well as local communities during the financial turmoil.

Chapter 15 offers insights on sustainable tourism as the authors investigated the constraints that explain why an attitude–behavior gap exists in responsible tourists’ behaviors.

Chapter 16 examines three leading networks that are intended to promote corporate sustainability and responsibility. The author explores their growing influence as he reviews their objectives, organizational structures, types of activities, practices and impacts.

Further details on this contribution is available here: http://www.igi-global.com/book/csr-new-era-corporate-citizenship/166426


About the Editor:

Dr. Mark Anthony Camilleri is a resident academic in the Department of Corporate Communication at the University of Malta. He specializes in strategic management, stakeholder engagement, corporate social responsibility and sustainable business. Mark successfully finalized his PhD (Management) in three years’ time at the University of Edinburgh in Scotland – where he was nominated for his “Excellence in Teaching”. During the past years, Mark taught business subjects at under-graduate, vocational and post-graduate levels in Hong Kong, Malta and the UK.

Dr Camilleri has published his research in peer-reviewed journals, chapters and conference proceedings. He is also a member on the editorial board of Springer’s International Journal of Corporate Social Responsibility and a member of the academic advisory committee in the Global Corporate Governance Institute (USA). Mark is a frequent speaker and reviewer at the American Marketing Association’s (AMA) Marketing & Public Policy conference and in the Academy of Management’s (AoM) Annual Meeting.

The Authors’ Biographies

Ozan Nadir ALAKAVUKLAR is a lecturer in management at Massey University School of Management. His research interests are based on sustainability, community organizing and social movements.

Marcello ATZENI received his PhD at the University of Cagliari. His research interests are related to tourism authenticity and consumer behavior.

Elisa BARAIBAR DIEZ is a Lecturer in Business Administration at the University of Cantabria. Her fields of research are corporate transparency, CSR, corporate governance and reputation. She focuses on transparency and its effects not only in a business context but also in other contexts such as universities.

Jesús BARRENA MARTINEZ is an Assistant Professor postdoctoral in the Department of Business Management at the University of Cadiz. He has a PhD in the field of Economics and Business Management. His teaching and research interests include Human Resource Management, Corporate Social Responsibility and Intellectual Capital. He has presented papers at international and national conferences and published in journals such as Corporate Social Responsibility and Environmental Management, International Journal of Management and Enterprise Development, Journal of Human Values, Tourism and Management Studies and Intangible Capital.

Roland BERBERICH is Independent researcher in Project Management with additional MRes degree from Heriot Watt University. He has acquired more than 10 years of project experience.

Claudiu George BOCEAN is Associate Professor at and PhD supervisor Faculty of Economics and Business Administration within University of Craiova. In 2000, graduated Bachelor Degree, major in Accountancy and Informatics, Faculty of Economics, University of Craiova, Romania. In 2004, graduated Master program in Business Administration, Faculty of Economics, University of Craiova, Romania. In 2007, PhD in Economics, Faculty of Economics, University of Craiova, Romania. In 2015, Habilitation title in Management, Academy of Economic Sciences Bucharest, Romania. Since 2002 – present, teaching and researching in Faculty of Economics and Business Administration, University of Craiova on topics such as Human Resource Management, Corporate Social Responsibility, Organization Theory, Business Economics, and co-operating within projects with national and international universities and organizations.

Michael Devereux obtained both Master in Business Administration (MBA) from University of North Carolina at Wilmington and a Master in International Business from Universitat de Valencia. Prior to graduate school, he gained a Bachelor in Economics and Geography focusing on international economics and Central/South America from Weber State University. Additionally, he has studied in Costa Rica, and in Guatemala participating in a microfinance and economic development project for indigenous women in Guatemala. His current interests are focused on international affairs, humanitarian components, health and well-being, economic development, community engagement, energy and environmental sustainability.

José Ignacio ELICEGUI REYES is Graduate in Management Business Administration and Business Sciences, as well as he has studied a Masters in Human Resource Management at the University of Cadiz. Currently, he is studying a Masters in Teacher Training in Secondary Schools and High Schools, Vocational Training and Language Training for the specialty of Business Administration at the University of Cadiz. Also, he is developing his PhD in the Human Resource Management field.

Martina G. GALLARZA lectures in the Marketing Department of Universidad de Valencia (SPAIN). She has formerly taught at Universidad Católica de Valencia, where she was Dean of the Business Faculty. Her research interests include consumer behavior and tourism services. She has authored more than 40 articles (in Annals of Tourism Research, Tourism Management, Journal of Consumer Behavior, Journal of Services Marketing, International Journal of Hospitality Management, Journal of Hospitality Marketing and Management among others), and has presented more than 70 papers in Congresses (EMAC, MKT TRENDS Conference, AMA Servsig, ATMC). She teaches in several international masters in Europe (MTM in IGC at Bremen (Germany) and MAE at IGR-IAE Rennes (France). Guest scholar for short periods at Columbia University (New York City. USA), ESCP (France), Sassari University (Sardinia. Italia), Strathclyde University (Glasgow, UK), She is member of the American Marketing Association (AMA), Asociación Española de Marketing (AEMARK), Association Française de Marketing (AFM) and formerly of Association Internationale d’Experts Scientifiques en Tourisme (AIEST She is member of the Board of Directors of Pernod Ricard. S.A. since 2012.

Raquel GOMEZ LOPEZ is a Lecturer in Business Management at the University of Cantabria (Spain). Her current research interests include quality management, excellence models, responsible management, family firms, innovation, and tourism. Raquel’s works have been published in journals of international impact such as Cornell Hospitality Quarterly, Total Quality Management & Business Excellence and Journal of Small Business and Enterprise Development among others. She is also author of several chapters in various collective works and one book. She regularly participates in prestigious international and national conferences, such as those organized by FERC, IFERA and ACEDE.

