Powering a new FutureDiscussion Platform 7 on Partnering, Networking and Communities of Practice

(12 Dec 2008, Lisbon)

Accelerating CSR practices in the new EU member states and candidate

countries as a vehicle for harmonisation,

competitiveness and social cohesion in the EU

Krisztina KissUNDP Liaison Officer for Hungary UNDP Office/Ministry of Foreign Affairskrisztina.kiss@undp.org+36 30 967 3451, +36 1 458 3495

CSR - Definitions

„A concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis.”

(Commission Green Paper 2001 „Promoting a 3European Framework for Corporate Social Responsibility”, COM (2001)366 Final)

“The management of, and response to, social, environmental, broader economic and ethical issues – and the extent to which businesses are responsive to stakeholder expectations on these issues.”

(Synthesis Report)

The 8 countries: Bulgaria, Poland, Lithuania, Hungary, Slovakia, Macedonia, Croatia and Turkey

Main Project objectives: To accelerate the implementation of CSR practices in

new EU region, which is seen as a vehicle for EU harmonization, improving competitiveness and social cohesion.

This is expected to be achieved by comprehensively mapping out the CSR activities and actors, identifying capacity gaps and areas where support to both business and the governments is needed, exchange of experience and good practices, awareness raising and supporting national stakeholders.

The Project activities fall under three components:

1. Situational analysis of CSR status in each Project country by carrying out baseline surveys, which will result in European synthesis report to be presented in Regional conference for discussions.

2. Promotion of multi-stakeholder dialogue to enhance awareness and exchange good practices by a) organizing national and local forums in each of the target countries; Regional conference for all Project countries; b) establishing peer groups to work on National CSR agendas and c) developing a Project website.

3. Developing and strengthening capacity of existing and future CSR stakeholders by a) organizing training sessions for peer groups and other active participants in CSR; b) taking peer groups on study trips to the UK, Germany and Spain; c) creating CSR tools database; and

d) organizing discussion tables and a study visit in the UK.

The Project was led by UNDP Office in Lithuania and was implemented by UNDP Offices in Project countries in cooperation with national and regional partners

Duration: January 2007 - September 2008Project partners: Great Britain, Spain and

Germany, as well as UN Global Compact Office and National CSR/Global Compact Networks in Project countries

Budget: 775 636 EuroDonors: EU, UNDP

The main aims of the baseline study

• Identify the actors / entities who promote CSR at country level

• Assess the level of engagement in CSR of actors / entities promoting CSR at country level through mapping their past and present CSR promotion activities

• Assess the level of dialogue between different actors promoting CSR

• Identify the level of foreign / domestic business engagement in CSR implementation at country level and collect examples of good practices

• Identify capacity gaps / constraints of CSR promoters and business entities in engaging in CSR activities

• Formulate recommendations and suggest specific activities based on the findings of the survey

Main findings Institutional level

• Agents of change (contrary to Western Europe) are business’

themselves (supported by membership based business

organisations and international organisations).

• The direct involvement of Government is diverse. However,

due to the socialist heritage, there is a general perception

that social responsibility is the primary role of government.

• The awareness and power of NGOs to put pressure on

business and government are limited.

• The media is failing to hold corporate actors accountable for

irresponsible business activities.

Main findings Company level

• In most of the participating countries, it is more often foreign,

multinational companies are key corporate drivers of the social

agenda.

• Summary data from 288 companies across 8 countries:

– Companies are more open to the concept of expressing a CSR

strategy and engaging in dialogue with stakeholders.

– Less uptake of CSR related governance practices, performance

management or public disclosure – and very little use of assurance

processes.

• Measuring international progress in CSR requires consensus on what

is being measured. There is need to build and promote a common

appreciation of how to measure CSR practice at a company level

across the region.

Main results The six domains

36,8%30,9%

44,8%

58,9% 61,5%

84,0%

39,6%44,4%

38,2%

34,5% 30,2%

11,1%23,6% 24,7%17,0%

6,6% 8,3% 4,9%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Strategy StakeholderEngagement

Governance PerformanceManagement

PublicDisclosure

Assurance

Dimensions

n=28

8

No / little evidence On the way Good practice and beyond

Main results - Reporting

0%

6%

16%

3%

7%

16%

39%

29%

0%

9%

16%

2%

14%17%

3%0%

6%

13%

0%2%

11%14%

0%0%

54%

7%

16%

31%

8%

0%0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Bulgaria Croatia Hungary Lithuania Macedonia Poland Slovakia Turkey

n=

288

Corporate Social Responsibility / Sustainable Development environmental / health & safety GRI Other

