Description
This thesis looks into how multinational companies differ when they communicate Corporate Social Responsibility (CSR) rhetoric strategies through corporate discourse. Through a rhetoric analysis of 74 executive letter included in annual or sustainability reports from firms located in Latin America and Scandinavia.
MASTER THESIS
MSc INTERNATIONAL BUSINESS (cand.merc.)
DEPARTMENT OF INTERNATIONAL ECONOMICS & MANAGEMENT
CSR rhetoric in Latin
America and Scandinavia
Authors: Ioana Blaga
Victoria Rodríguez
Surpervisor: Itziar Castelló
Department of Intercultural Communication and
Management Centre for Corporate Social Responsibility
(cbsCSR)
Pages: 119
Characters (with spaces): 251 019
17/08/2011
Executive Summary
This thesis looks into how multinational companies differ when they communicate
Corporate Social Responsibility (CSR) rhetoric strategies through corporate discourse.
Through a rhetoric analysis of 74 executive letter included in annual or sustainability reports
from firms located in Latin America and Scandinavia, we have reviewed how their written
discourses can be useful to identify which rhetoric strategy they communicate in relation to
their aim to legitimate their role as multinational businesses. We propose and determine the
existence of 4 types of rhetoric:
? Strategic CSR rhetoric, which is rooted in the economic pattern of the firm.
? Institutional CSR rhetoric, which is entrenched on the fundamentals of CSR theories.
? Dialectic CSR rhetoric aims to improve the dialog between firm and stakeholders.
? Political CSR rhetoric, based on the new political role of the firm and the
collaborations with Governments and civil society.
Each one of these rhetoric categories refers to a different form of legitimacy and is based on
distinct theories of the firm analyzed in this thesis. The pragmatic legitimacy is achieved
through the strategic rhetoric; the cognitive legitimacy through the institutional rhetoric;
and the moral legitimacy through the dialectic and political rhetoric. We claim that the
political rhetoric seems to signal a new understanding of the firm’s role in society and a
search for moral legitimation. However, this new form of rhetoric is still fairly uncommon
although its use is growing.
The business perspective on CSR is not only influenced by internal motivations and
deliberate insight, but is to a large extent guided by the way society defines standards of
acceptable social corporate behavior. Therefore, we also review the state of the national
business systems in both regions and as well acknowledge the perception of stakeholder
pressures toward. We also consider the globalization pressures and the getting closer trends
for CSR reporting.
By combining theory and business examples, this thesis could help managers and scholars in
the conceptualization of how firms understand their role in society and how they try to
differentiate themselves through their CSR rhetoric strategies.
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Table of Contents
1. Introduction ............................................................................................................................4
1.1 Research field ......................................................................................................................4
1.2 Research purpose ................................................................................................................6
1.3 Research question ...............................................................................................................7
1.4 Disposition ..........................................................................................................................7
2. Methodology...........................................................................................................................9
2.1 Preconceptions ....................................................................................................................9
2.2 Choice of Subject ............................................................................................................... 10
2.3 Research Perspective ......................................................................................................... 11
2.4 Research Approach ............................................................................................................ 12
2.5 Research Strategy .............................................................................................................. 16
2.5.1 Rhetoric analysis ........................................................................................................... 16
2.5.2 Thematic analysis as a coding method ........................................................................... 18
2.6 Sample and Data Collection Process .................................................................................. 19
2.7 Data analysis and coding process ....................................................................................... 21
2.8 Research Limitations.......................................................................................................... 22
2.8.1 Researcher bias ............................................................................................................. 23
2.8.2 Source critics ................................................................................................................. 24
3. Theoretical Framework ......................................................................................................... 25
3.1 Definitions of CSR .............................................................................................................. 25
3.1.1 Academic perspectives of CSR ....................................................................................... 25
3.1.2. Institutional factors influencing the scope of CSR .......................................................... 29
3.1.3. The scope of CSR in different regions ............................................................................ 30
3.2 CSR regional overview ....................................................................................................... 31
3.2.1 CSR in Scandinavia ........................................................................................................ 31
3.2.2 CSR in Latin America...................................................................................................... 34
3.3 Strategic CSR and Shared Value ......................................................................................... 35
3.4 Institutional Theory ........................................................................................................... 37
3.4.1 Review of formal and informal institutions .................................................................... 37
3.4.2 The National Business System ....................................................................................... 39
3.5 Global trends: neo-liberalism, neo-institutionalism and the political role of firm ............... 44
3.6 Legitimacy ......................................................................................................................... 50
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3.6.1 Pragmatic legitimacy ..................................................................................................... 51
3.6.2 Cognitive legitimacy ...................................................................................................... 51
3.6.3 Moral legitimacy ........................................................................................................... 52
3.6.4 Managing legitimacy in a globalized world .................................................................... 52
3.7 Reputation ........................................................................................................................ 54
3.8 CSR rhetoric strategies: Strategic, Institutional, Dialectic and Political ................................ 55
3.8 Summation of the theoretical framework .......................................................................... 58
4. Empirical Analysis and Discussion .......................................................................................... 61
4.1 Strategic CSR ..................................................................................................................... 65
4.1.1 Operationalization ........................................................................................................ 67
4.1.2 Innovation..................................................................................................................... 68
4.1.3 Reputation .................................................................................................................... 69
4.1.4 Strategic link ................................................................................................................. 70
4.1.5 Governance................................................................................................................... 71
4.1.6 Shared Value ................................................................................................................. 72
4.1.7 Leadership on CSR ......................................................................................................... 73
4.2 Institutional CSR ................................................................................................................ 74
4.2.1 CSR ............................................................................................................................... 77
4.2.2 Sustainability................................................................................................................. 78
4.2.3 Philanthropy ................................................................................................................. 79
4.2.4 Stakeholder dialog ........................................................................................................ 80
4.2.5 Sustainable growth ....................................................................................................... 81
4.3 Dialectic CSR ...................................................................................................................... 82
4.3.1 Global Standards ........................................................................................................... 84
4.3.2 Citizenship .................................................................................................................... 85
4.3.3 Accountability ............................................................................................................... 86
4.3.4 Partnership ................................................................................................................... 88
4.3.5 Global Agenda ............................................................................................................... 89
4.3.6 Inclusivity ...................................................................................................................... 90
4.3.7 Focus on the issue ......................................................................................................... 91
4.3.8 Social contribution ........................................................................................................ 92
4.4 Political CSR ....................................................................................................................... 94
4.4.1 Access ........................................................................................................................... 96
4.4.2 Development ................................................................................................................ 97
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4.4.3 Rights ............................................................................................................................ 99
4.4.4 Political engagement ..................................................................................................... 99
5. Concluding remarks ............................................................................................................. 102
5.1 Conclusion ....................................................................................................................... 102
5.2 Limitations....................................................................................................................... 108
5.3 Putting the paper into perspective: suggestions for future research ................................ 110
6. References .......................................................................................................................... 112
7. Appendix ..................................................................................................................................i
List of Tables
Table 1 Pragmatism as research philosophy in management research .............................................. 13
Table 2. Major differences between deductive and inductive approaches to research ...................... 14
Table 3. Explicit and Implicit CSR ....................................................................................................... 39
Table 4. Institutional, Strategic, Dialectic and Political Approaches to the Legitimization Process ...... 58
Table 5. Categories of rhetoric and themes' description .................................................................... 59
Table 6. Total number of themes mentioned under the Strategic CSR rhetoric category ................... 66
Table 7. Percentage of companies reporting in each category relative to the total number of
companies ........................................................................................................................................ 67
Table 8. Total number of themes mentioned under the Institutional CSR rhetoric category .............. 76
Table 9. Percentage of companies reporting in each category relative to the total number of
companies analyzed .......................................................................................................................... 76
Table 10. Total number of themes mentioned under the Dialectic CSR rhetoric category .................. 83
Table 11. Percentage of companies reporting in each category relative to the total number of
companies analyzed .......................................................................................................................... 84
Table 12. Total number of themes mentioned under the Political CSR rhetoric category ................... 95
Table 13. Percentage of companies reporting in each category relative to the total number of
companies analyzed .......................................................................................................................... 96
Table 14. CSR focus in Latin America and Scandinavia ..................................................................... 104
List of Figures
Figure 1. Carroll's four-part model of CSR.......................................................................................... 28
Figure 2. Comparison CSR rhetoric strategies, Latin America vs. Scandinavia ..................................... 63
Figure 3. Comparison CSR rhetoric strategies Latin America vs. Scandinavia ...................................... 63
Figure 4. Percentage of total number of themes mentioned by Latin American companies ............... 64
Figure 5. Percentage of total number of themes mentioned by Scandinavian companies .................. 64
Figure 6. Relative weight of each CSR category in relation to the total number of themes ................. 64
Figure 7. Total number of themes mentioned on the Strategic CSR rhetoric strategy ........................ 66
Figure 8. Total number of themes mentioned on the institutional CSR rhetoric category .................. 76
Figure 9. Total number of themes mentioned on the Dialectic CSR rhetoric category ........................ 84
Figure 10. Total number of themes mentioned on the Political CSR rhetoric category ....................... 96
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1. Introduction
This initial chapter will serve as an introduction to the subject of our master thesis,
Corporate Social Responsibility (CSR); and through it we intend to present the research field,
purpose and objectives of our study. At the end of the chapter we also present the
disposition and structure of the thesis.
1.1 Research field
Nowadays the field of corporate social responsibility (CSR) is clearly expanding and gaining
more attention not only from companies but also from scholars, governments or civil
society. CSR can be seen as a social and political phenomenon in its broadest sense
(Vallentin & Murillo, 2009). CSR is considered a necessity for business organizations to define
their roles in society and to adhere social, ethical, legal and responsible standards to its
economic procedures (Maon, Lindgreen, & Swaen, 2008). Carroll defines CSR as follows: “the
social responsibility of business encompasses the economic, legal, ethical and discretionary
[philanthropic or community leadership] expectations that society has of organizations at a
given point in time” (Carroll & Buchholtz, 2003, p. 40).
Within the worldwide sphere a number of initiatives have arisen to set different standards
according to businesses CSR practices. Sustainability reporting practices such as the Global
Reporting Initiative (GRI); indexes based on socially responsible investment criteria like the
Dow Jones Sustainability Index (DJSI) or FTSE4Good; sustainability reporting practices like
the Global Reporting Initiative (GRI); or membership in CSR communities such as the World
Business Council for Sustainable Development or the UN Global Compact (Gjølberg, 2009).
The United Nations (UN) in 2000 set the strategic policy “UN Global Compact” aimed to
encourage business to align their operations and strategies with a set of universal principles
in the areas of human rights, labor, environment and anti-corruption (Global Compact UN,
2010). Following this commitment businesses dealing in a globalized environment assist that
markets, trade, technology or finance advance in sustainable ways benefiting economies and
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societies in all places (Global Compact UN, 2010). Throughout the last decade the European
Commission has released several communications on CSR where a definition of CSR is given:
“Corporate social responsibility (CSR) is a concept whereby companies integrate social and
environmental concerns in their business operations and in their interaction with their
stakeholders on a voluntary basis” (European Comission, 2006, p. 2). For the European
Commission CSR can make a major contribution towards sustainability and competitiveness,
both in Europe and globally. (European Comission, 2006).
Taking into consideration that the global economy in the last four years has undergone
through the worst financial crisis since the great depression in the 1930s, concepts such as
sustainability and competitiveness are even more relevant to overcome the current crisis
and engage business to integrate their strategies with social or environmental concerns, and
this way legitimize their operations and recover their undermined reputation. This
commitment with CSR apart from a way to increase business reputation should be truly
understood as a way of doing business itself, meaning that CSR should be more than a mere
business strategy, but a way of sustainable business philosophy.
In sum, it is straightforward that CSR is more relevant than ever before in the context of the
global economic crisis, it will help building trust in business which is crucial to recover
business operations all over the world, and it can also redirect business to new forms of
value creation through addressing social or environmental challenges creating “shared
value” (Porter & Kramer, 2006; 2011).
It is clear the concept of CSR is very broad; there are many definitions and related concepts,
thus it may lead to confusion to understand the responsibilities of the firm, and so it can be
interpreted and implemented differently in any business. For example some business might
focus in philanthropic issues; while other business might focus on linking CSR with their core
business, which according to Porter & Kramer (2006) is strategic CSR.
It is important to underline that in a globalized world multinational companies need to pay
attention to social and environmental concerns in different countries or regions with
different regulations; which means they might attend legal environmental requirements for
instance in some countries or voluntary CSR actions in other. For the reason that firms are
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embedded in different national business systems, they will experience divergent degrees of
internal, external and lateral pressures to engage in CSR (Matten & Crane, 2005). Then,
international presence of multinational firms also means to interact with multiple and
diverse stakeholders.
1.2 Research purpose
We have realized most of the cross-national or regional studies on CSR have been mainly
focused on studying the situation within Europe (Albareda, Lozano, Tencati, Midttun, &
Perrini, 2008) or between Europe and the United States (Matten & Moon, 2008; Hartman,
Rubin, & Dhanda, 2007; Maignan & Ralston, 2002), therefore the primary purpose of this
study is to fill the gap of research and conduct a regional study comparing two different
regions: Scandinavia and Latin America. Then we take into account the regional basis to
compare corporate approach to CSR in both regions, analyzing the top companies’ self
representations and CSR statements included in the CEO letters. Moreover our main aim is
to detect how corporations in both regions currently make use of CSR statements to
legitimize themselves and if there are significant differences across regions.
Being students from a Master of Science in Business Administration within the International
Business concentration our purpose is to detect which are the main cross regional
differences and similarities and through this study to be able to better understand CSR
practices and rhetoric in two very different regions. By looking at the largest multinational
companies in each region we would like to observe also if trends on CSR are getting closer
even in distinct settings due to the globalization of the economy.
Nowadays we consider corporate responsibility essential to any kind of business; even more
in times of crises helping firms to re-shape their strategies and try to approach their business
operations from more sustainable and innovative ways. After all, they need to legitimize
their roles in society. Therefore we would like to find out how they position themselves
when talking about CSR in their corporate written discourses.
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1.3 Research question
Considering the theme background and the research purpose previously outlined, the main
research question is defined as:
What are the main differences between CSR rhetoric strategies between Latin American
and Scandinavian top companies?
Other specific sub question arises:
How does this influence their legitimacy strategies?
By including this sub question we would like to find out how top companies in Latin America
and Scandinavia legitimize their business strategies through CSR written discourse.
1.4 Disposition
We have structured the thesis into five main chapters. The first chapter above, served as an
introduction to the subject of our thesis, and here we presented the research purpose and
the objectives of our study.
In the second section the methodology is presented. We will explain and motivate the
methodological considerations that we are using for this thesis. We will clarify the research
approach and methods used and how we collected the empirical data to answer the
research question. Also we will present the limitations of the thesis scope and omitted
points of discussion. In addition, we describe the sample of companies by regions, with an
explanation of the reasons why we have chosen them.
Chapter three will cover the theoretical approach. We will describe our theoretical
framework and all the related theories and concepts we will be using later as the
fundamentals for our empirical analysis. This literature review will create the basis for the
analytical framework. Since the field of study lies within the broad concept of corporate
social responsibility, academic literature on CSR is reviewed to offer the reader with
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different insights on the subject. Also we will describe here the general perspectives on CSR
approaches in both regions.
Chapter four will contain the analysis and discussion of the empirical data. The findings from
the organizational documents will be presented to see how CSR is represented in their
written discourses. We analyze our empirical findings and connect them to the proposed
theoretical framework. The focus will be given to the main cross-regional differences or
similarities found among the way top companies from Scandinavia and Latin America
communicate CSR strategies. Moreover having in mind that firms face both operational
challenges and institutional pressures coming from their regulators, it is important to
incorporate this duality into the analysis. Therefore, the analysis section takes both an
institutional and a strategic perspective.
Finally the last chapter will end up with a conclusion. We will describe our concluding
remarks reflected after this research, taking into consideration our research initial purpose;
therefore attempting to answer the research question and mentioning the main points
touched upon in this thesis. In the concluding remarks we will also put the research into
perspective by identifying implications and opportunities concerning future studies.
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2. Methodology
In this section we present the methodological considerations that we are using for this
thesis. We will clarify the research approach and methods used and how we collected the
empirical data to answer the research question. More to the point we describe the sample
of companies by regions. And at the end of this section we will also consider the limitations
of the thesis.
2.1 Preconceptions
In general, people tend to have different perceptions, values, and preconceptions depending
on the particular environment they belong to. It is likely they will interpret any situation
through their own acquired understanding according to their background. In some cases,
people do not realize about such natural influence at all. Likewise, in the world of research,
preconception is a major threat to the validity of qualitative studies (Miles & Huberman,
1994). As preconception also varies from person to person, it may affect particular
researcher’s selection of topic, or methodology etc. According to Maxwell (2005),
researcher’s own values and expectations may positively or negatively influence the conduct
and conclusion of the research. It is not possible to completely eliminate researchers’ values,
beliefs or perceptual lenses; instead it is necessary to identify particular preconceptions and
understand how these issues will be useful and productive for the researcher (Maxwell,
2005).
In this research, the preconceptions are naturally based on the knowledge that the two
authors have acquired through sixteen months as Master Students in Business
Administration within the specialization in International Business, as well as previous
background experiences. In fact, some specific courses like “Corporate Social Responsibility:
Ethical, Political and Strategic Perspectives” and “Social Responsible Consumer Marketing”
offered by Copenhagen Business School helped and inspired the authors to understand the
Introduction
and RQ
Methodology
Theoretical
Background
Analysis Conclusion
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theoretical foundations of Corporate Social Responsibility. Briefly, to date the authors
understand the spread interest in CSR around the entire world, and the growing importance
of the tied concepts and business practices regarding CSR.
Regarding Latin America and Scandinavia as the geographical areas of the study, the authors
realized that there was less connection and background with the Latin American region,
having only studied theoretically some of the most important emerging markets such as
Mexico or Brazil, and that this could lead to the omission of important points. Nonetheless in
order to prevent such bias the authors have approached the situation and have covered
additional readings with the purpose of having a wider knowledge of the whole region in
economic terms as well as in specific CSR terms.
2.2 Choice of Subject
Any kind of research can be conducted because of three different kinds of goals: personal
goals, practical goals and intellectual goals (Maxwell, 2005). Maxwell also suggests that
personal goals and experiences of the researcher play an important role in many research
studies and it is impossible and unnecessary to exclude such personal goals from the
research design. In the same line, Saunders et al. (2009) connotes that it is important to
choose a topic in which the author is likely to do well and already have some academic
knowledge. Though, it is basic to bear in mind that a good research also needs to fulfill the
gap of existing theory and facilitate its development.
With a global mindset and a strong interest in social responsibility issues, the authors
decided to choose the topic relating to corporate social responsibility within an international
perspective.
As introduced in the second part of the first chapter, there have been relatively few
attempts to identify how companies from different geographical regions themselves
approach CSR, we have realized most of the cross-national or regional studies on CSR have
been mainly focused on studying the situation within Europe (Albareda, Lozano, Tencati,
11
Midttun, & Perrini, 2008) or between Europe and the United States (Matten & Moon, 2008;
Hartman, Rubin, & Dhanda, 2007; Maignan & Ralston, 2002),
Furthermore, more detailed studies focus their interest in the comparison of different
sectors of activity such as the chemical industry (Hoffman, 1999), energy sector (Sharma,
2000) or automotive industry (Geffen & Rothenberg, 2000); all of them being already known
for its environmental impact. As CSR practices have a much broader scope than only
environmental issues, we believe it would be more interesting to explore the biggest
companies from both regions, consequently covering a wide range of sectors of activity,
mainly because of the nature of such big companies as multinational organizations and as
global players.
Also within the crisis we are immerse, we considered very interesting how the companies
legitimize themselves through their CEO written discourse in their Annual or Sustainability
Reports. They use this annual communications to clearly position their companies in
economic, strategic or sustainability concerns; hence we decided to explore in which
sustainability terms they are more interested and how they communicate their strategies,
operations or future developments concerning CSR themes.
Additionally, the selection of the two specific regions was made due to the interest of the
authors in cross-regional comparisons and it was somehow shaped by the language
capabilities and background of the researchers.
As a result, finally the authors came up with the topic “Corporate Social Responsibility
rhetoric in Latin America and Scandinavia” as the research topic.
2.3 Research Perspective
The purpose of this study is to explore how the largest companies in Latin America and
Scandinavia approach CSR. The study does not investigate concrete social responsibility
practices, but rather explores corporate written discourse about CSR practices and
12
approaches. The authors investigated official organizational documents in order to
understand companies’ points of view, especially their self-representation relating to CSR
issues. Precisely we investigated the CEO letters opening the companies’ Annual or
Sustainability Reports. Therefore, the company’s perspective was the one considered for
research purposes.
2.4 Research Approach
We are going to review now the research approach, the research philosophy and the
scientific approach adopted in this paper, these methodological concerns are discussed
under this current point called “Research Approach”.
Business and management research is characterized by the use of both qualitative and
quantitative approaches. These methods have different strengths and are often best used to
address different king of goals (Maxwell, 2005). In the past, qualitative studies were less
accepted by scientific researchers because they considered it provided less rigor, reliability
and verifiability (Berg, 2004). Nonetheless in social sciences research which focuses on
individuals, there are many elements such as emotions, motivations, symbols and their
meanings or any other subjective aspects connected to naturally evolving lives of individuals
and groups that represent their behavioral routines and experiences (Berg, 2004). All these
elements could be considered objective but they are mostly viewed with certain
fundamentals of symbolism, meaning, connotation or understanding that usually require
consideration of the individual’s own perceptions and subjective apprehension, therefore
requiring the use of qualitative studies (Berg, 2004).
According to Weiss (1994) qualitative studies tend to focus on description of visualizable
series of incidents while quantitative approaches tend to asses correlations between an
earlier incident and subsequent incident in terms of quantifiable data. Then, apparently the
main difference between qualitative and quantitative research is the method of collection
and measurement. Another way to distinguish between the two methods is the focus on
numeric (numbers) or non-numeric (words) data (Saunders et al., 2009).
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Instead of identifying which research method is superior to the other, it is necessary to
choose the method that best fits with the research questions and purpose (Saunders et al.,
2009). Consequently we are choosing pragmatism as research philosophy. In terms of
research philosophy, pragmatism argues that the most important factor of the
epistemology, ontology and axiology the researcher adopts is the research question
(Saunders et al., 2009). Table 1 below summarizes the most important aspects of
pragmatism.
Table 1 Pragmatism as research philosophy in management research
Ontology: the researcher’s view of the
nature of reality or being
External, multiple, view chosen to best enable answering of
research question
Epistemology: the researcher’s view
regarding what constitutes acceptable
knowledge
Either or both observable phenomena and subjective meanings can
provide acceptable knowledge dependent upon the research
question. Focus on practical applied research, integrating different
perspectives to help interpret the data
Axiology: the researcher’s view of the
role of values in research
Values play a large role in interpreting results, the researcher
adopting both objective and subjective points of view
Data collection techniques most often
used
Mixed or multiple methods designs, quantitative and qualitative
Source: Adapted from Saunders et al 2009 p. 119.
In this study, the research question is “What are the main differences between CSR rhetoric
strategies between Latin American and Scandinavian top companies?”, thus it is more
appropriate to analyze the case by using the qualitative approach, rather that conduct a
quantitative study based on statistical analysis. Qualitative is used mainly as a data collection
technique (e.g. interview) or data analysis procedure (e.g. categorizing data) which
generates or uses non-numerical data (Saunders et al., 2009). Precisely in this qualitative
study, we will categorize data, coding as a thematic analysis, which will be explained more in
detail in the next point.
As part of the qualitative approach, methods such as interviews, questionnaires or focus
groups could have been used in this study. But due to the specific case, time and budget
constrictions we better considered using and analyzing organizational documents as a main
source of data. Then, the empirical information contained in this paper has been collected
from the CSR, Sustainability or Annual reports (depending how companies name the
corporate document), all of them being organizational documents containing CSR
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information. These corporate documents have been accessed through official companies’
websites.
Regarding the scientific approach, deduction and induction are rational processes broadly
used by researchers (Graziano & Raulin, 2004). With the deductive approach the aim is to
test the proposed hypothesis and the empirical data by using already existing theories; while
using an inductive approach the aim is to analyze and observe the empirical data in order to
build up new theory (Saunders et al., 2009). Then, it is clear deduction will be more suitable
when there is a broad extent on literature related to the research topic, from which the
theoretical framework can be well defined; combined with a research question that lends
itself to a deduction process. Conversely, having a proposed research on any new topic on
which there is very little existing literature, it may possibly be more proper to use an
inductive approach by generating data and analyzing and reflecting upon which theoretical
themes the data are suggesting (Saunders et al., 2009). The Table 2 summarizes some of the
most important differences between induction and deduction.
Table 2. Major differences between deductive and inductive approaches of research
Deduction emphasizes Inductions emphasizes
? scientific principles
? moving from theory to data
? the need to explain causal relationships
between variables
? the collection of quantitative data
? the application of controls to ensure validity
of data
? the operationalisation of concepts to ensure
clarity of definition
? a highly structured approach
? researcher independence of what is being
researched
? the necessity to select samples of sufficient
size in order to generalize conclusions
? gaining an understanding of the meanings
humans attach to events
? a close understanding of the research
context
? the collection of qualitative data
? a more flexible structure to permit changes
of research emphasis as the research
progresses
? a realization that the researcher is part of
the research process
? less concern with the need to generalize
Source: Saunders et al. (2009) p. 127
Although it is valuable to consider the direction of the relationship between theory and
research in terms of the scientific approach, being either deductive or inductive, the line of
division between these two options is not always straightforward (Bryman & Bell, 2007).
Thus, it can be assumed that it is possible to design the research based on both deductive
15
and inductive approaches, if it is more appropriate in any specific case and therefore it can
even lead to a more useful and valuable research approach (Saunders et al., 2009).
In order to understand how CSR rhetoric plays its role in the biggest companies of the
selected regions, in the initial phase of this research the data was collected based on the
framework adapted from the study of Castelló & Lozano (2011). Thereafter, the empirical
study has been carried out and the framework has been revised according to real findings.
Then, apparently this research is trying to test a theory as well as to enrich existing theory
from the empirical data. As a result, the research’s nature is mainly deductive but also
inductive.
As part of business and management research, this paper is intended to gain a deeper
understanding about CSR communications of top companies in Latin America and
Scandinavia, concentrating on subjective factors such as companies’ legitimacy through
outlined strategies and motivations.
The study focuses on companies’ perspectives which are subjective and can change from
time to time. Therefore, the context shown in organizational documents serves as an
important explanatory variable. The study began with gathering qualitative data through
companies’ documents and tried to interpret such context company by company.
Thereafter, the findings were grouped and analyzed based on the set framework which will
be explained in the next chapter, theoretical framework.
We began the analysis with specific observations through conducting exhaustive readings on
the corporate letters. Subsequently, according to the existing literature we detected
patterns and regularities from this primary data; and also we added other observed patterns
to the theoretical framework. Then as it was mentioned before, we mainly used elements of
deductive reasoning, but inductive reasoning has also been applied.
Before starting the readings, we had an idea about the theoretical framework we already
wanted to apply in the thesis. Then, the insights from primary sources gave us inspiration
together with additional literature on CSR apart from the main theoretical framework we
16
use from Castelló & Lozano (2011) to add new themes in that framework. This illustrates the
flexible approach we have applied in the research process.
2.5 Research Strategy
In this point we would like to explain the specific research strategy we have followed in the
thesis. We refer to the discourse and more specific the rhetoric analysis as the research
methodology and to the thematic analysis as the coding method used throughout the
empirical analysis.
2.5.1 Rhetoric analysis
As we mentioned in the introduction chapter, limited research has been conducted on CSR
communications as a way to legitimize business operations in cross-country or regional
comparative perspectives. Even more now in times of crises we think companies use
corporate discourse to legitimize themselves and the role they play in society. Then, our
research design takes an explorative perspective since we intend to analyze according to
literature, the CSR statements of top companies in two different regions.
The analysis of corporate written discourses will provide us with concrete fundamentals to
evaluate legitimacy strategies. According to (Hardy et al., 2000) discourse is one of the
strategic forms that firms use to legitimize their actions. Within the analysis on corporate
discourse, the study of companies’ rhetoric strategies presents an interesting perspective of
not only corporate procedures and actions but also on their view of the role of the firm in
society (Scherer & Palazzo, 2007).
Thus, we are going to conduct the rhetoric analysis as research methodology. Rhetoric can
be defined as the art of effective or persuasive speaking or writing; or the language designed
to have a persuasive or impressive effect (Oxford University Press, 2011). According to Gross
(1994), rhetoric is a theory capable of analyzing public understanding and an activity capable
17
of creating it. The way organizations define and use words reflects their implicit intentions
and following actions (Searle, 1995). Moreover, rhetoric is seen as a key cultural and
symbolic resource for firms to develop and communicate their shared knowledge (Alvesson,
1993). This author also emphasizes the importance of rhetoric when organizations use it to
show up particular identities and intangible assets as distinctive leading to differentiation
strategies.
The rhetorical strategies firms pursue, act as structural features of their organizational
discourse and thus can be detected through the analysis of corporate communications
(Castelló & Lozano, 2011). The rhetorical strategies frequently acquire the form of
enthymemes or argumentations-in-use; they are syllogisms whose premises are drawn from
the audience. They are usually only partially expressed, so their logic is completed by the
audience. Then enthymemes are not considered universal rational or true but are so only
within specific socio-cultural contexts depending on their conformity to the audience beliefs
and assumptions (Castelló & Lozano, 2011). Thus this analysis strategy gives to this study the
explorative, and subjective character in the interpretations carried out in the analysis.
In this thesis, conducting rhetorical analysis drives an interest in the role of corporate
language in structuring organizational actions and procedures; with the clear focus on CSR
rhetoric and its use as a corporate message to influence an audience, that normally gathers
together a broad range of stakeholders related to any company: from suppliers, customers,
Governments, to NGOs or civil society in general.
We aim to identify legitimacy through CSR strategies and their embeddedness within
differentiated corporate discourses; in order to achieve this aim we study the structure of
corporate rhetoric. To study the latter we will code CEO statements in either sustainability or
annual reports (since not all the companies published a separated sustainability report, we
considered relevant to include CEO letters published also in regular annual reports provided
that they also contain CSR statements in those corporate letters).
It is clear that annual, sustainability or shareholder reports are means to legitimize corporate
actions (Suddaby & Greenwood, 2005). Given that CSR is a relatively new management
18
development (The Economist, 2008) companies reflect these management trends in their
corporate discourses, particularly in letters from top management included in the first pages
of the reports (Snider, Hill, & Martin, 2003). The CEO statements included in the reports
define the companies’ strategic lines and can be considered one of the most representative
parts of the whole report (Abrahamson & Amir, 1996). They usualy cover one or two pages
of length in the report (but it depends on the company, because they can be even longer)
and include a complete description of the company most important performance highlights
and the main strategic lines of action of the company. Hence, they present the company’s
organizational rhetoric, not the individual rhetoric even if they are signed by the CEO being
the main representatives of the firm. The executives make sure these letters transmit the
firms’ image and the main messages the company wants to deliver to its stakeholders and
general public (Castelló & Lozano, 2011). We intend to explore the CEO letter’, to
understand the statements and detect all CSR related issues presented.
2.5.2 Thematic analysis as a coding method
We consider that analyzing the CEO statements gives a clear evidence of the CSR messages
the company wants to share with its stakeholders. Apart from the theoretical framework
proposed by Castelló & Lozano (2011), to be able to analyze the CEO statements we used
thematic analysis which is the process of encoding qualitative information where the
encoding requires and explicit “theme”, a pattern found in the information (Boyatzis, 1998).
Thematic analysis will help us to transform the data analyzed (CEO statements) into codes.
Once we interpret the CEO statements we will be able to create themes and further codes.
This type of analysis is highly inductive, that is, the themes emerge from the data and are
not imposed upon it by the researcher. The data collection and analysis take place
simultaneously. Even background reading can form part of the analysis process, especially if
it can help to explain an emerging theme (Boyatzis, 1998). We can confirm in our research
the new emerging themes (differentiated from the themes proposed by Castelló & Lozano
(2011)) were initially generated inductively from the CEO statement information, but we
were also looking into theory to support some of the new themes.
19
It is clear throughout the research process we have been moving forward and backward
between the CEO letters and the research literature; this actually supporting the premise the
study is not completely deductive or inductive, but an analysis using both research
approaches.
2.6 Sample and Data Collection Process
In order to perform the study, the companies for our analysis where selected from the
ranking “The Forbes Global 2000” (as of 21.04.2010) due to the fact that this was the only
international ranking with a significant group of companies from the countries that forms
both the Latin American and Scandinavian regions. The Forbes Global ranks the 2000
biggest, most powerful listed companies in the world; the multinational companies listed get
a composite ranking from four metrics: sales, profits, assets and market value (Forbes,
2010).
Other available ranking, like the “Global Fortune 500” was also considered in the beginning,
but once reviewed, it did not list many relevant companies for the study. There were a
number of different ranking listing companies separately from the two regions, like the “S&P
Latin America 40” or the “FTSE Nordic 30”, but we did not consider those either, since we
agreed companies from both regions should be listed in the same ranking according to the
same criteria. Then we reached the conclusion, the relevant ranking for this study was the
Forbes Global 2000.
We found a sample of 69 companies from Latin America and 61 companies from Scandinavia
listed in the Forbes Global 2000 ranking. We went through these companies, checking their
corporate websites to access the sustainable or annual reports containing CSR information in
the CEO opening letters. Companies that did not provide CSR information in the corporate
communications were excluded, likewise companies not displaying the documents in English
were also rejected, because we consider English as the international business language, and
the one that we both as researchers can understand and interpret for the following rhetoric
analysis. Hence from the initial sample we ended up excluding 32 Latin American companies,
20
and 24 Scandinavian companies due to the mentioned reasons such as the lack of CEO letter,
no mention of sustainability, the language of the report or the type of report. These
excluded companies are presented in Table I and Table II in the appendix.
As a result the representative sample is made of 37 companies from each region.
The Latin American companies selected are:
Petrobas- Petróleo Brasil, Banco Bradesco, Vale, Itaúsa, Eletrobrás, Femsa, CSN- Cia
Siderurgica, Grupo Mexico, Usiminas , Oi Tele Norte Leste, Grupo Modelo, CBD-Brasil
Distribuiçao, Cemex, Metalurgica Gerdau, Cemig, Grupo Bimbo, CPFL Energia, Braskem,
Redecard, BRF-Brasil Foods, Fibrial Celulose, Cielo, Sabesp- Saneamiento Basico, SQM,
Natura Cosmeticos, Soriana, Fresnillo, Banrisul, BCI- Banco Credito, ALFA, CMPC, Copel,
Embraer, Kimberly-Clark de Mexico, Net Serviços, Fosfertil, and Sul America.
The Scandinavian companies selected are:
Statoil, Nordea Bank, Nokia, TeliaSonera, Ericsson, Danske Bank Group, Fortum, Novo
Noridisk, H&M Hennes & Mauritz, SCA-Svenska Cellulosa, A.P. Moller-Maersk, SEB- Skand
Enskilda Bank, Volvo Group, Atlas Copco, Yara International, Skanska, Orkla, Vestas Wind
Systems, TDC, Swedbank, Electrolux, Kone, Norsk Hydro, Wärtsilä, Stora Enso, Tele2, Neste
Oil, Storebrand, SKF Group, Metso, Alfa Laval, TrygVesta, Kesko, DSV Group, SSAB,
Novozymes, and Boliden.
