A case study to investigate the implementation of Corporate Social Responsibility practices in a European company and determine the relationship between theatrical recommendations (World Wide and Europe) about CSR and its implementation in a European Company.
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 1 Infojobs Corporate Social Responsibility case in practice Implantation of CSR policies in the European Companies. Infojobs case in practice. Hristo B. Kolev1 AUBG2, EMBA3 program1 Corresponding Author – contact: firstname.lastname@example.org American University in Bulgaria3 Executive Master of Business Administration
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 2 AbstractPurpose:A case study to investigate the implementation of Corporate Social Responsibilitypractices in a European company and determine the relationship between theatricalrecommendations (World Wide and Europe) about CSR and its implementation in aEuropean Company.Methodology/approach:The paper is based on the Harvard Business Review’s article Strategy & Society: TheLink between Competitive Advantage and Corporate Social Responsibility byMichael E. Porter and Mark R. Kramer; the European’s Commission framework: Arenewed EU strategy 2011-2014 for Corporate Social Responsibility; and a case inpractice: Implantation and Report of Social Responsibility Practice in a Europeancompany – Infojobs.Findings:The paper finds that there is a close relationship between the article’srecommendations, the European Commission’s framework and the CSR practice in aconcrete company. The companys performance (Infojobs) proves that the bestpractice given by the article and the EC4 is the shared value between business andsocial responsibility, but one of the most important variables is the fact that managersand employees should implement these practices on voluntary bases.4 European Commission
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 3Introduction Free market does not always perform perfectly. Marketplace participants must acthonestly and justly toward each other if the ideals of the free market are to beachieved. CSR is a concern of all the society, ethics in business has been an issue foracademics, practitioners, and governmental regulators for decades, some believe thatunethical, immoral, and/or illegal behavior is widespread in the business world andtheir concerns are supported by the numerous scandals from the late ’90s and early2000s (WorldCom, Enron, Lehman Brothers, Bernard Madoff), others believe thatthere is a framework where all stakeholders together (companies, analysts,government, etc) should integrate CSR in companies. Can CSR gain some credence instakeholders? And correct a part of the satated his market imperfection? Actuallymodern trends of CSR practice goes further from giving positive response to thesequestions, and stands that CSR is becoming a strategic issues for modernorganizations in their competitive advantages. WBCSD5 defines CSR as "The continuing commitment by business to behaveethically and contribute to economic development while improving the quality of lifeof the work force and their families as well as of the local community and society atlarge", this definition is supported by the top ten motivators driving corporations toengage in CSR for competitive reasons: Economic considerations; Ethicalconsiderations; Innovation and learning; Employee motivation; Risk management or5 World Business Council for Sustainable Development
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 4risk reduction; Access to capital or increased shareholder value; Reputation or brand;Market position or share; Strengthened supplier relationships; Cost savings6. This paper is organized as follows. Part one is reviewing the Michael E. Porter andMark R. Kramer’s article. Part two presents the European governmental frameworkand policies to support and extend the implantation of CSR in Europe (the directive isgiven by the European Commission). Part three provides a practice case of implantingand reporting CSR in the Spanish company Infojobs. Part four is a concluding section.1. Analyst point of view of CSR7 From analytical point of view, there are several approaches that try to explain andput in practice the CSR. As common in most economic and social differences, thereare different approaches depending on the geographical location: Canadian (Montrealschool of CSR); Continental European and Anglo-Saxon. Other approaches are:Philanthropy; CSR as business strategy; and Creating Shared Value. One of the mostpopular approaches is the Creating Shared Value (CSV) approach, based on the ideathat corporate success and social welfare are interdependent. CSV received globalattention after an article publicized in 2006 by the actual second ranked businessschool in the world8 – Harvard Business Review article Strategy & Society: The Linkbetween Competitive Advantage and Corporate Social Responsibility, by Michael E.Porter and Mark R. Kramer (2006). Porter & Kramer (2006) stand that CSR efforts are counterproductive for tworeasons: they put business against society; and CSR is approached in generic ways.6 KPMGs International Survey of CSR, 20057 This section is based on the Harvard Business Review’s article Strategy & Society: The Link betweenCompetitive Advantage and Corporate Social Responsibility by Michael E. Porter and Mark R. Kramer8 Financial Times Global MBA Ranking 2012
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 5CSR is getting mature an the framework proposed is to identify all of the effects, bothpositive and negative, companies have on society; determine which ones to address;and suggest effective ways to do so. When looked at strategically, CSR can become asource of tremendous social progress, as the business applies its considerableresources, expertise, and insights to activities that benefit society, and this approachshould lead to build a long-term competitive advantage. Four prevailing justifications for CSR have been used: Moral Appeal (companieshave a duty to be good citizens and to do the right thing); Sustainability(environmental and community stewardship); License to Operate (tacit or explicitpermission from government); Reputation (improve companies image, strengthen istbrand, raise stock value). But none of these could help a company identify, prioritize,and address the social issues that matter most, because all of them focus on thetension between business and society rather than on their interdependence. Porter &Kramer (2006) point as the biggest problem that internally, CSR practices andinitiatives are often isolated from operating units-and even separated from corporatephilanthropy. Externally, the company’s social impact becomes diffused amongnumerous unrelated efforts, each responding to a different stakeholder group orcorporate pressure point. The consequence of his fragmentation is a lost opportunity.To correct this bias and integrate business and society, the authors propose companiesto identify those areas of social context with the greatest strategic value by:identifying the points of intersection between inside-out and outside-in practices; *Figures 1 and 2 – About Here*choose which social issues to address; and creating a corporate social agenda, makingResponsive CSR and Strategic CSR.