Main results - Standards

4%

26%

10%

31%

11%

27%

11%13%

7%

31%

39% 39%

7%

41%

33%

23%

0% 0%

7%

0% 0%

8%11%

7%

0% 0%3%

0% 0%

16%

8%

0%

4%

0% 0% 0% 0% 0%3% 3%

0%

74%

55%

40%43%

47%

3%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Bulgaria Croatia Hungary Lithuania Macedonia Poland Slovakia Turkey

n=28

8

Global Compact ISO 14001 EFQM EMAS SA 8000 Other

Baseline scorecard for the region

A = Integrated and managed: regard CSR as one of the most important factors of a successful and competitive business environment. NGO, consumer and government pressure for social and environmental performance by companies is mainstream.

B = Aware and responsive: regard CSR as central to a successful business environment, there is strong NGO, consumer and government pressure for companies to apply CSR practices, and there are few obstacles that hinder key actors to excel in their social and environmental performance.

C = Attentive and emerging: are aware of the importance of CSR, there are both corporate and NGO pressure to apply CSR practices, there are some obstacles, missing and a limited number of good examples.

D = Vigilant & challenged: there is some pressure to use CSR practices, however there are significant obstacles, major drivers are limited, there is a lack of capacity and experience.

E = Unaware and distracted: the prevailing economic conditions are challenging, there are major obstacles and no significant drivers for adoption of CSR as a business issue.

Development phases of European countries

E Unaware and distracted

D Vigilant and challenged

C Attentive and emerging

B Aware and responsiv

e

A Integrated and managed

UK

Austria

Eastern Europe Western Europe

New Europe

Baseline scorecard for the region

Country Institutional level Company level

Legal and political

environment

Civil societyPublic

DisclosureStandards

Bulgaria D C D D

Croatia C/D C D D

Hungary B/C C D C

Lithuania C/D D D D

Macedonia D D D C

Poland D D D D

Slovakia C C D D

Turkey D C D D

Overview of recommendationsTracking acceleration on CSR in the region

• Adopt the structure of this baseline for future work

• Build consensus on country level indicators

• Establish a mutual understanding for future development priorities

• Seek to co-opt other country level measures that are relevant for CSR

Legal and political environment

• National governments should identify a named department to lead on CSR issues

• National governments should consult widely with interested parties on CSR

• National governments to develop national CSR strategies

• National governments should produce government level reports, integrating CSR issues into public procurement and adopting relevant legislation

Civil society context

• Project initiators to enable further development of civil society organisations in the Region

Companies reporting on CSR

• Project initiators to support the further development of good reporting practice by companies in the region

Company adoption of standards

• Project initiators to support the further development of good management practice by companies in the region

Overview of recommendations (cont.)

Anti-discrimination measures are highly needed at public

levels• Incentive system• Enabling environment, built-out capacities

(human, institutional, financial, etc. - qualitative and quantitative)

• Relevant national legislative framework• Awareness raising campaigns• Special joint public events

>>> National CSR Strategies through Peer Working Groups and stakeholder involvement Were identified and recommended under the

Project

Development of National CSR Agendas through multi-stakeholder dialogue

Why more active Government involvement in CSR is needed?

Situation in the region (Baseline Study on CSR implementation, 2007)

- businesses themselves – supported by local, membership based business organisations are currently the main agents of change for CSR

- the awareness, ability and organisational power of NGOs to put pressure on business and government are limited

- the media in the Region is failing to hold corporate actors accountable for irresponsible business activities

- the direct involvement of Governments across the region is diverse and systematic government incentives and initiatives for social and environmental performance are generally missing

National CSR agendas/strategies were developed to accelerate CSR

Rationale: when traditional driving factors for CSR are missing, Government policies and actions may stimulate developments

Objective: to coordinate state measures for enabling better environment for companies to engage in CSR (CSR promotion measures); to set priority actions of Governments for 3-5 years – thus not a new tool of regulation

Format: no single format – ranging from - Roadmap in Turkey, Stakeholder agreement in Poland to - official government strategy in a form of national programme in Lithuania and Slovakia

Development of National CSR Agendas: process

• Mapping out various stakeholders and building their capacities to implement CSR

• CSR peer groups formed from government representatives and stakeholders-allowed to see “all sides”

• Partnership with three CSR/Global Compact Networks in Germany, Spain and UK and external CSR experts

• Multi-stakeholder forums nationally and locally

National CSR Agendas in a multi-stakeholder context

TURKEY - SECTORS4 CSR peer groups working actively

in the development of Agenda:• TUSIAD (Turkish Industrialist’s

and Businessmen’s Association) WG

• CSR Association round table• Textile CSR peer group• PR and Strategic Communication