Detailed information from the selected companies is enclosed in the appendix in Table III
and Table IV where companies are classified according to the ranking Fortune Global 2000,
and facts such as the country of origin, industry of operations and other financial data are
showed.
Then this representative sample shows the list of companies with the common characteristic
that are all multinational engaged in the CSR movement. Our assumption behind the
selection of large companies in both regions is that they are adopting and creating new
trends in CSR rhetoric, so we would like to compare and analyze those trends to find out the
distinctive features in each region.
21
The reporting period considered in this analysis was for the year 2009 and a total of 74
reports, accessed through the corporate websites, were scrutinized. We chose the year 2009
since we wanted to study the most recent trends on CSR; and we considered for year 2010
would be difficult to gather the majority of reports given that many companies publish their
reports after March. Therefore we started the thesis in February 2011 and by then many
companies did not have published yet the 2010 report. Then we decided to take year 2009
for the study.
We would like to point out that since the primary source of data for this research has been
organizational documents, the statements representing the different CSR themes have been
collected directly from those documents available at companies’ corporate websites. We
have organized a data base to quote all the representative statements and to indicate how
many themes each company have mentioned according to the overarching CSR category and
the specific themes forming the categories. The output tables from the data base are
attached in the appendix as Table V and Table VI.
Corporate documents, either Sustainable Reports or in the case the company did not provide
this specific report, Annual Reports were accessed from the corporate websites to access the
executives opening letters. Corporate websites were accessed from March 1st to April 7th,
2011.
2.7 Data analysis and coding process
The process of gathering the empirical relevant data from the CEO letters and the coding
process has been developed by the two authors of this research. In the first stage, each of us
looked for initial patters in the letters according to theory and we also found new patters to
define new codes. Once we looked for those initial patters we put in common our findings
and we created the common encoding framework, clarifying which themes where included
within the proposed overarching themes; which are “institutional”, “strategic”, “dialectic
rhetoric” as proposed by Castelló & Lozano (2011) and “political” the latter theme emerging
from going back and forth from theory of to the data.
22
In order to improve the quality of our analysis before starting the coding process of all the
CEO letters we did a deep review of all the proposed codes so far to set a shared starting
point. Then, we analyzed the total of 74 CEO letters from both regions of study so we could
detect all rhetoric strategies and their patters and similarities.
In the analysis process we detected the relevant sentences containing CSR themes and we
gathered them in our data base, having examples from the letters for all the categories
found across each letter.
As we already mentioned, both researchers went through the whole sample having done a
double analysis. This way we sought to make sure we agreed in all the themes we found. Of
course along the analysis process, there were some examples not so straightforward to
include in one theme or another, so we needed to discuss whether a quote was part of one
code or other, due to the subjectivity of some sentences, but we always looked at the
theoretical frame and themes definitions, discussed deeply and analyzed the quotes
together afterwards so the results could be clear for both of us. Thus we both analyzed
firstly separately and then we put our findings in common to validate all our results into the
proposed themes, therefore adjustments and refinement were done throughout the analysis
process until agreement was achieved.
As part of the analysis we include a more quantitative approach based on the 74 companies
from both regions, when we go through the themes we found and we group them in terms
of the category and we consider the frequency, and relative frequency to the total number
of themes reported.
2.8 Research Limitations
We acknowledge it is necessary to make clear there are some limitations in the study. We
have chosen to limit the geographical scope of the thesis to concentrate in the regions of
Latin America and Scandinavia represented by the 37 companies in each region that supply
the CSR required information. Therefore we have been careful with drawing conclusions
23
from this material, within the countries, there are significant differences in the forms and
intensity of CSR. Also generally concerning their political systems, it can be said Scandinavian
countries are more homogeneous than the Latin American countries. Although the thesis at
hand focuses on how leading companies in both regions communicate different CSR rhetoric
strategies through CEO written discourse, being then a corporate study. But there must be
said political context highly influences the firms dealing in each region, we cover this topic in
the theoretical framework as the institutional factors shaping business CSR strategies.
Furthermore, even if we are analyzing the reports referring to financial year 2009, we do not
intend to deeply discuss the underlying reasons behind the economic recession and how it
has influenced current CSR strategies in firms.
We also acknowledge the limitations of both the sampling selection and sample size. A
sample restricted to 74 reports might be considered small. However provided the
explorative character of the research we consider conclusions arising from this sample to be
significant.
2.8.1 Researcher bias
When performing the qualitative analysis of corporate disclosure through organizational
documents, the researcher can be biased by the previous knowledge on the topic or by the
background, as the analysis involve interpreting and coding data.
In order to try to avoid such bias, the researchers performed an extensive literature review
on the topic, getting familiar with CSR issues and main theories, as well as previous similar
studies. The coding scheme used as the main framework for collecting data (Castelló &
Lozano, 2011) was studied and discussed in order to increase the understanding of how CSR
issues should be categorized.
24
2.8.2 Source critics
Even though documents accessed from private sources like companies are likely to be
reliable, authentic and meaningful, people who write organizational documents, such as
managers, are likely to have a particular point of view that they want to get across (Bryman
& Bell, 2007). In this particular study, the researchers were interested in identifying how
corporations presented their view of CSR through the organizational documents, therefore
the way of performing a self-presentation was itself relevant for the research. Company
reports made available to different stakeholders are likely to be approved and reviewed,
especially in the case of large companies such as the ones selected for this thesis.
As the data sources for the research were organizational documents, the researchers were
somehow limited to the information disclosed by companies through these means.
Considering the aim of the research and the relevance of CSR disclosure in representing CSR
beliefs and behaviors, the data obtained was considered sufficient and relevant in providing
interesting insights into the nature and the differences in CSR approach among regions.
Therefore, such limitation did not influence negatively the outcome of the research.
25
3. Theoretical Framework
In this chapter, we will present our theoretical framework, which we will use later as the
basis for our analysis of the empirical data collected. We have chosen to delimitate our
theoretical framework first on theories related to general CSR definitions, institutional
factors influencing the scope of CSR and the scope of CSR in different regions. Then we also
focus the theoretical frame defining the trends of CSR related to the strategic and shared
value approaches, institutional theory, neo-liberalism, neo-institutionalism and the political
role of firm. We also review legitimacy strategies, as well as CSR rhetoric strategies. Finally,
an overview of the elements included in the theoretical framework is given.
3.1 Definitions of CSR
3.1.1 Academic perspectives of CSR
The concept of corporate social responsibility (CSR) has evolved from a narrow notion into a
complex concept over the past decades. When reviewing the literature on CSR, there are a
few authors that emerge as the main theorists, still the range of definitions and studies
made on CSR shows that there is still no consensus in neither the corporate nor academic
world on how the term should be defined (Dahlsrud, 2006; Lantos, 2001; Sasse & Trahan,
2007).
So far, CSR has been characterized by the integration of social and environmental concerns
into business activities on a voluntary basis, which over the past two decades has gained
widespread popularity and legitimacy (Gjølberg, 2010). Clarkson (1995) highlights the fact
that managers do not think or act in terms of concepts such as responsibility or integration.
Though, if managers do think of CSR, most likely they will concentrate on the demand from
stakeholders that are perceived as being powerful, legitimate and/or urgent (Clarkson, 1995;
Mitchell, Agle, & Wood, 1997). This means that the increasing demand and pressure on
Introduction
and RQ
Methodology
Theoretical
Background
Analysis Conclusion
26
companies by various stakeholders suggest that the CSR efforts neither emerged as of legal
requirements nor as completely voluntary actions; this can also be seen in the European
Commission’s definition on CSR from 2006 who states that “An increasing number of
European companies are promoting their corporate social responsibility strategies as a
response to a variety of social, environmental, and economic pressures” (European
Comission, 2006).
The Corporate Social Responsibility concept was from the beginning business-drive but with
the impact from the economic globalization and deregulation, the concept of CSR is
becoming more and more elevated as new and innovative for national and global
governance. Thus, it is fundamental and relevant not only for companies, but also to
governments (Bendell, 2000). The CSR concept can be interpreted in different means as
there is no specific rules on how to apply it (Crane et al., 2008). Furthermore, the idea is
continuously developing as one can see from the literature (Carroll, 1991). Another reason
why it has been so hard to agree on a single definition of the term is due to the different
understanding of CSR coming from the institutional differences described by the national
systems. The difference of the cultural, national and social environments in some countries
in what firms concerning CSR might not be the same as in other countries, where e.g. CSR
implies the fulfillment of legal requirements (Crane et al., 2008).
The notion of CSR has drawn attention and interest from business, civil society, media and
government and thus its fast growth since the 1990s can be explained as a “unique rise to
prominence” in the management literature (Crane et al., 2008, p. 3). Today, besides a
managerial concept, CSR is in addition promoted as a concept in which civil society and
governments should engage in, for them to be observed as modern and legitimate (Sahlin-
Anderson, 2006).
Bowen who had the first publication on the topic argues that the industry has “an obligation
to pursue those policies, to make those decisions or to follow those lines of actions which
are desirable in terms of the objectives and values of society” (Bowen, 1953, p. 6). Wood
(1991) expanded the ideas proposed by Bowen (1953) and proposed the following three
principles deriving from CSR: 1) That businesses are social institutions and thus, obligated to
27
use their power responsibly; 2) That businesses are responsible for their outcomes coming
from their involvement with society; and 3) That individual managers are also moral agents,
who should exercise discretion in the decision making process.
Friedman (1970) disagrees with Wood (1991) and argues that businesses only have one
social responsibility, maximizing the profit of their owners. He argues that managers who
use the firm’s resources for non-profitable social purposes is imposing a tax on the
organization and diverting economic efficiency.
Frederick et al., (1992), Freeman (1984) and Lodge (1977) disagree with the economic view
proposed by Friedman (1970) claiming that the role of institutions is not working as the
economic model suggests, because of the separation between ownership and management,
the rise of oligopolies and the interactions and influence of governments and society. In their
opinion, businesses should be seen as social institutions rather than mainly private
institutions. In this way, companies are responsible for any of their social and environmental
actions in the community.
Freeman (1984) created the “stakeholder theory of the firm” which addresses the
corporation and its responsibilities by looking at the stakeholders that have a legitimate
interest in the corporation. According to Freeman (1984), companies are not merely
managed at the interests of their shareholders, but also of stakeholders, which are defined
as “any group or individual who can affect, or is affected by, the achievement of the
organization’s objectives" (Freeman, 1984, p. 46).
Elkington (1999) also opposed the economic model suggested by Friedman (1970) and
created the “triple bottom line” implying that businesses should not only have the goal of
adding economic value to the business but as well the aim at adding environmental and
social value, in order to achieve sustainability. The triple bottom line is outlined by the
environmental-, economic-, and social-perspectives (Crane & Matten, 2004).
One of the first authors to establish one of the most accepted theories of CSR is Carroll,
(1979). He argues that corporations have four responsibilities that need to be carried out in
28
order for them to be good corporate citizens: economic, legal, ethical and philanthropic. He
outlines these responsibilities in consecutive layers within a pyramid (Figure 1), which all
need to be carried out/fulfilled in order to achieve ‘true’ social responsibility.
Figure 1. Carroll's four-part model of CSR
Source: (Carroll A. B., The Pyramid of Corporate Social Responsibility: Toward the Moral of
Organizational Stakeholders, 1991)
The first two layers in the pyramid, economic and legal responsibilities are assumed to be
“required” of all corporations, while the ethical and philanthropic responsibilities are
considered “expected” and “desired” by society. Consequently, Carroll & Buchholtz (2003, p.
35) outline the following definition for CSR: “Corporate social responsibility encompasses the
economic, legal, ethical and philanthropic expectations placed on organizations by society at
a given point of time”. What is common for the economic and legal responsibilities is that
businesses are required to have both. Further, companies also are expected to be ethical,
where they not just follow and meet rules and regulations of society but as well the norms
and standards. At the top of Carroll’s pyramid lies the philanthropy.
As discussed, the definition of CSR varies and the views on CSR differ in terms of the
foundation or scope of CSR. Based on the theoretical grounds, Corporate Social
responsibility can be summarized as a voluntary action due to that it goes beyond what laws
require, but not that the activities are totally left to the responsibility of companies.
29
3.1.2. Institutional factors influencing the scope of CSR
In general, there are differences of CSR approaches; theoretically it has been argued that
there are differentiated institutional settings or specific conditions that favor socially
responsible corporate behavior; thus, CSR can be influenced by the region, the nation, the
industry and the company itself. More specifically, at a regional or national level, there is
considerable distinction in economic, cultural, environment or political contexts, which will
be reflected in the level of endorsement of CSR and the types of activity promoted by firms
in particular countries (Welford, 2005).
Campbell (2007) states that the relationship between basic economic conditions in any
business environment and the responsible corporate behavior of companies operating in it is
influenced by several factors that are: public and private regulation, the existence of
nongovernmental and other independent organizations that observe corporate behavior,
the institutionalized norms concerning proper corporate behavior, the associate behavior
among corporations and the shared dialogues among corporations and their stakeholders.
According to Campbell the economic conditions (such as the level of competition, or the
health and progress of the economy) shape the probability that companies will behave in
more socially responsible ways; weak economic performance or an unhealthy economy will
reduce that probability. Campbell sustains that in the case of too high or too low
competition in the environment, companies will tend to behave in less socially responsible
ways, while having moderate competition enhances better CSR approaches by companies. In
the case of having strong State normative regulation, collective industrial self-regulation,
NGOs or any other independent organizations monitoring corporate behaviors then
companies are more likely to operate in socially responsible ways (Campbell, 2007).
In Norway, company policies regarding indigenous population are reflected by the local
condition that there is a large minority indigenous population in the northern part of the
country (Welford, 2005). Some researchers also highlight social issues in the level of the
industry. For example Araya (2006) found out that social and environmental reporting is
30
more common in internationally oriented and socially and environmentally sensitive
industries in Latin America.
At the company level, there are several factors influencing CSR practices such as internal
organizational conditions, strategic attributes, and of course stakeholder pressures (Etzion,
2007).
3.1.3. The scope of CSR in different regions
CSR, has to a great extent its origin as an American concept that focuses on how companies
can align social expectation with profit maximization (Vogel, 2005; Preuss, Haunschild, &
Matten, 2006; Matten & Moon, 2008). However, in the past couple of years it has attained
an audience reaching beyond the business society (Sahlin-Anderson, 2006) where
governments also need to be engaged in this global trend of CSR in order to be perceived as
legitimate and modern. CSR, is a state-market-society model that is neither politically nor
culturally neutral (Blowfield, 2005; Hanlon, 2008), and the common divisions among
American and Europen societies are clearly seen in CSR, as they are noticeable in different
interpretations and practices of CSR across the Atlantic (Matten & Moon, 2008).
There have been several studies made to address the differences in CSR between countries,
mostly within Europe (Aaronson, 2002; Perrini, 2005; Silberhorn & Warren, 2007) and
between Europe and US (Maignan & Ralston, 2002). Some comparisons have been made
addressing differences in CSR among Asian countries (Ang & Leong, 2000; Chapple & Moon,
2005; Welford, 2005) but also studies exploring the differences between countries in Asia,
Europe, North America and other regions have been conducted (Welford, 2005; Baughn,
Bodie, & McIntosh, 2007). For example Maignan and Ralston (2002) discovered that
companies in different countries differed in their managerial practices, stakeholder issues
but also on how much they emphasized and communicated CSR activities on their websites.
In comparison to companies in France and the Netherlands, companies in the UK and the US
usually tend to discuss CSR principles and to mention codes of ethics on their webpage much
more, as well as mentioning what they give to the community through voluntary donations
and solidarity activities (Perrini, 2005; Chapple & Moon, 2005).
31
Most of the academic literature has a focus on ethical and environmental issues, even
though “doing the right thing” appears to have different interpretations across the world
(Baughn, Bodie, & McIntosh, 2007) and the understanding of CSR is different from
organization to organization (Casanova & Dumas, 2010). Therefore, although the existence
of studies made on cross-country and cross-region comparisons addressing CSR practices in
Europe, Asia and Latin America are few, the current studies suggest the existence of
different regional patterns concerning the way CSR is viewed and implemented.
In the US, the CSR concept is more influential than in Europe. In Europe the capitalism model
tends to define the economic responsibility of states more widely and focused while the
Anglo-American region see the legal responsibility from another perspective, that
government intervention and rules are much more likely to be viewed as an intervention
with private liberty, whereas the European thinking tends to see the state in the role of
enforcing the accepted rules (Crane & Matten, 2004).
In Europe most of the social issues on the corporate agenda are located within the field of
ethical responsibility, as corporations need constant reaffirmation of their social legitimacy.
Likewise, the philanthropic activities in Europe are most of the time implemented
compulsory through the legal framework. Perrini (2005) states that corporations’ social
responsibilities in Europe are still connected to protecting the environment and community,
but also taking care of customers and workers. Thus, companies are likely to meet specific
CSR issues such as: health-, safety- and environmental issues, considering them strategic.
3.2 CSR regional overview
3.2.1 CSR in Scandinavia
Sweden, Denmark, Norway and Finland are all characterized by what is called the Nordic
model, which is built on traditions in social responsibility and cooperation’s. The traditions of
social responsibility in the mentioned countries are built upon the traditions of social
responsibility and democracy that are tied to the development of the countries in the first
32
half of the twentieth century (Schiller, 1993). In the later part of the twentieth century, the
major part of the developments is connected to the emergence of the welfare state with
strong social democratic influences.
The “Nordic Model” is often referred to because of the similarities of the Nordic
governments, but also the similarities among the Nordic businesses. This model represents
both the cultural-ideological values and similarities in political-economic institutions. The
business systems in the Nordic companies are often labeled coordinated market economies
(Hall & Soskice, 2001) shared business systems (Whitley, 1999), or social democratic
business systems (Amable, 2006). Other theorists argue that because of the Nordic countries
capability to combine economic competitiveness with social welfare there is an exclusive
“Nordic capitalism” (Byrkjeflot et al., 2001; Fellman & Sjögren, 2008) which has recently
drawn a lot of attention. All five Nordic countries (Denmark, Finland, Norway, Sweden and
Iceland) were in 2009 ranked among the top fifteen most competitive economies (Schwab &
Porter, 2009) and among the top fifteen countries in the UN Human Development Index
(UNDP, 2008). In the Nordic countries the government plays a central role in the economy.
Besides being engaged in the economic issues through public policy and the corporatist
system, the government is as well one of the key players and one of the biggest owners,
investors, and buyers in the Nordic economies (Byrkjeflot H. , Myklebust, Myhrvang, &
Sejersted, 2001; Einhorn & Logue, 2003; Iversen & Thue, 2008).
The essence of the Nordic state-market-society model is a solid embedding of the economy,
that is attained by strong, social-democratic and universalist welfare state, a powerful
corporatist industrial relations system, and a consensual political culture accentuating
equality, discussion and involvement (Dahl, 1984; Esping-Andersen, 1990).
Theoretically, the features of the Nordic countries business systems are “in conflict”,
conflicting, with the underlying business-society model of CSR. To give an example, CSR
implicitly awards discretionary powers to business in issues of great social and
environmental concern, whereas in the Nordic context such concerns are considered to
belong to the public domain, and are to be determined through democratic, collective or
representative process. Therefore, the Nordic Model (with strong collective institutions),
which holds companies responsible could come into conflict with the role of governments
33
and the emphasis on unilateral, voluntary actions by business in CSR. Another example, the
CSR business-society model does not give trade unions a lot of opportunities, but rather
assigns them status as “stakeholders” on bar with non-governmental organizations (NGOs),
activists, and local community groups (Preuss, Haunschild, & Matten, 2006). Though, the
Nordic trade unions can influence the companies’ decision-making through the corporatist
system that takes place in the Nordic countries (Arter, 1999). The privilege by the trade
unions in the Nordic countries can therefore affect the policy process, producing a
uncertainty towards CSR, due to the influence they possess on the Nordic policy formation.
The Nordic governments have all a high international focus on matters such as sustainable
development, poverty reduction, environmental protection and human rights, which are all
central when framing CSR. The governments tend to highlight humanitarianism,
environmentalism, and internationalism as objectives in and of themselves (Lafferty &
Meadowcroft, 2000). From the theory mentioned above it is reasonable to assume that the
change of CSR is relatively similar across all Nordic countries, due to the fact that they all
have similar views on the role of business in society.
Gjølberg (2010) made a comparative analysis of the varieties of CSR in the Nordic countries
and could through collaboration between researchers from major Swedish, Norwegian,
Danish and Finnish business schools and universities represented in the Nordic Centre for
CSR conduct interviews on the matter of CSR in the various countries. The interviewees
were representatives from ministries and government agencies with responsibility for CSR,
as well from labor unions, employee associations, and key NGOs in the national CSR debates.
Gjølberg (2010) could conclude from the interviews that the general description of the
Scandinavian countries is as a well-regulated state with high levels of social and
environmental protection. The interviewees from government, business confederations, and
trade unions describe that the various countries perceive CSR as relevant mainly when
domestic firms do business aboard. “In fact, there is outright skepticism toward introducing
CSR in a domestic context, as this is seen as a return to the old days of paternalism and
charity. Instead, there is a strong preference for the existing regulatory and corporatist
system which grants universal rights administered through a welfare state system, and
several interviewees emphasized that CSR must not be a substitute for state action”
34
(Gjølberg, 2010, pp. 221-222). This development describes CSR explicitly as “second best”, as
a strategy that is primarily relevant overseas, when lacking a global framework. This
reformulation of CSR to some extent dissolves the potential conflict with the basic Nordic
Model of strong government participation in issues of great community concern. (Gjølberg,
2010).
3.2.2 CSR in Latin America
There is no general definition of CSR in Latin America, and different organizations in the
various countries offer diverse definitions. Since it is difficult to generalize about anything in
Latin America so is also the case about the generalization of CSR in the region (Schmidheiny,
2006). Though, if we are to generalize, CSR in Latin America is more focused and being
influenced by social issues such as poverty and inequality than environmental issues because
they are of a challenge and a huge problem for the region.
Over the past 10 years, multinational companies from the region have grown substantially.
Although the economic growth of the region in the last couple of years, poverty is still
widespread and Latin America remains one of the most imbalanced regions across the
world. Despite this, multinational companies from the region have prospered and succeeded
globally with their strong leadership and are integrating CSR practices in their business
strategy. For many Latin American companies the social contributions such as engagement
with employees and local communities to improve the social lives of the society, in terms of
providing housing, education and special health benefits, have been a part of their corporate
vision (Casanova & Dumas, 2010). According to Contreras (2004), many family run
businesses, portray their cooperation and engagement with society as a way to do the ‘right
thing’.
Many corporations are taking the role of the state in Latin America as governments are not
very effective to act in the interest of society but also because of the pressure from civil
society to meet the needs the governments in the region are not meeting. As the region is
becoming more democratic, the opportunities created for people to speak out have
35
increased and so has their pressure increased on the private sector (Casanova & Dumas,
2010).
Many of the recent CSR initiatives in Latin America started around 1997. Latin American
multinationals from Mexico to Brazil feel the need to engage with their communities and
societies. As many public and formerly public owned companies were born with a public
good goal with ethics and public service as part of their core structure. Thus it is not
surprising that we can find a number of local multinationals such as the bakery Grupo Bimbo
in Mexico or the cosmetics company Natura in Brazil where ethical values have been
integrated into their business strategy (Casanova & Dumas, 2010).
3.3 Strategic CSR and Shared Value
It is evident business around the globe have many reasons for engaging in CSR activities that
benefit society and the environment. Executives around the world recognize a strong
strategic business case for engaging in social initiatives. Porter and Kramer are in the leading
position of strategic CSR. They argue that the mutual dependence of businesses and society
implies that both corporate decisions and social policies must follow the principle of shared
value (Porter & Kramer, 2006), that is, corporate success and social welfare are
interdependent.
Porter and Kramer suggest that integrating CSR into corporate core strategies it can
generate “shared value” because businesses create win-win situations with society. The
authors recognize that very often firms’ approaches to CSR are disconnected from business
and strategy, which can give result to less business opportunities and less value creation if
strategic CSR is not well applied. They take the strategic CSR explanation further by
developing a corporate social agenda which “looks beyond community expectations to
opportunities to achieve social and economic benefits simultaneously” (Porter & Kramer,
2006, p. 85). Then CSR moves from performing as mere corporate citizens and reducing
damage from inappropriate business practices, which would form part of a responsive CSR
36
strategy; to a truly engaged strategic CSR that delivers strategies to strengthen corporate
strategy as a whole by the betterment of social conditions (Porter & Kramer, 2006).
Definitively strategic CSR is seeking to align organizational values, business strategy and core
competencies with a social agenda to benefit both the business and society. Whether this
actually occurs is questionable due to the fact that social responsibility is such a broad
concept; it is much more than damage limitation or philanthropy. In any case the evidence
for the advantages of CSR in business emerge as positive but sometimes variable. Businesses
engaged in strategic CSR cannot solve all the world’s problems, but actually they can have a
remarkable influence for good (Holme, 2010).
Porter and Kramer (2006) precisely link competitive advantage to corporate social
responsibility. They say ‘‘CSR can be much more than a cost, a constraint or a charitable
deed – it can be a source of opportunity, innovation and competitive advantage.’’ (Porter &
Kramer, 2006, p. 80). Then, strategic CSR can become an instrument of change in an
organization’s values, behaviors, and performance.
As stated by Porter & Kramer (2006) it is through strategic CSR that the firm will make the
most significant social impact and reap the greatest business benefits. Strategic CSR is about
choosing a unique position by doing things differently from competitors in a way that lowers
costs or better serves a particular set of customer needs.
Nowadays, the application of strategic CSR may well serve as an useful mean to respond to
the negative impact of the current financial crisis, in particular as a helpful strategy to
maintain or regain firms’ reputation and legitimacy through CSR. Specially through creating
shared value, Porter and Kramer suggest how to reinvent capitalism and release a wave of
innovation and growth after the global downturn. They propose there are three key
conducts through which companies can create shared value opportunities: by reconceiving
products and markets; by redefining productivity in the value chain, and by enabling local
cluster development (Porter & Kramer, 2011). In their opinion, every company should look
at decisions and opportunities through the lens of shared value; this would lead to new
approaches that generate greater innovation and growth for companies, and consequently,
37
also superior benefits for society (Porter & Kramer, 2011). In this recent article from
February 2011 Porter and Kramer emphasize the definition of shared value as “policies and
operating practices that enhance the competitiveness of a company while simultaneously
advancing the economic and social conditions in the communities in which it operates”
(Porter & Kramer, 2011, p. 66). They state the concept rest on the premise that both
economic and social progress must be addressed using value principles; being value defined
as benefits relative to cost not only in economic terms but also counting with societal issues.
Therefore we consider this concept to be relevant for our thesis, and precisely we have
included “shared value” as one of the themes included in the theoretical framework, which
will be clarified at the end of this theory section. In the back and forth process from the
theory to the empirical data we observed how companies disclose shared value topics in
their letters so we included it as a new theme. For the purpose of the study and according to
the above reviewed theory we define shared value in our framework as the “firms’ new
discourse on how to deliver sustained social and economic value for both the company itself
and the community that surrounds it”.
3.4 Institutional Theory
3.4.1 Review of formal and informal institutions
There is a broad distinction between formal and informal institutions (Powell & Di Maggio,
1991). The most formal are the regulatory institutions representing principles and standards
provided by laws and other official regulations. The informal institutions can be grouped into
normative and cognitive (Scott, 1995). Normative institutions involve less formal standards
that are accepted in company networks. Cognitive institutions represent the most informal
rules and values that can be exemplified by social interaction between CSR players (Scott,
1995).
38
International companies can find the constraining nature of formal and informal institutions
in their path, for instance resulting from stricter regulation of economic exchanges, and
limitation of business activity in some countries. But also it is recognized that institutions
provide general useful frameworks to enable business procedures, and institutional
regulation helps setting the basic principles for businesses within the broad field of CSR. To
illustrate this, common CSR standards may perhaps produce a number of limitations for
corporations, but it also makes easier the process of sharing business knowledge in the CSR
field. Thus, formal and informal institutions should not be viewed exclusively in terms of
their restricted character, but also as bringing opportunities for those firms who truly
understand and use them correctly.
As we have already mentioned, obviously there will be different regulations, beliefs and
standards connected to CSR in different countries, and therefore those will outline how
businesses must operate in different countries. Matten & Moon (2008) explain and argue
how and why CSR differs among countries and change within them. They suggest a
distinction between “explicit CSR” and “implicit CSR” in their comparative research on
businesses’ CSR communications in the U.S. and Europe that provide relevant and
comprehensible arguments when looking at CSR in both regions. “Explicit CSR” refers to
business policies that take responsibility for society, by integrating voluntary programs or
other CSR strategies with the aim to combine social and business value. Explicit CSR may be
responsive to institutional or stakeholder pressure (Matten & Moon , 2008). Alternatively,
“implicit CSR”, “refers to corporations’ role within the wider formal and informal institutions,
for society’s interests and concerns” (Matten & Moon , 2008, p. 409). It is made of values,
norms and rules that produce requirements for organizations to deal with stakeholder
issues. Continuously, Table 3 shows the main differences between explicit and implicit CSR.
Within the European business environment, CSR has until now been characterized as
“implicit” and relatively moderate in terms of communication. In the U.S., in contrast, a
more “explicit” communication strategy has been evident (Matten & Moon , 2008). They
argue that a reason could be that the European CSR has been originated under wider
institutional responsibility leaving less incentive for firms to take a more explicit
responsibility.
39
Table 3. Explicit and Implicit CSR
Explicit CSR Implicit CSR
Describes corporate activities that assume
responsibility for the interest of society
Describes corporations’ role within the wider formal
and informal institutions for society’s interests and
concerns
Consists of voluntary corporate policies, programs,
and strategies
Consists of values, norms, and rules that result in
(often codified and mandatory) requirements for
corporations
Incentives and opportunities are motivated by the
perceived expectations of different stakeholders of
the corporation
Motivated by the societal consensus on the
legitimate expectations of the roles and contributions
of all major groups in society, including corporations
CSR as an explicit element of corporate policies CSR as an implicit element of the institutional
framework of corporations
Liberal market economies Coordinated market economies
National institutions encouraging: National institutions encouraging:
? Individualism ? Collectivism
? Discretionary agency ? Systematic/obligatory agency
? Incentivizing responsive actors ? Incentivizing program-driven agency
? Liberalism ? Solidarity
? Network governance ? Partnership governance
? Policies providing discretion ? Policies providing obligations
? Isolated actors ? Interlocking/associated actors
Source: Adapted from Matten & Moon (2008) p. 410, 411
3.4.2 The National Business System
In this point we will present a theoretical background with the aim of deeper clarifying the
differences in CSR among countries, and how national institutions influence it. Matten &
Moon (2008) adopt the concept of National Business Systems (NBS) which evolves from
differences in historic, legal and institutional structures (Whitley, 1997 cited in Matten &
Moon, 2008, p. 407). The authors identify there are four key subdivisions of national
institutional frameworks, that are the political system, the financial system, the education
and labor market system, and the cultural system
Even if it is common to describe the Scandinavian countries as a homogeneous group, they
are different in some issues such as market, ownership or corporate governance structures.
Although they are quite alike when it comes to macroeconomic conditions such as the
political stability, enforcement of the law, government effectiveness, control of corruption,
40
accountability or labor regulations; displaying then a homogeneous image of the region in
these terms (Thomsen, 2008).
In general Latin America is a much more heterogeneous region. The CSR agenda in Latin
America has been profoundly shaped by socio-economic and political conditions, which have
tended to make worse many environmental and social problems such as deforestation,
unemployment, inequality, and crime (De Oliveira, 2006). Despite these problems CSR is
seen by many Latin Americans as the hope for positive change in the face of persistent
poverty, environmental degradation, corruption, and economic stagnation (Schmidheiny,
2006).
In this section we present a brief description of similarities and differences between
Scandinavian and Latin American institutional systems. For comparison, below we also
present information from Europe and the U.S. from Matten & Moon (2008) keeping the
argument that their framework of “explicit CSR” (represented by the United States) and
“implicit CSR” (Europe) gives significant insights for any CSR regional comparison with
reference to the different national business systems in which firms operate.
The political system
It can be said that the most visible political difference between Europe and the U.S. is the
role the state plays. One of the underlying reasons for the presence of implicit CSR in Europe
is the role of the formal institutions of the region. In contrast, the U.S. market is based on
different values and principles justifying the wider use of explicit CSR (Matten & Moon,
2008).
In Scandinavia the State takes responsibility for its society through programs in public health
and housing, pensions or unemployment compensations for example. Sweden, Denmark,
Norway and Finland are all relatively small, but wealthy social democracies known for their
high government expenditure (Thomsen et al., 2008). The reliance on the government and in
the national institutions has helped businesses in their development.
41
Regarding Latin America, in some of its countries policy change occurs repeatedly, while in
other it is stable, the region obviously being larger and more heterogeneous, definitively is
not as politically homogenous as Scandinavia. Therefore the political conditions under the
institutional framework that influence the capacity for governance vary significantly from
country to country; for example there are countries showing strong executive power and
weak legislature power, giving place to an unstable policy environment. Thus, the result is a
significant disparity in the level of policy stability across the region (Pereira, Singh, &
Mueller, 2011). This might be the reason of one of our suspicions regarding a more explicit
CSR in Latin America, being the largest multinational firms more involved with the
development of the region through CSR programs, covering those health, housing, education
services that the Government does not provide to the Latin population.
The financial system
Within the financial structure in Europe, companies are generally included in networks
consisting of a small number of large investors, being banks key players providing financial
support (Matten & Moon , 2008). Whereas European countries are known for having a large
amount of direct or mutually interlocking ownership; the United States, in contrast have
been more dependent on contract-based ownership. In the U.S., the stock market is the
largest financial source and companies are consequently obliged to show a high degree of
transparency and accountability to investors (Matten & Moon , 2008).
Denmark stands out in the Scandinavian perspective, since about two thirds of listed
companies are controlled by a majority shareholder. In Norway there is still a very significant
state ownership component in commercial banking. Sweden holds a tradition of large
business groups and large industrial firms. This kind of business structure has been favored
by the social democratic governments, by strong labor unions and by the industrialists’
family conglomerates. The result is that almost half of the stock market capitalization in
Sweden has long been under the control of the business spheres (Thomsen et al., 2008).
The most visible characteristics affecting the Latin American economies and financial system
are the rapid technological change, the economic globalization, the concentration of
42
ownership, the defined control, and the need for capital (Bedicks & Arruda, 2005). According
to Al Nasser & Garza (2009) the region has developed stabilization programs designed to
improve the underlying macroeconomic conditions but also significant and deep reforms
intended to liberalize and improve the efficiency of their financial markets. In Latin America
most companies are controlled by dominant groups, frequently families who carry out both
the role of owners and managers at the same time. Moreover Latin America has experienced
a decline in the number of listed companies in domestic markets since companies have gone
private because of the increasing internationalization of industry and finance (Bedicks &
Arruda, 2005).
The current economic crisis has clearly influenced the procedures of the formal institutions;
Governments around the globe have been required to mediate and intervene in the
economy to a greater extent. As a result in the financial system, the ownership structures in
many important financial institutions have moved toward a higher government stake. In
relation to firm’s CSR commitment under weak economic conditions, as it was reviewed
before, Campbell (2007) argues that weak financial performance and an unhealthy economic
environment is likely to reduce the probability that firms keep their CSR commitments as
before the downturn; but we will not able to study if that is true for both regions, since we
are studying a single fiscal year.