Misra Cagla GUL is an Associate Professor of Marketing and the Vice Director of the Graduate School of Arts and Sciences at Isik University. She holds a PhD degree from Bogazici University, and an MBA degree from Georgia State University. She has published in the fields of marketing and consumer behavior in times of recession, corporate social responsibility, social marketing, status consumption, green consumer behavior and strategic marketing. She teaches various marketing courses including consumer behavior, advertising and services marketing, both at undergraduate and graduate levels. Her professional experience includes over 5 years in marketing in telecommunications and energy sectors. She has a B.Sc. degree in Industrial Engineering from Bogazici University.

Jose Ramon CARDONA received a doctorate in business economics from the University of the Balearic Islands in 2012. He worked as lecturer in marketing at the University of Zaragoza, Pablo de Olavide University and the University of the Balearic Islands. He’s a research associate of the research group Business Management and Tourist Destinations.

Giacomo DEL CHIAPPA is an assistant professor of marketing at the Department of Economics and Business, University of Sassari (Italy), and Associate Researcher at CRENoS. He is also a senior research fellow, School of Tourism and Hospitality, University of Johannesburg, South Africa. His research is related to destination governance and branding, consumer behavior, and digital marketing. He has published articles in several international journals, among others the International Journal of Hospitality Management, Journal of Services Marketing, Journal of Travel Research, International Journal of Tourism Research, International Journal of Contemporary and Hospitality Management, Current Issues in Tourism, and Information Systems and E-Business Management.

Michael DEVEREUX obtained both Master in Business Administration (MBA) from University of North Carolina at Wilmington and a Master in International Business from Universitat de Valencia. Prior to graduate school, he gained a Bachelor in Economics and Geography focusing on international economics and Central/South America from Weber State University. Additionally, he has studied in Costa Rica, and in Guatemala participating in a microfinance and economic development project for indigenous women in Guatemala. His current interests are focused on international affairs, humanitarian components, health and well-being, economic development, community engagement, energy and environmental sustainability.

José Luis FERNANDEZ SANCHEZ, PhD is a Professor of Business Administration at the University of Cantabria. He specializes in CSR, especially social investment.

Paul George HOLLAND, received a Bachelor in Business degree from the Manukau Institute of Technology, Auckland, New Zealand in 2012 and a Master of Business Studies from Massey University, New Zealand in 2015.

Mehmet KAYTAZ is currently professor of economics and the Dean of Faculty of Economics and Administrative Sciences at Işık University, Istanbul, Turkey. He holds a M.A. degree from the University of Manchester (1974) and Ph.D. from the University of Nottingham (1978). He was a faculty member of Boğaziçi University between 1978-2005.He served as President of State Institute of Statistics, Turkey; as Undersecretary of Treasury; as an alternate director in European Bank for Reconstruction and Development, and as Chairman of Board of Directors of Eregli Iron & Steel Factories. He has authored articles and books on small-scale enterprises, income distribution, economic growth, statistics, finance and education.

Valentín-Alejandro MARTINEZ FERNANDEZ is a Permanent Professor at University of A Coruña, Area of Marketing and Market Research. B.A. Information Sciences, Complutense University of Madrid. MBA Management and Business Administration, University of A Coruña. PhD. Information Sciences, Complutense University of Madrid.

Patricia MARTINEZ GARCIA DE LEANIZ is an Assistant Professor at the University of Cantabria (Spain). Her current research interests include corporate social responsibility, consumer behavior, corporate marketing and responsible management. Her research focuses on theoretical and empirical studies in the tourism sector. Patricia’s works have been published in journals of international impact such as International Journal of Hospitality Management, Journal of Business Ethics, International Journal of Contemporary Hospitality Management and Journal of Travel and Tourism Marketing among others. She is also author of several chapters in various collective works and one book. She regularly participates in prestigious international and national conferences, such as those organized by EMAC, AEMARK and ACEDE.

Lars MORATIS is an expert in corporate social responsibility (CSR) affiliated with Antwerp Management School in Belgium as the Academic Director of the Competence Center Corporate Responsibility and with the NHTV University of Applied Sciences in The Netherlands as Professor of Sustainable Business. His research interests lie in the credibility of corporate CSR claims, ISO 26000, CSR strategy, CSR implementation, responsible management education and critical perspectives on CSR. His other interest is the psychology of sustainability. He received an MSc in Business Administration from Erasmus University Rotterdam School of Management and his PhD from the Open University the Netherlands. His PhD dissertation on ISO 26000 carried the title ‘Standardizing a better world? Essays and critical reflections on the ISO 26000 standard for corporate social responsibility’. He publishes on his research interest in both scientific and practitioner-oriented journals and book chapters. He has written several books, among which is ‘ISO 26000: The business guide to the new standard on social responsibility’.

María D. ODRIOZOLA (PhD) is a Lecturer in Business Administration at the University of Cantabria. Her research focuses on Human Resources Management and CSR. Particularly, she is specialized in labor social responsibility practices.

Mariella PINNA is a Research Fellow at the University of Sassari where she teaches in the area of “Ethics”. Her research interest is related to ethical consumption and consumer behavior.

Vesela RADOVIC is an associate professor, works in the Institute for Multidisciplinary Research, Belgrade University, Serbia. Dr. Radovic has an MPH in fire safety protection and a PhD in safety, protection and defense from the Faculty of Safety in Belgrade. She has a long record of experience in the area of disaster management. As an expert in the area of disaster management she prepared the handbook, Methodology of Risk Assessment and Emergency Management Planning at the Local Level. This manual was a part of the activities of the USAID, Serbia Preparedness, Planning and Economic Security Program, implemented by the DAI/Washington. She spent a year with the Fulbright/Hubert Humphrey Fellowship, at Tulane University, School of Public Health and Tropical Medicine, Department of International Health and Development, New Orleans, LA. During that year in USA her focus was on public policy making and emergency preparedness. Dr. Radovic will focus her future activities in academic community in order to share acquired knowledge to help her country, Serbia in supporting the necessary reforms in the context of Euro-Atlantic Integrations.