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 6 The moral purpose of business should focus efforts to find shared vale in operatingpractices and in the social dimensions of competitive context have the potential notonly to foster economic and social development, but also to change the waycompanies and society think about each other. NGOs, governments, and companiesmust stop thinking in terms of “Corporate Social Responsibility” and start thinking interms of “Corporate Social Integration”. When a well-run business applies its vastresources, expertise, and management talent to problems that it understands and inwhich it has a stake, it can have a greater impact on social good than any otherinstitution or philanthropic organization. Porter & Kramer (2006) support their CSR framework mainly with 2 examples:Toyota – Prius hybrid electric/gasoline vehicle. This product has created a uniqueposition with customers and has established technology standards, the combination ofthese two could suppose a competitive advantage for the company in near future; andNestlé’s example – the company went to Moga to build business and establish localsources of milk from a large, Nestlé diversified base of small farmers in the region,and the result was a creation of shared value for both the company and the region.Today Moga has higher standard of living and knowledge, compared to other regionsin the vicinity.2. European Framework of CSR9 The government is one of the most important stakeholders when we speak aboutCSR. Its role is crucial. On one hand regulation can set the agenda for socialresponsibility by the way of laws and regulation that will allow a business to conduct9 This section is based on the European’s Commission policy: A renewed EU strategy 2011-2014 forCorporate Social Responsibility
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 7itself responsibly, on the other hand, and most important, the government could act ineducation with regulations for high school and undergraduate education, this couldbuild in a social responsibility from the very beginning, therefore future managers andcompanies will carry integrated CSR in their DNA. That way CSR will be part of thecompany’s strategy and culture. European Commission is taking measures in CSR since early 2001 when the firstdefinition was stated: COM (2001)336 “a concept whereby companies integrate socialand environmental concerns in their business operations and in their interaction withtheir stakeholders on a voluntary basis”. The Commission has played a pioneeringrole in Europe ever since, creating European Multistakeholder Forum on CSR in 2001,European Alliance for CSR in 2006. CSR underpins the objectives of the Europe2020 strategy for smart, sustainable and inclusive growth. Under this objective ofEurope 2020 the Commission has reviewed and established a strategy for CSR 2011-201410 aligned with internationally recognized principles and guidelines as OECDMultinational Enterprises, the principles of the United Nations Global Compact, theISO26000 Guidance Standard on Social Responsibility, the ILO Tri-partiteDeclaration of Principles Concerning Multinational Enterprises and Social Policy, andthe United Nations Guiding Principles on Business and Human Rights. This EuropeanGovernmental framework seems a necessity as, today, only 15 out of 27 EU MemberStates have national policy frameworks to promote CSR11. A modern understanding of CSR needs a modern (new) definition. This newdefinition, given in the EU Strategy 2011-2014 is aligned with the analysts’ opinion10 European Commission: A renewed EU strategy 2011-2014 for Corporate Social Responsibility11 European Commission, 2011, “Corporate Social Responsibility: National Public Policies in the EU”
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 8given in part one. European Commission (2011) stands that enterprises should have inplace a process to integrate social, environmental, ethical, human rights and consumerconcerns into their business operations and core strategy in close collaboration withtheir stakeholders, with the aim of: maximizing the creation of shared value; andidentifying, preventing and mitigating their possible adverse impacts. This definitionis completely suitable with the framework given by Porter & Kramer (2006). This2011-2014 strategy shows that the Commission is aware of the multidimensionalnature of CSR, and that public authorities should play a supporting role through asmart mix of voluntary policy measures and, where necessary, complementaryregulation, for example to promote transparency, create market incentives forresponsible business conduct, and ensure corporate accountability. The agenda for action 2011-2014 covers 8 main areas:• Enhancing the visibility of CSR and disseminating good practices: launch a multistakeholder CSR platforms in a number of relevant industrial sectors; and launch in 2012 award scheme for CSR partnership between enterprises and other stakeholders.• Improving and tracking levels of trust in business: limit the “green washing” practices and effects; and periodic surveys of citizen trust in business and attitudes towards CSR.• Improving self-and co-regulation processes: launch a code of good practice.• Enhancing market reward for CSR: increase consumer attention to CSR-related issues; implement a Public Procurement Directives facilitating the better integration of social and environmental considerations; and promote CSR practice from public companies or public investments.