The education- and labor market systems
The education and labor market systems also differentiate Europe from the U.S. The
collaboration between the state and the private sector in Europe is much more evident than
in the U.S., since the state offers preliminary and secondary education. In the U.S., the
private sector is shaping the courses of action and strategies (Matten & Moon , 2008). Even
though, privatization of European industry and public services has produced a considerable
delegation of responsibilities to firms and has consequently increased societal expectations
of business (Matten & Moon , 2008).
Scandinavia is well known for its high government spending in education but at the same
time for its high income taxes to fund the latter. All the countries forming the region have
been focused in the high quality of education, being really oriented to the human capital
43
formation as a key asset for the economy. Moreover the state provides social protection,
retirement pensions, the unemployment compensations and other social insurances
(Rogerson, 2007).
On the other hand in Latin America, the education system is well ahead, with lower rates of
high education access. Additionally most social protection is provided through contributions-
based programs, which means is generally linked to employment conditions. Therefore only
workers in formal and structured employment positions have access to a range of social
benefits in most Latin American countries; and only certain types of employment offer
coverage for retirement benefits, unemployment compensation and health insurance
(Gasparini & Bertranou, 2005). Therefore one of the roles of the State to cover this gap
should be to compensate for deficiencies in the labor market through social programs for
individuals unable to find work, with low salaries, or without social benefits.
Notwithstanding there are some social programs that provide cash transfers or
compensations for certain basic services such, medication, as food or educational stuff.
Some governments in Latin America are also providing social security for those who do not
have access through employment (Gasparini & Bertranou, 2005).
In the next section within our empirical analysis we will be able to find out if the analyzed
companies in the region also try to cover the gap in social security, health and education
through their CSR programs.
Cultural system
In this point, the U.S. and Europe take up remarkably different positions that can be tracked
largely into history and culture. Their cultural systems have originated very different wide
assumptions about society, business and government; it can be said that Europeans show a
stronger faith in unions, labor organizations, political parties and the state itself (Matten &
Moon , 2008).
In terms of informal institutions, the Scandinavian countries are relatively small, and key
aspects like trust, transparency and accountability play important roles. Trust can substitute
formal law as a mechanism to protect minority investors in the Scandinavian countries,
44
which are believed to be small tightly networked societies. Media exposure may also be
important in uncovering unsustainable behavior of managers, board members, and brands
(Thomsen et al., 2008).
Looking at Latin America researchers on politics, bureaucracies and federalism have clear up
how institutional design affects the stability and quality of democracy and how the cultural
system of the region have originated related assumptions about society, business and
government. There are still persistent problems of corruption, clientelism, executive
legislative conflict, and the “unrule of law” in the region (Helmke & Levitsky, 2006). Despite
the consolidation of a variety of civil and human rights, many Latin American states have
failed to consistently sustain or enforce the rule of law and, as a consequence, many citizens,
particularly poor citizens do not possess these rights in practice (Helmke & Levitsky, 2006).
After this review of the national business systems and its different components we can
observe how the two regions of study differ in terms of political, financial, labor or cultural
systems. According to the framework proposed by Matten & Moon (2008) and once
reviewed their national institutions and what they encourage to business, we could
categorize the Scandinavian CSR as explicit within a coordinated market economy, and the
Latin American CSR as explicit within a liberal market economy (in general terms, but being
aware of exceptions within the region).
3.5 Global trends: neo-liberalism, neo-institutionalism and the political
role of firm
Recently, multinational companies have shown a more explicit commitment to CSR, as the
concept has been more widely accepted in formal and informal institutions around the
world. This trend is also seen in the companies from Scandinavia and Latin America; they
show a more solid commitment in their CSR written communications. The generalized shift
from implicit to explicit may have increased even more lately due to the effects of the
financial crisis and the blames of irresponsible corporate behavior; but also due to the
globalization and the getting closer reporting trends for international players. There are new
45
similar trends and constructs in CSR within national or regional boundaries of reference,
because of the globalization effects and the harmonization of global CSR beliefs and
practices (Tengblad & Ohlsson, 2010). To explore these current global trends we would like
to review the so called neo- institutionalism, neo-liberalism in politics and economy, and the
relatively novel political role of the firm and political CSR.
Before we start reviewing these global trends, and even if we have already been using the
term and being aware of the general knowledge, we consider suitable to include a formal
definition for globalization in this part. “Globalization can be defined as a process of
intensification of cross-border social interactions due to declining costs of connecting distant
locations through communication and the transfer of capital, goods, and people. This
process leads to growing transnational interdependence of economic and social actors, an
increase in both opportunities and risks, and to intensified competition” (Scherer & Palazzo,
2011, p. 901).
New-institutionalism
Despite the fact that we have just reviewed how CSR differs according to different locations
and therefore how different national business systems influence CSR issues, we are aware
that in recent years institutional and business trends are also shaped by the globalization
effects. It can be said that institutional frameworks and national business systems also
evolve according to globalization pressures; then multinational corporations as part of wider
spheres of action have also to respond to new sources of responsibility. As a result, in terms
of Matten & Moon (2008) explicit CSR is gaining extent across Europe and beyond since the
concept is more generally accepted in formal and informal institutions.
In order to understand this changing process leading to a more explicit CSR communication
the “new institutionalism” (DiMaggio & Powell, 1991; Meyer, 2000) perspective is
appropriate. New institutionalism explains how different institutional environments
influence firms to become more homogeneous across national borders; this theory is more
focused on the external forces coming from the environment than from the company itself.
It focuses on the resulting standardized business practices in organizations across industries
and countries.
46
Matten & Moon (2008) state that the expanding explicit CSR approach can be explained by
the fact that organizational practices have evolved and become institutionalized because
societal actors perceive them as legitimate. According to (DiMaggio & Powell, 1983) this
legitimacy is produced by a process of institutional isomorphism which is shaped by three
external pressures: coercive, mimetic and normative.
Relevant to this study, they are defined below and related to the purpose of the thesis.
Coercive isomorphisms arise primarily from formal and informal pressures laying on
businesses coming from other organizations or institutions they deal with. These types of
pressures refer mainly to the regulatory environment, represented by rules, norms or laws.
In relation to CSR, this would implicate normative initiatives, particularly those of the
governments or other international institutions, advocating and pressuring for a strategic
integration of CSR for example. As a remarkable example in Europe some Governments have
taken serious initiatives to further encourage CSR. Precisely in Denmark from 2009 a new
regulation on CSR has been set, advocating for compulsory CSR reporting for the largest
companies of the country in their annual reports. The aim is to inspire Danish businesses to
take an active position on social responsibility and communicate it, this way promoting more
CSR awareness and transparency (Danish Commerce and Companies Agency, 2011).
Mimetic processes are not a result of coercive authority, but rather of uncertainty and
increasingly ambiguous and complex external business environment. As a result, this
uncertainty leads organizations to shape their behavior according to peer companies. “When
goals are ambiguous, or when the environment creates symbolic uncertainty, organizations
may model themselves on other organizations” (DiMaggio & Powell, 1983, p. 151). Relating
to CSR, this pressure may be identified when international companies imitate one another in
their approach to CSR.
Finally, normative pressures stem primarily from the shared professional systems developed
within a given line of work, which ultimately define what is considered to be the ‘proper’
course of action, the conditions and methods of work, and the morally right thing to do.
Normative pressures revolve around the concept of professionalization (DiMaggio & Powell,
47
1983). For companies, sharing the same knowledge can lead to a standardization of CSR
procedures, and may possibly influence its development toward homogeneity. As an
example, a normative pressure would be present if professional forces such as the corporate
community, academia and soft regulation encourage Scandinavian firms to employ a
strategic approach in relation to CSR. In recent years, educational institutions have played an
important role in promoting CSR. CSR has become an integrated part of education in
business schools all over the world, implying that in the upcoming years business leaders
may be much more familiar with these standards.
Neo-liberalism
Recently we are seeing how contemporary trends in economy and politics are getting closer
around the world towards an economization of public domains and the predominance of
neo- liberal methods of governance and neo-liberal visions of civil society. The so-called neo-
liberalism is such a broad and complex concept, it’s not just an economic doctrine or a mere
set of political measures. According to Shamir (2008, p. 3) “neo-liberalism is rather a
complex, often incoherent, unstable and even contradictory set of practices that are
organized around a certain imagination of the ‘market’ as a basis for the universalization of
market-based social relations, with the corresponding penetration in almost every single
aspect of our lives, of the discourse and/or the practice of commodification, capital
accumulation, and profit making”. Thus, neo-liberalism, transfers the logic of the “market”
to other social domains, therefore extending a model of economic rationality and conduct
beyond the economy itself.
The neo-liberal discourse naturally influences CSR business practices and leads to the
assumption that business responsibilization and morality are grounded in a neo-liberal
epistemology that dissolves the distinction between economy and society with the “social”
being encoded as a specific example of “the economy” (Shamir, 2008). In this subject
Vallentin & Murillo (2009) are articulating similar concerns about the coming neo-liberalism
and the consequences of subordinating CSR to an economic rationale. Moreover, they
acknowledge the emergence of a neo-liberal mindset is not in opposition to CSR, but which
operates within the concept, and which is becoming governmentalized as conduct of
48
conduct through its application (Vallentin & Murillo, 2009). Even though they argue it is
needed to keep up a differentiated view not only of the business and morality of CSR
discourse, but also of CSR governance. The neo-liberal mindset is one of the crucial forces at
play in the CSR field, but it is not the only one (Vallentin & Murillo, 2009).
We recognize that within this neo-liberal global framework and the repercussion of the
financial crisis, in general, the capacity to influence the economic environment of civil
society and national governments is limited compared to the widening sphere of influence of
multinational corporations. On this global level, neither nation-states nor international
institutions alone are able to sufficiently regulate the global economy and to provide global
public goods, the collaborations with international corporations is well needed.
The gap between the rapid pace of economic globalization, especially financial, and the slow,
inadequate or uncoordinated regulatory responses have created huge problems in
governance that are unavoidable to deal with when reviewing the way governments want to
address progress towards sustainability and a more inclusive globalization. Therefore we
assume corporations as key players should innovate and make substantive changes, being
truly responsible for their economic, environmental and social influence. These assumptions
are related to the next point below when the corporations are considered to take a “political
role”.
Political role of the firm and political CSR
As we have explained within the neo-liberal mindset there is a need to redefine the social
responsibilities of businesses as “political actors” in a globalized world.
Scholars in management and economics have widely shared the assumption that businesses
should focus on profits only, while it is the duty of the state organization to provide public
goods for society (Friedman, 1970). In this view business firms are regarded as simply
economic actors, and governments and their state agencies are considered the only political
actors. Scherer & Palazzo argue that, under the conditions of globalization, the strict
separation of political tasks between private business and nation-state governance does not
hold any more; it is clear many corporations have started to assume social and political
49
responsibilities that go well beyond legal requirements and fill the regulatory space in global
governance (Scherer & Palazzo, 2011).
Within the effects of the current crisis corporate responsibility is challenged by a stronger
ethical imperative that goes beyond the framework of legal obligations and demand a
deeper social commitment. For this commitment to be effective, we already know CSR must
be integrated into long-term business strategies and taking into account both the demands
of shareholders and competition, as well as the impact on all the rest of stakeholders.
Increasingly, there is a growing need for preventive and effective regulation to incorporate
an assessment of the potential consequences of economic activity in the social and
environmental settings. Thus, corporate social responsibility has been placed on an
increasingly wide sphere, between the legal regulations and social expectations.
As a consequence of all the global trends, a new role of business arises: the “political role of
the firm” in a globalized economy and society. According to Scherer & Palazzo (2007) this
shift to a politicization of the corporation is due to the shifting societal demands the
corporation has to deal with and therefore firms replace implicit compliance with assumed
societal norms and expectations with an explicit involvement in public processes that before
were exclusively part of the state’s political agenda.
In recent years business firms have started to engage in activities that have traditionally
been regarded as definite governmental activities (Matten & Crane, 2005; Scherer and
Palazzo, 2008). This is especially true and visible for multinational corporations because they
engage in public health, education, social security, and protection of human rights while
often operating in countries with failed state agencies (Matten and Crane, 2005). Therefore
multinational corporations through their CSR programs address social problems (such as
AIDS, malnutrition, homelessness, and illiteracy), identify ethics codes, protect the natural
environment, and engage in self-regulation to fill global gaps in legal regulation and moral
orientation (Scherer & Palazzo, 2011). Scherer and Palazzo (2007) also argue that some of
the observable CSR activities, such as developing corporate codes of conduct in partnership
with critical NGOs, exposing corporate CSR performance to third-party control, linking
corporate decision making to civil society discourses, or changing corporate attention and
50
resources to societal challenges beyond immediate stakeholder pressure, are all pointing to
the “politicization of the corporations”.
These above mentioned activities demonstrate an increasing participation of corporations in
the creation of global public goods and in the development of global business regulation.
Matten and Crane (2005) suggest that in the path of this progress some business firms have
even begun to assume a state-like role. Many companies carry out the functions of
protecting, enabling, and implementing citizenship rights, which have originally been
considered the exclusive responsibility of the state and its related agencies (Scherer &
Palazzo, 2011). Matten and Crane (2005) also maintain that these corporate initiatives often
occur in cases where the state system fails, that is, when the state withdraws, when the
state has not yet implemented basic citizenship rights, or when it is mainly unable,
powerless or unwilling to do so. As a consequence these authors conclude that business
firms have become important “political actors” in the global society.
3.6 Legitimacy
Legitimacy is a concept that has been discussed and researched for several decades and the
broad scope of available literature regarding the subject has been the result of different
takes that researchers have had throughout the years. Though, the key in our reflection has
been Suchman’s (1995) approach of legitimacy, which appears as the most thorough and
comprehensive. He proposes a thorough view of the theory and makes a typology of all
types of legitimacy from different theorists and scholars have come up with.
Organizational legitimacy has been defined by scholars as the acceptance of the organization
by its environment and has suggested it to be vital for the survival and success of
organizations (Kostova & Zaheer, 1999). Organizational legitimacy emphasizes the social
acceptance from adherence to social norms and expectations and is defined as “a
generalized perception or assumption that the actions of an entity are desirable, proper, or
appropriate within some socially constructed system of norms, values, beliefs, and
definitions” (Schuman, 1995, p. 574). In other words, legitimacy is the result of the
51
congruence between the behavior of an entity and the set of beliefs of the audience it is
judged by. What is fundamental is the view of the audience and not the opinion of a single
individual (Schuman, 1995). Without the legitimacy from the stakeholders, the organization
will neither be capable of renewing its license nor gain new areas of power to grow (Castelló
& Lozano, 2011).
In the past years, the legitimacy of corporations has been challenged due to the conflicts
between companies and civil society. Conflicts such as violations of human rights and
environmental side effects have both threatened companies reputation and have raised the
question about the social role of business in general (Palazzo & Scherer, 2006). Legitimacy
has become very crucial for corporations and even more of a crucial issue for those
companies that operate worldwide. Hence, being successful in gaining and retaining
legitimacy demands that a corporation comprehends the norms, values, beliefs and
definitions of its environment and that it changes in order to reach the goals it has set itself.
Schuman (1995) distinguishes among three types of organizational legitimacy: pragmatic,
cognitive and moral legitimacy. The three types of legitimacy have all to some degree a
general perception or belief that organizational actions are desirable, proper or relevant
within some social system constructed of norms (Schuman, 1995).
3.6.1 Pragmatic legitimacy
Pragmatic legitimacy is a result of the self-interest of the organizations stakeholders
(Schuman, 1995). Here, legitimacy is assessed in terms of the extent to which the
organization acts to serve and fulfill the interest of its stakeholders. These “individuals”
(stakeholders) will ascribe legitimacy to the company as long as the corporation acts to serve
the needs and interests but also that the stakeholders perceive to gain a benefit from the
corporation’s activities (Palazzo & Scherer, 2006). The concept can be divided into the
exchange-, influence- and dispositional legitimacy between organizations and its
stakeholders (Schuman, 1995).
3.6.2 Cognitive legitimacy
Cognitive legitimacy is about when the audience sees no other possibility than the existing
52
system. As cognitive legitimacy operates at the subconscious level, it creates difficulties for
companies to manipulate and have an influence over the viewers’ perceptions (Palazzo &
Scherer, 2006). Thus, cognitive legitimacy is more about proposing something to the
audience that its system of values allows it to get an understanding of, if not, the audience
will refuse it. Consequently, the behavior of the corporation could often end with the firm’s
adaption to social expectations (Palazzo & Scherer, 2006).
3.6.3 Moral legitimacy
Moral legitimacy rests on the moral judgments of an organization’s output, procedures,
structures and leaders (Palazzo & Scherer, 2006) but also on the judgment concerning
whether the activity is “the right thing to do” (Schuman, 1995); “it reflects a prosocial logic
that differs fundamentally from narrow self-interest” (Schuman, 1995, p. 579). Thus, it is
expected that moral concerns generally prove to be more resilient/resistant to self-
interested manipulations than purely pragmatic thoughts. According to Schuman (1995), he
describes the moral legitimacy of organizations as the result of “explicit public discussion”
and he believes that corporations can manage moral legitimacy if they are determined to
participate in these discussions (Palazzo & Scherer, 2006). It is also of importance when
managing moral legitimacy, that corporations communicate and convince others by rational
arguments rather than manipulation and persuasion (Palazzo & Scherer, 2006).
3.6.4 Managing legitimacy in a globalized world
Schuman (1995) introduced two approaches when “managing legitimacy” – strategic and
institutional. The institutional approach (cognitive focus) outlines legitimacy as an often-
unconscious alteration process, where the firm reacts to external expectations and therefore
the probability to really manage legitimacy is partial (Schuman, 1995). The strategic
approach (focused on pragmatic legitimacy) implies that companies treat legitimacy as more
of an operational resource where corporations have the capability to “instrumentally
manipulate and deploy evocative symbols in order to garner societal support” (Schuman,
1995, p. 572). However these strategic attempts, often just remain a symbolic reaction to
legitimacy pressure as such firms find it fundamental to conform to the normative demands
of their audience and create support and reputation (Ashforth & Gibbs, 1999). However,
53
according to Schuman (1995) strategic manipulation is not helpful when it comes to ensuring
or stabilizing moral legitimacy because its short term effects.
In Schuman’s (1995) point of view, “pragmatic legitimacy is too weak due to its limited
(group-specific) and ephemeral impact and if we further assume that cognitive legitimacy is
devaluated through pluralisation, moral legitimacy becomes the decisive source of societal
acceptance for corporations in an increasing number of situations” (Palazzo & Scherer, 2006,
p. 74). Palazzo & Scherer (2006) conclude that the move from a stable industry society to a
more globalized post-industrial society, has resulted in the erosion of cognitive legitimacy
and in a world with growing resistance towards pragmatic legitimacy. Palazzo & Scherer
(2006) suggest that the CSR and management strategies of today is built upon a discussion
on organizational legitimacy that does not reflect the conditions in the globalized
economies, as these strategies are primarily based upon pragmatic and cognitive legitimacy.
In the globalized world of today, the pragmatic and cognitive forms of legitimacy are
becoming more and more pressured as a consequence of the increasing role of the
individual in society. In addition, the importance of stakeholder’s pressure at the local level
is destroying the social view on general norms and, hence, institutional legitimacy (Castelló
& Lozano, 2011). It is no longer enough to mainly engage in philanthropic donations and CSR
activities to gain legitimacy from various stakeholders, since what was taken for granted
before is under discussion. Therefore corporations have begun to search for a new form of
legitimacy through their CSR activities, moral legitimacy (Castelló & Lozano, 2011).
Moral legitimacy has become “the core source of societal acceptance” (Palazzo & Scherer,
2006, p. 78). To give an example, after September 11, 2001 companies stopped the habit of
going offshore with their business in order to avoid taxes since this was thought of being
unpatriotic (Johnson & Holub, 2003). This example demonstrates how established
businesses can fail to keep their cognitive legitimacy and become highly politicized (Palazzo
& Scherer, 2006).
Palazzo & Scherer (2006) contend that idea of the public acknowledgement and acceptance
cannot any more be connected from public discourse, even though the legitimacy theories
54
talk about the taken for granted societal background rules. Consequently, Schuman (1995)
argues that moral legitimacy results from communication and Palazzo & Scherer (2006)
suggest that this direction towards moral legitimacy, involves a turn from the economic,
utility driven, and output oriented view on CSR, to a political, communication-driven, and
input oriented concept of organizational legitimacy.
3.7 Reputation
“Reputation is a generalized expectation about a firm’s future behavior or performance
based on collective perceptions (either direct or, more often, vicarious) of past behavior or
performance” (Deephouse & Schuman, 2008, p. 14). Legitimacy and reputation have many
features in common as they both show social perceptions of conformity as being central
determinants of organizational success (Deephouse & Schuman, 2008). Fombrun has argued
that “the more a company pursues a strategy that differentiates it from rivals with each of
its major constituent groups, the more likely are constituents to ascribe a strong reputation
to the company” (Fombrun, 1996, p. 292). The critical media attention makes firms respond
quickly in ways that will maintain or restore their legitimacy and reputation (Wartick , 1992).
Reputation is a continuous measure and a firm’s position usually grows at the other
competitors’ expense. Reputation dynamics also pushes firm’s to differentiate them from
others by being more unique. As firm’s never know exactly the expected outcome of
transactions in advance, their partners or to be partners will look at the reputation of the
company in sequence to map previous performances onto present performances, (Barney,
1991; Deephouse & Carter, 2005). In organizational studies, research has shown that
companies with a advantageous reputation can yield important competitive advantages.
Legitimacy does not only affect how people act towards firms, but also how people see
firms. Weaver, Trevino, & Cochran (1999) claim that the negative media attention has an
impact on the development of CSR programs. Therefore firms must respond to these critics,
as some initiatives not necessarily reflect real problems or are tied to organizational goals.
55
3.8 CSR rhetoric strategies: Strategic, Institutional, Dialectic and Political
Castelló & Lozano (2011) identified 17 themes of rhetoric; in addition we identified 11 more
themes. The themes are grouped into four categories of rhetoric: strategic, institutional,
dialectic, and political role of the firm.
The first domain is the “Strategic Rhetoric”, which highlights how companies manipulate and
position evocative symbols in order to gather support from society (Schuman, 1995). The
themes included under strategic rhetoric are the following: operationalization, innovation,
reputation, strategic link, governance, shared value and leadership on CSR. Through the
strategic rhetoric, firms strive to build symbolic links with values embedded in the strategic
management tradition, for instance efficiency in various organization projects, operations of
innovation and corporate returns, with the goal to implicitly enhance corporate returns and
increase the company reputation.
Strategic rhetoric is accustomed towards what Schuman (1995) defines as pragmatic
legitimacy, where firms have a strategic interest to use their power to influence and
manipulate their social context. Strategic rhetoric assumes that that behind the firm’s CSR
activities lies the organization’s own egoistic interest (Schuman, 1995). Further, in capitalist
societies, corporations are required to maximize profits and thus, shareholder value
(Castelló & Lozano, 2011). In the end, all the organization’s activities (including CSR) should
in one or another way contribute to the firm’s profit (Margolis & Walsh, 2003; Vogel, 2005;
Wartick & Cochran, 1985) and support the business objectives (Wood, 1991). Furthermore,
firms are encouraged to find other forms of rhetoric strategies to explain e.g. hopes and
expectation as strategic rhetoric has its weaknesses in its posivistic character and
instrumental legitimation (Castelló & Lozano, 2011).
The second category of rhetoric is the “Institutional Rhetoric” and includes themes such as:
CSR, sustainability, philanthropy, stakeholder dialog and sustainable growth; this group of
themes is often used in the CEO discourse with the aim to gain legitimacy and acceptance in
society (Castelló & Galang, 2011). Institutional rhetoric is oriented towards cognitive
legitimacy, and implies firm’s desire to conform to the expectations from society (Schuman,
56
1995). Firms use themes, as CSR and stakeholder engagement as they are very common
representations of the CSR movement to show the organization’s worthiness and
acceptability (Oliver, 1991). Castelló & Lozano (2011) argue that that theme, such as CSR and
sustainability, remain fairly academic and meaningless and are losing their normative force
today. Further, although institutional rhetoric is recognized and used as an instrument for
cognitive legitimacy it does not lead to moral legitimacy (Castelló & Lozano, 2011).
The third domain, “Dialectic rhetoric” incorporates themes such as global standards,
citizenship, accountability, partnership, global agenda, inclusivity, focus on the issue and
social contribution; Dialectic rhetoric has its roots in the communication/dialog practice
between corporations and their stakeholders (Castelló & Lozano, 2011). The organization’s
aim is to inform more about their actions and results and increase the acceptance of
corporate decisions making (Scherer & Palazzo, 2007). The language of dialectic rhetoric
used in the CEO discourses underlines the importance of generating the common good
(Argandoña, 1998) and community building through different activities for the citizens
(Waddock, 2004). The Global standards is one of the themes with the clearest example as it
refers to certifiable or non certifiable standards that aims in increasing business
accountability. Some examples of cited standards are: GRI, AA 1000 AS, ISAE 8000, Dow
Jones Sustainability Index, FTS100 and the Global Compact, most of them belonging to civil
society organizations (Castelló & Lozano, 2011). The abundance of dialectic rhetoric should
help the enhancement of discursive quality (Habermas, 1990; Scherer & Palazzo, 2007)
among corporations and stakeholders as it unfolds/opens corporate decisions making to civil
society discourses (Palazzo & Scherer, 2006). The authors claim that the dialectic rhetoric is
based and built upon the communicative efforts between the actors involved. Schuman
(1995) argues that moral legitimacy is the outcome of communicative activity, in which
organizations seek to persuade each other about which direction is more appropriate or
whether or not to share the collective action. The notion of dialectic rhetoric is that it aims
to build a kind of organization that is adapted toward mutual understanding and agreement.
The last domain, the “Political CSR rhetoric” includes themes as: access, development, rights
and political engagement. All of them point out to the new political re-conceptualization of
the role of firms, which we understand as the enlarged political responsibilities for business
57
and the long-term collaborations with governments and civil society actors. We interpret
these themes as a transition from voluntary, business driven or philanthropic acts to a long-
term politicized collaboration with governments and civil society actors. In this domain firms
try to make an effort in the community by undertaking “civilizing” activities ; that is firms try
to engage with the communities and also to create some sort of communication link
between the firm and its communities with the intention of finding a mutual understanding
(Castelló & Galang, 2011). This rhetoric is as the dialectic rhetoric, a new form of legitimacy
that firms try to obtain that we associate with moral legitimacy as well as it is acknowledged
in political CSR theory (Palazzo & Scherer, 2006). Also the political rhetoric as the dialectic
involves a certain degree of stakeholder engagement and the creation of communicative
links and deep collaborations between the firm and its communities with the aim of finding
mutual benefits.
While traditional theories of legitimation such the ones associated to institutional theory
and strategic management theory focus on a specific issue that needs to be legitimated by
the corporation, a political theory perspective emphasizes that the legitimation of
organizations deals with the complex power relationships among the social players involved
(Castelló & Galang, 2011). Within the institutional theories, moral legitimacy has been widely
defined as a process that reflects a positive normative evaluation of the organization and its
activities (Schuman, 1995).
Moral legitimacy refers to conscious moral judgments on the organization’s actions,
structures or leaders; it is resting not on judgments about whether a given activity benefits
the executor, but rather, whether the activity is ‘the right thing to do’ in a given context
(Schuman, 1995). It has been argued that the pluralism of modern societies in the context of
an increasing globalization results in a loss of cultural homogeneity that deteriorate the
normative taken-for-granted of the institutional conception of moral legitimacy (Palazzo &
Scherer, 2006). Corporations obtain moral legitimacy mostly through their strong
involvement in discussions with the rest of the political actors (Palazzo & Scherer, 2006). In
order to manage moral legitimacy organizations need to communicate by persuading others
using reasonable arguments and not through enforcing positions (Scherer & Palazzo, 2007).
58
To sum up, Table 4 below gathers the characteristics of the four different types of rhetoric
strategies.
Table 4. Institutional, Strategic, Dialectic and Political Approaches to the Legitimization
Process
Strategic Institutional Dialectic Political
Who manages
legitimacy
Managers in charge
of management
Organizations by
conscious or
unconscious
adaptation
Organizations aware
of their ethical
dimensions and
power relations to
society
Organizations aware
of their ethical
dimensions and
power relations to
help achieve a more
equal society
Main concepts Performance Social contract,
duty
Inclusion, dialog Collaboration
Management
theories
Strategic
management;
corporate social
performance
Business ethics;
stakeholder
approach
Corporate
citizenship
Political role of the
firm
Role of legitimacy
Pragmatic
llegitimacy
Cognitive legitimacy Moral legitimacy Moral legitimacy
Way
Legitimacy is
managed
through CSR
Organizations
provide concrete
accounts of the
benefits of their
actions to business
Organizations use
normative
structures
recognized by the
public to signal
legitimacy
Organizations
consideration as a
corporate citizen
Organization aims at
improving the
discursie quality
with their
stakeholders
Legitimacy message We manage well;
we are accountable;
we use CSR to earn
additional profit
We are “good” and
responsible; We
belong to the CSR
community
We want to be
engaged in a dialog
We want to engage
you stakeholders in
an equal dialog
Examples in
literature
(Sundaram &
Inkpen, 2004;
Vogel, 2005;
Wartick & Cochran,
1985; Wood, 1991)
(Fombrun &
Shanley,
1990; Gardberg &
Fombrun, 2006)
(Matten & Crane,
2005; Palazzo &
Scherer, 2006;
Scherer & Palazzo,
2007)
(Matten & Crane,
2005; Palazzo &
Scherer, 2006;
Scherer & Palazzo,
2007)
Source: Adapted from Castello & Galang 2011(working paper) & Castello & Lozano (2011)
3.8 Summation of the theoretical framework
Castello & Lozano (2011) identified 17 themes of CSR rhetoric; in addition we identified 7
more themes. Table 5 below outlines these themes we have based the analysis on, and gives
a brief explanation for each.
59
Table 5. Categories of rhetoric and themes' description
Category of rhetoric
(Overarching
dimensions)
Themes Description of Themes Examples
Strategic CSR rhetoric Operationali-
zation
Innovation
Reputation
Strategic Link
Governance
Shared Value
Leadership in
CSR
Mention of how businesses are embedding
CSR in their business systems, processes
and structure including the development of
new capabilities
Any process leading to new products or
processes resulting from CSR policies or
stakeholder engagement.
Any mention of reputation in relation to
CSR
Any mention of the relation between CSR
or sustainability activities and the firm’s
strategy
Any mention of the importance of the
governance structure related to
sustainability or CSR issues. Mention of
compliance of rules or processes. Mention
of ethical norms or policies.
Any mention of policies and operating
practices that enhance the
competitiveness of the firm while
simultaneously advancing the economic
and social conditions in the communities in
which it operates. Shared value creation
focuses on identifying and expanding the
connections between societal and
economic progress
Self representation and companies’ aim to
lead CSR development in their business
strategies.
Business process; systems;
people skills; performance,
excellence, monitoring
performance; coordination with
supply chain to create socially
responsible product.
Innovations; innovate; new
products
Reputation
Corporate performance;
stakeholder value; business case;
increase competitiveness through
CSR
Corporate Governance;
compliance; code of conduct;
integrity; professionalism; ethical
policy
Firms’ new discourse on how to
deliver sustained social and
economic value for both the
company itself and the
community that surrounds it.
Statements or any mention of
addressing the specific CSR
leadership and challenges that
the firm faces (accomplishments
from past years, goals for the
next years)
Institutional CSR rhetoric CSR
Sustainability
Philanthropy
Stakeholder
dialog
Sustainable
growth
Voluntary initiative, integrates social and
environmental concerns in business
operations. Mentions responsibilities.
Any mention of activities aimed at
balancing the fulfillment of human needs
with the protection of the natural
environment so that these needs can be
met not only in the present, but in the
indefinite future.
Voluntary donations, mostly through
foundations to solidarity activities. These
actions are considered to the different
from the object of the core business
Any process of communication with the
stakeholder coming from the firm. Includes
communication, dialog, and response.
Firms engaging in global growth to enlarge
its presence in new regions across the
world and mentioning explicitly sustainable
growth to make it possible.
CSR; triple bottom line; socio-
economic factors; collective
responsibility
Sustainable development;
sustainability.
Philanthropy; solidarity activities;
donations; foundations.
Talking to stakeholders; ensure
we are responding to our
stakeholders; commit to our
stakeholders
Mentions to global sustainable
growth related to the classical
growth strategy but making
connections to a sustainable way
to achieve it.
60
Dialectic CSR rhetoric Global
Standards
Citizenship
Accountability
Partnership
Global
Agenda
Inclusivity
Focus on the
issue
Social
contribution
Certifiable standards focused on increasing
business accountability through reporting
Use of the metaphor of the firm as a citizen
Any mention of a process in which the firm
is held accountable by stakeholders. This
also includes voluntary actions by the firm
to increase its transparency
Any mention of collaborations of
partnerships other than strictly business
partnerships
Any mention of issues that are dealt with
by global institutions such as the UN,
especially if they are included in the UN
Millennium Goal. They can be considered
one of the top priorities for all actors (civil
society, governments and companies).
Mention of any activities aimed at
disfavored/ non-profit/ non-economic
stakeholders that are related to the firm’s
core business
A significant part of the statements refer to
a social/environmental problem that is
core to the firm’s business operation or
strategy
Any explicit mention of the importance of
the firm contributing to social
improvement, benefits to humanity or
positive change
GRI; Dow Jones Sustainability
Index; FTS100; Global Compact
Citizenship
Transparency; footprint; external
review committee, responsible
lobbying; accountable;
accountability
Collaboration between global
business; social entrepreneurs;
activist; governments; NGOs and
civil society
Climate change; poverty; equity;
energy needs; greenhouse gases,
water; carbon emissions; UN
World Diabetes Day; directly
mentioning “global agenda”
Non-traditional stakeholders;
promote an inclusive society
Responsible energy; universal
access to communications;
sustainable mobility
Contribution to positive change;
manage for the communities we
serve; deliver significant benefits
to humanity
Political role of the firm
Development
Access
Rights
Political
engagement
Transition from voluntary, business driven
and case-wise philanthropic acts to a long-
term politicized collaboration with
governments or civil society actors in:
Regional development
Access to services or products to previously
excluded customers. Any investment to
procure access to public services (not
related to the firm’s core business) to non-
economic stakeholders.
Rights and equity (fairness) among
(disfavored) stakeholders to build an
inclusive society.
Firm’s engagement through political
discourses to fill gaps in governments’
actions. Firms assuming enlarged political
co responsibility.
Actions that contribute to
communities, country or region
progress.
Firms’ aim to provide access to
their products/services to
underserved customers. Also the
procurement of access to public
services such as health or
education
Discourse on social and universal
rights touching upon different
social groups.
Democratic integration of the
corporate use of power,
especially in the transnational
context of incomplete legal and
moral regulation
Source: Adapted from Castelló & Lozano (2011) “Searching for New Forms of Legitimacy Through
Corporate Responsibility Rhetoric”, plus inclusion of new themes.
61
4. Empirical Analysis and Discussion
In this chapter we are presenting the findings of our empirical study. These are presented as
a comparison of statements from organizational documents from the Latin American and
Scandinavian top companies, following de theoretical framework or coding scheme
previously outlined. The focus of analysis and discussion is given to the cross-regional
differences and similarities found among Latin American and Scandinavian companies, as
well as to the different factors shaping them.
