Corporate Responsibility

Chair:       Marileena Koskela, Minttu Jaakkola & Salla Laasonen,
vvvvvvvvFinland Futures Research Centre
Time:        Thursday 9th June, at 1pm-3pm &
vvvvvvvvFriday, 10thJune, at 10:30-12:30 & 14:30-15:30
Venue:     Lecture room B3117
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Mirror, Mirror on the Wall, What is the Most Sustainable Company of All? Assessing Corporate Sustainability Performance by Using the Corporate Sustainability Map
Martin Kirchner & Jens Leker
University of Muenster, Germany
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As it could be demonstrated that meanwhile corporate success is affected by the response to the topic of sustainability to some extent, companies have recognized this as a crucial strategic issue. Accordingly, sustainability is put on the top of the agenda by many business executives. However, to succeed in the challenge of sustainability, appropriate instruments are required that support the development of sustainability strategies.
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We, therefore, introduce the Corporate Sustainability Map (CSM), a novel approach to assess and compare the sustainability performance of companies supporting decision-making processes. In contrast to pre-existing approaches, the underlying methodology relies on quantitative and publicly available data exclusively, ensuring traceability as well as applicability. The methodology is further based on well-established approaches that have been merely modified and allows for back calculation. Due to the fact that the CSM utilizes a portfolio illustration results can be interpreted easily as well. Finally, all these issues lay the foundation for a broad acceptance in business practice.
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To demonstrate the CSM’s practicability, an assessment of companies belonging to the chemical industry will be carried out providing valuable contributions for decision makers regarding the derivation of sustainability strategies.
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Environmental Reporting Practises in the Finnish Forest Industry
Marileena Koskela
Finland Futures Research Centre, Finland
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Environmental reports, corporate social responsibility reports and sustainability webpages are ways for companies to report their environmental issues. There is no strict format of reporting which means that companies select to report environmental performance in a way most suitable for them. This paper describes the environmental reporting practises in the Finnish forest industry. The analysis combines two sets of data. First, an expert survey (response rate 32%) defined issues needed to be measured in the Finnish forest industry. Use of wood, recycled fibre and non-renewable fuels, emissions to water and air, solid waste and transportation of raw material and products were named as environmental aspects and fossil fuels and eutrophication as environmental impacts needing to be measured. Second, the environmental reporting of three Finnish forest industry companies was content analysed by using the before mentioned aspects and impacts as analysing criteria. The results were further categorised into company’s quantitative results, company’s qualitative description of activities and general information.
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The companies provided most information on the use of wood and the emissions to air. The least information was provided on eutrophication but also information provided on the transportation of raw materials and products was concise. Most often companies reported company’s activities. Company’s results are reported nearly often as general information.
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Stakeholders and Corporate Social Responsibility in Corporate Responsibility Disclosure
Marileena Koskela
Finland Futures Research Centre, Finland
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Corporate social responsibility (CSR) consists of the responsibility of economic, social and environmental issues. Companies collect CSR data from the various parts of the company. Companies also publish many different types of reports, magazines and webpages that focus at least partly on CSR. These reports are targeted to the stakeholders. Stakeholders can be defined as persons that have an influence on the company or are influenced by the company.
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The results presented here are part of an on-going project that focuses on the feasibility and utilisation of CSR information in the anticipatory decision making. Three Finnish companies are used as case studies. The CSR disclosure, e.g. annual reports, CSR reports, policies, media releases, stakeholder magazines and sustainability webpages, will be analysed. Also, several interviews will be made in order to evaluate the process of dissemination of CSR information inside and outside the company.
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The material of this analysis are the sustainability webpages (autumn 2010), CSR reports (year 2009) and the press releases (year 2009). Content analysis is used in order to find out which stakeholders the case companies mention and under which part of the corporate social responsibility the stakeholders are mentioned. The material is analysed by phrases and the analysis is done in Finnish.
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Several different stakeholders are mentioned by the case companies, most often mentioned being customers, cooperative partner companies and employees. In economic responsibility, customers, cooperative partner companies, companies from own business sector and employees are mentioned most often. Whereas, in environmental responsibility, employees, customers, non-governmental organisations (NGOs) and cooperative partner companies and in social responsibility, cooperative partner companies, NGOs, customers and companies from own business sector are mentioned most often. In webpages, the most often mentioned stakeholders are customers, employees, NGOs and cooperative partner companies. The most often mentioned stakeholders in the press releases are cooperative partner companies, customers, companies from own business sector and employees and in the CSR reports, employees, customers, NGOs and cooperative partner companies. The differences between companies are discussed in the full paper.