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 9• Improving company (SME12 and large companies) disclosure of social and environmental information: 2,500 European companies publish CSR or sustainability reports, which puts EU in a position of global leadership13, however this is still a small fraction of the 42,000 large companies in the EU.• Further integrating CSE indo education, training and research: provide further financial support for education and training projects: and raise the awareness of education professionals and enterprises on the importance of cooperation on CSR. This area needs special attention, if performed well means that future European corporations and SME will bring implemented CSR in their culture, and will be leaded by managers who care CSR in their DNA.• Emphasizing the importance of national and sub-national CSR policies: create in 2012, with all Member States, a peer review mechanism for national CSE policies; European Commission invites all Member States to develop or update by mid 2012 their own plans or national lists of priority action to promote CSR of the Europe 2020 strategy.• Better aligning European and global approaches to CSR: monitor enterprises >1,000 to take ISO26000; commit all European enterprises to take account of at least one set of principles form those listed in page 7 of this paper; identify ways to promote responsible business conduct in its future policy initiatives towards more inclusive and sustainable recovery and growth in third countries.12 Small and Medium Enterprises13 CorporateRegister.com
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 10 This agenda is really ambitious and if all actions are to be performed as pretendedEuropean companies would build the strong, long-term competitive advantage, interms of CSR, discussed by Porter & Kramer (2006).3. Infojobs CSR case in practice14 Infojobs is a Spanish company established in 1998 in Barcelona. Its business is tooptimize selection and recruitment process for B2B clients. Ifojobs meats the twoparts of the process – Demand (unemployed or looking for new employment people)with Supply (companies that offer jobs). The service is free for the Demand and pay-per-offer for the Supply. Infojobs is owned by Schibsted (94%) and Grupo Intercom(6%), the company has divisions in Spain, Italy, Portugal and Brazil. Spanish divisionis of about 200 people with headquarters in Barcelona and offices in Madrid. The strongest Infojobs’ CSR policy is its core business, the Demand, at the sametime, Demand supposes only 2% of the company’s revenue (Infojobs is primary B2Bfirm). The company’s competitive advantage is based on having the highest possiblenumbers of active15, actualized, online CVs16. The online platform, available in theirweb, is easy to use, however the company provides free online and call center supportfor those (Demand) who have difficulties to make a profile, build their CVs and applyfor an active job offer. Infojobs has a special program to support and help thosepeople who don’t have access to Internet or lack of basic computer and Internetknowledge. Main efforts are focused on the Demand, but still, Infojobs helps on a freebase the Supply to start using the Internet to publish its job offers, Infojobs gives14 This section is based on a telephone interview with the HR director of Infojobs - Joan Pau FisasSuriol; Infojobs CSR report of 2011 and Infojobs CSR agenda 201215 Unemployed People actively searching job or employed people actively searching to switch their job16 Curriculum Vitae
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 11support to those companies who don’t have experience in this type of selection andrecruitment, also the first 5 job offers are free for the companies. Actually Infojobshas more that 7 million CVs in its online database and more than 12,000 companiessubscribed (as clients). The company is pushing the society into innovation and use ofthe new technologies, optimizing their time and creating better opportunities for bothDemand and Supply. Still Infojobs is going further and is doing another type of CSR, based at lease at 3of the 4 prevailing justifications of CSR, named in both, the Porter & Kramer (2006)analysis and presented in the European Commission CSR strategy 2011-2014: MoralAppeal; Sustainability; and Reputation. Since 2009 Infojobs presents an annual CSRreport to its stakeholders.• 2011 CSR Report: The company had 5 main commitments in 2011. o Infojobs made a free additional service of 22,000 packs to unemployed and 12% of them got a job. o Infojobs ran a total of 31 trainee in-situ sessions for unemployed in Madrid, Barcelona and Zaragoza. o Infojobs dedicated €22,000 for scholarships in the IT area. o Infojobs created a voluntary program for internals. More that 30 internal senior assessors helped external companies and NGOs in selection and recruitment practices. o Infojobs donated its Christmas budget for presents for employees to 3 NGOs.• 2012 CSR agenda/commitments: o Improving CSR Policies: the company is continuing to improve its CSR policies in 3 axis: various projects to increase the access to