We would like to point out that since the primary source of data for this research have been
organizational documents, the statements representing the different CSR themes have been
collected directly from those documents available at companies’ corporate websites. We
have organized a data base to quote all the representative statements and to indicate how
many themes each company have mentioned according to the overarching CSR category and
the specific themes forming the categories. The output tables are attached in the appendix
as Table V and Table VI. Corporate documents, either Sustainable Reports or, in the case the
company did not provide this specific report, Annual Reports were accessed from the
corporate websites to access the executives’ opening letters.
In general the findings reveal that CSR rhetoric approach in Latin American companies’ top
companies varies from Scandinavian companies mainly in the “political role” Latin American
companies display. In the rest of rhetoric strategies both are similar and Scandinavian
companies show a more “dialectic” CSR rhetoric approach. Moreover, the statements about
CSR activities provided by companies’ executive letters is quite mature in the case of
companies from both regions; that was unexpected for us as researchers, since we expected
less CSR interest and therefore fewer statements in the Latin American companies’ reports.
Then we have observed how themes related to Corporate Social Responsibility,
Sustainability or Social Responsibility are widely in practice and therefore reported by top
Introduction
and RQ
Methodology
Theoretical
Background
Analysis Conclusion
62
companies from both regions. We think this is due to the effects of globalization making
international companies approach CSR from a standard global approach.
After this general overview, and following the next quantitative review, we will present the
differences among companies from the two regions more in detail for each category and
each theme. We are also including representative quotes from the reports.
Quantitative approach
A more quantitative approach based on the 74 companies analyzed provides opportunity for
further generalizations. The comparison between the themes composing the CSR rhetoric
strategies from both regions suggests that although the strategic and institutional rhetoric
remain dominant strategies, companies are also focusing on the dialectical and political role
of the firm. In the next page, in Figure 2, we can observe the total number of themes found
for each region in each category. In relative terms, we can observe Figure 3 where we
represent the total number of themes on each rhetoric category relative to the number of
themes included on it. (i.e. the Strategic rhetoric category is made out of seven themes:
operationalization, innovation, reputation, strategic link, governance, shared value, and
leadership on CSR; or the political role of the firm category is made out of four themes:
access, development, rights and political engagement). Hence in relative terms both
Strategic and Institutional are the most reported categories in both regions, then the
Dialectic is more reported in Scandinavia and the most significant difference is in the Political
role of the firm rhetoric category, where Latin America is outstanding. We can then refer the
Strategic and Institutional categories as the “mainstream” ones according to Castelló &
Lozano (2011), because they predominate in corporate reports from both regions. But even
though these are the predominant categories, the use of dialectic is also important, and the
political role of the firm is more significant in Latin America with respect to the results of
Scandinavia.
63
Figure 2. Comparison CSR rhetoric strategies, Latin America vs. Scandinavia
Figure 3. Comparison CSR rhetoric strategies Latin America vs. Scandinavia
(total number of themes observed relative to the number of themes of each category)
Continuously in figures 4 and 5 we can observe the percentage of total themes reported in
each category relative to the total number of themes reported in each region (total number
of themes for Latin America is 333 and for Scandinavia is 303). Representing that for
example in Latin America after counting all the themes companies have mentioned on their
corporate reports the Strategic category weights the 32% of the total, the Institutional the
23%, the Dialectic the 29% and the Political role 16%. Being aware that these weights are
relative to the number of themes included in each category, then we can observe how the
more numerous categories that are strategic and dialectic stand out.
107
75
98
53
101
68
101
33
Strategic Institutional Dialectic Policital role
Total CSR themes
Latin America Scandinavia
0
2
4
6
8
10
12
14
16
18
Strategic
CSR
Institutional
CSR
Dialectic
CSR
Political
role of the
firm
Latin America
Scandinavia
64
Figure 4. Percentage of total number of themes mentioned by Latin American companies
Figure 5. Percentage of total number of themes mentioned by Scandinavian companies
For comparison with the above results we can check the theoretical weight of each CSR
category in relation to the total number of themes each category includes, which is
illustrated below in figure 6.
Figure 6. Relative weight of each CSR category in relation to the total number of themes
Strategic
CSR
32%
Institutional
CSR
23%
Dialectic
CSR
29%
Political role
of the firm
16%
Latin America
Strategic
CSR
33%
Institutional
CSR
23%
Dialectic
CSR
33%
Political role
of the firm
11%
Scandinavia
Strategic CSR
29%
Institutional
CSR
21%
Dialectic CSR
33%
Political role
of the firm
17%
65
4.1 Strategic CSR
We name our first category, strategic CSR rhetoric, where we have included themes such as:
operationalization, innovation, reputation, strategic link, governance, shared value and
leadership on CSR. All of these themes focus on the way organizations influence and take
advantage of powerful symbols with the aim to try to get support from society (Schuman,
1995). Through strategic rhetoric, firms must maximize shareholder value by increasing
corporate returns or improving the reputation by embedding symbols in the strategic
management tradition, as for example managing management projects more efficient
(Castelló & Lozano, 2011). Within this rhetoric firms have the aim to relate the CSR activities
to the firm’s strategy, operationalization and innovation processes (Castelló & Lozano,
2011). In this rhetoric, the motives for the CSR interest and activities rest only in the
organizations self-interest, what Suchman (1995) defines as pragmatic legitimacy where the
main reason is for the organizations to earn profits so that in the end all the activities within
the firm, including CSR, must contribute to the profits of the company (Margolis & Walsh,
2003; Vogel, 2005; Wartick & Cochran, 1985). In this category CSR is viewed under the
principle where CSR activities only are accounted for when they support business objectives
(Castelló & Galang, 2011).
This category represents the aim of companies to provide concrete accounts of the benefits
of their actions to business through strategic means with the intention of maximizing
shareholder value and to garner societal support. In our distinction of CSR categories, the
Strategic rhetoric gathering seven different themes out of the 24 total, counts as the 29%
(see Figure 6 above), being the second biggest category after dialectic rhetoric.
We have noticed how companies from Latin American and Scandinavia show strong
commitment to this type of rhetoric by mentioning the different strategic CSR related
themes. By looking at the overall result for the category, the total number of Strategic CSR
themes reported by Latin American companies is 107 and 101 for the Scandinavian
companies, as we can see in Table 6 below. Furthermore in the Table 6 we can observe in
detail how many companies mention the different themes included in the strategic category.
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Graphically we can observe this distinction in Figure 7. Continuously Table 7 gathers in
relative terms the percentage of companies mentioning the different themes in relation to
the total number of companies analyzed in each region.
Notable, we can see how Latin American companies especially stick out in comparison to
Scandinavian companies in “Reputation”, showing a mentioning rate of 70,27 % in
comparison to 40,54% for the Scandinavian companies. In the “Strategic link” and
“Governance” themes, Scandinavian companies stick out in comparison to Latin American
companies and mentions strategic link by 37,84 %, versus 21,62% for the Latin American
companies, and display 72,97% out of the 37 companies analyzed in Scandinavia and 75,68%
respectively (Table 7 below) versus the 51,35% for both themes mentioned by the Latin
American companies.
After this general comparison within the overarching category, we are going to analyze the
different themes included in the Strategic rhetoric category individually.
Table 6. Total number of themes mentioned under the Strategic CSR rhetoric category
Strategic CSR Theme Latin America Scandinavia
Operationalization 29 34
Innovation 8 14
Reputation 26 15
StrategicLink 24 20
Governance 11 7
Shared Value 4 6
Leadership on CSR 5 5
107 101
Figure 7. Total number of themes mentioned on the Strategic CSR rhetoric strategy
0
5
10
15
20
25
30
35
40
Strategic CSR
Latin America
Scandinavia
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Table 7. Percentage of companies reporting in each category relative to the total number of
companies
Latin America Scandinavia
Operationalization 78,38% 91,89%
Innovation 21,62% 37,84%
Reputation 70,27% 40,54%
Strategic Link 64,86% 54,05%
Governance 29,73% 18,92%
Shared Value 10,81% 16,22%
Leadership on CSR 13,51% 13,51%
4.1.1 Operationalization
The “operationalization” theme refers to how corporations are embedding CSR in their
business systems and processes. Here, firms mention how they embed CSR in their business
processes, people skills and how they monitor performance; some of the examples of
companies mentioning this theme are:
“The Organization continues integrating the main indexes of corporate sustainability”, Banco
Bradesco (Brazil).
“In the area of environmental care, we improved processes for efficient water usage, and
appropriate handling or our wastes and emissions”, Femsa (Mexico).
“Internal controls which aim to minimize the potential environmental impact from energy
consumption, waste sorting, disposal of batteries, among others”, Oi Tele Norte Leste
(Brazil).
“We continuously invest in the best globally- available industrial technologies for the
protection of air, water and soil, so as to minimize the impacts of our operations on the
environment”, Gerdau Metalurgia (Brazil).
“We regularly evaluate the use of water and materials, as well as our carbon dioxide
emissions across the supply chain”, Nokia (Finland).
“By focusing on developing increasingly more energy-efficient engines and complete vehicles
that can operate on renewable fuels and by introducing hybridisation we are taking a lead in
the market”, Volvo (Sweden).
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“Electrolux has a three-part climate strategy that connects a crucial cause with good
business. It focuses on climate-smart products, communicating their benefits and
streamlining energy use in our own operations”, Electrolux (Sweden).
In all of these quotations from the companies’ executive letters opening either their
Sustainability or Annual Reports from 2009, we can see how CEOs bring up how the
company integrates CSR and embeds it in the company processes. The level of this theme
being mentioned in the CEO letters is 78,38% for Latin America and 91,89% for Scandinavia.
Most companies mentions something about operationalization as it is a standard theme and
clearly shows how the company stays committed to CSR.
4.1.2 Innovation
The “innovation” theme refers to processes that lead to new products or processes that are
the result either from CSR policies or from the engagement to stakeholders. This can be the
invention of new products that lead to more sustainable products or new processes in
relation to CSR.
Of the 37 companies in Latin America eight CEO letters mentions innovation, which accounts
for 21,62% in comparison to 37,84 % in Scandinavian companies. The quotations below
represent this theme:
“The advances made on managing this resource have resulted in an 8.3% increase in the use
of recovered water”, Grupo Mexico (Mexico).
“Through the "Committed to the Environment" program in 2009 we complemented new
product launches with degradable packaging technology, achieved a significant reduction in
the use of fuel and improved our management of solid waste”, Grupo Bimbo (Mexico).
“With an eye on a future with less emissions from the air transport sector, we participated in
a project for developing a new generation of renewable fuel from sugarcane, which may be a
long-term sustainable”, Embraer (Brazil)
“The realisation of Loviisa 3 as a combined heat and power plant offers an unprecedented
opportunity to even further reduce CO? emissions”, Fortum (Finland).
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“This new generation of insulins has the potential to offer better treatment for people with
diabetes and further strengthen Novo Nordisk's competitive position”, Novo Nordisk
(Denmark).
By looking at the innovation quotations from the executive letters we can observe that
companies in Scandinavia mentions innovations much more than Latin American companies.
The reason behind this can be due do the fact that the Scandinavian region has more access
to more advance technology due to the development of the region;
4.1.3 Reputation
The theme reputation displays any mentioning of reputation in connection with CSR such as
the firm’s achievements, positions and their uniqueness. In Latin America, the companies
tend to bring up more about themselves than in Scandinavia which can be seen from the
percentage of themes reported in the various executive letters, 70,27% in Latin America to
51,35% in Scandinavia. The reputation theme is the second largest theme after
operationalization in Latin America; consequently we can assume that Latin American
companies are more concerned in reputation issues than Scandinavian counterparts. We
include some quotations below to show what kind of reputation firms mentions in their CEO
letters:
“This performance has ranked Petrobas the fourth in the market value among listed global
energy companies”, Petrobas (Brazil).
“The Global Compact of the UN, which for the second consecutive year recognized our
previous sustainability report as a Notable Communication on Progress”, Vale (Brazil)
“Also being appointed for the third consecutive year, as a leading company in sustainability
in the financial services sector”, Itaúsa (Brazil).
“Today, we are the third largest clean energy company in the world), Electrobas (Brazil).
“This year Nokia was chosen as the “World Technology Supersector Leader.” This honor
means Nokia was ranked No 1”, Nokia (Finland).
“Fortum's reputation has improved and our investments in sustainability have received
recognition”, Fortum (Finland).
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“SKF Group won the Swedish Innovation Awards for its work on developing the new family of
energy-efficient bearings”, SKF (Sweden).
In the reputation quotes we can observe how Latin American companies are more
concerned about reputation and considers it more important to write about as the region is
developing and doing much better than previous years and try to make stakeholders more
aware about them and their economic, environmental and social performance
achievements. In general what we can deduce from the reputation mentions by companies
in both regions it that the Latin American companies mention how they are among the
leading companies in sustainability in their sector (i.e. the previous quotation from Petrobas
and Electrobas) while Scandinavian companies are mentioning how they are winning awards
(i.e. previous quotation from SKF).
4.1.4 Strategic link
When the CEO mentions anything about the relation between CSR or sustainability activities
and the firm’s strategy such as corporate performance, stakeholder value or increased
competitiveness through CSR it is a part of the “Strategic Link” theme. In Latin America 34
companies out of 37 (64,86%) have mentioned this theme in their executive letters while in
the Scandinavian companies 20 have mentioned this theme, therefore the percentage of
companies is 54,05%. The difference between the regions in this theme is not very large, and
as operationalization this theme is also commonly used in the CEO discourse, therefore the
high degree of appearance in both regions. We include some quotations below to represent
how various companies mentions this type of relation:
“In the economic area, our sustainability strategy proved its worth. Faced with a dramatic
global financial crisis, Vale demonstrated the practical competitive advantages of its
consistent management strategy”, Vale (Brazil).
“We firmly believe that integrating social responsibility into our business strategy not only
has immediate benefits, but is a factor in our success in confronting the difficulties companies
around the world are facing”, Femsa (Mexico).
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“In 2009, Cemig sought to continually improve its corporate sustainability actions, aligning
the creation of economic value respect for social environment with stakeholder preservation
of the environment”, Cemig (Brazil).
“Our business success is interconnected with innovating energy-savvy, resource-efficient
appliances. Embedding high social and environmental standards throughout our daily
operations is a crucial part of doing business well”, Electrolux (Sweden).
“Reaching the best results begins with having a solid strategy that includes analyzing our
performance on the economical, social and environmental levels”, Atlas Copco (Sweden).
“H&M strives to be a sustainable business- financially, socially and environmentally. If we are
to continue being a successful company, we believe that integrating sustainable thinking into
everything that we do is absolutely necessary”, H&M (Sweden).
4.1.5 Governance
The theme governance represents any mentioning of the importance of the governance
structure related to sustainability or CSR issues, the compliance of rules or processes and
ethical norms or policies. The associated issues are: corporate governance, compliance, code
of conduct, integrity, professionalism and ethical policy.
In Latin America 11 companies out of 37 (29,73%) have mentioned governance issues in
their executive letters which is the among the top 4 mentioned themes comparing to
Scandinavia where only 7 companies (18,92%) mentions this theme. Thus we can assume
that Latin American companies mention more governance issues than their counterparts,
since Scandinavia has more economic, political and social stability and because the
governments in Scandinavian countries plays a huge role in making sure that the governance
structures are very well established. Therefore in Scandinavia the companies don’t have the
same urge to mention governance structures as much as in Latin American corporations.
Some examples of companies mentioning this theme are:
“With improvements in corporate governance and in the managing methods, besides
developing a group of projects aiming at the integration of all Electrobas companies”,
Electrobas (Brazil).
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“Enhancing the corporate governance practices is also one of our priorities. Our Code of
Ethics and Conduct of Company was widely disseminated”, Sabesp (Brazil).
“For the Itausa group the operations carried out by its subsidiaries must be grounded on the
commitment to Corporate Governance ans sustainble actions. “, Itausa (Brazil).
“We have started the implementation of a group-wide Code of Ethics and Conduct, to
provide guidance for all employees in our day-to-day work”, Telia Sonera (Sweden).
“Our Code of Conduct and Code of Business Ethics are regularly assessed, making sure we are
on track wherever we are in the world”, Ericsson (Sweden).
“Our values, our Code of Conduct and the UN Global Compact initiative endorse also guide all
Metso employees towards sustainable operations”, Metso (Finland).
4.1.6 Shared Value
The theme “Shared value” includes the mention of policies and operating practices that
enhance the competitiveness of the firm while simultaneously advancing the economic and
social conditions in the communities in which it operates. The shared value creation focuses
on identifying and expanding the connections between societal and economic progress;
In Latin America 4 companies out of 37 (10,81%) have mentioned shared value in their
executive letters, which is the lowest mentioned theme in the region, while in Scandinavia 6
companies have mentioned this theme (16,22%). From these numbers we can assume that
both regions are concerned with delivering sustained social and economic value for both the
company itself and the community surrounding it; we include some quotations below to
represent what firms understand and mention in their CEO letters about shared value:
“Our capacity to generate value makes us one of the economic pillars of development in the
regions where we operate”, Grupo Mexico (Mexico).
“Thanks to our deep sense of service and to an understanding that attention to the needs of
the environment and the search for the welfare of the individual represent a commitment
and a raison d'etre that will continue to generate value for our stakeholders and future
generations”, Grupo Bimbo (Mexico).
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“Motivate us to continue to advance our corporate management alligned with Corporate
Social Responsibility aiming to achieve sustainable development that generates value for all
our stakeholders”, BCI (Chile).
“CSR should be an integral part of every organization that wants to build strong relationships
with its customers and have the acceptance of the societies in which it operates”, Nordea
Bank (Sweden).
“I am personally committed to continuing the sustainable approach we have employed for
many years. But this is not about sustainability and corporate responsibility just for the sake
of it. It is about creating long-term shareholder value, building the brand, and engaging with
customers and employees.”, Ericsson (Sweden).
“We are moving towards sustainability becoming a shared responsibility. “, H&M (Sweden).
“Sustainability efforts are an important component of the Volvo Group's competitiveness and
our ability to create value for customers, shareholders and future generations”, Volvo
(Sweden).
4.1.7 Leadership on CSR
This theme focuses on the self representation and companies aim to lead CSR development
in their business strategies. This can be statements or any mention of addressing the specific
CSR leadership and challenges that the firm faces (accomplishments from past years and
goals for next years).
In both Latin America and Scandinavia 5 companies out of 37 have mentioned leadership on
CSR in their executive letters, representing a 13,51% of the total number of companies
analyzed. Hence, we can assume that both regions have the same thought about the
importance of mentioning this theme in the CEO discourse. As this is a new theme that we
have discovered in the analysis of the CEO letters, companies are becoming more aware
about the importance of not just i.e. integrating CSR into business processes and strategy
but also the magnitude of becoming a world leader on CSR. We include some quotations
below to represent what firms mention in their CEO letters about this theme:
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“The improvement in our performance in the sustainability indicators that are detailed in this
report. They are contributing to the search for excellence in the management of our
businesses, making our actions transparent to society, and helping to spread our practices in
the sustainability area across all different countries in which we operate”, Vale (Brazil).
“To be in 2020 one of the two largest energy groups in Brazil in terms of market value, with a
significant presence in the Americas and to be a world leader in sustainability in the sector”,
Cemig (Brazil).
“2009 posed important challenges that we transformed into opportunities in order to keep
our commitment to efficiency, productivity and job creations, with the aim of strengthening
our leadership as a company that conducts itself in a dynamic and flexible manner, but above
all transparency, under the premise of fair and responsible practices”, Grupo Bimbo
(Mexico).
“KONE wants to be a part of finding solutions to these challenges by aiming to be the eco-
efficiency leader in the industry” KONE (Finland).
“As the world's cleanest and best diesel, NExBTL is set to be increasingly important financially
for us and publicly committed ourselves to using only certified palm oil as soon as possible”,
Neste Oil (Finland).
4.2 Institutional CSR
We name our second category, institutional CSR rhetoric, where we have included themes
such as: CSR, sustainability, philanthropy, stakeholder dialog and sustainable growth. This
category of themes is very often used in the executive letters and have the purpose to gain
legitimacy and garner society acceptance (Castelló & Galang, 2011). Institutional rhetoric is
oriented towards cognitive legitimacy, and implies firm’s desire to conform to the
expectations from society (Schuman, 1995). Themes such as CSR and stakeholder dialog are
very common in CEO discourses as they represent the CSR movement and presents the
firm’s worthiness and acceptability (Oliver, 1991). Castelló & Lozano (2011) argue that that
theme, such as CSR and sustainability, remain fairly academic and meaningless and are
losing their normative force today. Further, although institutional rhetoric is recognized and
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used as an instrument for cognitive legitimacy it does not lead to moral legitimacy (Castelló
& Lozano, 2011).
The institutional CSR rhetoric themes are quite common in CEO discourse from both regions
as these themes.
In our distinction of CSR categories, the institutional rhetoric gathering five different themes
out of the 24 total, counts as 20,8 % (Figure 6, p. 64) being the third biggest category after
strategic rhetoric.
We have noticed how companies from Latin American and Scandinavia show strong
commitment to this type of rhetoric by mentioning the different institutional CSR related
themes. By looking at the overall result for the category, companies from Latin America
show more commitment to this rhetoric strategy; quantitatively, the total number of themes
reported in the institutional category represent the 33,33% over the total of themes
mentioned by Scandinavian companies. In the case of Latin America this category represents
the 29,43% over the total of themes mentioned by all the Latin American companies. Then
the total number of Institutional CSR themes reported by Latin American companies is 75
and 68 for the Scandinavian companies, as we can see in Table 8 below. Also in Table 8 we
can observe in detail how many companies mention the different themes included in the
strategic category. Graphically we can observe this distinction in Figure 8.
Continuously Table 9 gathers in relative terms the percentage of companies mentioning the
different themes in relation to the total number of companies analyzed in each region.
Remarkable, we can see how Latin American companies stick out in comparison to
Scandinavian companies in themes such as “sustainability”, showing a mentioning rate of
70,27% in comparison to 56,76% for the Scandinavian companies. As well as in the
philanthropy theme where Latin America has a mentioning rate of 16,22% in comparison to
Scandinavia’s merely 2,7%. On the other hand themes such as CSR and Stakeholder dialog
are more mentioned in the CEO discourse of the Scandinavian companies, although it is not
by many percentages (see Table 9). After this overall comparison within the overarching
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category, we are going to analyze the different themes included in the institutional rhetoric
category separately.
Table 8. Total number of themes mentioned under the Institutional CSR rhetoric category
Institutional CSR Theme
Latin America Scandinavia
CSR 19 22
Sustainability 26 21
Philanthropy 6 1
Stakeholder
dialog
15 18
Sustainable growth 9 6
Total 75 68
Figure 8. Total number of themes mentioned on the institutional CSR rhetoric category
Table 9. Percentage of companies reporting in each category relative to the total number of
companies analyzed
Latin America Scandinavia
CSR 51,35% 59,46%
Sustainability 70,27% 56,76%
Philanthropy 16,22% 2,70%
Stakeholder dialog 40,54% 48,65%
Sustainable growth 24,32% 16,22%
0
5
10
15
20
25
30
Institutional CSR
Latin America
Scandinavia
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4.2.1 CSR
The “CSR” theme refers to how firms with a voluntary initiative, integrates social and
environmental concerns into their business operations. Here, the CEO mentions
responsibilities and voluntary actions taken by the company to promote responsibility such
as CSR, triple bottom line, socioeconomic factors and collective responsibility. In Latin
America 19 companies out of 37 (51,35%) have mentioned CSR in their executive letters; in
Scandinavia 22 companies (59,46%). Some examples of companies mentioning this theme
are:
“These changes in the economic, social, cultural, and human spheres which led FEMSA to
reinforce its business strategies including those related to social responsibility”, FEMSA
(Mexico).
“We take this opportunity to reaffirm our commitment, stated at the time that Fibria was
conceived, to develop our renewable forestry business as a sustainable source of life,
generating wealth and economic growth, , promoting human and social development and
guaranteeing environmental conservation”, Fibria Celulosa (Brazil).
“We are a company committed to society, to the environment, and to the rational,
sustainable use of natural resources” Kimberly Clark de Mexico (Mexico).
“In power and heat production, our strengths are in our production portfolio that supports
sustainability and utilizes renewable and low-carbon energy sources”, Fortum (Finland).
“We strive towards excellence in all areas of corporate responsibility, including economic,
environmental and social responsibility”, KONE (Finland).
“In accordance with our responsibility programme for 2008-2012, we are improving our
energy efficiency and reducing our emissions”, Kesko (Finland).
CSR is a theme that is often mentioned in the CEO letters, this can also be seen in both the
regions where more than 50% of the companies have mentioned this concept to a greater
extent. As can be seen from the quotations above this theme is often used to demonstrate
the organizations worthiness and acceptability. Companies use words as commitment and
responsibility towards in order to gain support from the society. The theme is often used as
a consideration to good business practice.
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4.2.2 Sustainability
The “sustainability” theme refers to activities aimed at balancing the fulfillment of human
needs with the protection of the natural environment so that the needs can be met not only
in the present, but in de indefinite future.
Of the 37 companies in Latin America 26 CEO letters mentions sustainability, which accounts
for 70,27% in comparison to 21 companies (56,76%) in Scandinavian companies. The
quotations below represent this theme:
“During 2009, Redecard remained dedicated to improving its market practices, supporting
the changes necessary to make its business more sustainable”, Redecard (Brazil).
“Grupo Modelo maintains its commitment with the company's sustainable development in
the communities in which it operates”, Grupo Modelo (Mexico).
“In 2009, Cemig sought to continually improve its corporate sustainability actions, aligning
the creation of economic value respect for social environment with stakeholder preservation
of the environment”, Cemig (Brazil).
“Managing responsibly. As we see it, a business can only be sustainable in the long term if it
meets stakeholders' expectations regarding social and environmental impact, in addition to
delivering strong financial performance. This is the core of our Triple Bottom Line approach.”,
Novo Nordisk (Danmark).
“Our performance in 2009 demonstrates our strong commitment to conduct our business in a
responsible and sustainable manner at all times”, Kone (Finland).
“We make great products using renewable and recyclable raw material - products that can
make a real difference for our customers, for their customers, for consumers and for the
planet”, Stora Enso (Finland).
By looking at the above quotations from the CEO letters we can observe that the term
sustainability is on many occasions lacking in-depth meaning. Kone and Novo Nordisk
constitutes two good examples of how the term is loosing its deeper meaning since it does
not refer to any new understanding of the role of the firm when applying the institutional
rhetoric, but instead to a collection of cognitive rhetoric that is already familiar to the
audience.
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4.2.3 Philanthropy
The theme “Philanthropy” displays voluntary donations mostly through donations to
solidarity activities. These deeds are considered to be different from the object of the core
business. By looking at the executive letters from both regions there is a noteworthy
difference in the mentioning of this theme between the regions. Out of all the Latin
American companies we have analyzed 6 of them are mentioning these theme, accounting
for 16,22% of all the Latin American. companies, while only one company of all the 37
Scandinavian companies mentions anything about philanthropy (2,7%). The reason behind
this can be the role of the state in both the regions. As Scandinavian governments are doing
much more for society and companies in Scandinavia are more focused on the regions
where they operate this could be the reason why they mention so little about philanthropy
while in Latin America the companies take the government’s role and takes the role of the
state in society. Consequently we can assume that Latin American companies are more
concerned in philanthropy issues than Scandinavian counterparts. We include some
quotations below to show what kind of philanthropy firms mentions in their CEO letters:
“We created the Vale Fund for Sustainable Development which is designed to support actions
by NGOs to balance environmental conservation with the improvement of social and
economic conditions of communities, with an initial focus on the Amazon rainforest blome”,
Vale (Brazil).
“In a related initiative, in 2009 SQM inaugurated a cultural center at a school in Toconao,
restoring the building, furnishing it, and providing the necessary equipment in order to offer
classes and workshops to the community”, SQM (Chile).
“Through the ALFA Foundation, we continued to promote all levels of the teaching-learning
process through such initiatives as scholarship programs, support to educational institutions
and infrastructure as well as teacher training”, Alfa Laval (Sweden).
“Our long term financial commitment to the World Diabetes Foundation, a leading funding
body devoted solely to projects within diabetes care and prevention in the developing world”,
Novo Nordisk (Danmark).
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4.2.4 Stakeholder dialog
The “Stakeholder dialog” theme includes any process of communication with the
stakeholder coming from the firm and includes communication, dialog and response to
various stakeholders.
In Latin America 15 companies out of 37 (40,54%) are communicating with stakeholders in
their executive letters while among the Scandinavian companies 18 (48,65%) mentions this
kind of communication in the CEO letters. In this theme, companies from both regions are
talking to stakeholders in almost the same extent, same number. We include some
quotations below to represent some types of stakeholder communications from the CEO
letters from both regions:
“To Petrobas the Sustainability Report is an essential tool for transparency in monitoring,
disclosing and rendering accounts to its stakeholders about its economic, environmental an
social performance”, Petrobas (Brazil).
“We would like even to communicate in a more and more effective way with our
stakeholders, recognizing the diversity of their expectations concerning our business and
offering then timely and appropriate answers”, Electrobas (Brazil).
“We understand that we can positively influence our stakeholders by providing high quality
information and promoting initiatives that contribute to the creation of a new consciousness
and the adoption of sustainable habits”, CPFL Energia (Brazil).
“A good dialog with the customers, simpler and more understandable products, efficient and
customer-friendly service solutions, and competitive conditions are key elements of this
work”, Storebrand (Norway).
“We do these things because we believe the sustainable development of Atlas Copco will
benefit all our stakeholders”, Atlas Copco (Sweden).
“A business can only be sustainable in the long term in it meets stakeholders' expectations
regarding social and envrion-metal impact, in addtion to delivering strong financial
performance”, Novo Nordisk (Danmark).
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4.2.5 Sustainable growth
The theme sustainable growth represents firms engaging in a global growth to enlarge their
presence in new regions across the word, mentioning explicitly sustainable growth to make
it possible.
In Latin America 9 companies out of 37 (24,32%) have mentioned sustainable growth in their
executive letters; in Scandinavia 6 companies (16,22%), which is one of the least mentioned
themes in both regions. From these finding we can deduce that Latin American companies
are to some level more concerned about achieving a sustainable growth than Scandinavian
companies.
Some examples of companies mentioning this theme are:
“We would like to achieve much more. Our future vision expressed in our 2010-2020 Strategic
Plan, shows the width of our ideal: to be the largest global corporate clean energy system in
2020”, Electrobas (Brazil).
“The new energy generation projects ensure the company's growth in the generation of
energy utilizing clean and renewa-ble sources”, Cemig (Brazil).
“In addition we invest in conservation and biodiversity efforts and closely collaborate with
communities to ensure that our growth is truly sustainable”, Fresnillo (Mexico).
“Economic responsibility for KONE means creating value for our stakeholders through long-
term growth in sales and profits. Value can only achieved by continuously developing our
competitiveness in a sustainable way”, Kone (Finland).
“We take sustainability into account, as a whole in our business. We want to solve global
problems actively and comprehensibly and thus create a foundations from Metso's
sustainable, profitable growth and for the continuous well-being of our stakeholders”, Metso
(Finland).
“As we grow and globalise our business, it is critical that all employees develop a deep
understanding of the principles at the heart of Novo Nordisk Way of Management, which
describes our vision, our values, our commitment and our policies, and thereby guides all of
our actions. Continual training is necessary as our business grows and attracts new people
and as the regulatory environment and global norms change”, Novo Nordisk (Denmark).
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4.3 Dialectic CSR
In this category of dialectic CSR rhetoric we have included the themes: global standards,
citizenship, accountability, partnership, global agenda, inclusivity, focus on the issue and
social contribution. All of them point out to the communication or dialog practice between
the corporations and their stakeholders; and all the activities they carry out to keep
acceptance from stakeholders. Therefore the dialectic themes are related to companies’
efforts to keep a good open dialog with stakeholders.
Through dialectic rhetoric organizations show awareness of their ethical dimensions and
power relations to society. Thus corporations recognize themselves as corporate citizens.
Then in contrast to the performance of just economic interests, dialectic CSR rhetoric brings
a form of harmonized dialog that is oriented toward mutual understanding and agreement
between the organization and the broad range of stakeholders and civil society (Castelló &
Lozano, 2011). As a result moral legitimacy (Schuman, 1995) emerges from that
communicative activity in which incumbents try to persuade each other to take joint
collective action or decide what direction is more suitable.
This category represents the aim of companies to share some values or principles with
stakeholders through dialectic means with the intention of addressing social issues. The
partnership and accountability themes might be the best representations of the
organization’s willingness to establish direct relationships with diverse stakeholders. Social
contribution and inclusivity themes are more focused on social progress towards equality.
Global standards and global agenda focus on global guidelines and global issues.
In our distinction of CSR categories, the Dialectic rhetoric gathering eight different themes
out of the 24 total, counts as the 33% (see Figure 6, p. 64), being then the most numerous
category.
We have observed how companies from Latin American and Scandinavia display strong
commitment to this type of rhetoric by mentioning the different dialectic CSR related
themes. Looking at the overall result for the category, companies from Scandinavia show
more commitment to this rhetoric strategy; quantitatively, the total number of themes
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reported in the dialectic category are representing the 33,33% over the total of themes
mentioned by Scandinavian companies. In the case of Latin America this category represents
the 29,43% over the total of themes mentioned by all the Latin American companies. Then
the total number of Dialectic CSR themes reported by Scandinavian companies is 101 and 98
for the Latin American companies, as we can see in Table 10 below. Also in the table 10 we
can observe in detail how many companies mention the different themes included in the
dialectic category. Graphically we can observe this distinction in Figure 9. Continuously table
11 gathers in relative terms the percentage of companies mentioning the different themes in
relation to the total number of companies analyzed in each region.
Noteworthy, we can observe how Scandinavian companies stand out in comparison to Latin
American companies in the “Accountability” and “Global Standards” themes, displaying a
72,97% out of the 37 companies analyzed in Scandinavia and 75,68% respectively (Table 11)
versus the 51,35% for both themes mentioned by the Latin American companies. Latin
American companies stand out comparing to Scandinavia in the “social contribution” theme,
having a 45,95% versus a 29,73%.
After this general comparison within the overarching category, we are going to analyze the
different themes included in the Dialectic rhetoric category separately.
Table 10. Total number of themes mentioned under the Dialectic CSR rhetoric category
Dialectic CSR Theme
Latin America Scandinavia
Global Standards 18 17
Citizenship 2 2
Accountability 19 27
Partnership 13 8
Global Agenda 19 28
Inclusivity 6 2
Focus on the issue 4 6
Social contribution 17 11
Total 98 101
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Figure 9. Total number of themes mentioned on the Dialectic CSR rhetoric category
Table 11. Percentage of companies reporting in each category relative to the total number of
companies analyzed
4.3.1 Global Standards
The “global standards” theme refers to the certifiable standards focused on increasing
business accountability through reporting. For example we consider part of this theme
companies mentioning in their executive letters that they are included in global
sustainability indexes like the Dow Jones Sustainability Index or the FTS100; or when
companies subscribe the United Nation’s Global Compact principles or the GRI reporting
initiative.
In Latin America 18 companies out of 37 (48,65%) have mentioned global standards in their
executive letters; in Scandinavia 17 companies (45,95%). Some examples of companies
mentioning this theme are:
0
5
10
15
20
25
30
Dialectic CSR
Latin America
Scandinavia
Latin America Scandinavia
Global Standards 48,65% 45,95%
Citizenship 5,41% 5,41%
Accountability 51,35% 72,97%
Partnership 35,14% 21,62%
Global Agenda 51,35% 75,68%
Inclusivity 16,22% 5,41%
Focus on the issue 10,81% 16,22%
Social contribution 45,95% 29,73%
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“The company also maintained its investments grade rating and ensured for the fourth
consecutive year its listing on the Dow Jones Sustainability Index. In line with the ten
principles of the UN's Global Compact […]”, Petrobas (Brazil).