Amir Hossein RAHDARI is one of the top 25 youngest Sustainable Business professionals (2degrees). He is the director of research at Corporate Governance and Responsibility Development Centre, an external reviewer to several Int. peer-reviewed journals (JCR and Scopus indexed), a research contributor to CSRI and some other leading platforms. He is also an independent research & consultant and a member of several leading panels on sustainability including GBI Panel (US), NG Panel (UK), Ministry of Petroleum CSR Committee (Iran).

Pedro M. ROMERO FERNANDEZ is a Professor in the Department of Business Management at the University of Cadiz. His teaching experience (more than 15 years) spans the broad range of strategy, human resources and management. He has published his work in the field of HRM in peer-reviewed top national and international journals, such as the International Journal of Human Resource Management, British Journal of Management, Journal of Business Research and Journal of Business Ethics.

María Dolores SANCHEZ FERNANDEZ is a PhD “Competitiveness, Innovation and Development” and a Lecturer at the University of la Coruña (Spain), Faculty of Economics and Business, Department of Analysis and Business Management, Business Organization area. She is also part of the GREFIN (University of A Coruña) and GEIDETUR (University of Huelva) research groups and associate researcher at the Centre of CICS.NOVA.UMinho and Lab2PT research at the University of Minho, GEEMAT (Brazil) and REDOR Network (Mexico). She has been the author or co-author of several articles published in indexed journals. She has participated in over 100 communications in national and International conferences and is a member of the scientific committee. She reviews international scientific magazines in Spain, United States and Brazil. Her main research topics are: Corporate Social Responsibility, quality, tourism, the hotel industry and human resources.

Katharina SARTER is an Ailsa McKay Postdoctoral Fellow at Glasgow Caledonian University. Previously Research Fellow at Bielefeld University, University of Muenster, and University of Rostock as well as Bernheim Postdoctoral Fellow at the Hoover Chair of Economic and Social Ethics at the Catholic University of Louvain and Visiting Scholar at the Public Procurement Research Group at the School of Law of the University of Nottingham.

Catalina SITNIKOV is Professor at University of Craiova (Romania), Faculty of Economics and Business Administration. She has PhD title in Management since 2000, Habilitation title in Management since 2014 and since February 2015 is PhD supervisor in Management. For 3 years activated as Visiting Lecturer at Helsinki University of Technology, Lahti Center (Finland). Since 1995, she has been teaching undergraduate, master and PhD students. She teaches Quality Management, Total Quality Management and Management. Her main research areas include: management, strategic management, and mostly quality management, instruments and models specific to the stages of quality planning, control and improvement, quality management strategies, ISO standards, CSR from the perspective of specific standards and instruments.

Marius Sorin TUDOR holds a PhD from the Faculty of Economics and Business Administration within University of Craiova. In 1998, graduated Bachelor Degree, major in Accountancy and Informatics, Faculty of Economics, University of Craiova, Romania, In 2001, graduated Master program in Business Administration, Faculty of Economics, University of Craiova, Romania In 2008, PhD in Economics, Faculty of Economics, University of Craiova, Romania Since 2006 – present, teaching and researching in Faculty of Economics and Business Administration, University of Craiova on topics such as Project Management, Environmental Economics, Marketing public, Methods and techniques for decision-making in public organizations, Media management. Since 2015 – present, Manager of Universitaria – Publishing house within University of Craiova.

Başak UCANOK TAN received her B.A. degree in Business Administration from Başkent University. Upon her graduation she was granted the Sunley Management Scholarship and completed MSc in International Management from the University of Northampton, UK. Her master’s dissertation focused on the adverse psychological effects of financial crises on layoff survivors. She continued her academic pursuits in Marmara and Istanbul Bilgi University and earned her PhD in Organizational Behavior with her dissertation on the investigation of organizational citizenship behaviors in Turkish SMEs. Her academic research focus concentrates on the dynamics of micro organizational phenomena including work values, organizational citizenship behavior, organizational commitment, alienation, leadership and cooperative behavior. She has served as coordinator in Public Relations program in Istanbul Bilgi University from 2010 to 2012 and has recently became Associate Professor.

Anya Catharina Eva ZEBREGS is a master student at University of Amsterdam. Last January she completed her masters in Business Administration and currently she is writing her thesis for the Social Psychology masters. The two masters complement each other very well; she gathered knowledge about consumers, organizations, groups of people and how to influence them and combined this with strategic and economic knowledge. She is interested in marketing and consultancy and after her internship, which will start this September, she would like to find a job in either marketing or consultancy. Further, Anya has always been very interested in CSR and the non-profit market, one of the reasons why she chooses to write her first master thesis about CSR. Further, she is president of the board of SOLVE Consulting Amsterdam. SOLVE is a professional student consultancy organization active in social enterprise consulting. The organization advises non-profits and social enterprises in their efficiency and effectiveness.

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Corporate Governance Regulatory Principles and Codes

The corporate governance principles have initially been articulated in the “Cadbury Report” (Jones and Pollitt, 2004) and have also been formalised in the “Principles of Corporate Governance” by the Organisation for Economic Cooperation and Development (Camilleri, 2015a; Lazonick and O’Sullivan, 2000). Both reports have presented general principles that help large organisations in corporate governance decisions. Subsequently, the federal government in the United States enacted most of these principles that were reported in the Sarbanes-Oxley Act in 2002 (Abbott, Parker, Peters and Rama, 2007). Different governments and jurisdictions have put forward their very own governance recommendations to stock exchanges, corporations, institutional investors, or associations (institutes) of directors and managers, sometimes with the support of intergovernmental organisations. With regards to social and employee related matters, large organisations could implement ILO conventions that promote fair working conditions for employees (Fuentes-García, Núñez-Tabales and Veroz-Herradón, 2008). The corporate disclosure of non-financial information can include topics such as; social dialogue with stakeholders, information and consultation rights, trade union rights, health and safety and gender equality among other issues (EU, 2014). The compliance with such governance recommendations is usually not mandated by law. Table 1 presents a selection of corporate governance principles:

 

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Most of these principles have provided reasonable recommendations on sound governance structures and processes. In the main, these guidelines outlined the duties, responsibilities and rights of different stakeholders. In the pre-globalisation era, non-shareholding stakeholders of business firms were in many cases sufficiently protected by law and regulation (Schneider and Scherer, 2015). In the past, the corporate decisions were normally taken in the highest echelons of the organisation. The board of directors had the authority and power to influence shareholders, employees and customers, among others. Sharif and Rashid (2014) suggested that non-executive directors had a positive impact on the CSR reporting. Moreover, Lau, Liu and Liang (2014) examined how board composition, ownership, and the composition of the top management team could influence corporate social performance. However, with the diminution of public steering power and the widening of regulation gaps, these assumptions have become partly untenable (Lau et al., 2014). In many cases, stakeholders of business firms lack protection by nation state legislation. Notwithstanding, with the inclusion of stakeholders, corporate governance may compensate for lacking governmental and regulatory protection and could contribute to the legitimacy of business firms (Miller and del Carmen Triana, 2009). Schneider and Scherer (2015) argued that the inclusion of stakeholders in organisational decision processes on a regular basis can be regarded as the attempt of business firms to address the shortcomings of a shareholder-centred approach to corporate governance. The casual consultation with stakeholders is often characterised by unequal power relations (Banerjee, 2008).

Previous research may have often treated the board as a homogeneous unit. However, at times there could be power differentials within boards (Hambrick, Werder and Zajac, 2008). Boards are often compared to other social entities, in that they possess status and power gradations. Obviously, the chief executive will have a great deal of power within any organisation. In addition, the directors may include current executives of other firms, retired executives, representatives of major shareholders, representatives of employees and academics. Who has the most say? Is it the directors who hold (or represent) the most shares or does it reflect the directors’ tenures? Alternatively, it could be those who hold the most prestigious jobs elsewhere, or the ones who have the closest social ties with the chairman. These power differentials within top management teams could help to explain the firms’ outcomes. Ultimately, the board of directors will affect processes and outcomes.

A more macro perspective on informal structures opens up new questions regarding the roles of key institutional actors in influencing the public corporation (Hambrick, Werder and Zajac, 2008). Although researchers have long been aware of different shareholder types, there has been little consideration of the implications of shareholder heterogeneity for the design and implementation of governance practices. Managers and shareholders, as well as other stakeholders, have wide variations of preferences within their presumed categories. For instance, there are long-term- and short-term-oriented shareholders, majority and minority shareholders, and active and passive shareholders. In addition, the rise of private equity funds have created a whole new shareholder category, which is becoming more and more influential. The idea of heterogeneity within stakeholder categories, including diversity among equity shareholders, will become a popular topic in future governance research (Miller and del Carmen Triana, 2009). Growing shareholder activism raises questions that could have been overlooked in the past. Who runs, and who should run the company? Corporate governance does not begin and end with principals, agents, and contracts. Beyond the obvious roles of regulatory authorities and stock exchanges, we are witnessing an increasing influence from the media, regulatory authorities, creditors and institutional investors, among others. These various entities may have a substantial effect on the behaviours of executives and boards of public companies. Arora and Dharwadkar (2011) had suggested that effective corporate governance could discourage violation of regulations and standards. Jizi, Salama, Dixon, Stratling (2014) examined the impact of corporate governance, with particular reference to the role of board of directors, on the quality of CSR disclosure in US listed banks’ annual reports after the US sub-prime mortgage crisis. Jizi et al. (2014) implied that the larger boards of directors and the more independent ones are in a position to help to promote both shareholders’ and other stakeholders’ interests. They found that powerful CEOs may promote transparency about banks’ CSR activities for reputational concerns. Alternatively, the authors also pointed out that this could be a sign of managerial risk aversion.

Recently, many businesses have linked executive pay to non-financial performance. They tied executive compensation to sustainability metrics such as greenhouse gas (GHG) reduction targets, energy efficiency goals and water stewardship, in order to improve their financial and non-financial performance (CERES, 2012). Interestingly, the latest European Union (EU) Directive 2014/95/EU on non-financial disclosures EU directive has encouraged corporations and large undertakings to use relevant non-financial key performance indicators on environmental matters including; greenhouse gas emissions, water and air pollution, the use of (non) renewable energy and on health and safety (Camilleri, 2015b).

References

Abbott, L. J., Parker, S., Peters, G. F., and Rama, D. V. (2007). Corporate governance, audit quality, and the Sarbanes-Oxley Act: Evidence from internal audit outsourcing. The Accounting Review, 82(4), 803-835.

Arora, P., and Dharwadkar, R. (2011). Corporate governance and corporate social responsibility (CSR): The moderating roles of attainment discrepancy and organization slack. Corporate governance: an international review, 19(2), 136-152.

Banerjee, S.B. (2008). Corporate social responsibility: The good, the bad and the ugly. Critical sociology, 34(1), 51-79.

Camilleri, M. A. (2015a). Valuing stakeholder engagement and sustainability reporting. Corporate Reputation Review, 18(3), 210-222.

Camilleri, M. A. (2015b). Environmental, social and governance disclosures in Europe. Sustainability Accounting, Management and Policy Journal, 6(2), 224-242.

CERES (2012). Executive compensation tied to ESG performance. The CERES roadmap for sustainability. http://www.ceres.org/roadmap-assessment/progress-report/performance-by-expectation/governance-for-sustainability/executive-compensation-tied-to-esg-performance-1 accessed on the 2nd February 2016.

EU (2014). EU adopts reporting obligations for human rights and other “non-financial” information. Lexology http://www.lexology.com/library/detail.aspx?g=41edd30b-e08c-4d26-ba6f-b87158b5ee85 accessed on the 10th February 2016.