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Implementation of Total Responsibility Management into Corporate Strategy
Štefka Gorenak1 & Vito Bobek2
1Celje, Slovenia & 2University of Applied Sciences FH Joanneum, Austria
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This contribution reports about relationship and potential synergies between the total quality management (TQM) and total responsibility management (TRM) as well as corporate citizenship. TRM principles and standards reflect the raising public expectations about corporate social responsibility. Many companies develop TRM as requisitely holistically and hence successfully manage their responsibilities toward their stakeholders and natural environment. The evolution and implementation of TRM in companies includes three main components/approaches: inspiration/vision, integration and improvement/innovation. The improvement/innovation elements of TRM create a significant demand for companies to broaden measuring of their performance. TRM indicators focus on stakeholders (together with triple-bottom-lines) of economic, social and environment issues (‘cost-benefit’ approach).
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Gorenje Group represents a successful case of implementation of TRM into corporate strategy (including sustainable indicators). The synergies also lead (socially) responsible companies to long-term competitiveness by contributing to requisitely holistic management of (innovative-responsible) enterprises/companies. CSR and sustainability could be promoted through transparency, good governance, concern for the environment and good relations with company’s stakeholders. Morally proactive leadership is critical for successful TRM and corporate citizenship. The proactive companies focus on the importance of CSR and its management inside and outside the global company (case Gorenje Group). Introduction of TRM may hence be a management innovation.
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Keywords: corporate social responsibility (CSR), total quality management (TQM), total responsibility management (TRM), corporate citizenship (CC), ecology, sustainable indicators, leadership, competitiveness, Gorenje Group
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Purpose of Sustainability Contractual Clauses
Kateřina Peterková
Aarhus University, Denmark
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Present paper develops a conceptual framework for legal research of sustainability contractual clauses (SCCs) in business contracts concluded within international supply chains. Several tools were developed by companies to ensure that their business partners observe the same social and environmental standards; inclusion of SCCs into contracts is one of them. From the perspective of contract law and legal theory, SCCs have been addressed only by a limited number of academics. A reason may be sought in the inadequate theoretical foundation and uncertainty, what the actual intent of SCCs is. This paper provides a classification of SCCs according to their purpose. Based on literature review, analysis of existing hard and soft law and empirical desk research, the factors influencing the objective of SCCs are identified and the four main purposes of SCCs are established: defensive, motivating, regulatory and enforcing. The framework serves as a ground for future research of sustainable international contracts, under which various aspects of SCCs (e.g. incorporation into contracts, content, interpretation and enforceability) may be examined in context of their specific purpose. Further, understanding the purpose of sustainability concerns’ inclusion into contracts is essential for choosing the optimal regulatory approach and contract management.
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Stakeholder Dialogue for Sustainable Development? An Analysis of Corporate Statements
Salla Laasonen
Finland Futures Research Centre, Finland
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The significance of stakeholder dialogue continues to strengthen its role as a key component of corporate responsibility. This implies that stakeholder dialogue is a tool through which a company can ensure that corporate actions are aligned with the goals of sustainable development. Stakeholder dialogue has proven to be a useful tool for gaining information on business environment from a range of stakeholders, and thus protecting against future legitimacy risks. This holds especially for non issue-specific and ongoing stakeholder dialogue. Closely related to this, the focus in this paper is on dialogue around a specific issue, a foreign direct investment. For this purpose, the focus is on how the investing company refers to stakeholder dialogue. Documents consisting of annual reports and press releases during 2003-2010 are analyzed in order to assess what role is given to stakeholder dialogue. The company perspective is then reflected against the NGO and other actors’ perspective on dialogue in the case (Laasonen 2010). The findings indicate that the roles and meaning placed on dialogue vary considerably depending on the actor.
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Global Dispute on Sustainable Business: Analysing MNE-Stakeholder Relationships in Local Media Texts
Hanna Lehtimäki, Johanna Kujala & Anna Heikkinen
University of Tampere, Finland
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The purpose of this paper is to examine how multinational enterprise (MNE) – stakeholder relationships are presented in local media texts in a case of global dispute on sustainable business. The stakeholder literature has made a strong claim that business logic based on serving only one stakeholder, the owners, narrows the potential for value creation and imparts a false sense of security. In this paper, we study MNE-stakeholder relationships in an empirical setting where Europe’s second largest pulp producer, Metsä-Botnia (hereafter Botnia) invested in a pulp mill in South America.  Despite good planning targeted to build a sustainable plant, a disagreement arose regarding its location. The conflict burgeoned into a public issue, which attracted various sets of stakeholders.
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The paper starts by discussing earlier research on MNE-stakeholder relationships to explain our main theoretical starting point. After that we explicate the methodological choices and describe the process of empirical data collection and analysis targeted at local media texts in Argentina. Then, the events of the case are described and the results of the media text analysis presented. At the end, we discuss the theoretical and managerial contributions of the research as well as its limitations.
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Keywords: knowledge management, integrated management systems, continual improvement
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Corporate Governance, Sustainable Development and Value Creation – Some Evidence from Italian Listed Companies
Alex Almici
Università degli Studi di Brescia, Italy
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Modern corporate situations, characterised by the globalisation of the markets and of the information, highlight the need to link the potential of a not transient growth to the adequate reconciliation of all the expectations converging around the entrepreneurial formula and not only of those attributable to shareholders.