“In 2009 we reinforced our commitment to the Global Compact- a United Nations framework
that sets out 10 principles”, Banco Bradesco (Brazil).
“With the publication of Vale's third sustainability report, prepared in accordance with the
guidelines of the Global Reporting Initiative (GRI)”, Vale (Brazil).
“I am also pleased that we have regained our position in the global FTSE4Good responsible
investment index”, Telia Sonera (Sweden).
“After several years favorable rating by the widely recognized Dow Jones Sustainability
Indexes […] in the process of developing this report, we have referred to the guidance and
requirements of the Global Reporting Initiative (GRI) and UN Global Compact reporting
guidelines”, Nokia (Finland).
“Given our commitment to being a responsible business, it is natural that we continue to
support the ten principles of the United Nations Global Compact” H&M (Sweden).
In all of these quotations from the companies’ executive letters opening either their
Sustainability or Annual Reports from 2009, we can see how CEOs stress the importance of
their organizations subscribing the different global standards to keep their sustainability
commitments under the standard values of international organizations or indexes. It is
positive they keep the level of commitment set by the different organizations, so
stakeholders can check organizations follow these standards set internationally. By
mentioning the global CSR standards, companies legitimize themselves as following common
rules, so stakeholders perceive they are operating according to globally set CSR principles.
4.3.2 Citizenship
The “citizenship” theme refers to the use of the metaphor of the firm as a citizen, when the
company considers its citizenship, i.e. its concerns as corporate citizen.
We have only found two companies in each region that in their written communications
consider and explicitly mention themselves as corporate citizens. Therefore they only count
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as the 5,41% of the analyzed companies in each region. The quotations below represent this
theme:
“It is essential that Telia Sonera is regarded as a responsible employer -a good corporate
citizen”, Telia Sonera (Sweden)
“The impacts of our operations in Latin America and China on local communities are quite
different than in our traditional home base, as the social, economic and cultural contexts are
so different. To be successful in these societies in the long term as a company and as
individual people, we need to be even more transparent, more sharing and more prepared to
learn” Stora Enso (Finland).
“Projects of social, environmental and citizenship responsibility implemented by the Company
[…]”, Copel (Brazil)
“We will continue to play the role that corresponds to us as a good corporate citizen in the
social and economic sphere”, Kimberly-Clark de Mexico.
Then we can observe how this theme is the least mentioned by the companies in both
regions. Therefore we are able to deduce citizenship is not a common consideration for
multinational companies in Latin American or Scandinavia.
4.3.3 Accountability
The theme accountability gathers any mention of processes in which the firm is held
accountable by stakeholders. This also includes voluntary actions by the firm to increase its
transparency. As a result the theme includes issues mentioned concerning accountability,
transparency, footprints, external review committees, or responsible lobbying.
In Latin America 19 companies out of 37 (51,35%) have mentioned accountability in their
executive letters; on the other hand, in Scandinavia 27 companies have mentioned this
theme, therefore the percentage of companies is 72,97% which is the second highest
comparing to the rest of themes included in the dialectic rhetoric category. Then we can
deduce Scandinavian companies are more concerned in accountability issues than Latin
American counterparts.
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We include some quotations below to represent what firms understand and mention in their
CEO letters about accountability issues:
“To Petrobas the Sustainability Report is an essential tool for transparency in monitoring,
disclosing and rendering accounts to its stakeholders about its economic, environmental and
social performance […] Our 2009-2013 Business Plan calls for avoiding the emissions of 4,5
milion tons of CO? equivalent in 2013”, Petrobas (Brazil).
“Such is the context in which we have mapped out our strategy, using Balanced Scorecard
(BSC) methodology, in order to make our future strategy transparent and objective”,
Usiminas (Chile).
“We also recorded progress on the corporate sustainability front with the institution of a
sustainability committee to structure related issues”, CBD Brazil GPA.
“Above all transparency, under the premise of fair and responsible practices”, Grupo Bimbo
(Mexico).
“It is also vitally important that we keep our own company, and the industry's carbon
footprint, in check. In 2009 we achieved our carbon-footprint-reduction targets, meeting our
portfolio-efficiency aims”, Ericsson (Sweden).
“At SEB, we raised our sustainability ambition significantly during 2009, addressing both our
own footprint management and business practices […] We decided, among other things, to
reduce our carbon footprint by 45 per cent until 2015”, SEB (Sweden).
“Our Environmental Excellence development program includes actions to strengthen KONE's
innovation leadership in the area of eco-efficiency and to minimize KONE's carbon footprint”,
KONE (Finland).
We can observe how Scandinavian companies are more focused on mentioning their
footprint reductions to be more eco-efficient, on the other hand Latin American companies
apart from footprints they also focus in transparency and other tools for monitoring,
disclosing and rendering accounts to its stakeholders about its economic, environmental and
social performance.
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4.3.4 Partnership
The theme partnership includes any mention of collaborations or partnerships other than
strictly business partnerships. It includes then collaborations between corporations and
global organizations, social entrepreneurs, activists, governments, NGOs or civil society.
In Latin America 13 companies out of 37 (35,14%) have mentioned partnership in their
executive letters; on the other hand, among the Scandinavian only 8 companies have
mentioned this theme, therefore the percentage of companies is 21,62%. Then we can
observe the Latin American hold more partnership agreement with diverse organizations
that the Scandinavian companies analyzed.
We include some quotations below to represent which partnerships other that strictly
business ones are mentioned by companies in both regions:
“In parallel, Vale in conjunction with civil society organizations, oversaw the publication of an
Open Letter to Brazil on Climate change” Vale (Brazil).
“We are proud of having been the first to accept the invitation of the Colombian government,
and thus to serve as an inspiration for other companies interested in joining in the work of
rebuilding peace in the country” FEMSA (Mexico).
“Also to the Rio Grande do Sul Recycling Project, in partnership with Vonpar Foundation and
Banco do Brasil Foundation, besides proceeding with various already existing initiatives”,
BRASKEM (Brazil)
“We play an active part in organizations such as the Roundtable on sustainable palm oil and
maintain close contacts with political decision makers and other opinion leaders” Neste Oil
(Finland).
“Our long-term financial commitment to the World Diabetes Foundation, a leading funding
body devoted to solely projects within diabetes care and prevention in the developing world”,
Novo Nordisk (Denmark)
“We reinforced our commitment to social contribution by joining forces with the Red Cross on
providing IT and telecommunications facilities in disaster scenarios”, TDC (Denmark).
In general what we can deduce from the partnership mentions by companies in both regions
it that the Latin American companies have created partnership with governments in the
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region and other organizations to overcome the social, environmental or economic problems
the region still has (i.e. the previous quotation from FEMSA Mexico referring to its
contribution for peace in Colombia). In contrast, Scandinavian companies mention
partnerships normally involved with global problems, since the region counts with political,
social and economic stability. Then their partnership with national governments does not
play the role they show in Latin America, all the contrary, because the national systems in
Scandinavia are really well established and they count with social peace and economic
welfare.
4.3.5 Global Agenda
The theme global agenda represents any mention of issues that are dealt with by global
institutions such as the UN, especially if they are included in the UN Millennium Goal. They
can be considered one of the top priorities for all actors (civil society, governments and
companies). Thus, the associated issues are: climate change, poverty, equity, energy needs,
greenhouse gases, water, carbon emissions, UN World Diabetes Day or any other issue
directly mentioning “global agenda”.
In Latin America 19 companies out of 37 (51,35%) have mentioned global agenda issues in
their executive letters; in Scandinavia 28 companies (75,68%) which is the most mentioned
theme comparing to the rest of themes included in the dialectic rhetoric category. Then we
can deduce Scandinavian companies are really concerned about global agenda issues.
Some examples of companies mentioning this theme are:
“Climate change has established itself at the top of the environmental agenda in recent
years- a situation that will remain for the foreseeable future, since it ultimately involves our
survival”, SCA (Sweden).
“We innovate and are committed to help fight against climate change”, A.P. Moller-Maersk
(Denmark).
“After the UN Climate Conference in Copenhagen in December it has become increasingly
clear that businesses have a key role to play in delivering on public expectations of change”
SEB Group (Sweden)
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“This year we want to emphasize the importance of more responsible water management
this being vital element for the planet” Grupo Mexico.
“In the view of the worldwide debate about climate change and greenhouse gas emissions by
our industry, Braskem resolved to include these issues in its agenda”, Braskem (Brazil).
“We reconfirm our commitment to address climate change and to the development of a low-
carbon economy as a result of this concern, CPFL is an active participant in discussions
between corporations regarding the subject of global warming”, CPFL (Brazil).
4.3.6 Inclusivity
The theme inclusivity includes the mention of activities aimed at disfavored, non-profit, non-
economic stakeholders that are related to the firm’s core business.
In Latin America 6 companies out of 37 (16,22%) have mentioned inclusivity issues in their
executive letters; on the other hand, in Scandinavia only 2 companies have mentioned this
theme, therefore the percentage of companies is 5,41% which is one of the lowest from
Scandinavia comparing to the rest of themes included in the dialectic rhetoric category. Then
we can deduce Latin American companies are more concerned with inclusivity issues than
Scandinavian counterparts; this is due to social differences in Latin America; companies
operating there can help to reduce them. On the contrary, Scandinavia is already a fair equal
society, and then companies rarely mention inclusivity actions.
We include some quotations below to represent what firms understand and mention in their
CEO letters about inclusivity issues:
“Braskem has made a significant contribution to the Social Insertion Program in the Deep
South of the state of Bahia”, Braskem (Brazil).
“The inauguration in November of the first bank branch in Heliopolis, a destitute community
with about 100000 inhabitants […] in the domestic market we are the private bank with the
largest presence in classes D and E”, Banco Bradesco (Brazil).
“In 2009, we welcomed 550 persons with disabilities, senior citizens, and members of other
vulnerable groups into our Workplace”, FEMSA (Mexico).
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“We believe that we have an obligation and an opportunity to develop new and better
therapies both for inhibitor patients and for general hemophilia patients as well as other
patients with rare coagulation disorders”, Novo Nordisk (Denmark).
“The Millennium Development Goals and our work in the Millennium Villages in sub-Saharan
Africa continue to be among our core commitments. The support we provide is not in the
form of charity, but rather through technology and competence, and is built on a sustainable
business case”, Ericsson (Sweden).
4.3.7 Focus on the issue
The theme focus on the issue has been considered when a significant part of the statements
refer to a social/environmental problem that is core to the firm’s business operations or
strategies. Then issues such as responsible energy, universal access to communications or
sustainable mobility are included in this dialectic theme.
In Latin America 4 companies out of 37 have mentioned focus on the issue in their executive
letters, representing a 10,81% of the total number of companies analyzed; in Scandinavia 6
companies have mentioned this theme, therefore the percentage of companies is 16,22%.
Then we can deduce Latin American and Scandinavia companies rarely mention focus on the
issue facts, but if a bit more frequent for Scandinavia companies, this can be due to their
great concern on environmental issues.
We include some quotations below to represent what firms mention in their CEO letters
about this theme:
“Instead of utilizing fresh water from aquifers, the flotation plants at Fresnillo and Sucito will
use treated water, which brings environmental benefits to the community and reduces our
fresh water consumption costs” Fresnillo (Mexico).
“Sets the goal of achieving levels of excellence in the energy industry with regard to the
intensity of greenhouse gas emissions in processes and products”, Petrobas (Brazil).
“The scarcity of water can limit our ability to generate value as this is a basic supply for our
mining-metallurgic processes. The advances made on managing this resource have resulted
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in an 8,3% increase in the use of reverted water, which means that 69% of the water we
consume is water recovered from our own processes”, Grupo Mexico.
“Increasing the efficiency of the energy markets and responding to the challenge of climate
change require market-driven integration and a coherent energy policy”, Fortum (Finland).
“We consider it our obligation to continue developing products and services that radically
reduce the level of emissions to both air and the sea. Improved ship design, more efficient
engines and propulsors, use of gas as fuel, and optimized flexible power plants solutions all
contribute to a more sustainable environment”, Wärtsilä (Finland).
“We have further broadened our environmental focus areas, with water and biodiversity
issues growing in importance. In 2009, we continued to look at reducing the environmental
impact of our devices and operations”, Nokia (Finland).
4.3.8 Social contribution
The theme social contribution includes any explicit mention of the importance of the firm
contributing to social improvements, benefits to humanity or contribution to positive
change. Mentions of the way companies manage the contributions for the communities they
serve, or the way they deliver significant benefits to humanity.
In Latin America 17 companies out of 37 (45,95%) have mentioned accountability in their
executive letters; on the other hand, in Scandinavia 11 companies have mentioned this
theme, therefore the percentage of companies is 29,73% which is the second highest
comparing to the rest of themes included in the dialectic rhetoric category.
In Latin America 17 companies out of 37 have mentioned social contributions in their
executive letters, representing a 45,95% of the total number of companies analyzed; in
Scandinavia 11 companies have mentioned this theme, therefore the percentage of
companies is 29,73%. Then we can deduce Latin American companies are more concerned in
social contribution issues than Scandinavian counterparts.
We include some quotations below to represent the social contributions firms mention in
their CEO letters:
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“As part of its community efforts, the Company has implemented multiple initiatives focusing
on recovering heritage, improving education and culture, and socially advancing these
important communities” SQM (Chile).
“All this aims at creating opportunities of social and economic growth, especially for the 300
Mapuche communities living close to forests and areas where the company operates in Chile”
CMPC (Chile).
“Company performs with devotion, dedication and efficiency its role of fomenting and
promoting social and economical development of State of Paraná, serving population with
quality and providing conditions to its own growth as a company, contributing with welfare
of the community”, Copel (Brazil).
“We see the effect telecommunications are having in alleviating poverty. Access to
communications has a positive impact on GDP and socioeconomic development” Ericsson
(Sweden).
“Our products are our greatest contributions to society. They provide significant benefits to
patients, tangibly improving people's health Novo Nordisk”, (Denmark).
“The World Bank Green Bonds, where SEB as the supporting the build-up of more sustainable
economies in developing countries”, SEB (Sweden).
In general what we can deduce from the social contribution mentions by companies in both
regions is that the Latin American companies have greater commitment to alleviate social
problems in locations with problems inside Latin America; this way again we can see how
Latin American corporations try to overcome the social or economic problems the region still
has to deal with. We therefore reaffirm that for many Latin American companies the social
contributions such as engagement with employees and local communities to improve the
social lives of the society, in terms of providing housing, education and special health
benefits, is a part of their corporate vision (Casanova & Dumas, 2010). On the other hand,
when Scandinavian companies mention social contributions they are normally related to
alleviating global problems (i.e. from the previous quotations companies refer to alleviating
poverty in developing countries) again this is due to the welfare state of the region given
that the region counts with political, social and economic stability.
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4.4 Political CSR
In this category of political CSR rhetoric or political role of the firm we have included the
themes: access, rights, development, and political engagement. We interpret these themes
as a transition from voluntary, business driven or philanthropic acts to a long-term
politicized collaboration with governments and civil society actors All of them point out to
the new political re-conceptualization of the role of firms, which we understand as the
enlarged political responsibilities for business and the long-term collaborations with
governments and civil society actors in.
This rhetoric category explains the nature of the role of the firm as a political actor in regular
interactions with the communities it operates in and signals the effectiveness of stakeholder
engagement through collaborations. The political rhetoric as the dialectic involves a certain
degree of stakeholder engagement and the creation of communicative links and deep
collaborations between the firm and its communities with the aim of finding mutual
benefits.
As an example of the political rhetoric we include the following quotation:
“The company made progress at several long term programs that have already benefitted
thousands of users throughout the state of Minas Gerais, with an emphasis on the "Luz Para
Todos" Program, directed at providing universal electric energy service” CEMIG (Brazil).
This type of rhetoric is associated with an increasing aim of firms to gain a new form of
legitimacy which is moral legitimacy as understood in political theory (Palazzo & Scherer,
2006). While traditional theories of legitimation such the ones associated to institutional
theory and strategic management theory focus on a specific issue that needs to be
legitimated by the corporation, a political theory perspective emphasizes that the
legitimation of organizations deals with the complex power relationships among the social
players involved. (Castelló & Galang, 2011).
In our distinction of CSR categories, the Political role of the firm rhetoric gathering four
different themes out of the 24 total, counts as the 17% (see Figure 6, p.64), being then the
category with less themes included on it.
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Looking at the overall result for the category, companies from Latin America show a more
solid commitment to this rhetoric strategy comparing to Scandinavian companies;
quantitatively, the total number of themes reported in the political CSR rhetoric category are
53 for Latin America and 33 for Scandinavia, as we can see in Table 12 below. These figures
from the political CSR rhetoric category are representing the 15,92% over the total or
themes mentioned in all the rhetoric categories by Latin American companies; and in the
case of Scandinavia this category represents the 10,89% over the total of themes mentioned
by all the Scandinavian companies. Also in the Table 12 we can observe in detail how many
companies mention the different themes included in the political CSR category. Graphically
we can observe this distinction in figure 10. Continuously table 13 gathers in relative terms
the percentage of companies mentioning the different themes in relation to the total
number of companies analyzed in each region. Remarkably, we can observe how Latin
American companies stand out in comparing to Scandinavian companies in the “access” and
“development” themes, displaying a 24,32% of mentions of access themes out of the 37
companies in Latin America, versus a 10,81% for Scandinavia; and 40,54% for development
in Latin America comparing to only the 8,11% in Scandinavia. Latin American companies
stand out comparing to Scandinavia in the “social contribution” theme, having a 45,95%
versus a 29,73%.
Table 12. Total number of themes mentioned under the Political CSR rhetoric category
Political role of the firm Theme Latin America Scandinavia
Access 9 4
Development 15 3
Rights 7 5
Political engagement 22 21
Total 53 33
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Figure 10. Total number of themes mentioned on the Political CSR rhetoric category
Table 13. Percentage of companies reporting in each category relative to the total number of
companies analyzed
Latin America Scandinavia
Access 24,32% 10,81%
Development 40,54% 8,11%
Rights 18,92% 13,51%
Political engagement 59,46% 56,76%
4.4.1 Access
The theme access describes the firms’ aim to provide its services or products to previously
excluded customers, also in this theme we include any investment to procure access to
public services (not related to the firm’s core business, i.e. health or education) to non-
economic stakeholders.
In Latin America 9 companies out of 37 (24,32%) have mentioned accountability in their
executive letters; on the other hand, in Scandinavia only 4 companies have mentioned this
theme, therefore the percentage of companies is 10,81%. Then we can realize Latin
American companies are more concerned in access issues than Scandinavian counterparts.
We include some quotations below to represent what firms mention in their CEO letters
about access issues:
“With this new service station Bradesco reached 100% coverage in Brazilian municipalities.
We continued on our quest to provide access to banking services and the democratization of
credit in thousands of locations previously underserved”, Banco Bradesco (Brazil).
0
5
10
15
20
25
Access Development Rights Political
engagement
Politcal role of the firm
Latin America
Scandinavia
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“We continued to find ways to promote access to better housing and community
infrastructure. For example we launched our most successful low-income housing solution,
Patrimonio Hoy, in the Dominican Republic” CEMEX (Mexico).
“The company made progress at several long term programs that have already benefitted
thousands of users throughout the state of Minas Gerais, with an emphasis on the "Luz Para
Todos" Program, directed at providing universal electric energy service” CEMIG (Brazil).
“The link between access to communication, GDP growth and poverty reduction is well
documented. Access to communications has a positive impact on GDP and socioeconomic
development; a 10% increase in mobile penetration leads to a 1,2% GDP increase in
developing countries” Ericsson (Sweden).
“We have continued our efforts to expand access to diabetes care throughout the world as a
company and via the World Diabetes Foundation […] Our approach to improving access to
diabetes care in developing countries […] Our commitment to supply life-saving insulin at
reduced cost in the poorest countries of the world”, Novo Nordisk (Denmark).
When comparing the quotations from companies in both regions, we can realize how the
Latin American companies mention access to their services underserved customers and also
they mention the provision of other services that traditionally in other setting would be only
responsibility for nation governments (i.e. education, health or housing); then we assume
Latin American companies care for the low income stakeholders and they provide means to
provide them access and to create at the end a more equal society. Alternatively
Scandinavian companies the few mentions they have about access themes are all related to
access to their product and services in developing countries. Then we can conclude they care
also for the global betterment to reduce differences between developed and developing
countries, even supposing the great existing differences they try to show they would like to
collaborate to reduce them.
4.4.2 Development
This theme includes any mention by companies about their engagement on regional
development. It considers actions that contribute to communities, country or regional
progress.
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In Latin America 15 companies out of 37 have mentioned development in their executive
letters, representing a 40,54% of the total number of companies analyzed; in Scandinavia
only 3 companies have mentioned this theme, therefore the percentage of companies is
8,11%. Then we can deduce Scandinavia companies hardly ever mention development, but
in contrast the theme is more frequent for Latin American companies, this can be due to
their concern for the ongoing development of the region, still with many gaps. We include
some quotations below to represent what firms mention in their CEO letters about this
theme:
“We have contributed for the economic and environmental development of the State of Sao
Paulo”, SABESP (Brazil).
“The company continued its program to develop and fund a contest to finance micro-
entrepreneurs in the region. The objective of this program, which is now in its third year, is to
foster the economic and social development of the communities around San Pedro de
Atacama” SQM (Chile).
“The Vale foundation continued to establish Knowledge Stations, which aim to contribute
towards improving the quality of life and to the integrated and sustainable development of
the communities in six Brazilian states”, Vale (Brazil).
“To develop a strong performance on HSE (health, society and environment) and social
indicators such as local development and human rights improvements”, Statoil (Norway)
“Access to communications has a positive impact on GDP and socioeconomic development; a
10% increase in mobile penetration leads to a 1,2% GDP increase in developing countries.
Ericsson”, (Sweden).
“The World Bank Green Bonds, where SEB as the supporting the build-up of more sustainable
economies in developing countries”, SEB (Sweden).
Once more within this theme we can observe how Latin companies are focused on regional
development in deprived regions within Latin America and Scandinavian companies when
mention development they are focused on developing countries in general as a global issue
for multinational companies.
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4.4.3 Rights
This theme groups the firms’ mentions referring to rights and equity (fairness) among
disfavored stakeholders to help building an inclusive society. The theme refers to the
discourse on social and universal rights touching upon different social groups.
In Latin America 7 companies out of 37 have mentioned issues related to the theme rights in
their executive letters, representing a 18,92% of the total number of companies analyzed in
the region. In Scandinavia 5 companies have mentioned this theme, therefore the
percentage of companies is 13,51%. Then we can deduce Latin American and Scandinavia
companies seldom mention rights in their written discourses. We include some quotations
below to represent what firms mention in their CEO letters about this theme:
“Usiminas will reaffirm its commitment to foster effective action to fight corruption and
defend Human Rights, decent working conditions and the environment”, Usiminas (Brazil).
“As well as in resource allocation, the Fund for Children and Adolescent (FIA) with a focus on
guaranteeing the rights of children and adolescent”, Petrobas (Brazil).
“To provide broad coverage of subjects related to labor relations, human rights, and the
fight against corruption”, Embraer (Brazil).
“Millions of people the world over have a legitimate ambition to rise from poverty an raise
their standard of living […]To develop a strong performance on HSE and social indicators such
as local development and human rights improvements” Statoil (Norway).
“We have to deal with important and sensitive issues in our daily work – ranging from fair
business practices – to freedom of speech – and the right to privacy and integrity” Telia
Sonera (Sweden).
“Our technology, solutions and services strengthen access to basic human rights: the right to
health, education and the right to earn a livelihood. And we see access to communication as
a basic human right”, Ericsson (Sweden).
4.4.4 Political engagement
The political engagement theme reflects the democratic integration of the corporate use of
power, especially in the transnational context of incomplete legal and moral regulations. It
shows the firms’ engagement through political discourses to fill gaps in governments’
actions. Therefore we observe firms assuming enlarged political co responsibility.
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We have created this theme being part of the overarching category also called “political
CSR” because we detected in firm’s discourses that apart from the other specific themes
access, development or rights just reviewed before, firms were also creating a new discourse
talking about other responsibilities, not only as businesses but also as pure political actors
part of the communities where they operate or when talking about global issues.
In Latin America 22 companies out of 37 have mentioned political engagement issues related
to the theme rights in their executive letters, representing a 59,46% of the total number of
companies analyzed in the region. In Scandinavia 21 companies have mentioned this theme,
therefore the percentage of companies is 56,76%. Then we can deduce Latin American and
Scandinavia companies are committed and they often mention political engagement in their
written discourses. We include some quotations below to represent what firms mention in
their executive letters about this theme:
“Our investment plan reflects the positive outlook for the Brazilian economy and confirms
our commitment to the creation of jobs and the development of the country as a whole”
CBD Brazil.
“We have primarily supported education, at various levels, and public administration,
stimulating improvement in services provided to society” Gerdau Metalurgia (Brazil).
“Behind our commitment to continue supporting programs that we consider of special value
for the community, there are a series of further efforts to participate in health, education,
food and environmental care actions, convinced that only when all society collaborates we
can achieve significant progress” Soriana (Mexico).
“Banrisul is in line with the State government's public policies- and that is how it should be,
given the Bank's important social role” Banrisul (Brazil).
“Novozymes and WWF have come together to encourage politicians to further the
integration of biotechnology into strategies for reducing climate change and to support the
application of low-carbon biotechnology in industry” Novozymes (Denmark)
“We recognize that global problems require global solutions, and we will continue to work in
relevant forums to help drive adequate political responses”, A. P. Moller-Maersk (Denmark).
“We play an active part in organizations such as the Roundtable on sustainable palm oil and
maintain close contact with political decision makers and other opinion leaders” Neste Oil
(Finland).
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“Storebrand is an active prime mover in relation to the Norwegian and international
authorities when it comes to developing regulations and a framework for the industry that
are appropriate for both customers and companies”, Storebrand (Norway)
Within this theme once more we can observe the pattern already described in previous
themes: Latin American firms show political engagement with the state of the region and
Scandinavian firms show political engagement with global issues. Hence Latin American
mention how they are collaborating with national governments or other organizations to
sustain national regional development, they mention health, education or housing initiatives
and they also mention their support to governmental policies. Since Scandinavian firms are
focused on global issues, they mention how they help to create international regulations or
frameworks for many issues included in a global agenda i.e. industry environmental
regulations, climate change, water disposition etc. What it is common to companies in both
regions is that they clearly show a deep political engagement in line with the new political
role of the firm. They have reported about their CSR procedure as businesses but we can
detect in their written discourses how they go beyond their business profile to talk about
what before was exclusively to be considered part of governments’ speech.
Through the empirical analysis of the factors influencing the legitimacy strategies followed
by the Scandinavian and Latin American companies, we find that political rhetoric is relevant
in both regions but in particular for Latin America. We can argue that in a highly pluralized
context such as the one in Latin America cognitive legitimacy of CSR might be limited by the
range and complexity of societies (Palazzo & Scherer, 2006) and its relations with different
social claims. Consequently, firms increasingly balance their legitimacy with political
legitimacy strategies in a dynamic debate on their role in society, which we consider part of
the moral legitimacy search. Therefore in general with the themes included in this political
CSR rhetoric category we can observe how they transmit moral legitimacy because these
corporations communicate and try to convince the audience or stakeholders by rational
arguments and they communicate what is the right thing to do, instead of using
manipulation or persuasion (Palazzo & Scherer, 2006). Moreover often they communicate
the result of “explicit public discussions”, when they mention collaborations with
governments, civil society organizations or other stakeholders.
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5. Concluding remarks
In this final section, we present our conclusions and personal reflections on this study,
connected to our research aims. Additionally we include the limitations of the thesis and
final remarks on its perspective and suggestions for additional research.
5.1 Conclusion
In order to proceed to the main conclusions that arise as the outcome of the thesis, it is
relevant to review the research aim proposed in the beginning of the thesis work. The main
research question was defined as:
“What are the main differences between CSR rhetoric strategies between Latin American
and Scandinavian top companies?”
Other specific sub question was outlined, in order to define the research area:
How this influences their legitimacy strategies?
These questions were answered in the previous chapter, where we carried out a cross-
regional analysis and discussion of results, linking the findings to the theoretical framework.
In this research we have distinguished four types of CSR rhetoric applied by firms when
communicating their CSR approaches and by them trying to gain legitimacy. These rhetoric
strategies are strategic, institutional, dialectical and political role of the firm. The four have
different mainstays and they are related to different management theories. They also
engage different forms of firms’ legitimization. Following the frame of Castelló and Lozano
(2011) we argue that strategic rhetoric try to set pragmatic legitimacy, which is based on the
fundamental firm’s economic rationale; institutional rhetoric refers to cognitive legitimacy,
being then CSR mentions related to the sense of belonging to a group of companies; while
Introduction
and RQ
Methodology
Theoretical
Background
Analysis Conclusion
103
the dialectic and political of the role categories aims to create moral legitimacy, which is
related to civil society engagement and it is the more advanced legitimacy type.
We found out that top companies from Latin America and Scandinavia primarily refer to
strategic and institutional CSR rhetoric categories, but that they are also starting to look for
moral legitimacy by engaging either in a dialectic or political role of the firm strategies. This
might point out that they are searching for a new form of moral legitimacy which aims to
improve the discursive quality between them and their stakeholders (dialectic category) and
their role within civil society and collaborations with Governments (political role of the firm).
The communication of these two CSR rhetoric categories indicate the shift from the basic
economic rationale, utility driven view of CSR into a political, communications-driven
concept of organizational social responsibility (Palazzo & Scherer, 2006). This communicative
approach to ethical and moral issues shows a strong association connecting corporate
decision making and the influence of the firm’s broad stakeholder network.
The differences in CSR approaches found between companies from the two regions seems to
be driven by economic, institutional and cultural differences (Matten & Moon, 2008). Since
Latin America is a region characterized by unsteady economic environment and political
instability, this leads to understand why Latin American top companies tend to communicate
their political role focused on the engagment with the Latin American society progress. On
the other hand, the economic and instituional state of Scandinavia being characterized by
the political stability and the admirable welfare state leads to understand the Scandinavian
firms’ aproach to gain moral legitimacy by mentioning themes related to the management of
environmental issues globally through their value chain, and their focus to solve social global
problems such as poverty in developing countries.
The predominant strategic approach communicated by companies in the two regions might
indicate that CSR has come a long way from its early roots of charity to become a strategic
business practice inserted in corporate values. This means that top companies in the two
regions have adopted a comprehensive CSR notion that is aligned with the fulfillment of all
levels of Carroll (1991) pyramid, and follows the main ideas proposed by Freeman (1984) in
the stakeholder theory and Elkington (1999) in the “triple bottom line” (TBL) approach, as
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part of the strategic CSR rhetoric mentioned in their reports to gain pragmatic legitimacy
based on the economic rationale of the firm.
Companies generally address a comprehensive set of stakeholders in their CSR approach and
give emphasis to social, economic and environmental issues, although some issues are more
stressed in one region than in the other, as we have already noticed due to the different
stages of development: Latin America is more focused on its own social progress and
Scandinavia is focused on other global issues such environmental care and poverty in
developing countries.
These regional differences have arisen through the way companies communicate CSR issues,
some generalizations for each region can be drawn from the analysis previously presented,
and taking into consideration the general CSR profiles of the two regions. This overview can
be outlined by looking at the CSR themes, that is to say, the main CSR focus given by
companies in each region. Table 14 shows the regional profile that can be noted through the
analysis of findings, and that shape the entire study. Scandinavian companies are strongly
focused on environmental issues and stress the idea of sustainability, whereas Latin
American companies show high concern for social issues, which can be perceived in the
nature of CSR processes the companies mention, the stakeholders addressed and in the
political role companies seem to take as social agents, fulfilling the gap left by the national
governments.
Table 14. CSR focus in Latin America and Scandinavia
Latin America:
Social issues and
Political role
•Most CSR mentions
address social issues
related to employees
and community
•Companies try to fulfill
the gap left by
Goverments as social
agents
Scandinavia:
Sustainability and
Environment
•Focus on the
management of
environmental impact
through the value chain
•The concept of
sustainability arises as
part of their strategy
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The cross-regional differences were apparently mainly shaped by regional factors. The CSR
profile of companies seems to be determined a by a mix of factors, at a regional, national,
industrial and company level, that created an interesting set of characteristics and provided
meaningful insights into the way CSR is communicated. In example Statoil from Norway
which belongs to the oil and gas industry is really focused on environmental concerns, and
focus its attention to climate change, (“as an energy company, we find ourselves at the
crossroads between two apparently irreconcilable challenges- the energy crisis, and the
climate crisis”); on the other side, Petrobas from Brazil also an energy company providing oil
and gas, apart from sustainable development and environmental concern mentioning
footprint reduction, they are explicitly taking a political role when they say “Petrobas is
rewriting the history of the Brazilian presence in the global energy scenario, ensuring
considerable reserves to Brazil” clearly stating their importance as an international company
for the Brazilian economy. Apart of this, they also highlight their social programs: “Petrobas
Development & Citizenship program, the Petrobas Environmental Program, and the Petrobas
Cultural Program, and the Petrobas Cultural Program, as well as in resource allocation to the
Fund for Children and Adolescents (FIA)”. Just comparing this two companies belonging to
the same industry we can see how both focus on sustainable development, but Petrobas
from Brazil has an outstanding political role, also when describing all the social programs
they have to help communities in Latin America.
The analysis and discussion included in the previous section showed that most differences
and similarities among countries could be explained by the literature review previously
carried out. However, because there are no previous studies that compare countries in Latin
America and Europe in terms of CSR approaches, there is no exact basis of comparison in
terms of the results concerning cross-regional agreements and disagreements. This might be
one of the main contributions of this research, by looking at such different regions of the
globe and attempting at identifying patterns in CSR rhetoric strategies, as well as the factors
shaping them.
The effectiveness of firm’s discourse in shaping organizational legitimacy is well
acknowledged, and apart from mapping out different CSR rhetoric strategies, this research
aims to achieve deeper understanding of the way firms search for legitimacy through their
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corporate CSR discourse. We have analyzed firms’ written discourses and we have allocated
the CSR themes around a frame made out of four CSR rhetoric strategies, which relate to
gaining distinct types of legitimacy (pragmatic, cognitive, or moral). After the analysis
regarding legitimacy, our major finding is that corporations are adapting their legitimacy
strategies toward a new understanding of their role in society. Corporations have integrated
the language of civil society, which we connect with the dialectic and political rhetoric, into
their legitimacy approach found in their discourses.
We argue corporations are seeking legitimacy through new forms of argumentations that
relate to values and beliefs, as well as in new forms of dialog and engagement with civil
society. The use of dialectic and political rhetoric by corporations from both regions might
lead firms to make more balanced decisions that increase the stakeholders’ acceptance of
the subsequent effects. Moreover the use of these CSR categories might also advance a new
open relationship with stakeholders, leading to mutual collaborations and common goals.
For example within the dialectic CSR category, the mentions of partnerships (non strictly
related to core business), deep stakeholder dialogs, global agenda issues or accountability
mechanisms, among others, is changing not only the way corporations face current
challenges but also the way they make sense of their activities and communicate to
stakeholders. Also within the political CSR category when firms talk about the commitment
with the communities around them, and they mention issues related to human rights,
development or they show political engagement in general, they are also trying to gain
moral legitimacy. We have observed how Scandinavian companies try to gain moral
legitimacy mainly through the dialectic strategy; and Latin America apart from the dialectic
they are really focused on the political role of the firm strategy. Even so, further research
would be needed to better understand how companies actively recognize and define their
new political role.