Fuentes-García, F. J., Núñez-Tabales, J. M. and Veroz-Herradón, R. (2008). Applicability of corporate social responsibility to human resources management: Perspective from Spain. Journal of Business Ethics, 82(1), 27-44.

Hambrick, D. C., Werder, A. V. and Zajac, E. J. (2008). New directions in corporate governance research. Organization Science, 19(3), 381-385.

Jizi, M. I., Salama, A., Dixon, R. and Stratling, R. (2014). Corporate governance and corporate social responsibility disclosure: Evidence from the US banking sector. Journal of Business Ethics, 125(4), 601-615.

Jones, I., and Pollitt, M. (2004). Understanding how issues in corporate governance develop: Cadbury Report to Higgs Review. Corporate Governance: An International Review, 12(2), 162-171.

Lau, K. L. A. and Young, A. (2013). Why China shall not completely transit from a relation based to a rule based governance regime: a Chinese perspective. Corporate Governance: An International Review, 21(6), 577-585.

Lazonick, W., and O’sullivan, M. (2000). Maximizing shareholder value: a new ideology for corporate governance. Economy and society, 29(1), 13-35.

Miller, T. and del Carmen Triana, M. (2009). Demographic diversity in the boardroom: Mediators of the board diversity–firm performance relationship. Journal of Management studies, 46(5), 755-786.

Schneider, A. and Scherer, A. G. (2015). Corporate governance in a risk society. Journal of Business Ethics, 126(2), 309-323.

Sharif, M. and Rashid, K. (2014). Corporate governance and corporate social responsibility (CSR) reporting: an empirical evidence from commercial banks (CB) of Pakistan. Quality & Quantity, 48(5), 2501-2521.

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Call for Chapters on CSR

Corporate  Sustainability and Responsibility: The New Era of Corporate Citizenship
CSR Chapter
 This edited book will be published by IGI Global (USA)
Proposals Submission Deadline: January 31, 2016
Full Chapters Due: April 30, 2016
Submit your Chapter here.

 

 

Introduction

The contemporary subject of Corporate Social Responsibility (CSR) has continuously been challenged by those who want corporations to move beyond transparency, ethical behavior and stakeholder engagement. Today, responsible behaviors are increasingly being embedded into new business models and strategies that are designed to meet environmental, societal and governance deficits.

This book builds on the previous theoretical underpinnings of the corporate social responsibility agenda, including Corporate Citizenship (Carroll, 1998; Waddock, 2004; Matten and Crane, 2004), Creating Shared Value (Porter and Kramer, 2011; 2006), Stakeholder Engagement (Freeman, 1984) and Business Ethics (Crane and Matten, 2004) as it presents the latest Corporate Sustainability and Responsibility (CSR2.0) perspective. The CSR2.0 notion is increasingly being recognized as a concept that offers ways of thinking and behaving that has potential to deliver significant benefits to both business and society (The International Conference(s) on Corporate Sustainability and Responsibility, organized by the Humboldt University Berlin in 2014, 2016).

This ‘new’ proposition is an easy term that may appeal to the business practitioners as it is linked to improvements in economic performance, operational efficiency, higher quality, innovation and competitiveness. At the same time it raises awareness on responsible behaviors. Therefore, CSR2.0 can be considered as strategic in its intent and purposes, as businesses are capable of being socially and environmentally responsible ‘citizens’ as they pursue their profit-making activities.

 

Objective

 This book is a concise and authoritative guide to students and well-intended professionals. CSR is moving away from ‘nice-to-do’ to ‘doing-well-by-doing-good’ mantra. This contribution covers many aspects of Corporate Sustainability and Responsibility (CSR2.0).

It will include relevant theoretical frameworks and the latest empirical research findings in the area. It shall provide thorough understanding on corporate social responsibility, sustainability, stakeholder engagement, business ethics and corporate governance. It also sheds light on environmental, social and governance (ESG) disclosures and sustainability reporting; CSR and digital media, socially responsible investing (SRI); responsible supply chain management; the circular economy, responsible procurement of sustainable products; consumer awareness of sustainability / eco labels; climate change and the environmental awareness; CSR in education and training; and responsible behaviors of small enterprises among other topics.This publication will explain the rationale for CSR2.0 as a guiding principle for business success. It shall report on the core aspects of contemporary strategies, public policies and practices that create shared value for business and society.

References

Carroll, A. B. (1998). The four faces of corporate citizenship. Business and society review, 100(1), 1-7.

Crane, A., & Matten, D. (2004). Business ethics: A European perspective: managing corporate citizenship and sustainability in the age of globalization. Oxford: Oxford University Press.

Freeman, R. Edward (1984). Strategic Management: A stakeholder approach. Boston: Pitman. ISBN 0-273-01913-9.

Matten, D., & Crane, A. (2005). Corporate citizenship: Toward an extended theoretical conceptualization. Academy of Management review, 30(1), 166-179.

Porter, M. E., & Kramer, M. R. (2006). The link between competitive advantage and corporate social responsibility. Harvard business review, 84(12), 78-92.

Porter, M. E., & Kramer, M. R. (2011). Creating shared value. Harvard business review, 89(1/2), 62-77.

Waddock, S. (2004). Parallel universes: Companies, academics, and the progress of corporate citizenship. Business and society Review, 109(1), 5-42

 

Target Audience

This book introduces the concept of corporate sustainability and responsibility (CSR2.0) to advanced undergraduate and / or post graduate students in a structured manner. It is also relevant to policy makers, business professionals, small business owners, non-profit organizations and charitable foundations.