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 12 employment for people at risk of social exclusion; transmit its values to the children – future managers and stakeholders who will have the responsibility to establish responsible and productive companies; preserve the environment and reduce the impact from Infojobs’ activity. o Community Support: continue with the voluntary project; launch software for unemployed and employed professionals; assess the Supply (companies) in order to create Responsible job offers. o Environmental Protection: reduce energy losses in the company; increase the use of recycled paper; calculate greenhouse gas (GHG) emitted by the company and run a project to reduce it; get ZeroCO2 stamp. o External Communication: improve information to stakeholders: via email (to Demand and Supply subscribed to the service); Newsletter; Blog; 2.0(tweeter, facebook, etc.); improve communication though web page; present the 2012 CSR report to the United Nations Global Compact. o Internal Communication: continue with the voluntary program and increase participation The company has established KPIs17 in order to measure the CSR impact in 2012. *Figure 3 – About Here*17 Key Point Indicator
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 13 After reviewing Infojobs CSR commitment and policies, conclusion is simple.CSR is part of the company’s culture and business, it is approached strategically andgenerates opportunity, innovation, and competitive advantage while solving pressingsocial problems. Infojobs has created a distinctive value for both company and society(Demand and Supply). The company’s progress is related with its stakeholder’sprogress (Demand, Supply, Government) and the company’s R&D is investing in thestakeholder’s improvement in the industry (job market through technology). Infojobsfits 100% in the Porter & Kramer (2006) framework for CSR and is a good case tofollow by the first area from the European Commission’s strategy 2011-2014.4. Conclusions It is all about people. Companies, their strategy and structure are driven by peopleand if we have social responsible people we will have CSR companies. Analystsopinion and frameworks, government’s directives are very important part of the CSRas well, their work is basic in aligning companies commitment with CSR and theyhave lots of possibilities to improve actual situation by laws, recommendations, publicprocurement, education. But still, people are the most variable in this equation,because companies should integrate CSR on voluntary bases, as part of their strategyand business, just like Infojobs, Nestlé’s case or Toyota. Infojobs didn’t implant CSRpractice, didn’t needed a directive or low obligation, it just was created with thisvalues and culture, its main business is social responsible and sustainable. That’s whythe most important area to work in future is education. If society manages to implantsocial responsibility in schools and universities, the managers, entrepreneurs,governments, and other stakeholders will create and rule social responsiblecorporation.
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 14References:Joan Pau Fisas Suriol, (15.3.2012) Infojobs HR Director, telephone interviewInfojobs (2011) CSR reportInfojobs (2012) CSR agendaHarvard Business Review’s article Strategy & Society (2006) “The Link betweenCompetitive Advantage and Corporate Social Responsibility” by Michael E. Porterand Mark R. KramerEuropean’s Commission policy (2011) “A renewed EU strategy 2011-2014 forCorporate Social Responsibility”European Commission, (2011) “Corporate Social Responsibility: National PublicPolicies in the EU”European Commission’s CSR web page, (20.3.2012)http://ec.europa.eu/enterprise/policies/sustainable-business/corporate-social-responsibility/index_en.htm
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 15KPMG, (2005) “International Survey of CSR”Social Enterprise Block, (10.3.2012) http://www.socialenterpriselive.com/your-blogs/item/why-csr-why-nowSlide Share Corporate Social Responsibility, (11.02.12) "Need of the Hour", bySikander Kushwaha; Sitakant Behra; Sudhir Kr. Pandey; Sushil Bandict LakraFinancial Times Global MBA Ranking, (2012)http://rankings.ft.com/businessschoolrankings/global-mba-rankings-2012Wikipedia, (15.3.2012) http://en.wikipedia.org/wiki/Corporate_social_responsibility
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 16 Figure 1 – Looking inside-out: mapping the social impact of the value chain
INFOJOBS CORPORATE SOCIAL RESPONSIBILITY CASE IN PRACTICE 17 Figure 2 – Looking outside-in: social influence on competitiveness Figure 3 – Infojobs KPIs indicators