Connected to the research question, our proposed sub question associated to corporate
legitimacy aimed to enrich the research, and contribute to further explore and link the
differences in the CSR rhetoric strategies to different legitimacy strategies of firms as reliant
on the regional firm distinctiveness. Though exploratory in nature, this empirical research
show how the political rhetoric is more utilized in the context of potential divergences with
107
civil society, like the case of Latin America; this also encourages further debate on the
changing nature of the societal understanding of the role of the firm.
Then we agree firms in both regions as social and political actors need to provide new social
and environmental values to society, highlighting the pressure they receive from its
stakeholders regarding these issues. We consider companies are responding to these
pressures with new legitimacy strategies in the form of communication processes and new
rhetoric in which they state their responsibilities with society and with the environment.
Organizations are using communicative strategies that show the engagement with
stakeholders with the aim to achieve higher levels of agreement and social stability and
progress.
As mentioned before our results for the Scandinavian companies confirm these strategies of
legitimization might be the result to the need of responding to stakeholders pressuring
about risky issues such as environmental problems together with the active reflection about
principles of stakeholder inclusion, corporate responsibility or citizenship. On the other hand
we find Latin American companies are concerned in a deeper way with social inclusivity and
responsibility.
We also acknowledge the majority of companies use the concept of sustainability or
sustainable development and other related issues, fact supporting the idea of the
isomorphic growth of the CSR movement around the world and its entailed cognitive
legitimacy search.
We consider our research contributes to the limited number of CSR studies that have been
conducted in Latin American, especially adding the comparison with one of the more
developed regions as it is Scandinavia. By using the region as level of comparison, we wanted
to bring out the context influence and at the same time to show the impact of globalization
on the CSR strategies spreading across different types of firms.
We consider that comparing Scandinavia as a homogeneous region with Latin American as
one of the more heterogeneous one brings the opportunity to discover the disparity in
108
institutional, cultural or economic issues that the region provides. However, this opportunity
also limits the generalization of these findings to the rest of the region, since there are
countries without representation on the sample; because the biggest multinationals of Latin
American are located in Mexico, Brazil or Chile, and there are many countries with no
representation in the sample.
In conclusion, despite the limitations of the study (that will be better reviewed in the next
point below), the research aims could be successfully reached and the analysis provided
valuable insights into the way companies communicate and approach CSR and how
companies from the two analyzed regions differ in their CSR rhetoric strategies. The study
showed that although CSR is increasingly seen as strategic by companies and there is a
common ground in the CSR practices they communicate related to the strategic and
institutional category, there are also significant cross-regional differences in the way
companies approach CSR issues dealing within the dialectic and political role of the firm
categories. Therefore we think this analysis contributed to clarify the interconnections and
relationships between organizations’ CSR strategies and their engagement with their
political and social contexts.
5.2 Limitations
There are certain limitations and shortcomings in the research. The limitations of this thesis
were dealt with in the methodology section; but this part of the thesis aims to summarize
and to clarify the main points.
The qualitative research method employed in this thesis is not designed to give a fixed
conclusion. Instead, our findings make the conclusion more advisory than absolute. As noted
earlier, there are many institutional factors shaping CSR strategies, as well as a great number
of stakeholders linked to the activities of multinational corporations. However we have
reviewed the institutional influence in general and we have not considered explicit country
specific factors for the analysis, since we compare the two groups of companies regionally.
109
This thesis has concentrated then on the regional basis for the analysis instead on country
level, even if we are aware the Latin American region is very heterogeneous; this has been
necessary in order to limit the scope of the thesis, but it may fail to give a comprehensive
picture of the external and internal pressures that multinational companies experience.
We have incorporated a theoretical background to describe the institutional settings in both
regions in order to build a stronger argument, but a quantitative study of a representative
number of firms would be necessary in order to create new theories. It is tough to generalize
on behalf of the current findings because the number of studied companies is limited to 74
firms among the biggest companies from the two regions. The findings are also limited to
the way companies present themselves in terms of CSR rhetoric strategies, given that the
aim of the research was to analyze the corporate communications and self representations
regarding CSR strategies rather than the actual CSR practices.
A broader research with the use of alternative research methods such as interviews or
surveys would certainly enrich the analysis by gathering additional data, investigating the
actual CSR practices and comparing them to the ones presented in organizational
documents. It is believed that such methodological limitations are inherent to the nature of
this research, and do not have a negative impact in the study outcomes, or on the
achievement of the research aims. Moreover provided the explorative character of the
research we considered conclusions arising from this sample to be important.
Lastly, concentrating on the executives CSR written discourse as representing the company
may well give the holistic view of the organization to their CSR approach and strategies. But
the findings could appear different if we had had the opportunity to interview them directly
to contrast their written discourse. But due to CEOs availability, time and budget
constrictions we better considered using and analyzing organizational documents as a main
source of data.
110
5.3 Putting the paper into perspective: suggestions for future research
Being immerse in the current economic crisis, it is clear companies need global
development, which will bring stability and prosperity. That is why they need to contribute
to the improvement of the state of the world. Companies are global citizens and their values,
goals and strategies should reflect that. We are facing a new phase of globalization in which
the business economic model if it is based on global sustainable economic growth will have
to go with the general sustainable well being of societies. Then, definitively multinational
corporations in this context have to go beyond profit making and share responsibilities with
governments to solve social issues. Even more companies operating in emerging markets
have to go past what the regulations establish and be partners with the governments and
the civil society in reducing poverty or any other social issues. Corporate social responsibility
should include a clear compromise in improving the societies in which firms operate.
Companies all over the world are experiencing a crisis of responsibility, or the lack thereof.
Legitimacy and reputation will only be repaired by the re-establishment of trust between
firms and with their stakeholders. To move away from the bad reputation and legitimate
their roles, firms need to continue their work on strategic and institutional CSR as basis and
then they should definitively include in an increasing way the dialectical and the political role
strategies into their CSR approach.
With the shortcomings mentioned in the previous point taken into consideration, it is likely
that a study with similar aims but using alternative research methods would enrich the
present findings, by investigating what companies actually do regarding CSR practices. This
could be carried out through surveys, interviews or case studies.
In addition, since the findings from the present study suggest that the cross-regional
differences in CSR rhetoric strategies are due to a large extent to regional and national
factors, it would be interesting to perform a larger study including companies from other
countries, in order to check if the same patterns emerge. Therefore the study could be
enriched by adding other countries giving place to a comparison between Latin America
111
versus Europe, in order to gain deeper insights into the regional differences in terms of CSR
approaches.
Following, in terms of future research, it could be fruitful to interview with companies
operating in different institutional environments to assess the differences and similarities in
stakeholder pressure, how firms use CSR in dealing with organizational crises, and ultimately
how CSR can be useful in efforts to repair legitimacy and reputation.
Differences between large and small companies from Latin America and Scandinavia could
also be investigated as well as firms facing varying levels of legitimacy and reputation
threats. Another area that could be worth examining is how homogeneous the CSR
initiatives taken by firms in the two regions are viewed by different stakeholders. Whether
the heightened expectations from stakeholders demand firms to implement unique
approaches, or if copying the mainstream is sufficient. This research approach could be
interesting to assess in connection with legitimacy and reputation. The CSR developments in
the coming years will also be interesting to follow, as new regulations are likely to change
current CSR practices.
In order to improve the validity of our results, further research is needed with a larger
sample and over a period of time to bring other findings on changes in the kinds of CSR
rhetoric applied and the characteristic of the firms applying each. A broader study would
provide further insights regarding the variability of the rhetoric employed in the
conversations different firms have with their stakeholders. Further research then is needed
for understanding how companies actively make sense of their role and new responsibilities
and how this is evolving over time.
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i
7. Appendix
Table I. Excluded companies from the Latin American region
Rank Forbes
Global 2000
Company Country Industry Sales
($bil)
Profits ($bil) Assets ($bil) Market
Value($bil)
Reason of exclusion fromthe
sample
1 52 Banco do Brasil Brazil Banking 56.10 5.82 406.46 42.78 Report not available in English
2 131 América Móvil Mexico Telecommunications
Services
30.22 5.40 34.70 72.09 No CSR information in the CEO
letter
3 222 Ecopetrol Colombia Oil & Gas Operations 14.26 2.40 27.20 54.14 No CSR information in the CEO
letter
4 309 Carso Global
Telecom
Mexico Telecommunications
Services
16.04 1.23 27.85 15.65 No CSR information in the CEO
letter
5 681 BanColombia Colombia Banking 4.14 0.62 30.28 9.25 Report not available in English
6 698 JBS Brazil Food, Drink & Tobacco 20.19 0.07 24.37 12.18 No CEO letter included
7 714 GFNorte Mexico Banking 4.28 0.45 43.33 7.61 No CSR information in the CEO
letter
8 754 Antarchile Chile Diversified Financials 10.38 0.29 12.21 8.73 No CSR information in the CEO
letter
9 791 Inbursa Mexico Banking 2.10 0.62 22.07 11.47 Report not available in English
10 829 Grupo Aval Colombia Diversified Financials 4.85 0.34 28.31 6.19 Report not available in English
11 834 Falabella Chile Retailing 6.33 0.36 8.15 13.59 Report not available in English
12 896 Grupo Televisa Mexico Media 4.01 0.46 9.69 11.34 Report not available in English
13 925 Cencosud Chile Food Markets 10.49 0.19 9.84 8.75 Report not available in English
14 930 BM&F Bovespa Brazil Diversified Financials 0.76 0.45 12.17 13.17 Report not available in English
15 953 Grupo Carso Mexico Conglomerates 5.06 0.49 7.48 8.17 Report not available in English
16 961 Credicorp Peru Banking 2.10 0.49 22.15 6.35 No CSR information CEO letter
17 1009 Grupo Elektra Mexico Retailing 3.28 0.38 9.12 12.89 No CSR information CEO letter
18 1179 McDermott
International
Panama Construction 6.19 0.39 4.85 5.48 Report not available in English
ii
19 1190 Ultrapar
Participacoes
Brazil Oil & Gas Operations 18.31 0.24 6.37 3.87 No CSR information in the CEO
letter
20 1297 Mercantil Venezuela Diversified Financials 2.92 0.37 24.72 0.54 No CSR information in the CEO
letter
21 1335 Bradespar Brazil Diversified Financials 1.79 0.49 5.08 7.67 Report not available in English
22 1338 Industrias Peñoles Mexico Materials 3.33 0.39 3.79 7.91 Report not available in English
23 1380 CCR Brazil Transportation 1.57 0.32 5.22 9.31 Report not available in English
24 1385 Banesco Banco Venezuela Banking 2.57 0.36 17.31 0.19 None report available
25 1436 Cantv Venezuela Telecommunications
Services
4.62 0.68 4.41 0.58 Report not available in English
26 1461 OGX Brazil Oil & Gas Operations 0.00 0.16 4.18 29.30 No CSR information CEO letter
27 1505 El Puerto de
Liverpool
Mexico Retailing 3.47 0.28 4.52 6.32 No CEO letter included in the
report
28 1646 LAN Airlines Chile Transportation 3.52 0.23 5.77 5.89 Report not available in English
29 1648 WEG Brazil Capital Goods 2.14 0.28 2.49 6.04 No CEO letter included in the
report
30 1653 Volcan Compania
Minera
Peru Materials 0.69 0.18 1.27 10.48 No CEO letter included in the
report
31 1734 Banco de Chile Chile Banking 3.23 0.06 28.34 1.88 No CEO letter included in the
report
32 1886 Buenaventura Peru Materials 0.74 0.15 1.99 9.27 No CSR information in the CEO
letter
Source: Adapted from “The Global Forbes 2000” available at:http://www.forbes.com/2010/04/21/global-2000-leading-world-business-global-
2000-10_land.html [Accessed May, 3 2011].
Table II. Excluded companies from the Scandinavian region
Rank Forbes
Global 2000
Company Country Industry Sales
($bil)
Profits
($bil)
Assets
($bil)
Market
Value($bil)
Reason of exclusion fromthesample
1 200 DnB NOR Norway Diversified Financials 13.06 1.48 315.61 18.37 No CSR information in the CEO letter
2 267 Svenska
Handelsbanken
Sweden Banking 8.81 1.43 297.27 17.20 No CSR information in the CEO letter
iii
3 273 Telenor Norway Telecommunications
Services
16.85 1.55 28.49 21.42 N o CSRinformation in the CEO letter
4 409 Sampo Finland Insurance 8.04 0.92 37.41 13.69 No CSR information in the CEO letter
5 435 Carlsberg Denmark Food, Drink & Tobacco 11.42 0.69 25.94 11.85 No CSR information in the CEO letter
6 462 Investor Sweden Diversified Financials 4.98 4.38 23.84 13.59 No CSR information in the CEO letter
7 819 UPM-Kymmene Finland Materials 11.06 0.24 19.11 5.63 No CSR information in the CEO letter
8 896 Sandvik Sweden Capital Goods 10.05 -0.37 12.83 12.91 No CSR information in the CEO letter
9 1161 Aker Solutions Norway Construction 9.33 0.39 6.84 3.61 No CSR information in the CEO letter
10 1176 Assa Abloy Sweden Business Services &
Supplies
4.88 0.37 5.97 6.92 No CSR information in the CEO letter
11 1183 Pohjola Bank Finland Banking 3.08 0.28 50.93 3.56 No CSR information in the CEO letter
12 1201 Kinnevik Sweden Diversified Financials 1.17 2.28 7.46 4.57 No CSR information in the CEO letter
13 1212 Industrivarden Sweden Diversified Financials 2.79 2.89 7.53 4.27 No CSR information in the CEO letter
14 1311 Securitas Sweden Business Services &
Supplies
8.75 0.30 4.31 3.96 No CSR information in the CEO letter
15 1525 D/SNorden Denmark Transportation 4.03 0.67 2.04 1.79 No CSR information in the CEO letter
16 1528 Swedish Match Sweden Food, Drink & Tobacco 1.98 0.44 2.29 5.26 No CSR information in the CEO letter
17 1628 SpareBank 1 SR-
Bank
Norway Banking 1.12 0.19 21.62 1.10 Annual report
18 1654 Jyske Bank Denmark Banking 1.97 0.09 43.30 2.24 CSR Report
19 1674 Sydbank Denmark Banking 1.42 0.15 30.43 1.83 Annual report (mentions a little about CSR
in the CEO letter)
20 1684 Getinge Sweden Health Care Equipment
& Svcs
3.19 0.27 5.09 5.60 Report not available in English
21 1721 FLSmidth & Co Denmark Construction 4.33 0.31 4.22 3.42 No CSR information in the CEO letter
22 1850 NCCGroup Sweden Construction 7.24 0.18 4.18 1.80 No CEO letter available
23 1909 Lundbergs Sweden Diversified Financials 2.94 0.22 10.23 2.98 No CSR information in the CEO letter
24 1913 Fred. Olsen Energy Norway Oil & Gas Operations 1.14 0.47 2.39 2.35 No CSR information in the CEO letter
Source: Adapted from “The Global Forbes 2000” available at:http://www.forbes.com/2010/04/21/global-2000-leading-world-business-global-
2000-10_land.html [Accessed May, 3 2011].
iv
Table III. Latin American companies included in the research
Rank Forbes
Global 2000
Company Country Industry Sales ($bil) Profits
($bil)
Assets
($bil)
Market
Value($bil)
1 18 Petrobras-Petróleo
Brasil
Brazil Oil & Gas Operations 104.81 16.63 198.26 190.34
2 51 Banco Bradesco Brazil Banking 59.10 4.60 281.40 54.50
3 80 Vale Brazil Materials 27.82 5.88 100.81 145.14
4 82 Itaúsa Brazil Conglomerates 66.36 2.25 342.63 28.74
5 235 Eletrobrás Brazil Utilities 13.11 2.68 58.00 15.95
6 432 Femsa Mexico Food, Drink & Tobacco 15.08 0.76 16.07 14.84
7 478 CSN-Cia Siderurgica Brazil Materials 5.57 1.32 16.74 25.30
8 612 Grupo Mexico Mexico Materials 5.02 0.90 12.01 18.97
9 620 Usiminas Brazil Materials 5.54 0.68 14.78 14.26
10 658 Oi_(Tele Norte Leste) Brazil Telecommunications
Services
8.17 0.50 16.73 7.99
11 681 Grupo Modelo Mexico Food, Drink & Tobacco 6.27 0.66 8.92 17.42
12 701 CBD-Brasil
Distribuição
Brazil Food Markets 13.34 0.34 10.33 9.54
13 713 Cemex Mexico Construction 14.54 0.10 44.51 9.30
14 732 Metalurgica Gerdau Brazil Materials 13.46 0.19 26.23 7.42
15 782 Cemig Brazil Utilities 4.75 0.82 10.44 9.25
16 841 Grupo Bimbo Mexico Food, Drink & Tobacco 8.64 0.44 7.41 8.81
17 864 CPFL Energia Brazil Utilities 5.36 0.65 7.02 10.16
18 919 Braskem Brazil Chemicals 8.75 0.53 12.68 3.58
19 942 Redecard Brazil Business Services &
Supplies
1.39 0.80 10.01 10.20
20 953 BRF-Brasil Foods Brazil Food, Drink & Tobacco 8.07 0.06 14.76 10.75
21 980 Fibria Celulose Brazil Materials 3.44 0.32 16.25 8.72
v
Source: Adapted from “The Global Forbes 2000” available at:http://www.forbes.com/2010/04/21/global-2000-leading-world-business-global-
2000-10_land.html [Accessed May, 3 2011].
22 1102 Cielo Brazil Business Services &
Supplies
1.98 0.88 1.61 11.03
23 1316 Sabesp Brazil Utilities 3.13 0.49 11.61 3.89
24 1351 SQM Chile Chemicals 1.44 0.33 3.20 10.32
25 1399 Natura Cosmeticos Brazil Household & Personal
Products
2.15 0.35 1.57 8.22
26 1400 Soriana Mexico Retailing 7.03 0.22 5.02 4.82
27 1421 Fresnillo Mexico Materials 0.85 0.32 1.20 8.38
28 1432 Banrisul Brazil Banking 2.85 0.31 16.41 3.38
29 1438 BCI-Banco Credito Chile Banking 2.32 0.24 20.00 3.59
30 1468 ALFA Mexico Conglomerates 8.58 0.15 8.26 3.80
31 1468 CMPC Chile Materials 2.96 0.20 7.60 8.61
32 1472 Copel Brazil Utilities 2.38 0.47 5.51 5.66
33 1486 Embraer Brazil Aerospace & Defense 5.12 0.19 9.04 3.96
34 1615 Kimberly-Clark de
Mexico
Mexico Household & Personal
Products
1.89 0.32 2.08 5.74
35 1680 Net Serviços Brazil Media 2.65 0.42 4.78 4.31
36 1705 Fosfertil Brazil Chemicals 1.49 0.34 1.79 4.81
37 1813 Sul America Brazil Insurance 4.62 0.21 7.14 2.47
vi
Table IV. Scandinavian companies included in the research
Rank
For2000
Company Country Industry Sales ($bil) Profits
($bil)
Assets
($bil)
Market
Value($bil)
1 64 Statoil Norway Oil & Gas Operations 79.76 3.16 97.09 72.26
2 95 Nordea Bank Sweden Banking 22.81 3.41 729.06 39.42
3 135 Nokia Finland Technology Hardware &
Equip
58.72 1.28 49.11 49.18
4 208 TeliaSonera Sweden Telecommunications
Services
15.24 2.63 36.20 31.30
5 276 Ericsson Sweden Technology Hardware &
Equip
28.83 0.51 35.78 32.55
6 290 Danske Bank Group Denmark Banking 30.41 0.33 597.03 15.75
7 353 Fortum Finland Utilities 7.79 1.88 28.40 22.79
8 422 Novo Nordisk Denmark Drugs & Biotechnology 9.83 2.07 10.27 44.65
9 427 H&M Hennes &
Mauritz
Sweden Retailing 14.54 2.35 7.60 50.24
10 452 SCA-Svenska
Cellulosa
Sweden Household & Personal
Products
15.48 0.67 20.99 10.52
11 453 Mxller-Maersk Denmark Transportation 48.70 -1.32 66.49 33.77
12 527 SEB-Skand Enskilda
Bank
Sweden Banking 13.02 0.16 323.28 13.50
13 537 Volvo Group Sweden Consumer Durables 30.49 -2.06 44.77 18.31
14 564 Atlas Copco Sweden Capital Goods 8.90 0.87 9.17 17.41
15 590 Yara International Norway Chemicals 10.50 0.65 10.34 12.03
16 640 Skanska Sweden Construction 19.10 0.51 11.17 6.89
17 641 Orkla Norway Food, Drink & Tobacco 9.70 0.45 16.39 8.16
18 651 Vestas Wind Systems Denmark Capital Goods 9.51 0.83 9.08 9.89
19 686 TDC Denmark Telecommunications
Services
6.91 0.47 16.65 8.77
vii
20 688 Swedbank Sweden Banking 10.23 -1.47 251.18 9.11
21 790 Electrolux Group Sweden Consumer Durables 15.24 0.36 9.80 6.09
22 856 Kone Finland Construction 6.80 0.67 5.07 10.72
23 959 Norsk Hydro Norway Materials 11.63 0.05 13.43 8.20
24 1039 Wärtsilä Finland Capital Goods 7.54 0.56 6.55 4.78
25 1044 Stora Enso Finland Materials 12.82 -1.26 16.41 5.06
26 1045 Tele2 Sweden Telecommunications
Services
5.48 0.63 5.01 6.58
27 1062 Neste Oil Finland Oil & Gas Operations 13.81 0.32 8.16 3.64
28 1100 Storebrand Norway Insurance 7.71 0.15 63.24 3.14
29 1104 SKF Group Sweden Capital Goods 7.85 0.23 6.91 7.23
30 1281 Metso Finland Capital Goods 7.19 0.21 7.95 4.69
31 1392 Alfa Laval Sweden Capital Goods 3.64 0.38 3.45 6.02
32 1418 TrygVesta Denmark Insurance 3.50 0.39 8.36 4.07
33 1502 Kesko Finland Food Markets 12.10 0.18 5.51 3.56
34 1598 DSV Group Denmark Transportation 7.00 0.23 4.38 3.42
35 1667 SSAB Sweden Materials 4.17 -0.14 8.44 5.48
36 1743 Novozymes Denmark Drugs & Biotechnology 1.63 0.23 2.09 6.41
37 1747 Boliden Sweden Materials 3.86 0.35 4.65 3.47
Source: Adapted from “The Global Forbes 2000” available at:http://www.forbes.com/2010/04/21/global-2000-leading-world-business-global-
2000-10_land.html [Accessed May, 3 2011].
viii
Table V. LATIN AMERICAN COMPANIES
Company Category of rhetoric Themes Quotations
1 Petrobas Strategic CSR Operationalization Petrobas's excellencein deep and ultra deep water technology and exploration, thecapacity of its staff and theadoption
of best corporategovernancepractices afforded thecompany consistent results in 2009
This bet was proven right and allowed us to maintain uninterrupted, thecorporate strategy to expand business in an
integrated manner, with profitability and in compliance with social and environmental standards.
Reputation This performancehas ranked Petrobas thefourth in themarket value among listed global energycompanies
Strategic Link Petroba's strategyto drivebusiness and activities with social and environmental responsibility
Governance Adoption of best corporate governance practices
Institutional CSR CSR The corporatestrategyto expand business in an integrated manner, with profitability and in compliance with social and
environmental responsibility standards
Sustainability This will allow the companyto expand its growing investments in a solid, sustainable manner
Giving back to societya part of the outcome of its activities, maintaining its commitment to sustainable development.
Philanthropy Additionally, the companysupports cultural, sports, social and environmental projects in which it invested about $R 464,5
million in 2009
Stakeholder dialog To Petrobas the SustainabilityReport is an essential tool for transparencyin monitoring, disclosing and rendering
accounts to its stakeholders about its economic, environmental and social performance
Dialectic CSR Global Standards The company also maintained its investments graderating and ensured for thefourth consecutive year its listing on the
Dow Jones Sustainability Index. In line with the ten principles of theUN's Global Compact
Accountability To Petrobas the SustainabilityReport is an essential tool for transparencyin monitoring, disclosing and rendering
accounts to its stakeholders about its economic, environmental and social performance
Our 2009-2013 Business Plan calls for avoiding the emissions of 4,5 million tons of CO? equivalent in 2013
Inclusivity Petrobas Development & Citizenship program, thePetrobas Environmental Program, and the Petrobas Cultural Program,
and the Petrobas Cultural Program, as well as in resourceallocation to theFund for Children and Adolescents (FIA)
Focus on the issue Sets the goal of achieving levels of excellence in theenergy industrywith regard to the intensityof greenhousegas
emissions in processes and products.
Social contribution As a result of all of these efforts, Petrobas is rewriting thehistory of the Brazilian presence in theglobal energyscenario
ensuring considerablereserves to Brazil and giving back to thesociety a part of theoutcomeof its activities maintaining
its commitment to sustainabledevelopment
Political role of the firm Rights As well as in resource allocation the Fund for Children and Adolescent (FIA) with a focus on guaranteeing therights
of children and adolescent
Political engagement This goal will mitigatetheemissions growth curvewithout restricting business expansions or jeopardizing theinterna-
tional commitments Brazil has taken-on. Petrobas is rewriting thehistoryof theBrazilian presencein theglobal energy
scenario, ensuring considerable reserves to Brazil
ix
2 Banco Strategic CSR Operationalization The Organization continues integrating themain indezes of corporatesustainability
Bradesco Innovation Bradesco opened thefirst fluvial bank branch in Brazil, in a vessel. The new systemoffer onlineservices such as bill
payment, consumption bills, deposits, taxes, withdrawals and loans all by satellitecommunication
Reputation All this is reflected in the recognition of the Organization as oneof the best places to work
Institutional CSR Philanthropy We seek to develop a sense of solidarity among our morethan 85 thousand employees. In line with this, wemaintain
theBradesco Volunteer Program
Dialectic CSR Global Standards In 2009 we reinforced our commitment to the Global Compact- a United Nations framework that sets out 10 principles
Partnership We joined the Brazilian platformCompanies for Climate (EPC) of the Center for Sustainability Sudies at Fundaçao
Getulio Vargas and also entered into commitment with Ethos Institutea
Global Agenda Which aims at encouraging society as a wholeto join theinternational agreement on climatechange
Inclusivity The inauguration in November of thefirst bank branch in Heliopolis, a destitutecommunitywith about 100000 inhabitants
In thedomestic market weare theprivate bank with thelargest presence in classes Dand E
Banking inclusion was also extended to 40000 riverside dwellers
Social contribution Concern about health and quality of lifeis a premise at Bradesco's human resources management
Employees and student engaged in activities throughout thecountry for thebenefit of over 1,6 million of people
Political role of the firm Access With this new service station Bradesco reached 100%coveragein Brazilian municipalities. We continued on our quest
to provide access to banking services and thedemocratization of credit in thousands of locations previouslyunderserved
Development Thus, webelieve to have contributed to thedevelopment of these communities and of the country at a large
Rights The democratization of credit to these millions of Brazilians is certainly one of themost important tasks undertaken by
theorganization. Banking inclusion was also extended to 40000 riverside dwellers
3 Vale Strategic CSR Operationalization In a context of uncertaintyin global markets, in 2009 wemade extensive social and environmental investments, tota-
lling US$781 million, with $580 million going into environmental actions and US$201 million into social projects
Reputation The Global Compact of theUN, which for thesecond consecutive year recognized our previous sustainabilityreport as a
Notable Communication on Progress
Strategic Link In theeconomic area, our sustainabilitystrategy proved its worth. Faced with a dramatic global financial crisis, Vale
demonstrated thepractical competitiveadvantages of its consistent management strategy
Leadership on CSR The improvement in our performancein the sustainability indicators that are detailed in this report. They arecontributing
to thesearch for excellence in themanagement of our businesses, making our actions transparent to society, and helping
to spread our practices in thesustainabilityarea across all different countries in which weoperate
Institutional CSR Sustainability We havereinforced our sustainabilitystrategywith thepublication of significant global guidelines that serve to guide
our action, in particular our SustainableDevelopment Policy, which aims also to construct a social, economic, and
environmental legacy in theregions where we operate, based on three main areas; Sustainable Operator, Local
Development Catalyst and Global SustainabilityAgent
Philanthropy We created the ValeFund for SustainableDevelopment which is designed to support actions byNGOs to balance
environmental conservation with theimprovement of social and economic conditions of communities, with an initial
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focus on the Amazon rainforest blome
Sustainable growth We also made investments that arefundamental to our organic growth and to our economic sustainability in the
mediumand long terms
Dialectic CSR Global Standards With the publication of Vale's third sustainability report, prepared in accordancewitht the guidelines of the Global
Reporting Initiative (GRI)
Accountability We areconsolidating our stratety of transparent and accountable actions
Partnership In parallel, Vale in conjunction with civil society organizations, oversaw thepublication of an Open Letter to Brazil on
Climate change
Global Agenda We participated with proposals in thedebate on the Brazilian government's position at theUN on Climate Change (COP15)
Social contribution We striveto contributeto the reduction of thedeficit in sanitation and housing in the areas where we operate
Political role of the firm Development The Valefoundation continued to establish Knowledge Stations, which aimto contribute towards improving thequality
of lifeand to theintegrated and sustainabledevelopment of thecommunities in sixBrazilian states
Political engagement In 2009, theVale Foundation invested a total of US$11 million in infrastructureand housing projects, and this resulted
in the allocation of US$395 million by the municipalities and theFederal Government
Supporting local municipalities, wedevelop executive engineering projects and provide support in winning the resources
that are available fromstate and federal government
4 Itausa Strategic CSR Reputation Also being appointed for the third consecutive year, as a leading company in sustainabilityin thefinancial services sector
Governance For theItausa group the operations carried out by its subsidiaries must begrounded on thecommitment to Corporate
Governanceand sustainableactions.
Dialectic CSR Global Standards As part of market recognition, Itausa was proud to rank in the Dow Jones Sustainability Index(DJSI) for thesixth time
5 Electrobas Strategic CSR Reputation Today, we arethe third largest clean energy companyin the world
Strategic Link The commitment with sustainabilityis not only a speech, but it is a continual corporatepractice;
Governance With improvements in corporate governanceand in themanaging methods, besides developing a group of projects
aiming at the integration of all Electrobas companies
Leadership on CSR Today, we arethe third largest clean energy companyin the world
Institutional CSR Sustainability For more that fiftyyears, Electrobas companies have generated clean and renewable energyand haveshown that the
commitment with sustainabilityis not only in speech, but it is a continual corporatepractice
Philanthropy
Stakeholder dialog We would likeeven to communicate in a moreand moreeffectivewaywith our stakeholders, recognizing thediversity
of their expectations concerning our business and offering then timely and appropriate answers
Sustainable growth We would liketo achievemuch more. Our future vision expressed in our 2010-2020 Strategic Plan, shows thewidth of
our ideal: to be thelargest global corporate clean energysystemin 2020
Dialectic CSR Global Standards The same commitment makes us signatories of the Global Compact
Accountability We embrace the challengeof visibility and wewould like to beassessed, compared and, furthermore, recognized as an
exampleof consistent growth, aligned with sustainability principles
xi
Global Agenda Our clean energy platformgives us a prominent position in theenergy industry, in a world struggling with social envi-
ronmental impacts and climatic changes
6 FEMSA Strategic CSR Operationalization In thearea of environmental care, we improved processes for efficient water usage, and appropiate handling or our
wastes and emissions
Reputation The GRI organization has granted us with a level A in the verification process
Strategic Link We firmlybelieve that integrating social responsibilityinto our business strategynot onlyhas immediate benefits, but is
a factor in our success in confronting the difficulties companies around the world arefacing
Institutional CSR CSR Thesechanges in the economic, social, cultural, and human spheres which led FEMSA to reinforce its business strategies
including thoserelated to social responsibility
Sustainability Through this policy, we formalizethe integration of social responsibility into our strategic business processes and mana-
gement systems, and unify our criteria under the basic premise of sustainability
Stakeholder dialog Communication with our stakeholders
Sustainable growth During 119 years, our social investment, communication with stakeholders, and theconviction of behaving responsibly
toward our communities and theenvironment have proven to bethe right path to growth, and a strength amid adversity
Dialectic CSR Global Standards This report has been prepared based on indicators of theGlobal Reporting Initiative (GRI G3)
Partnership We areproud of having been the first to accept the invitation of the Colombian government, and thus to serveas an
inspiration for other companies interested in joining in thework of rebuilding peace in thecountry
Inclusivity In 2009, wewelcomed 550 persons with disabilities, senior citizens, and members of other vulnerable groups into our
workplace
Social contribution In thematter of social responsibilities, thereare manyissues on which wehave focused our efforts: combating obesity,
supporting water preservation, reducing emissions and solid waste, proper management of PET, and thematerial of
plastic bags used in our conveniencestores
Political role of the firm Development Tima Bank program, which continued to work with former members of guerrilla and paramilitarygroups in their efforts
to rejoin societyand develop their own business
Rights We held 450 educational programs and morethan 230 familydevelopment programs in thecountries whereweoperate
Political engagement Charting myown destiny, our programfor encouraging thedevelopment of lifeskills among young people, has become
FEMSA flagship program. This year, we reached two more states in Mexico and are prepared to expand into other countries
in Latin America. The success achieved by this programis proof that private-government alliances can maximize thevalue
generated for other communities
7 CSN-Cia Political role of the firm Development Demonstration of our commitment to thedevelopment of thecountry, by generating jobs and wealth
siderurgica Political engagement Our investments, even during such an adversemoment, totaled 1.9 billion. This is an unequivocal demonstration of our
commitment to the development of the country, by generating jobs and wealth.
8 Grupo Strategic CSR Operationalization This year we want to emphasizetheimportanceof moreresponsible water management this being vital element for
Mexico theplanet
Innovation The advances made on managing this resource haveresulted in an 8.3%increasein the useof recovered water
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Strategic Link It is only with thecommitment of everyone that wewill be ableto facetheglobal responsibilityof sustainabledevelopment
Shared Value Our capacity to generatevalue makes us one of theeconomic pillars of development in the regions whereweoperate
Institutional CSR CSR The companies that compromisethegroup arejoined in a philosophy of continual improvement that includes theprinci-
ples of social responsibility and has been a constant sinceour company began
Sustainability Sustainabledevelopment is an ongoing challengefor Grupo Mexico
Only with the commitment of everyonethat wewill beable to face theglobal responsibilityof sustainabledevelopment
Dialectic CSR Global Standards The information provided has been prepared according to Global Reporting Initiative (GRI)
Accountability In themining division, our consumption of electricitylowered 1,2%compared to 2008 and our goal is to reduce this by a
further 2%for 2010
Global Agenda This year we want to emphasizetheimportanceof moreresponsible water management this being vital element for
theplanet
Energy is oneof the principal costs for our operation, in both themining and railroad sectors, thereforeconcern for the
conservation and efficient useof energy is especially clear
Focus on the issue The scarcityof water can limit our abilityto generatevalueas this is a basic supply for our mining-metallurgic processes.