 

Recommended Topics

• Theoretical Underpinnings on Corporate Sustainability and Responsibility;
• The Evolution of Corporate Sustainability and Responsibility;
• International Policies and Regulatory Instruments for Engagement in Corporate Sustainability and Responsibility;
• Responsible Corporate Governance and Sustainable Business;
• Environmental, Social and Governance (ESG) Disclosures of Sustainable and Responsible Businesses;
• Corporate Citizenship and Sustainable Business;
• Socially Responsible Investing (SRI) for Sustainable Business;
• Responsible Supply Chain Management for Sustainable Business;
• Responsible Procurement of Sustainable Products;
• Corporate Sustainability and Responsibility Communications;
• Corporate Sustainability and Responsibility Reporting and Digital Media;
• Consumer Awareness of Sustainable Products and Responsible Businesses;
• The Use of Eco labels by Responsible Businesses;
• Global Issues, Climate Change and the Environmental Awareness of Sustainable and Responsible Businesses;
• Corporate Sustainability and Responsibility Initiatives in Education and Training;
• Corporate Sustainable and Responsible Behaviors;
• The Business Case for Responsible Behaviors among Small and Medium-Sized Enterprises.

 

Submission Procedure

Researchers and practitioners are invited to submit on or before January 31, 2016, a chapter proposal of 1,000 to 2,000 words clearly explaining the mission and concerns of his or her proposed chapter. Authors will be notified by February 15, 2016 about the status of their proposals and sent chapter guidelines. Full chapters are expected to be submitted by April 30, 2016, and all interested authors must consult the guidelines for manuscript submissions at http://www.igi-global.com/publish/contributor-resources/before-you-write/ prior to submission. All submitted chapters will be reviewed on a double-blind review basis. Contributors may also be requested to serve as reviewers for this project.

Note: There are no submission or acceptance fees for manuscripts submitted to this book publication, CSR 2.0 and the New Era of Corporate Citizenship. All manuscripts are accepted based on a double-blind peer review editorial process.
All proposals should be submitted through the E-Editorial DiscoveryTM online submission manager.

 

Publisher

This book is scheduled to be published by IGI Global (formerly Idea Group Inc.), publisher of the “Information Science Reference” (formerly Idea Group Reference), “Medical Information Science Reference,” “Business Science Reference,” and “Engineering Science Reference” imprints. For additional information regarding the publisher, please visit http://www.igi-global.com. This publication is anticipated to be released in 2016.

Important Dates

January 31, 2016: Proposal Submission Deadline

February 15, 2016: Notification of Acceptance
April 30, 2016: Full Chapter Submission
June 30, 2016: Review Results Returned
July 31, 2016: Final Acceptance Notification
August 15, 2016: Final Chapter Submission

 

For Further Inquiries:

Mark Anthony Camilleri, Ph.D.

Department of Corporate Communication

Faculty of Media & Knowledge Sciences

Room 603, MaKS Building

University of Malta

Msida, MSD2080

MALTA

Tel: +356 2340 3742

Mob: +356 79314808

Email: Mark.A.Camilleri@um.edu.mt

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Social responsibility policies in the USA

 

mapImage by newmediatraffic.com

 

Corporate social responsibility (CSR) initiatives and communicating activities within the areas of philanthropy, stewardship, volunteerism and environmental affairs are not treated as a regulatory compliance issue in the United States of America (USA). Therefore, organisations are not obliged to satisfy their numerous stakeholders’ expectations vis-a-vis their corporate sustainability and responsibility practices. CSR practices are voluntary practices encompassing laudable behaviours that go beyond financial reporting requirements. At the same time, it must be recognised that sustainable and responsible practices are increasingly being embedded into core business functions and corporate decisions, such as supply chain, transportation, engineering and marketing. In this light, this chapter sheds light on major US institutional frameworks that have been purposely developed to foster CSR engagement among organisations. Policies, principles and voluntary instruments include formal accreditation systems and soft laws that stimulate business to implement and report their CSR-related activities. Several agencies of the US Government are currently employing CSR programmes that are intended to provide guidance in corporate citizenship and human rights; labour and supply chains; anticorruption; energy and the environment; as well as health and social welfare among other issues.

This contribution looks at the US governmental institutions’ processes and their discretionary investments in responsible behaviours, in terms of financial and human resources. It looks at the establishment of particular standards, procedures and expectations. There is a discussion on how US entities have often interpreted their own view on business ethics and corporate citizenship, within the context of their own organisation. Moreover, it contends that there could still be a lack of an appropriate definition which could encapsulate CSR terminology. Arguably, as corporate responsibility becomes more widely understood, accepted and practiced, there could be positive implications for greater convergence of common activities that could be included in corporate responsibility disclosures. In conclusion, this chapter posits that there are indications that US business, industry and governmental organisations are changing their attitudes on CSR, sustainability reporting and corporate governance. It also identifies the drivers and actors that are raising the CSR agenda in the USA.

Excerpt from: “Camilleri, M.A. (2016) A descriptive overview of social responsibility policies in the United States of America. In Idowu, S.O. & Vertigans, S. (eds) CSR in Challenging Times. Springer (Forthcoming)”.

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Environmental, Social and Governance Disclosures in Europe

Excerpt from: Camilleri, M. (2015). Environmental, social and governance disclosures in Europe. Sustainability Accounting, Management and Policy Journal, 6(2). http://www.emeraldinsight.com/doi/abs/10.1108/SAMPJ-10-2014-0065

 

Last year, the European Union (EU) announced its new guidelines on non-financial reporting that will only apply to some large entities with more than 500 employees. This includes listed companies as well as some unlisted companies; such as banks, insurance companies and other companies that are so designated by member states; because of their activities, size or number of employees. There are approximately 6,000 large companies and groups within the EU bloc (EU, 2014).  The most prevalent reporting schemes in the EU were often drawn from; the G3 Guidelines of the Global Reporting Initiative (GRI) and the United Nations Global Compact (UNGC). In addition, several platforms and organisations that promote corporate sustainability reporting have developed partnerships with AccountAbility, OECD, UNEP, Carbon Disclosure Project and with many governments and sector organisations (Van Wensen et al., 2011; Kolk, Levy & Pinkse, 2008).