Companies CSR peer group

POLAND-STAKEHOLDERSConsultations with 6 main groups of CSR stakeholders: • Business• NGOs, labour unions• Government, academia, • media

HUNGARY-PEER GROUPS, NGOs, STAKEHOLDERS• CSR strategy recommendation for the Government

MACEDONIA – CSR BODY•Coordinative Body on CSR•National Agenda on CSR 2008-2012 – The Government adopted in October 2008

BULGARIA – FORMAL GROUP•A multi-stakeholder CSR experts’ group is appointed by the Order of Deputy Minister of Labour and Social Policy

Development of National CSR Agendas: challenges

• The definition of CSR: Often mixed up with PR, charity, philanthropy or ad-hoc initiatives, the CSR concept should be understood and applied on the basis of common denominator by all national (CSR) stakeholders.

• Lack of capacities of stakeholders

• Leadership and financial sustainability: Which institution assumes the leading role in the implementation of the National CSR strategy and Action Plan? How to ensure the financial sustainability of the national strategy?

• Monitoring and Assessment of results: How do we assess the progress?

• Promotion and spreading the CSR practices among SMEs: What kind of incentives to be applied? Specific requirements which are less cumbersome and less expensive in order to be effectively implemented by SMEs

National CSR Agendas: priorities

Among the priority areas for advancing public policies on CSR the eight countries recognised:

- CSR education and advocacy,

- support to civil society organisations and capacity development of other local stakeholders,

- small and medium enterprise (SME) guidance,

- responsible public procurement,

- development of regional CSR reporting standards and impact monitoring systems

(Statement of Vilnius Conference on Public CSR Policies, 9 September 2008)

Results • Comparable baseline analysis of CSR implementation situation in

the region mapping the actors in the field of CSR• CSR Agendas in 7 countries as first multi-stakeholder agreements

to outline vision/ action plan for CSR development. Led to formalized public CSR policies - provides sustainability for many years to come

• Multi-stakeholder forums turned into permanent or formalized structures (CSR Coordinative Body in Macedonia, CSR Association in Bulgaria, CSR Platform in Turkey, etc.) – will allow to continue the dialogue

• Better understanding among stakeholders - working together allowed to understand each other concerns better

• Cooperation among countries: establishment of knowledge and expert sharing platform in the region, a database of good practices, a joint European masters programme on CSR

The UN Global Compact is the world's largest corporate citizenship and sustainability initiative.

• Since its official launch on 26 July 2000, the initiative has grown to more than 6200 participants, including over 4700 businesses in 120 countries around the world.

• It is a network-based initiative with the Global Compact Office and six UN agencies at its core.

• The Global Compact involves all relevant social actors: companies, whose actions it seeks to influence; governments, labour, civil society organizations, and the United Nations, the world's only truly global political forum, as an authoritative convener and facilitator.

Local networks are clusters of participants who come together to advance the Global Compact and its principles within a particular geographic context:

• They perform increasingly important roles in rooting the Global Compact within different national, cultural and language contexts, and also in helping to manage the organisational consequences of the Compact’s rapid expansion.

• Their role is to facilitate the progress of companies (both local firms and subsidiaries of foreign corporations) engaged in the Compact with respect to implementation of the ten principles, while also creating opportunities for multi-stakeholder engagement and collective action.

• Furthermore, networks deepen the learning experience of all participants through their own activities and events and promote action in support of broader UN goals.

The UN Global Compact

The Ten Principles enjoy universal consensus and are derived from:

 The Universal Declaration of Human Rights The International Labour Organization's Declaration on Fundamental Principles and Rights at Work The Rio Declaration on Environment and Development

The United Nations Convention Against Corruption 

  Human RightsPrinciple 1: Businesses should support and respect the

protection of internationally proclaimed human rights; and • Principle 2: make sure that they are not complicit in human

rights abuses.  Labour Standards• Principle 3: Businesses should uphold the freedom of

association and the effective recognition of the right to collective bargaining;

• Principle 4: the elimination of all forms of forced and compulsory labour;

• Principle 5: the effective abolition of child labour; and • Principle 6: the elimination of discrimination in respect of

employment and occupation. 

 

Environment

      Principle 7: Businesses should support a precautionary approach to environmental challenges;

      Principle 8: undertake initiatives to promote greater environmental responsibility; and

      Principle 9: encourage the development and diffusion of environmentally friendly technologies   

Anti-Corruption

      Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery. 

www.unglobalcompact.org

Thank You for your attention !