The advances made on managing this resource haveresulted in an 8,3%increasein the use of revered water, which
means that 69%of thewater weconsumeis water recovered fromour own processes
Social contribution This commitment extends to our neighboring communities, through the investment of US$7 million in building infrastruc-
ture, developing social programs, promoting productions projects and generating opportunities in health and education
Political role of the firm Access We invested US$ 12,5 million in our schools for employee families, sports and cultural programs, and also in basic resi-
dential infrastructureand services
This project is one of themost modern of its type in theworld and will guaranteea greater supplyof qualitywater for
both thecommunityand our operators
Development Our capacity to generatevalue makes us one of theeconomic pillars of development in the regions whereweoperate
Political engagement Social and communityinfrastructure is another keyaspect for thedevelopment of our pleople
9 Usiminas Strategic CSR Reputation Inclusion of Usiminnas in BM&F Bovespa's CorporateSustainability Index(ISE), which brings together a select group of
enterprises considered references in thepracticeof sustainability and corporategovernance
Governance Throughout 2009 we developed and formalized our Corporate SustainabilityGuidelines to promoteobjectiveand veri-
fiable good practice
Dialectic CSR Global Standards A signatoryof theUN Global Compact since2004
Accountability Such is thecontext in which we have mapped out our strategy, using Balanced Scorecard (BSC) methodology, in order to
makeour futurestrategytransparent and objective.
Political role of the firm Rights Usiminas will reaffirms its commitment to this UN initiativefor 2010 and will foster effective action to fight corruption
and defend Human Rights, decent working conditions and the environment
10 Oi Tele Strategic CSR Operationalization Internal controls which aimto minimizethepotential environmental impact fromenergy consumption, wastesorting,
Norte Leste disposal of batteries, among others
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Reputation For thesecond consecutiveyear, Oi is a member of the CorporateSustainability Indexat BM& Fbovespa
Strategic Link It also means fromthe strengthening of this theme(sustainability) within the company's strategy, capping actions re-
Institutional CSR Sustainability Our performance in theIndexresults fromthe evolution and continuation of sustainabilityactions promoted by several
areas
Dialectic CSR Global Standards Oi has been a member of the United Nations Global Compact since August 2009
Political role of the firm Access Oi's unwavering commitment to reach all national frontiers with broadband internet access
Development Reasserting its commitment to the country's social development and to thedemocratization of access to knowledge, Oi
Futuro expanded its programs in education, cultureand sports
Political engagement The commitment to take freebroadband serviceto all public schools, thus to morethat 54 million students, adds Oi to
theuniverse of public policies, given the introduction of new technologies and, under the coordination of the Education
Ministry, radicallychanges education and thequalityof teaching in Brazil
11 Grupo Strategic CSR Operationalization Through theimplementation of profitable productive activities, long-termvision and adherence to theprinciples that gave
Modelo birth of our companyin Mexico almost 85 years ago, Grupo Modelo continues to advance on the road to sustainability
Reputation We areparticularlyproud to be Mexico's current leader beer company and, as a Mexican company, weare also proud to
hold theseventh position within the global beer industry
Strategic Link Thanks to our special business model, allowing us to consolidateour leadership in Mexico, and at thesame timestreng-
then our international presence, while still making positiveeconomic, environmental and social contributions
Institutional CSR CSR This report, which constitutes therecount of the most important actions undertaken in theareas of social responsibility
and corporate sustainability
Sustainability Grupo Modelo maintains its commitment with the company's sustainabledevelopment in the communities in which it
operates
Stakeholder dialog To our shareholders, suppliers, clients, consumers, government institutions and social organizations: wearegrateful for
your confidenceand support and we renew our commitment to continueworking for a better society through profitable
responsible and long-termproductiveactivities, aimed to collaborate towards thepreservation of a viable and balanced
environment for future generations, who will be ableto take advantageof it for new and better opportunities
Dialectic CSR Global Standards This report is presented for thethird consecutiveyear, following the guidelines of Global Reporting Initiative(GRI)
Accountability With the representation of the2009 Sustainability Report Grupo Modelo reasserts its commitment to a responsibleper-
formance and transparencytowards our stakeholders
Global Agenda Thanks to our environmental protection programs, todayan important percentage of thetotal energyconsumed byGrupo
Modelo comes fromalternative sources of energy
12 CBD Strategic CSR Operationalization Implementation of various initiatives, including building new "green" stores, promoting of theuseof recycled bags and
Brazil GPA mitigating environmental impact in regard to water and energy
Reputation Consolidate our leading position as Latin America's largest retail company
Strategic Link In 2010 we expect to score further advances in this area, ensuring that the principles and ideals of sustainabilityplay an
increasinglyimportant rolein our dailyactivities
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Institutional CSR Sustainability We also recorded progress on the corporate sustainabilityfront with the institution of a sustainability committeeto
structure related issues
Sustainable growth Our objectives have been clear since the outset: to grow in a sutainable manner
Dialectic CSR Global Standards We also maintained our commitments with the Global Compact, a UN initiative designed to promote ethical ans socially
responsible business conduct
Accountability We also recorded progress on the corporate sustainabilityfront with the institution of a sustainability committeeto
structure related issues
Political role of the firm Development Our investment plan reflects the positive outlook for the Brazilian economyand confirms our commitment to the crea-
tion of jobs and thedevelopment of the country as a whole
Political engagement Our investment plan reflects the positive outlook for the Brazilian economyand confirms our commitment to the crea-
tion of jobs and thedevelopment of the country as a whole
13 CEMEX Strategic CSR Operationalization We areexpanding and strengthening our efforts in key areas such as safetytraining for drivers and contractors. Above
all, we remain committed to our global long-termgoal of zero incidents
Strategic Link We took important and decisivesteps to strengthen not only our business model, but also out commitment to
sustainable development
Governance We activelyengage with our global panel of sustainabilityexperts, who provideimportant and valuable advice
Institutional CSR CSR As a global company, weare deeplyaware of our responsibility to address complexsustainability challenges
Stakeholder dialog We engaged the communities in which we operatethrough open and ongoing dialogue, social initiatives, and
volunteer efforts
Dialectic CSR Accountability We continued to reduce our carbon footprint by improving the energy efficiencyof our operations and expanding our use
of alternativefuels. As a result, in 2009 weincreased our use of alternative fuels to 16,4%, exceeding our target for
2015 ahead of time
Global Agenda We reconfirmour commitment to address climate changeand to the development of a low-carbon economy
Focus on the issue We arecommitted to further reducing our impact on the environment and recognizethat we havemany opportunities
to improve
Social contribution We continued to find ways to promoteaccess to better housing and community infrastructure
Political role of the firm Access We continued to find ways to promoteaccess to better housing and community infrastructure. For example welaunched
our most successful low-incomehousing solution, Patrimonio Hoy, in the Dominican Republic
14 Gerdau Strategic CSR Operationalization We continuously invest in thebest globally- available industrial technologies for the protection of air, water and soil, so
Metalurgia as to minimizetheimpacts of our operations on theenvironment
Reputation The implication of SafetyHour at our plants in Brazil has been internationally recognized by the World Steel Association
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Institutional CSR Sustainable growth We also believethat the growth of a company should always be aligned to community development and respect for the
environment.
Dialectic CSR Partnership We haveprimarilysupported education, at various levels, and public administration, stimulating improvement in services
provided to society.
Global Agenda We continuously invest in thebest globally- available industrial technologies for the protection of air, water and soil, so
as to minimizetheimpacts of our operations on theenvironment
Social contribution We haveprimarilysupported education, at various levels, and public administration, stimulating improvement in services
provided to society.
Political role of the firm Political engagement We haveprimarilysupported education, at various levels, and public administration, stimulating improvement in services
provided to society.
15 CEMIG Strategic CSR Operationalization Knowledgemanagement took another step forward with thecreation of theUniverCemig, a corporate universityaimed at
ensuring managerial and operation excellenceat Cemig, whose tonic is the integration of peopleand efforts to generate
ans shareknowledge
Reputation Cemig has also been elected, onceagain, global leader in theutilities super sector
Strategic Link In 2009, Cemig sought to continuallyimprove its corporatesustainabilityactions, aligning thecreation of economic value
respect for social environment with stakeholder preservation of theenvironment
Leadership on CSR To be in 2020 oneof the two largest energy groups in Brazil in terms of market value, with a significant presencein the
Americas and to be a world leader in sustainability in the sector
Institutional CSR CSR Reinforcing its commitment to the corporateresponsibility
Sustainability In 2009, Cemig sought to continuallyimprove its corporatesustainabilityactions, aligning thecreation of economic value
respect for social environment with stakeholder preservation of theenvironment
Stakeholder dialog In its quest to continuallyimproverelations with its suppliers theCompanydeveloped the "Cemig Suppliers and Relation-
ship with Supplier Manual" in order to establish a set of principles and directives, translated into commitments, that will
guide theactions undertaken byCemig and its suppliers
Sustainable growth The new energy generation projects ensurethecompany's growth in the generation of energyutilizing clean and renewa-
blesources
Dialectic CSR Global Standards Cemig celebrated its tenth year of inclusion in theDow Jones SustainabilityIndex
Accountability In 2009, water sources wereresponsiblefor 99%of Cemig's energygeneration, allowing thecompany to make water the
driving force behind its development and ensuring that greenhousegas emissions arewell below theaverage levels of
theglobal electric energy sector
xvi
Partnership In 2009, Cemig implemented the Special Integrated Management Programof Networks and Trees-Premiar together with
municipalities, universities and the population
Global Agenda Ensuring that greenhousegas emissions are well below the average levels of the averagelevels of theglobal electric
energysector
Political role of the firm Social contribution The company madeprogress at several long termprograms that havealready benefitted thousands of users throughout
Access thestate of Minas Gerais, with an emphasis on the"Luz Para Todos" Program, directed at providing universal electric
energyservice
16 Grupo Strategic CSR Operationalization Each one of our efforts to minimizeenvironmental impact represents and efficiency improvement in thesupply chain and
Bimbo generates tangiblebenefits to the organization
Innovation Through the"Committed to theEnvironment" programin 2009 wecomplemented new product launches with degradable
packaging technology, achieved a significant reduction in theuseof fuel and improved our management of solid waste
Reputation Moreover, Reforestamos Mexico has done an extraordinaryjob through its effort to contribute to Mexico's reforestation
earning the2009 National Forestry Merit Award
Strategic Link We area global, modern and sustainable company, permanently striving to maintain adherence to best practices through
local initiatives and programs that will ensure thecommon good and will generate long-termsocial, economic and
environmental benefits
Shared Value Thanks to our deep sense of service and to an understanding that attention to the needs of the environment and the
search for thewelfareof the individual represent a commitment and a raison d'etrethat will continue to generatevalue
for our stakeholders and future generations
Leadership on CSR 2009 posed important challenges that wetransformed into opportunities in order to keep our commitment to efficiency,
productivity and job creations, with the aimof strengthening our leadership as a companythat conducts itself in a dynamic
and flexiblemanner, but above all transparency, under the premiseof fair and responsiblepractices
Institutional CSR CSR We havealways assumed thecommitment to responsible performancetowards our diverse stakeholders and society
Solid strategyof social responsibilitythat is incorporated throughout our operations, supported bythehighest ethical and
human values in all the countries whereweoperate
Sustainability We areglobal, modern and sustainablecompany
Dialectic CSR Accountability Aboveall transparency, under the premiseof fair and responsible practices
Global Agenda Grupo Bimbo committed to theenvironment voluntarilyoffsets greenhouse gas emissions generated
Social contribution Our "Committed to Your Health" programpromotes an appropriatediet and a healthy lifestyle, aligned with the World
Health Organization Global Strategy(WHO)
xvii
Political role of the firm Political engagement "Committed to Our Society" program, and was madeevident through social projects and support given to organizations
that work for the well-being, health and education of thousands of people. We want our presence to make a positive
difference in thecommunity
17 CPFL Strategic CSR Operationalization We also invested in clean and renewableenergy and sugarcane biomass cogeneration
Energia Reputation For thesecond year running CPFL Energia received the award for Best Companyin Latin America for Sustainabilityfrom
Latin Finance magazineand the Management Excellenceconsulting firm
Strategic Link Our strategyof maintaining disciplined financial management, diversifying thebusiness portfolio and seeking greater
Governance operating efficiency, led by the search for excellence as regards sustainability and superior corporate governancepractices
Shared Value This is about adopting a responsible attitudetowards thecommitments wehave with employees, customers, suppliers,
shareholders and public authorities. Thegeneration of valuein the future depends on responsibledecisions taken today
Institutional CSR Sustainability Our strategyof maintaining disciplined financial management, diversifying thebusiness portfolio and seeking greater
operating efficiency, led by the search for excellence as regards sustainability and superior corporate governancepractices
Stakeholder dialog We understand that wecan positivelyinfluenceour stakeholders by providing high quality information and promoting
initiatives that contribute to thecreation of a new consciousness and theadoption of sustainablehabits
Dialectic CSR Global Standards CPFL is also a member of theBrazilian Committeeof the Global Compact in threeof its four commissions
Partnership We support the A Bag is a Drag campaign of the Brazilian Environmental Ministry, which aims to reduceconsumption of
plastic bags and therebyreduce the environmental impact of our daily activities
Global Agenda As a result of this concern, CPFL is an activeparticipant in discussions between corporations regarding the subject of global
warming.
18 BRASKEM Strategic CSR Operationalization We haveundertaken to reducetheintensity of our emissions of greenhouse gases, stating Braskemcorporate views in
thedocument e preciso amadurecer para ser verde (Weneed to matureto begreen). This document also reaffirmed
Braskemcommitment to the search for new technological opportunities and increased energy efficiency, furthering the
useof 100%renewablematerials and development of a market for products capable of reducing greenhouse gas emissions
Innovation In 2009 Braskemstarted the ETBE plant. ETBE is a bioadditivepartially manufactured fromsugar cane ethanol and this
plant was established in Camaçari (Bahia), replacing the MTBE unit. The construction, in Triunfo (Rio Grande do Sul), of
enable production of the Green Polyethylene product also evolved quickly
Strategic Link It is our understanding that a company that enforces such practices (sustainable development) is technologicallyhealthy,
economically viable and socially fair.
Leadership on CSR Company achievements in 2009 and the vision of the futureBraskemhas of ranking among thefive majors of theglobal
petrochemical industry, and to beseen in 2020 as an organization that has made an outstanding contribution to sustainable
xviii
development, werethehallmarks of our actions in this period
Institutional CSR CSR It is our understanding that a company that enforces such practices (sustainable development) is technologicallyhealthy,
economically viable and socially fair.
Sustainability Since it was established in 2002, Braskemhas been acting based on sustainabledevelopment principles
Dialectic CSR Accountability The fourth inventory of greenhouse gases must also behighlighted. In 2009 this inventoryevidenced that emissions had
been reduced by 8,3%in absolutefigures, and their intensity by11.5%, against 2008 figures, evidencing thedepth of our
commitment
Partnership Also to theRio Grande do Sul Recycling Project, in partnership with Vonpar Foundation and Banco do Brasil Foundation,
besides proceeding with various already existing initiatives
Global Agenda In theview of theworldwidedebate about climate change and greenhouse gas emissions by our industry, Braskemresol-
ved to include theseissues in its agenda.
Inclusivity Braskemhas madea significant contribution to theSocial Insertion Programin the Deep South of thestate of Bahia
Social contribution Our main challenge is to improveCompany Private Social Investment Model in order to seethese projects actually contri-
buting to a change in social reality
Political role of the firm Political engagement Our main challenge is to improveCompany Private Social Investment Model in order to seethese projects actually contri-
buting to a change in social reality
19 Redecard Strategic CSR Reputation In addition, Redecard also becamea constituent of theBusiness SustainabilityIndex(ISE) of theSão Paulo Stock Exchange
Institutional CSR Sustainability During 2009, Redecard remained dedicated to improving its market practices, supporting the changes necessaryto make
its business more sustainable
Dialectic CSR Global Standards It was the onlyBrazilian companyto be included in the Dow Jones Sustainability World Index– DJSI World in 2009
Political role of the firm Political engagement I have no doubt that thanks to the work and dedication of all our employees, Redecard is recognized in themarket as a
company that is innovative, secure, and flexible with a completeproduct portfolio, customer focused and that seeks
sustainable development of commerce, thus helping to drive theCountry’s economy
20 BRFBrasil Strategic CSR Strategic Link We areaware that these financial and operational results will onlycarry theseal of approval over theyears to comeif
Foods theyareachieved together with respect for the human being and the environment
Institutional CSR CSR Our operations are based on the constant search for economic, social and environmental equilibrium
Sustainability Without ever losing sight of our commitment to the sustainabilityof thebusiness and also for ensuring thecreation of
valuefor all our stakeholders
Stakeholder dialog At BRF, we believethat dialog and generation of valuefor all our stakeholders are fundamental to ensure thesustaina-
bility of thebusiness
xix
21 Fibria Strategic CSR Reputation Where Fibria is theonlyforestrysector representative (DJSI)
Celulose Strategic Link We takethis opportunity to reaffirmour commitment, stated at the time that Fibria was conceived, to develop our rene-
Institutional CSR CSR wableforestrybusiness as a sustainablesourceof life, generating wealth and economic growth, , promoting human and
social development and guaranteeing environmental conservation
Dialectic CSR Global Standards The market has shown considerable faith in theCompany, borneout by our selection for leading sustainabilityindicators,
such as the Dow Jones Global Sustainability World Index
22 Cielo Strategic CSR Operationalization We madeinvestments with our own resources and through fiscal incentives in cultural, social and sports projects, looking
for programs focused on education, child health and training youngsters for thelabor market
Reputation Our actions on this front in 2009 were recognized by several institutions in different areas, as wewereawarded the"Valor
Carreira" prize for excellence in people management
Institutional CSR CSR Awareof our social responsibility, wecontinued to invest in social projects and environmental preservation projects
Dialectic CSR Global Agenda Looking for programs focused on education, child health and training youngsters for thelabor market , prioritizing social
Inclusivity and economic inclusion
Focus on the issue During theyear, we invested in familyhealth assistance (Hospital Pequeño Prinicpe), culture (Insituto Brazil Leitor), social
Social contribution networking through sport (Fundaçao Gol deLetra and Instituto EsporteeEducaçao) and education (Instituto Ayrton Senna)
23 SABESP Strategic CSR Operationalization Theseinvestments improved the quality of living of the population. We maderoughly201,000 new water connections and
184,000 new sewage connections
Innovation In thesameline, it is important to emphasize the continuityof the pioneering implantation in a state-owned companyof
theVauleAdded Management (VAM) model, which is crucial to steer theactions related to theoptimization our asset
base and improve the quality of investments, to strengthen SABESP and its long-termsustainability
Reputation Additionally, SABESP is for the third consecutiveyear part of the CorporateSustainabilityIndexportfolio of the Sao Paulo
Mercantileand Stock Exchange (BM&F Bovespa)
Strategic Link The Company's strategic repositioning in view of thechallenges of the new regulatoryframework and theCompany's
expectations as regards the water and wasteservices and theenvironmental conservation
Governance Enhancing the corporategovernance practices is also oneof our priorities. Our Code of Ethics and Conduct of Company
was widely disseminated
Institutional CSR Sustainability The Vaule Added Management (VAM) model, which is crucial to steer theactions related to theoptimization our asset
base and improve the quality of investments, to strengthen SABESP and its long-termsustainability
Dialectic CSR Accountability We prioritized theWater Loss Reduction Programin 2009, water losses decreassed to 26%of revenue. Thegoal for 2010
We highlight theimplementation of moredetailed environmental clauses in supplier contracts, and the retaining of a
xx
consultant to implement and environmental accounting and balance sheet system
Partnership We also expanded partnering projects, such as collection of frying oil in the other cities, and theforestation of areas
around companyfacilities
Global Agenda In 2009, weprogressed in actions to mitigate the impact of climatechanges byplanting approximately 678,000 young
trees, and reducing by2,3%specific power consumption by cubic meter of water supplied
Political role of the firm Access The first was investment acceleration aiming universal services
Development We havecontributed for the economic and environmental development of theStateof Sao Paulo
Political engagement We havecontributed for the economic and environmental development of theStateof Sao Paulo
24 SQM Strategic CSR Operationalization SQM is committed to protecting its workers, thesurrounding communities and natural resources in theareas in which it
operates. Consistent with this commitment, SQM operates using an environmental management systemthat allows it to
identify and control environmental aspects of theCompany’s production processes
Strategic Link SQM’s long-termbusiness development is framed within its Sustainable Development Policy, whoseprinciples are
thecornerstoneof SQM's commitment to caring for theenvironment and our workers, the satisfaction of our customers
and our relationship with the communities in which we work
Institutional CSR Sustainability SQM's long-termbusiness development is framed within its sustainable development policy
Philanthropy In a related initiative, in 2009 SQM inaugurated a cultural center at a school in Toconao, restoring thebuilding, furnishing
it, and providing thenecessaryequipment in order to offer classes and workshops to thecommunity
Stakeholder dialog For this reason, wehavedevoted considerableefforts to strengthen our relationships with thesecommunities
Dialectic CSR Partnership SQM collaborates with high-level technical organizations to conduct environmental assessments and ensurefollow up of
environmental monitoring. The Pontificia Universidad Católica, which conducts hydro geological studies in the Tamarugal
Plains, the Salar de Llamara and the Salar de Atacama, has collaborated with SQM for several years
Social contribution As part of its community efforts, the Companyhas implemented multipleinitiatives focusing on recovering heritage,
improving education and culture, and socially advancing these important communities
Political role of the firm Access SQM understands that education enables individuals and communities to succeed and achievetheir goals, which is why
theCompany renewed its educational alliancewith theMunicipality of San Pedro deAtacama. Through this program,
which has been in placesince2007, SQM finances thesalaryof an educational specialist to work with local students with
learing disabilities
Development CommunityDevelopment. During 2009, theCompany continued its programto develop and fund a contest to finance micro-
entrepreneurs in theregion. The objective of this program, which is now in its third year, is to foster the economic and
social development of the communities around San Pedro deAtacama.
xxi
Political engagement During 2009, the Companycontinued its efforts to recover and restoreMaría Elena, a nitrate enclave that suffered
damagein the earthquake that struck the Antofagasta Region in Novemeber 2007. This works included rebuilding and re-
pairing damaged homes and infrastructure, painting all of thetown houses, stabilizing roads, and supervising thedesign
and development of public spaces
25 Natura Strategic CSR Operationalization We also increased the distribution of wealth to our stakeholders and were more efficient in our environmental manage-
Cosmetics ment, reducing by5.2%relative greenhouse gas emissions and offsetting the emissions of our chain bysupporting
socio-environmental projects
Reputation Listening to yourself, others, and the world, is and will always beour great inspiration in our persistent search for better
and stronger relationships with our many stakeholders: themost legitimate means of increasing therecognition of our brand
Strategic Link In Latin America, we want to bean important player who is committed to regional sustainable development. To this
end wewill adapt marketing, portfolio, logistics, and various channels, such as sales communication to meet theneeds
of each country
Institutional CSR CSR The strength of our operations brought impressiveprogress in all the main economic, social and environmental indicators
Thus wewill fulfill our vocation to striveto create economic, social, and environmental value
Stakeholder dialog We continued to invest in improving thequalityof relationships with manyof our stakeholders in 2009, making progress
on thesensitiveissues of theserelationships. This requires a collective effort to approach and engage in continuous
dialogue with all stakeholders
Dialectic CSR Accountability We also increased the distribution of wealth to our stakeholders and were more efficient in our environmental manage-
ment, reducing by5.2%relative greenhouse gas emissions and offsetting the emissions of our chain bysupporting
socio-environmental projects
Global Agenda In a year characterized bytheglobal economic crisis and thefrustrating impasse in negotiating an agreement on global
climate change
Political role of the firm Development In Latin America, we want to bean important player who is committed to regional sustainable development. To this
end wewill adapt marketing, portfolio, logistics, and various channels, such as sales communication to meet theneeds
of each country
Political engagement The third largest cosmetic market in theworld, Brazil signals that it is entering a virtuous cycle of prosperity. Our strong
identification with its soul and development cheers us; we will continue with our efforts to build a beautiful business
and a fairer societythat is moreethically committed to futuregenerations
26 Soriana Strategic CSR Operationalization We reinforced our training and integral development, and labor health programs directed to our collaborators
Institutional CSR CSR At the same time, we reinforce our commitment to continueattending our corporate social responsibilityactions
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Sustainability We havemadegreat efforts to maintain our labor plant and meet our financial commitments, guaranteeing the Com-
pany's long-termsustainability and profitability
Dialectic CSR Accountability We havefound formulas to involve more peopleand companies in our activities directed to theenvironment and have
expanded our reach. Wemanaged to recycle 85,000 tons of materials
We strivefor a company with clarityin goals, transparencyin its business administration and financial continuity
Partnership Especiallyvaluablethis year was our strategyof searching for synergies and bringing together theefforts of different
organizations, when innovativesolutions were required to meet the growing needs of themost vulnerable population
We havecontinously collaborated for approximately10 years with some of these organizations, such as food banks, the
Tarahumana Foundations, Un Kilo de Ayuda etc.
Political role of the firm Political engagement Behind our commitment to continue supporting programs that weconsider of special value for the community, thereare
a serieof further efforts to participate in health, education, food and environmental careactions, convinced that only
when all societycollaborates wecan achieve significant progress
27 Fresnillo Strategic CSR Operationalization We havedeveloped a comprehensivehealth, safety and environmental management systemthat integrates personnel
training and development. In addition we invest in conservation and biodiversityefforts and closely collaborate with
communities to ensurethat our growth is truly sustainable
Strategic Link Commitment to sustainabledevelopment, health, safety, environment and community relations programmes are an
integral part of the Group's activities
Institutional CSR Sustainability Theseattributes are backed up byour commitment to sustainabledevelopment
Stakeholder dialog We havea strong foundation upon which to deliver on this commitments to stakeholders
Sustainable growth In addition weinvest in conservation and biodiversity efforts and closely collaborate with communities to ensurethat
our growth is truly sustainable
Dialectic CSR Global Standards Our adherence to domestic and international standards of environmental performance is evidenced by ISO 14001
Partnership In 2009 Fresnillo plc becamea founding member of theCorporatecommitment to Wilderness. This is an initiative of the
WILDFoundation, an international non-profit organization dedicated to wilderness protection around theworld
Global Agenda The company also endorsed the Copenhagen Communiqué, an initiative of the Princeof Wales Corporate Leaders Group
on Climate Change
Focus on the issue Instead of utilizing fresh water fromaquifers, theflotation plants at Fresnillo and Sucito will use treated water, which
brings environmental benefits to the community and reduces our fresh water consumption costs
Social contribution Communityinvestments this year included education programmes and sponsorship of athletic teams, arts and culture
28 Banrisul Strategic CSR Operationalization There were also significant operational changes. Internal processes werereviewed, sectors were integrated in business
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platforms, targets were reassessed, and a people management policy sustained bycontinuous training and performance
valuing was adopted
Reputation The past years were marked by substantial investments in technological innovation and Banrisul received national
an international awards
Strategic Link We havebalanced modernityand personalized service, boldness and respect, efficiency and accessibility, results and
communityparticipation, profit and peoplevaluing, commercial prospects and social actions
Governance Banrisul continuity is ensured byits consolidated management model, which is supported by corporate governance prac-
tices focusing on institutional results and delivering increasing efficiencyto its clients
Institutional CSR Stakeholder dialog However, technical and joint decision represent a straight, secure path for the organization and its various stakeholders
Political engagement Banrisul is in linewith theState government's public policies- and that is how it should be, given the Bank's important
social role
29 Bci Strategic CSR Operationalization The strict attachment to ethical values that wepromote among our teammembers and which weincorporateinto our
management wererecognized
Innovation We also developed an innovativeproduct and concrete serviceoffering which allowed us to reaffirmour position as in-
dustry leaders in service quality
Reputation Fundacion Generación Empresarial when awarding us the "Ricardo Claro Valdés" award, founded this year
Strategic Link We seek to show in what wayour mission and values areexpressed and orient our actions in fundamental areas like cor-
porate governance, ethics, quality of work life, customers and suppliers, commitment to thecommunityand environment
Governance In thearea of corporate governance, this report expresses Bci's proactivespirit by referring to the policies and measures
adopted by theBoard aiming to advance thecompliance with theregulations
Shared Value Motivateus to continueto advanceour corporatemanagement aligned with CorporateSocial Responsibility aiming to
Institutional CSR CSR achieve sustainabledevelopment that generates value for all our stakeholders
Sustainability Contribute to our corporation's sustainabilitybywayof economic, social and environmental valuecreation
Stakeholder dialog I hopethis report allows you to better know us and share your ideas, comments and suggestions
Dialectic CSR Accountability We redoubled our efforts to continue progressing in transparency, trust and innovation
Partnership Another step to encouragethe reduction of C02 emissions thanks to our voluntary incorporation in the MayDay Network
Global Agenda Bci has been outstanding in the Chilean banking systemfor its commitment to managing its possibleenvironmental im-
pacts and using clean technology, as well as for the implementation of its energy efficiencyprogram. In 2009, we took
another step to encouragethereduction of C02 emissions thanks to our voluntary incorporation in the MayDay Network
Political role of the firm Access In 2009, weresolutelycontinued supporting our customers, especiallythose that were most affected by the economic
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crisis, and wereinforced the financial literacy programdirected at the C3 and D socioeconomic sectors
Development To continueshaping thebanking industry's development and so contributing to the realization of our people's dreams
and the progress of our country
Political engagement We redoubled our efforts to continue progressing in transparency, trust and innovation sinceweconsider themto be
essential elements to promoteprosperity in Chile
30 ALFA Strategic CSR Operationalization Despitethe economic restrictions imposed bythe crisis, we continued to support high impact projects, increasingly fo-
cusing our social responsibility efforts to optimize their efficiency
Reputation We arebuilding what is to be thelargest PET bottle recycling plant when it comest to initiates operations in 2010
Institutional CSR CSR We continued to show our unfailing commitment to corporate social responsibility
Philanthropy Through theALFA Foundation, wecontinued to promoteall levels of theteaching-learning process through such
initiatives as scholarship programs, support to educational institutions and infrastructureas well as teacher training
Sustainable growth A solid financial structureand perspectives for sustained, long termgrowth, but also a companywith a clear vision of its
social responsibility with an international community
Dialectic CSR Accountability Further achievements of the year include Nemak recycling 360,000 tons of aluminum, a significant reduction in energy
consumption, the treatment of wastewaters and thereduction in atmospheric emissions in our plants, all of which
represent important contributions with immediateenvironmental impact
Partnership ALFA has lead thefield in this area and continues to implement important environmental initiatives, for example, in con-
junction with our partner Shaw Industries of theU.S., weare building what is to beNorth America’s largest PET bottle
recycling plant when it initiates operations in 2010
Global Agenda In regards to climate change and environmental protection, 2009 was a very important year with the reaching of a world
consensus on theimportance of theenvironment
Social contribution Through theALFA Foundation, wecontinued to promoteall levels of theteaching-learning process through such
initiatives as scholarship programs, support to educational institutions and infrastructureas well as teacher training
Political role of the firm Development We maintained our support for the ALFA Planetarium, northern Mexico’s most visited museumwhose mission is to
promotethelearning of scienceand technology, areas that areinstrumental for thedevelopment of any country
Rights The challenging economic environment confirmed to us that crisis affect communities to a far lesser extent if theyare
well prepared, with an efficient social structure based on solid educational grounding. This fact serves to underscore our
conviction that education should bethecornerstoneof our corporate social responsibility program
Political engagement Also a company with a clear vision of its social responsibility with an international community that shares thesame
values and is positioned to capitalizeon numerous opportunities to continuecontributing to the progress of society
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31 CMPC Strategic CSR Operationalization Contains four priorityareas: development of renewableforest plantations, substitution of fossil fuels for biomass, certi-
fication of our clean production processes and increase in therecycling of paper
Institutional CSR Sustainability We stronglybelieve in theactual realization of theSustainableDevelopment principle, which essentially means to make
productive activities, required for thegrowth of our countries, compatiblewith the legitimateright that the future gene-
rations have to livein a suitable environment
Philanthropy The CMPCfoundation which supports schools located near the areas wherethe companyruns industrial operations
Stakeholder dialog I would welcome your views- shareholders, clients, suppliers, employees as well as government authorities and the co-
community' in general. Your feedback is much valued and appreciated since it will allow us to improve
Dialectic CSR Accountability We aremonitoring the carbon footprint of our products, initiallypine and eucalyptus pulps. Theresults of this work will
shortlybemade available to our clients, suppliers and anybody elsewho might be interested
Global Agenda There is also universal concern over world climatechange and how it is affecting every aspect of modern life, from
everyday activities to complexindustrial processes
Inclusivity The Good Neighbourhood Plan has placed special emphasis on developing projects such us direct employment for those
neighbours fromMapuche origin, educational support programs and encouragement of productivedevelopment
Social contribution All this aims at creating opportunities of social and economic growth, especially for the 300 Mapuchecommunities
living closeto forests and areas where thecompany operates in Chile
Political role of the firm Access The provision of theeducation children receive to makesuretheyhaveaccess to more opportunities in life and can in
return help their community grow
Development We stronglybelieve wehave contributed effectivelyto the development of our country, creating job opportunities and
wealth for Chile
Political engagement The wayCMPCdoes business and also in the constant commitment to the development of our country and its people,
especially those communities wherethe companyoperates
32 Copel Strategic CSR Operationalization Creation of Environment and Corporate Citizenship Management, that madeCopel the first company in theBrazilian
electric sector to grant first level subject status
Innovation Copel becamein 2009 thefirst electric power concessionairein thecountryto enter into contracts for purchaseof
electricitysurplus generated frombiodigestion of organic wastes
Reputation Integrate the CorporateSustainability Index- ISE of BM&Fbovespa, certifying effectiveness of programs and projects
Strategic Link We proudly present the Management and Sustainability Annual Report of Copel for 2009, prepared based on strategic
directives and sustainability commitments assumed bytheCompany
Institutional CSR CSR To Company's activities, conciliating sustainability with corporate responsibility, not setting corporate result aside
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Sustainability Copel practices, supports and promotes sustainability
Sustainable growth Copel practices, supports and promotes sustainability, it reaffirms its recognition as theonlyway capable of providing
thecompany, associated agents and environment with the opportunity to enjoy as partners of growth and development
Dialectic CSR Global Standards Signatoryof United Nations Global Compact, participant of Global Reporting Initiative- GRI
Citizenship Projects of social, environmental and citizenship responsibilityimplemented bythe Company
Accountability Company identified through it its main operating units, activities and processes that generate larger amount of these
gases and units, activities and processes capableof compensating or mitigating such issuances
Global Agenda Another innovative posturewas publication in 2009 of its first inventoryof emission of greenhousegases, according to
GHGprotocol methodology. Such inventorywill support outlining and formation of Copel Agenda for Climatic Changes
Social contribution Company performs with devotion, dedication and efficiencyits role of fomenting and promoting social and economical
development of State of Paraná, serving population with qualityand providing conditions to its own growth as a
company, contributing with welfare of thecommunity
Political role of the firm Development Company performs with devotion, dedication and efficiencyits role of fomenting and promoting social and economical
development of State of Paraná
Rights Also in 2009, Copel joined the Programin Favor of Gender Equity before Special Department of Policies for Women, of
Presidency of Republic, an important step for thedefinitive change of conceptions in people management and organiza-
tional culture in order to promoteequity of Company's gender
Political engagement Not losing sight of its important role on promoting economic and social development of Paraná, practicing the smallest
electricitytariff of Brazil and providing again discounts to consumers that pay electricity bill on time
33 Embraer Strategic CSR Operationalization Embraer has been improving its corporate risk controls, which arenow evaluated quarterly, representing and improve-
ment in corporate governance
Innovation With an eyeon a future with less emissions fromtheair transport sector, weparticipated in a project for developing a
new generation of renewable fuel fromsugarcane, which maybea long-termsustainablealternative
Reputation As a result, for thefifth consecutive year wewerelisted on the CorporateSustainabilityIndex(ISE) of the Sao Paulo Stock
Exchange (BM&FBOVESPA)
Governance We maintained thesamehigh corporategovernancestandards adopted in 2006. Theindependence and transparencyof
theEthics Committee within the scope of theBoard of Director
Institutional CSR CSR Embraer's commitment to building a sustainablefuture is based on all of its dimensions- economic, financial, social and
environmental
Sustainability Embraer's commitment to building a sustainablefuture is based on all of its dimensions- economic, financial, social and
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environmental
Dialectic CSR Global Standards We reaffirmed our commitment to theUnited Nations Global Compact
Global Agenda Embraer has an ongoing programof technological development that has delivered improved efficiencyfor aircraft
performance, and reduced fuel consumption and theemission of gases that contributes to global warming
Political role of the firm Rights Providebroad coverageof subjects related to labor relations, human rights, and thefight against corruption
34 Kimberly- Strategic CSR Operationalization In 2009, wewereable to reduceenergy and water consumption per metric ton of product. Wecontinue to useprimarily
Clarkde recyclable fiber; and thevirgin fiber we purchasecomes fromcertified forests
Mexico Institutional CSR CSR We area company committed to society, to theenvironment, and to the rational, sustainableuseof natural resources
Sustainability We area company committed to society, to theenvironment, and to the rational, sustainableuseof natural resources
Dialectic CSR Citizenship We will continueto play the rolethat corresponds to us as a good corporate citizen in thesocial and economic sphere
Social contribution And as wedo every year, in 2009 we gaveour support to morethan 200 institutions, benefiting more than 20,000 families,
5,000 women, 3,000 older adults and 5,000 infants
Political role of the firm Political engagement It continues with our productive chain, which benefits tens of thousands of families through Mexico; and with our
country, by fullycomplying with all our obligations
35 Net Strategic CSR Strategic Link We achieved these feats byadopting an ethical business posture, one that is based on respecting the market norms and
Services laws, and preserving and prioritizing the quality of our relationships with all the groups weinteract with
Institutional CSR Sustainability NET’s first Social Report, a starting point that shows what we have achieved and our current position, which reinforceour
belief in the directives wehave adopted towards ensuring our sustainability
Stakeholder dialog Preserving and prioritizing thequalityof our relationships with all the groups we interact with
36 Fosfertil Strategic CSR Operationalization Fosfertil invests in new technology, in thetraining and preparation of teams, in the qualityof operations and, aboveall,
in the safety of its employees, in theprotection of theenvironment, and in thegood relationship with theneighboring
communities
Reputation For thefifth timein a row, wereceived the Best in Agribusiness award, fromGlobal Rural magazine
Institutional CSR CSR Investing to keep up with thecontinuous growth of theBrazilian agriculture, and expanding and modernizing units and
Sustainability processes in the permanent search for economic, social and environmental sustainability
Political role of the firm Political engagement Investing to keep up with thecontinuous growth of theBrazilian agriculture, and expanding and modernizing units and
processes in the permanent search for economic, social and environmental sustainability
37 SulAmerica Strategic CSR Operationalization The useof water-based paint for repairs to our insured parties' vehicles, benefiting theenvironment, partner workshops
and clients
Reputation SulAmerica, for thesecond year running, as oneof Brazil's best companies in terms of people management, according to
xxviii
a study published in Valor Economico newspaper
Strategic Link I cannot omit highlighting our evolution in making sustainability and increasingly important part of our culture, operations
and day-to-dayroutinein managing thecompany
Governance We haveset up a SustainabilityCommittee and an area working exclusivelyon this issue, as well as including specific
sustainabilitytargets in our new cycleof strategic planning
Institutional CSR Sustainability I cannot omit highlighting our evolution in making sustainability and increasingly important part of our culture, operations
and day-to-dayroutinein managing thecompany
Dialectic CSR Accountability The modern building meets requirements for sustainability and operational efficiency, allowing for a reduction of up
to 30%in theuseof energyand natural resources
Political role of the firm Development We will have an opportunity to contribute to therevitalization of this new urban development area in Rio de Janeiro
Table VI. SCANDINAVIAN COMPANIES
Company Category of CSRrethoric Themes Quotations
1 Statoil Strategic CSR Operationalization In Canada, wehave great expectations for our oil sand test facilitythat will test several new technologies.