 

esg

 

When one explores the key topics that companies reported on, it transpired that carbon emission disclosures have become quite a common practice (Kolk et al., 2008). Moreover, recently there was an increased awareness on the subject of human rights and the conditions of employment (Lund-Thomsen & Lindgreen, 2013). Curiously, online reporting has offered an opportunity for accountability and transparency as information is easily disseminated to different stakeholders (Zadek, Evans & Pruzan, 2013). This has inevitably led to increased stakeholder engagement, integrated reporting and enhanced external verification systems. This subject has also been reported by Simnett and Huggins (2015), who have also presented a number of interesting research questions which could possibly be addressed through engagement research. At this point in time, stakeholders are considering reporting schemes as a valuable tool that can improve the quality of their reporting, particularly as it enables them to benchmark themselves with other companies (Adams, Muir & Hoque, 2014). The GRI is often regarded as ‘a good starting point’ for this purpose. Moreover, the provision of a UNGC communication on progress is a new global trend that has become quite popular among business and non-profit organisations. Some of the European organisations are gradually disclosing environmental information or certain other key performance indicators that are of a non-financial nature in their reporting (Zadek et al., 2013). Generally, public policies are often viewed as part of the regular framework for social and employment practices. Therefore, a considerable commitment is made by local governments who act as drivers for stakeholder engagement (Albareda, Lozano, Tencati, Middtun & Perrini, 2008).

 

One way to establish a CSR-supporting policy framework is to adopt relevant strategies and actions in this regard. Such frameworks may be relevant for those countries that may not have a long CSR tradition or whose institutions lack accountability and transparency credentials (Zadek et al., 2013). It may appear that EU countries are opting for a mix of voluntary and mandatory measures to improve their ESG disclosure. While all member states have implemented the EU Modernisation Directive, they have done so in different ways. While the Modernisation Directive ensured a minimum level of disclosure, it was in many cases accompanied by intelligent substantive legislation. National governments ought to give guidance or other instruments that support improvements in sustainability reporting. Lately, there was a trend towards the development of regulations that integrate existing international reporting frameworks such as the GRI or the UNGC Communication on Progress. These frameworks require the engagement of relevant stakeholders in order to foster a constructive environment that brings continuous improvements in ESG disclosures. Regular stakeholder engagement as well as strategic communications can bring more responsible organisational behaviours (Camilleri, 2015). Many corporate businesses use non-governmental organisations’ regulatory tools, processes and performance-oriented standards with a focus on issues such as labour standards, human rights, environmental protection, corporate governance and the like. Nowadays, stakeholders, particularly customers expect greater disclosures, accountability and transparency in corporate reports.

 

At the moment, we are witnessing regulatory pressures for mandatory changes in CSR reporting. Of course, firms may respond differently to reporting regulations as there are diverse contexts and realities. In a sense, this paper reiterates Adams et al.’s (2014) arguments as it indicated that ESG disclosures are a function of the level of congruence between the government departments’ regulatory environment and the use of voluntary performance measures. Somehow, EU regulatory pressures are responding to energy crises, human rights matters and are addressing the contentious issues such as resource deficiencies including water shortages. Notwithstanding, big entities are also tackling social and economic issues (e.g. anti-corruption and bribery) as they are implementing certain environmental initiatives (e.g. waste reduction, alternative energy generation, energy and water conservation, environmental protection, sustainable transport et cetera). In this light, there are implications for practitioners and assurance providers of integrated reports, standard setters and regulators (Simnett & Huggins, 2015). Future engagement research can possibly consider how report content and reporting formats, might impact on organisations’ decision making (Correa and Larrinaga, 2015). This paper indicated that practice and policy issues would benefit from additional empirical evidence which analyse how the European disclosure regulations may positively or adversely affect the corporations’ stakeholders.

http://www.emeraldinsight.com/doi/abs/10.1108/SAMPJ-10-2014-0065

 

References

Adams, C.A., Muir, S. & Hoque, Z. (2014) “Measurement of sustainability performance in the public sector”, Sustainability Accounting, Management and Policy Journal, 5 (1), 46 – 67

Albareda, L., Lozano, J. M., Tencati, A., Midttun, A., & Perrini, F. (2008). The changing role of governments in corporate social responsibility: drivers and responses. Business Ethics: A European Review, 17(4), 347-363.

ASB (2006). Reporting Statement: Operating and Financial Review. https://www.frc.org.uk/Our-Work/Publications/ASB/Reporting-Statement-Operating-and-Financial-Review-File.pdf Accessed 30th August, 2014.

Bansal, P., Jiang, G. F., & Jung, J. C. (2014). Managing responsibly in tough economic times: strategic and tactical CSR during the 2008–2009 global recession. Long Range Planning.

BSR (2012). Trends in ESG Integration In Investments https://www.bsr.org/reports/BSR_Trends_in_ESG_Integration.pdf Accessed on the 20th September 2014.

Camilleri, M.A. (2015). Valuing Stakeholder Engagement and Sustainability Reporting. Corporate Reputation Review (18) 2.

Carroll, A.B. (1991). The Pyramid of Corporate Social Responsibility: Toward the Moral Management of Organizational Stakeholders. Business Horizons 34 (4) 39-48.CBS (2013)
CCA (2008). Climate Change Act. http://www.legislation.gov.uk/ukpga/2008/27/contents Accessed 2nd October, 2014.

Clark, G.L. & Knight, E.R. (2008). Implications of the UK Companies Act 2006 for institutional investors and the market for corporate social responsibility. Journal of International Law, 11, 259.

ComLaw (2010) Australian Government: “Building Energy Efficiency Disclosure Regulations 2010- F2010L01955 http://www.comlaw.gov.au/Details/F2010L01955 accessed on the 7th February 2015.

Companies Act (2013) The Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013 No. 1970
http://www.legislation.gov.uk/uksi/2013/1970/pdfs/uksi_20131970_en.pdf accessed on the 8th February 2015.

Copenhagen Business School Public policy on CSR reporting: Danish experiences and other observations.https://www.globalreporting.org/SiteCollectionDocuments/Global-Conference-2013/slides/GRI-Academic-Public-Policy-TRJ-23May2013.pdf accessed on the 5th February, 2015.