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In such a defined context, corporate governance tends to evolve from a situation of primary care for the expectations of shareholders (shareholder view) and for the correlated financial responsibility, to a wide consideration of all the stakeholders (stakeholder view) and related responsibilities (financial, environmental, social, administrative).
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The correct carrying out of governance processes requires, therefore, a clear focus on sustainable development and on the related assumption of a concept of global responsibility. The decisions made by the governing bodies must be driven by the purpose to create value in the long term according to conditions of fairness and sustainable development.
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To sum up, this research aims to deepen the existing connections between corporate governance, sustainable development and value creation on the basis of the empirical analysis of a limited number of listed Italian companies.
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Integrating Sustainability into Strategy and Innovation – A Foresight-Inspired Systematic Approach for Businesses
Bernhard Albert
Freie Universität Berlin, Germany
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What is necessary is an approach which encompasses the integral and participatory identification and evaluation of environmental developments and the integration of the results into day-to-day business. A good basis are participatory processes. They make it possible to integrate the necessary actors at an early stage and to reduce opposition. At the same time they strengthen foresight capabilities and promote a holistic view on the organisation and its activities. During these processes, internal perceptions of corporate frameworks and external environments can be reconciled with the insights of external experts. Thus, the most influencing and most influenced general developments, blind spots, and company-specific trends can be identified. Subsequently, the results can be mapped in trend landscapes and rated in a trend radar. The latter are fundamental for developing strategies, assessing risks, identifying business opportunities and initializing innovation processes. In a critical final stage, the results have to be communicated, transferred to existing structures and processes and continually updated, e.g. in the shape of additional layers in road maps, project management and product planning. An accompanying evaluation returns to the start by detecting successes and changes and by providing a fresh perspective on inner and outer environments.
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Disruptive Innovations at the Bottom of the Pyramid – Can They Impact on the Future Sustainability of Today’s Companies?
Fadare Abayomi Baiyere
University of Tilburg, Netherlands
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Due to the different dynamics required to serve the emerging market that contains billions of people at the bottom of the pyramid (BOP), organizations need to innovate. However, the tendency for large and established companies to ignore the BOP market and rather focus on existing markets implies that, there exists a vulnerability that potentially disruptive innovations from the BOP will not be recognized on time. This paper examines the possibilities of disruptive innovations arising from the BOP, and their associated impact on the sustainability of companies operating in the developed world that primarily targets the top of the pyramid (TOP).
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Additionally, we evaluate the possible scenarios that could emerge from the interplay of innovations by different pyramidal market level. This paper further proposes a recommendation to limit a catastrophic impact resulting from disruptive BOP innovations.
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The Interaction Between Mandatory and Voluntary Reporting of Corporate Social Responsibility Related Information by Listed Companies in the EU and the US
Daniel Gergely Szabo
Aarhus University, Denmark
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Present paper analyses how Corporate Social Responsibility (CSR) information should be disclosed as part of the ongoing disclosure obligation for listed companies in the EU and the US. Current regulation of CSR in the EU and the US manifests itself principally in mandatory disclosure of certain pieces of CSR information. However, these requirements are rather limited and ambiguous. Despite of the limits of the mandatory disclosure requirements, listed companies disclose a significant amount of CSR information voluntarily. However, they are using different vessels and channels for the disclosure thereof, than for the fulfillment of the mandatory disclosure requirements. The duty for listed companies to disclose material information will as a starting point not require the mandatory disclosure of all CSR related information. The issue, however, is debatable, and so far the debate in the US seems to have advanced further than the debate in the EU. However, it is not unthinkable that voluntarily disclosed CSR information is posteriorly deemed to belong to the category of mandatory information.
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Sustainable Futures: The Future Choice of Stakeholders
Aliye Ahu Akgün, Eveline van Leeuwen, Masood Gheasi &  Peter Nijkamp
Free University Amsterdam, The Netherlands
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This study aims to express the opinions of stakeholders in terms of future sustainable development. In order to do so, this study uses the ideas from 172 stakeholders located in five different case study being part of the EU-project SMILE. The differences between the five case-studies enable us to address sustainability as well as its stakeholders in different situations. This way we can encapsulate different sustainability approaches and different needs for sustainable development. To analyse the trade-offs and synergies that exist between different objectives (opinions of different stakeholders) to sustainable development, four scenarios, viz. competitiveness; continuity; capacity and coherence reflecting the different dimensions of sustainability are developed and investigated with the use of a multi-criteria analysis, i.e. Regime analysis. The analysis is carried out to rank different dimensions of sustainable development, i.e. social, economical, ecological, institutional and physical, from the perspective of different stakeholders. These stakeholders were differentiated by their gender, education level, occupation, institution and also geographical information. This study is successful in bringing up the different dimensions of sustainability in relation to the opinions of different stakeholders. The results show that the most important sustainable future is the coherence scenario, in which ecological and social dimensions are the most important ones.
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