Correa, C., & Larrinaga, C. (2015). Engagement research in social and environmental accounting. Sustainability Accounting, Management and Policy Journal, 6(1).

CSR Compass (2014). Responsible supply chain management.
http://www.csrcompass.com/responsible-supply-chain-management Accessed 23rd September, 2014.

Danish National Action Plan (2014). Implementation of the UN Guiding Principles on Business and Human Rights.

Danish Business Authority, Copenhagen. http://www.ohchr.org/Documents/Issues/Business/NationalPlans/Denmark_NationalPlanBHR.pdf Accessed 30th September 2014.

DCCA (2010). Corporate Social Responsibility and Reporting in Denmark. Danish Commerce and Companies Agency.
http://samfundsansvar.dk/file/319099/corporate_social_responsibility_and_reporting_in_denmark_september_2010.pdf Accessed 14th September 2014.

DCGC (2014). Dutch Corporate Governance Code: Principles of good corporate governance and best practice provisions.
http://commissiecorporategovernance.nl/download/?id=606 Accessed on the 2nd October, 2014.

DECC (2014). UK National Energy Efficiency Action Plan. Department of Energy and Climate Change.
http://ec.europa.eu/energy/efficiency/eed/doc/neep/2014_neeap_united-kingdom.pdf Accessed 29th August, 2014.

ECCJ (2014). Assessment of the EU Directive on the disclosure of non-financial information by certain large companies. http://business-humanrights.org/sites/default/files/media/documents/eccj-assessment-eu-non-financial-reporting-may-2104.pdf Accesses on the 3rd January 2015.

EU (2002). Corporate Social Responsibility: A business contribution to Sustainable Development. COM(2002) 347 final. Commission of the European Communities, Brussels.

EU (2008). National Public Policies in the European Union. ec.europa.eu/social/BlobServlet?docId=6716&langId=en accessed on the 10th February 2014

EU (2011). A renewed EU strategy 2011-14 for Corporate Social Responsibility.
http://ec.europa.eu/enterprise/newsroom/cf/_getdocument.cfm?doc_id=701 Accessed 3rd February 2014.

EU (2012a). Sustainable and responsible business European Expert Group on corporate social responsibility (CSR) and SMEs.
http://ec.europa.eu/enterprise/policies/sustainable-business/corporate-social-responsibility/sme/european-expert-group/index_en.htm Accessed 12th July 2014.

EU (2012b). Energy Efficient Directive. http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32012L0027 Accessed on the 5th January 2015.

EU (2014a). Sustainable Development. http://ec.europa.eu/environment/eussd/
Accessed 14th June 2014.

EU (2014b). Non-Financial Reporting.
http://ec.europa.eu/internal_market/accounting/non-financial_reporting/index_en.htm Accessed 25th June 2014.

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The EU’s directive on the disclosure of non-financial information

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On the 29th September 2014, the European Council has introduced amendments to Accounting Directive (2013/34/EU) that mandates corporate business to disclose their non-financial performance. The EU Commission proposed non-binding guidelines on the details of what non-financial information ought to be disclosed by big businesses operating from by EU countries. This legislation respects environmental, human rights, anti-corruption and bribery matters as expressed in the UN Guiding Principles on Business and Human Rights (the “Ruggie Principles”) and OECD’s Guidelines for Multinational Enterprises (ECCJ, 2014).

This recent EU directive has marked a step forward towards the hardening of human rights obligations for large “public interest entities” with more than 500 employees. At the moment there are approximately 6,000 large undertakings and groups across the EU. Public interest entities include all the undertakings that are listed on an EU stock exchange, as well as some credit institutions, insurance undertakings and other businesses so designated by Member States.

In a nutshell, these non-financial disclosures should shed light on the corporate businesses’ social and environmentally responsible policies and practices. They will feature a brief description of the undertaking’s business model, including their due diligence processes resulting from their impact of their operations. This EU directive encourages corporates to use relevant non-financial key performance indicators on environmental matters including; greenhouse gas emissions, water and air pollution, the use of (non) renewable energy and on health and safety.

With regards to social and employee related matters, the corporate firms ought to implement ILO conventions that promote fair working conditions for employees. The corporate disclosure of non-financial information can include topics such as; social dialogue with stakeholders, information and consultation rights, trade union rights, health and safety and gender equality among other issues. Businesses should also explain how they are preventing human rights abuses and/or fighting corruption and bribery.

Through this directive the EU commission emphasises materiality and transparency in non financial reporting. It also brought up the subject of diversity at the corporate board levels. It has outlined specific reference criteria that may foster wider diversity in the composition of boards (e.g. age, gender, educational and professional background). The EU Commission has even suggested that this transparency requirement complements the draft directive about women on boards.

This new directive still allows a certain degree of flexibility in the disclosures’ requirements. As a matter of fact, it does not require undertakings to have policies covering all CSR matters. Yet, businesses need to provide a clear and reasoned explanation for not complying with this directive. Therefore, non-financial disclosures do not necessarily require comprehensive reporting on CSR matters (although this is encouraged by the Commission), but only the disclosure of information on policies, outcomes and risks (ECCJ, 2014). Moreover, this directive gives undertakings the option to rely on international, European or national frameworks (eg. the UN Global Compact, ISO 26000) in the light of the undertaking’s characteristics and business environment.

It is envisaged that the first CSR reports will be published in financial year 2017 (ECCJ, 2014).

Links:

http://ec.europa.eu/finance/accounting/non-financial_reporting/index_en.htm

Click to access eccj-assessment-eu-non-financial-reporting-may-2104.pdf

http://europa.eu/rapid/press-release_MEMO-14-301_en.htm?locale=en
 

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CSR: new disclosure and reporting obligations for listed organisations | EurActiv

Commission accuses companies of ‘group think’, demands social responsibility | EurActiv.

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