We believethis will makesignificant inroads into improving the environmental footprint and operational viability of
of this operation
Innovation Off thewestern coast of Norway, we aretesting a prototypeof the world's first full-scale floating wind turbine,
turbineHywind, designed for operation in deeper waters
Reputation The Forewind consortium, where we participate, was awarded the largest development area in theUK third licensing
round for offshore wind farms
Institutional CSR Sustainability To us, sustainabilityis a way of doing business
Dialectic CSR Global Agenda As an energycompany, wefind ourselves at thecrossroads between two apparentlyirreconcilablechallenges-
theenergy crisis, and the climate crisis
Political role of the firm Access Millions of people theworld over havea legitimateambition to risefrompoverty an raise their standard of living
Development To develop a strong performanceon HSE and social indicators such as local development and human rights
Rights improvements (both development & rights)
Political engagement To us sustainability is a wayof doing business. We believe that stricter regulations will makeit a profitableinvestment
2 Nordea Strategic CSR Operationalization In 2009 we have improved the waywerun our business byworking smarter not harder; it is more environmental
Bank friendlynow than a year ago and we use less energy in our main buildings and produce less CO2 emissions
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Strategic Link In Nordea we believe that responsible business is a prerequisite for sustainable results
Shared Value CSRshould be an integral part of every organization that wants to build strong relationships with its customers and
have the acceptance of thesocieties in which it operates
Leadership on CSR Business owns and drives CSRin Nordea
Institutional CSR CSR We hope wecan describeour commitment to CSR in a clear and interesting way. Thegoals for 2009 wereto ensure
theenvironmental-friendliness of our own operations and to integrateCSR with our internal processes.
Stakeholder dialog We learned that the report is of interest to a wide audience: students, customers, employees, shareholders, analysts
and Non Governmental Organizations (NGOs). We aregrateful for your interest and hope that wecan describeour
our commitment to CSR in a clear and interesting way
Dialectic CSR Global Standards During 2009 we continued to work according to the international standards wevoluntary signed years ago and the
consequential procedures theyentail.
Political role of the firm Access There aresections on improved accessibility, education, data gathering, materials management, product energy
efficiency and thevarious environmental services availablethrough mobiledevices.
3 Nokia Strategic CSR Operationalization We regularly evaluate the useof water and materials, as well as our carbon dioxide emissions across thesupply chain
Reputation This year Nokia was chosen as the“World Technology Supersector Leader.” This honor means Nokia was ranked No 1
in sustainability across the entireglobal technologysector on the basis of a detailed corporate sustainabilityanalysis
Strategic Link We havebeen working hard to rebuild our R&D organization and define new ways of working
Leadership on CSR At Nokia we striveto lead in sustainability bytaking it into account in everything wedo.
Nokia was ranked No. 1 in sustainability across theentireglobal technology sector
Institutional CSR Sustainability Nokia has a long track record of taking sustainabilityinto account in the waywedo business every day
Stakeholder dialog We would welcome your views on our sustainability performanceand this report
Dialectic CSR Global Standards After several years favorablerating bythewidely recognized Dow Jones SustainabilityIndexes […]in the process of
developing this report, we havereferred to theguidanceand requirements of the Global Reporting Initiative (GRI) and
UNGlobal Compact reporting guidelines
Accountability In 2009, wereduced our facilities’ CO2 emissions by 12 percent, compared with levels in 2006. During the same year,
we also reached theenergy savings target we had set to reach by 2012
Global Agenda Opportunities to cut greenhousegas emissions and address global warming.
Focus on the issue We havefurther broadened our environmental focus areas, with water and biodiversity issues growing in importance.
In 2009, wecontinued to look at reducing the environmental impact of our devices and operations
Social contribution We believethat better useof information and communication technologies can contributein a big way to economic
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growth whileoffering considerable opportunities to cut greenhousegas emissions and address global warming
4 Telia Strategic CSR Strategic Link TeliaSonera’s core business is to provide peopleand businesses with opportunities to communicate with each other
Sonera and connect to the rest of the world in an easy, efficient and environmentallyfriendly way
Governance We havestarted theimplementation of a group-wideCode of Ethics and Conduct, to provide guidance for all
employees in our day-to-daywork
Shared Value Corporateresponsibility is important to us, becauseit creates valuefor our customers, employees and our shareholders
Leadership on CSR TeliaSonera’s vision is to be a world-class service companyand contribute to a world with better opportunities for.
people and business
This is theonlyway wecan reach our goal of becoming a world class servicecompany and a good corporate citizen.
Institutional CSR Stakeholder dialog We havea group-wide approach, engage in stakeholder dialogueand aimfor continuous improvement
Sustainable growth Our services drivegrowth, competitiveness and contributeto a more open society, byproviding possibilities for more
people to communicate
Dialectic CSR Global Standards I amalso pleased that wehave regained our position in theglobal FTSE4Good responsibleinvestment index
Citizenship It is essential that Telia Sonera is regarded as a responsible employer -a good corporatecitizen-
Political role of the firm Rights We haveto deal with important and sensitiveissues in our daily work – ranging fromfair business practices – to
freedomof speech – and theright to privacyand integrity
5 Ericsson Strategic CSR Operationalization In shifting fromproducts to services, with today's technologyand know-how, wehave thepotential to affect climate
changepositivelyin ways that could not have been imagined few years ago.
Innovation Also in 2009 we developed a new framework to help our customers meet their energyand CO? , called TCO?. It intro-
duces carbon metrics into a total-cost-of-ownership (TCO) methodologythat allows operators evaluatethe carbon
intensity their networks whilemaking economical network investments decisions.
Reputation As themarket leader in telecom, we know we have a huge role to playin addressing these challenges, but this
responsibilityis also a business opportunity
Strategic Link We see our technology having the power to createa moresustainableplanet
Governance Our Code of Conduct and Code of Business Ethics are regularly assessed, making sure weare on track wherever weare
in the world
Shared Value I ampersonallycommitted to continuing the sustainableapproach we have employed for manyyears. But this is not
about sustainabilityand corporateresponsibilityjust for thesake of it. It is about creating long-termshareholder value,
building the brand, and engaging with customers and employees.
Institutional CSR CSR When it comes to corporateresponsibility, our unique global management systemensures that we apply the same
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standard in every market in which weoperate
Sustainability I ampersonallycommitted to continuing the sustainableapproach we have employed for manyyears. But this is not
about sustainabilityand corporateresponsibilityjust for thesake of it. It is about creating long-termshareholder value,
building the brand, and engaging with customers and employees.
Stakeholder dialog We areworking with key stakeholders in the industry to makea mass market product that will connect phones, PCs and
wall screens at a fraction of the current cost and with less complexity than today's telepresence systems
Dialectic CSR Global Standards We remain stronglycommitted to theUN global Compact principles
Accountability It is also vitally important that wekeep our own company, and the industry's carbon footprint, in check. In 2009 we
achieved our carbon-footprint-reduction targets, meeting our portfolio-efficiency aims.
Partnership We aregoing to work with governments and other industries, using telecommunication to reduce CO? emissions
We will be part of ICT-related work for StockholmRoyal Seaport, a sustainable city project that aims to befree of
fossil fuels by2030 and cut carbon emissions to less than 1,5 tones per person by 2020.
Global Agenda The MillenniumDevelopment Goals and our work in the MillenniumVillages in sub-Saharan Africa continue to be
Inclusivity among our corecommitments. Thesupport weprovideis not in theformof charity, but rather through technologyand
Focus on the Issue competence, and is built on a sustainablebusiness case
We envision that video communication will be available anywhere, anytime, to everyone;
Social contribution We see the effect telecommunications is having in alleviating poverty.
Access to communications has a positiveimpact on GDP and socioeconomic development;
Political role of the firm Access The link between access to communication, GDP growth and poverty reduction is well documented. Access to commu-
Development nications has a positive impact on GDP and socioeconomic development; a 10%increasein mobile penetration leads
to a 1,2%GDP increase in developing countries. And weseeaccess to communication as a basic human right.
Rights Our technology, solutions and services strengthen access to basic human rights: the right to health, education and the
right to earn a livelihood. And weseeaccess to communication as a basic human right.
Political engagement By 2020, we see a world with 50billion connected devices. But to reach that vision, we need open standards and
interoperatibility. If we don't drive down costs, billions of peoplewill be left out of global conversations
6 Danske Strategic CSR Operationalization We stayed focused on ensuring good, flexible working conditions to all our employees
Bank Strategic Link We kept working to integrate CRin our corebusiness
Institutional CSR CSR Continuing commitment to CR, exercising corporateresponsibility remains pivotal in theDanske Bank Group's business
model
Dialectic CSR Accountability In December 2009 we met an important goal byattaining carbon neutrality
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Partnership We worked together with tradeunions to mitigatethe number of layoffs
Global Agenda The achievement coincided with the UN ClimateChangeConference in Copenhagen (COP15) and sent a strong signal
about our ongoing commitment to mitigating climate change
7 Fortum Strategic CSR Operationalization In power and heat production, our strengths arein our production portfolio that supports sustainabilityand utilizes re-
newable and low-carbon energysources
Innovation The realization of Loviisa 3 as a combined heat and power plant offers an unprecedented opportunityto even further
reduceCO? emissions
Reputation Fortum's reputation has improved and our investments in sustainability have received recognition
Institutional CSR Sustainability In power and heat production, our strengths arein our production portfolio that supports sustainabilityand utilizes
renewableand low-carbon energysources
Stakeholder dialog I would liketo thank our employees for their dedication and willingness to makeFortuman even better companyin the
challenging operating environment. Thanks arealso owed to our customers and partners for a successful year
Dialectic CSR Accountability Fortumis well positioned to respond to future challenges because sustainability is oneof our cornerstones, and as
much as 91%of our power generation in the EU is CO? free
Global Agenda Increasing the efficiencyof the energymarkets and responding to the challenge of climate change require market-
driven integration and a coherent energy policy. The importanceof reducing emissions is recognized globally
Focus on the issue Increasing the efficiencyof the energymarkets and responding to the challenge of climate change require market-
driven integration and a coherent energy policy
Social contribution A European-widewholesale market for electricity benefits everyonebecause it increases competition, improves secu-
rityof supply, and enables the achievement of climate goals at the lowest possible cost for society
Political role of the firm Political engagement Harmonizing the various national support systems would be central, sincethe energy market is no longer national or
regional but increasinglyEuropean
8 Novo Strategic CSR Operationalization At the same timewehave reduced CO? emissions through greater efficiency and a new partnership model that helps
Nordisk drive themarket for renewableenergy
Innovation This new generation of insulins has the potential to offer better treatment for peoplewith diabetes and further
strengthen Novo Nordisk's competitiveposition
Reputation Global values for global growth. In theinsulin market we havemaintained our position as the world leader with a
market shareof morethan 50%byvolume
Institutional CSR CSR Managing responsibly. As we see it, a business can only be sustainablein the long termif it meets stakeholders'
Sustainability expectations regarding social and environmental impact, in addition to delivering strong financial performance. This is
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thecoreof our TripleBottomLineapproach.
Philanthropy Our long termfinancial commitment to the World Diabetes Foundation, a leading funding body devoted solelyto projects
within diabetes care and prevention in the developing world
Stakeholder dialog A business can only besustainablein the long termin it meets stakeholders' expectations regarding social and envrion-
metal impact, in addition to delivering strong financial performance
Sustainable growth As we grow and globalizeour business, it is critical that all employees develop a deep understanding of the principles
at the heart of Novo Nordisk Wayof Management, which describes our vision, our values, our commitment and our
policies, and thereby guides all of our actions. Continual training is necessaryas our business grows and attracts new
people and as the regulatory environment and global norms change
Dialectic CSR Accountability We havedecoupled growth in CO? emissions from business growth. By the end of 2009, emissions from pro-
duction had fallen below the level of the2004 baseline year
Partnership Our long-termfinancial commitment to the World Diabetes Foundation, a leading funding body devoted to solely
projects within diabetes careand prevention in thedeveloping world
Global Agenda We think that, viewed retrospectively, theoutcomeof the meeting, the Copenhagen Accord, will proveto bea turning
point in thecommitment to curb man's impact on theclimate
Inclusivity We believethat wehavean obligation and an opportunityto develop new and better therapies both for inhibitor
patients and for general hemophilia patients as well as other patients with rarecoagulation disorders
Social contribution Our products are our greatest contributions to society. They provide significant benefits to patients, tangiblyimproving
people's health
Political role of the firm Access We havecontinued our efforts to expand access to diabetes care throughout the world as a company and via theWorld
Diabetes Foundation. Our approach to improving access to diabetes carein developing countries
Our commitment to supply life-saving insulin at reduced cost in the poorest countries of the world
Political engagement As a global business, weneed a long-termand global framework to make decisions about our future operations. We
would thereforehave preferred clear targets for CO? emissions fromtheCOP15 meeting in Copenhagen in Dec 2009
9 H&M Strategic CSR Operationalization Like everything else at H&M, our sustainabilityagenda is based on a drive for continuous improvement. Ultimately, our
entire value chain has to be leaner, smarter and moresustainable than that of our competitors
Innovation We also continueto look for ways to limit theenvironmental impact of our products, for example using and trying out
new sustainablematerials
Strategic Link H&M strives to be a sustainablebusiness- financially, sociallyand environmentally. If weare to continuebeing a
successful company, webelievethat integrating sustainablethinking into everything that we do is absolutelynecessary
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Governance Therefore, implementing our Code of Conduct remains at the heart of our sustainabilityagenda
Shared Value We aremoving towards sustainability becoming a shared responsibility.
Institutional CSR CSR We aimto be a more sustainablealternativeby offering products that havebeen made under good working conditions
and with limited environmental impact
We areconstantly looking for ways to bea moreresponsible company
Sustainability Continuous improvement, as for everything wedo, has been at theheart of our approach to sustainability fromthe
beginning. Weareconstantlylooking for ways to be a more sustainable company- and to integrate sustainable thinking
into all thedecisions we make
Stakeholder dialog At the same timecustomers, employees, investors and others -rightfully- demand that weimprove working conditions
in our supplychain
Dialectic CSR Global Standards Given our commitment to being a responsiblebusiness, it is natural that we continueto support theten principles of
theUnited Nations Global Compact
Accountability At H&M wehavedecided to step up our efforts in thenext three years to further increase energyefficiency and
reducecarbon emissions
Global Agenda I signed the Copenhagen Communiqué to encourage theworld's leader to agree on an ambitious climatedeal
Social contribution I think thegreatest contribution H&M makes to the communities wherewe operateis thejobs that we help create
Political role of the firm Political engagement We havea responsibilitytowards everyone who contributes to our success, and weneed to make surethat weuse our
planet's resources wisely
10 SCA Strategic CSR Operationalization Are weusing the appropriate technology? How can weminimisethe products' environmental impact? Can wefind new
Innovation ways to distributeour goods? One exampleof innovation is ESAVE, SCA's Group-wideprogramme to reduceenergy
usage and environmental footprint. Byinvolving employees in thework since theproject's inception in 2003, approx.
900 small-scaleprojects havebeen executed, resulting in significant reductions in energy consumption and CO? emissions
Strategic Link Sustainability is verymuch a global issueand influences all aspects of enterprise, fromcapital to employees, customers
and suppliers
Institutional CSR Sustainability It has becomeevident that theissue of sustainabilityhas taken on a new guise. It is no longer a matter of legislation or
image, or indeed can it be reduced to emissions or resources. Sustainabilityissues cannot be traced separately; theyare
now thehub fromwhich thefuturedevelopment of our society -and our world- will emanate
Stakeholder dialog SCA is a global companywith operations in about 100 countries and our business has a broad interface with all types
of stakeholders. During theyear, wereceived acknowledgement that thesestakeholders appreciate our way of working
with sustainability
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Sustainable growth For SCA, sustainabilityinvolves viewing our business froma global perspective and being prepared to rethink deep-rooted
beliefs and methods of approach
Dialectic CSR Accountability The growth in SCA's well-managed forests exceeds harvesting, which means that theyabsorb 2,6 million tonnes of
carbon dioxide net on a annual basis. This almost corresponds to the carbon emissions fromSCA's entire production
Global Agenda Climate change has established itself at thetop of theenvironmental agenda in recent years- a situation that will remain
for theforeseeable future, sinceit ultimatelyinvolves our survival
Focus on the issue One exampleof innovation is ESAVE, SCA's Group-wideprogramme to reduce energyusageand environmental footprint
Political role of the firm Political engagement The business community holds a number of keys that can help resolve theissue, which is especiallyrelevant at a time
when the governments of theworld are finding it difficult to agree upon common targets
11 A.PMoller Strategic CSR Operationalization We areworking on theissues of labor relations, responsibleprocurement and anti-corruption, and now embrace thesust-
ainabilityagenda in our work and reporting
Innovation New innovativetechnologies will continue to reduceboth costs and environmental impact
Strategic Link Getting all theelements of sustainability integrated into current business models takes time, but each we make progress
Institutional CSR CSR We want to bea profitable, responsibleand sustainablebusiness
Stakeholder dialog We reported detailed performance data for each business unit, providing our stakeholders with more insight
Dialectic CSR Global Standards We signed up to the UN Global compact
Accountability In 2009, theGroup cut its total GHGemissions byalmost 7%compared to 2008
Global Agenda We innovateand are committed to help fight against climate change
Political role of the firm Political engagement We recognize that global problems require global solutions, and wewill continue to work in relevant forums to help drive
adequatepolitical responses
12 SEBGroup Strategic CSR Operationalization We arealready doing work in the area of sustainable financeand investments, as presented later on in this report. Let me
just mention theWorld Green Bonds, where SEB as the financial intermediary is supporting thebuild-up of moresustain-
able economies in developing countries
Strategic Link The greater challengewill beto make sustainabilitya fully integrated part of our business - making it a core capabilityfor SEB
Institutional CSR CSR We must meet increasingly higher expectations on responsible corporatebehavior if we want to remain successful
Sustainability We aimto build a sustainablebusiness for the long term: supporting our customers; continuing to valueour people and
being an innovative financial partner
Dialectic CSR Global Standards We thereforealso continue to support UN Global Compact
Accountability At SEB, weraised our sustainability ambition significantly during 2009, addressing both our own footprint management
and business practices throughout theGroup
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We decided, among other things, to reduce our carbon footprint by45 per cent until 2015
Global Agenda After theUN Climate Conferencein Copenhagen in December it has become increasingly clear that businesses havea keyrole
roleto play in delivering on public expectations of change
Social contribution The World Bank Green Bonds, whereSEB as the supporting the build-up of moresustainable economies in developing
Political role of the firm Development countries
Political engagement As a Nordic bank with largecorporate, small and medium-sized enterprises, institutions and private individuals among our
customers, our business carries impact in manycountries and local communities
13 Volvo Strategic CSR Operationalization By focusing on developing increasinglymoreenergy-efficient engines and complete vehicles that can operateon
renewablefuels and byintroducing hybridisation we aretaking a lead in the market
Reputation This vision shows our increased ambition for the futureand the responsibility wetakeas one of the world's largest
manufacturers of commercial vehicles
Strategic Link Our values and commitment to sustainabilityare, and will continueto be, reflected, promoted and implemented in Group
strategy, decisions and actions
Governance It also shows our commitment to theprinciples of the United Nation's Global Compact initiative and in our Code of Conduct
Shared Value Sustainability efforts are an important component of theVolvo Group's competitiveness and our ability to create value for
customers, shareholders and futuregenerations
Institutional CSR CSR This vision shows our increased ambition for the futureand the responsibility wetakeas one of the world's largest
manufacturers of commercial vehicles
Sustainability This report gives you a view of our strategies and commitment to sustainabledevelopment
Stakeholder dialog To promotesustainable transportation solutions, several stakeholders must partner and work towards a common goal
Dialectic CSR Global Standards It also shows our commitment to theprinciples of the United Nation's Global Compact initiative
Partnership In order to create sustainablemobilityit is necessary to cooperatewith different actors in society. That is whywe are
participating in a number of projects for theadvancement of futuretransports
Global Agenda Rising fuel prices have a largeimpact on our customers' economyand thenecessity of combating climate change becomes
increasinglyurgent
Social contribution The Group's products and services contribute to thedevelopment of society
Political role of the firm Political engagement We can offer the necessarytechnology, but we cannot create sustainabilityalone. Weneed to find moreefficient ways to
pool resources fromindustry, government and academia to address themajor environmental and societal challanges we
are facing
14 Atlas Strategic CSR Operationalization They havebeen designed taking human and environmental aspects into consideration in process of increasing productivity
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When wesay we arecommitted to sustainable productivity, it means that we do everything wecan to ensure reliable,
lasting results with a responsible use of resources; human, natural, and capital
Innovation We launched manynew and upgraded products, such as rollers for road development with reduced fuel consumption
and ergonomically developed battery-powered screwdrivers. We also announced that a rangeof oil-free compressors, with
heat recovery equipment, is thefirst in theworld to be certified for 'net zero energyconsumption'
Reputation Our work to reducetheimpact of HIV/AIDSin South Africa was recognized with the Swedish WorkplaceHIV and AIDS
Proramme/SWHAP) Achievement award
Strategic Link Reaching thebest results begins with having a solid strategy that includes analyzing our performanceon theeconomical,
social and environmental levels
Institutional CSR CSR When wesay we arecommitted to sustainable productivity, it means that we do everything wecan to ensure reliable,
lasting results with a responsible use of resources; human, natural, and capital
Sustainability Sustainability is therefor not an optimal add-on, but a routeto prosperityfor Atlas Copco
Stakeholder dialog We do thesethings because webelievethe sustainabledevelopment of Atlas Copco will benefit all our stakeholders
Sustainable growth Atlas Copco is prepared for sustainable, profitablegrowth
Dialectic CSR Accountability Oneclear outcome is that initiatives to introduce more environmental friendlyenergy sources resulted in a decreaseof
Global Agenda CO2 emissions
Social contribution Our work to reducetheimpact of HIV/AIDSin South Africa
Political role of the firm Political engagement Given this opportunity to reduceCO2 emissions, one might wonder whyit is not as natural with governments incentives to
modernizemanufacturing morerapidly, as it is with stimulus packages to invest in alternativeenergysources
15 Yara Strategic CSR Operationalization We established a compliancefunction in order to coordinate our efforts to uphold ethical and responsible business practices,
and in early 2010 welaunched thenew Yara Ethics Programproviding practical adviceand support for employees
Innovation Yara also launched its Yara Crop Nutrition concept, encouraging a shift fromtraditional soil management to tailored
crop management. Increased precision, through delivering nutritients to crops according to specifics needs, enhances
farmers' profits and benefits local environments
Reputation Yara has also a leading industryposition in safety
Governance We established a compliancefunction in order to coordinate our efforts to uphold ethical and responsible business practices,
and in early 2010 welaunched thenew Yara Ethics Programproviding practical adviceand support for employees
Dialectic CSR Global Standards Our commitment to the UN Global Compact
Global Agenda We view ourselves as a key stakeholder striving to enable more efficient crop production, in order to address several
challenges facing mankind: scarcityof water and croplands, pressure for increased foor production while preserving areas
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of biodiversity and limiting greenhouse gas emissions
Social contribution We presented an investment blueprint for the Beira Growth Corridor in Mozambique. In addition to kick-starting
agricultural markets, analyses suggest living conditions for as many as onemillion peoplecould improve
Political role of the firm Political engagement We can support legislators in pursuing solutions, through delivery of our expertiseand technology. We view
ourselves as a keystakeholder striving to enablemore efficient crop production, in order to address several
challenges facing mankind: scarcityof water and croplands, pressure for increased foor production while preserving
areas of biodiversityand limiting greenhousegas emissions
16 Skanska Strategic CSR Operationalization There is enormous potential for us in this field, and weare taking a new aggressive step to generatemore green business.
Our Green Business Officer will further refine our green construction portfolio and activelydemonstrate its advantages to
customers
Dialectic CSR Global Agenda The climate change issuerequires action. Thepotential for and interest in green construction aregrowing. Skanska
is needed for the environment and for building social infrastructure
17 Orkla Strategic CSR Operationalization The Group has increasinglyestablished common standards to ensure more uniformpractices in areas such as EHS, food
safetyand supplier monitoring
Strategic Link Work on revising and further developing theGroup's common guidelines and systems relating to ethics and corporate res-
Governance ponsibility will continuein the years ahead. Theseefforts will also strengthen the Group's long-termcompetitiveness
Institutional CSR CSR A strength of Orkla's corporateresponsibilitycommitment
Sustainability How to ensurea sustainable development of society that safeguards theneeds of both present and future generations
in a satisfactory manner. In order to earn society's trust, wemust ensureOrkla's activities createpositiveripple
effects and contribute to desirable social development
Stakeholder dialog The abilityto understand the needs of customers, employees, shareholders, authorities and other stakeholders, and to res-
pond effectivelyto theseneeds, is crucial to achieving long-termtrust and profitability
Dialectic CSR Accountability The Group has increasinglyestablished common standards to ensure more uniformpractices in areas such as EHS, food
safetyand supplier monitoring
Global Agenda The financial crisis and climate challenges havegiven rise to renewed debateabout how to ensure sustainable
development
18 Vestas Strategic CSR Operationalization Vestas is intensifying its efforts to enhancesafety, reduce our environmental footprint and useof Earth's resources
in order to strengthen our reputations as a responsible employer and competitivecollaboration partner
Innovation We haveannounced new wind turbines for theonshoreand offshore segments
Reputation In order to strengthen our reputations as a responsibleemployer and competitivecollaboration partner
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Dialectic CSR Accountability Vestas is intensifying its efforts to enhancesafety, reduce our environmental footprint
Global Agenda COP15 did not turn out to betheglobal and supranational climate breakthrough that Vestas has hopefor
Political role of the firm Political engagement Vestas will continueto promotea fixed price of CO2 which would give theenergy sector thepredictabilityrequired to carry
out the largescale investments in infrastructure. Over the next 25 year, an increasein the global population of two billion
people will raisethe priceof fossil fuels, thereby adding further strength to thecompetitiveness of modern energy.
19 TDC Strategic CSR Operationalization Finally, weare committed to bolstering our winning culture, increasing leadership capabilities and improving
employee motivation and productivityacross the organization
Shared Value
We can do much more to further improveour business and create added value for all our stakeholders: customers,
employees,
shareholders and the communities in which we operate
Institutional CSR CSR We reinforced our commitment to social responsibility
Dialectic CSR Global Standards We committed to the UN Global Compact
Accountability We commit to increasing energyefficiency by15%annuallyand reducing our CO2 emissions by5%by2014
Partnership We reinforced our commitment to social contribution byjoining forces with the Red Cross on providing IT and telecommuni-
cations facilities in disaster scenarios
Social contribution TDCwill continue to punch thetechnological boundaries to benefit our residential and corporatecustomers and societyat
large
Political role of the firm Political engagement TDCplayed a crucial rolein facilitating the industrial revolution and sub sequentiallyin the digital transformation of
Denmark, and wecontinue to assume our role and responsibilityas the backboneof Denmark's world-leading
communications infrastructure
20 Swedbank Strategic CSR Operationalization Our efforts to help fight unemployment among young peoplestarted lass autumn, are an exampleof our heritage
of taking social responsibility
Institutional CSR CSR Are an exampleof our heritageof taking social responsibility
Sustainability More actors have to act moreresponsibly through theentire business cycle, and lending must beapproached froma more
a more long-term, sustainableperspective
Stakeholder dialog Our aimis to be open, accessible and transparent to all our stakeholders and everyonewho influences our image
Dialectic CSR Accountability Transparency and regulations areneeded in everypart of thefinancial industry
Our aimis to be open, accessible and transparent to all our stakeholders and everyonewho influences our image
Political role of the firm Political engagement Since weare such an important part of every small town and big city wherewe operate, the needs of small business for
Capital, payment routines or advice, are not just purely business. What we do affects
the community, job opportunities, young people’s future confidence, cultural
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activities an sports
21 Electrolux Strategic CSR Operationalization Electroluxhas a three-part climatestrategythat connects a crucial causewith good business. It focuses on climate-smart
products, communicating their benefits and streamlining energyuse in our own operations
Innovation Our business success is interconnected with innovating energy-savvy, resource-efficient appliances
Strategic Link Our business success is interconnected with innovating energy-savvy, resource-efficient appliances. Embedding
high social and environmental standards throughout our daily operations is a crucial part of doing business well
Institutional CSR CSR Our performance this year demonstrates that by helping shapea moresustainablemarket, Electroluxcan makea positive
contribution and generate benefits to thebottomline
Sustainability In 2009, welaunched our vision and valued programin part to further integratesustainability into our business culture
Stakeholder dialog Seeking the opinions of our stakeholders and sharing ideas with themallows us to better understand these changes
Stakeholder engagement is a key focus area for us as wemoveforward
Dialectic CSR Accountability We exceeded our 2009 target to reduceenergy use by15%compared to 2005
Global Agenda Climate is oneimportant topic on our agenda
Political role of the firm Political engagement Getting peopleto switch to the most resource efficient products remains a key challenge. Cutting-edge products
alreadyin themarket can help us lead moreclimate-smart lives. What's needed arestrong markets frameworks,
including a global price on carbon emissions and financial incentives for consumers to purchaseenergy-lean appliances
22 KONE Strategic CSR Operationalization Investing in peopleleadership skills and training in general has helped us keep up a good spirit and a can-do attitude.
Innovation Another innovation is the KONE IDF300TM solution that integrates automatic building doors and elevatos enabling a safe
and easyhands-freeaccess to the building
Strategic Link Economic responsibilityfor KONE means creating valuefor our stakeholders through long-termgrowth in sales and profits
Leadership on CSR KONE wants to be a part of finding solutions to these challenges byaiming to be the eco-efficiency leader in the industry
Institutional CSR CSR We strivetowards excellence in all areas of corporate responsibility, including economic, environmental and social
Sustainability Our performance in 2009 demonstrates our strong commitment to conduct our business in a responsibleand sustainable
manner at all times
Sustainable growth Economic responsibilityfor KONE means creating valuefor our stakeholders through long-termgrowth in sales and
profits. Valuecan onlyachieved by continuously developing our competitiveness in a sustainableway
Dialectic CSR Accountability Our Environmental Excellence development programincludes actions to strengthen KONE's innovation leadership in the
area of eco-efficiency and to minimizeKONE's carbon footprint.
Global Agenda The most significant carbon dioxide impact of our operations relates to our car flee, electricityconsumption and logistics
23 Norsk Strategic CSR Operationalization And throughout thevalue chain, we will look for opportunities to minimize thecarbon footprint of aluminium-
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Hydro and of Hydro. In our own primary production as well as in products that help our customers reduce their emissions
and their energyconsumption
Dialectic CSR Global Standards Hydro is affiliated with theUnited Nations Global Compact
Accountability There arestill obstacles to overcome before we can implement a brand-new cell technologyproducing zero-emissions
aluminum, but every daywe aremaking progress in our determined efforts to save energy, emissions- and costs
Global Agenda Meeting thechallenges of climate changewill demand morealuminumand smart, energy-efficient solutions
Political role of the firm Political engagement Ever since Hydro 105 years ago, we have transformed scientific knowledgeand natural resources into products that help
create viablesocieties
24 Wartsila Strategic CSR Operationalization Environmental considerations favor investments into renewablepower sources and the active search and explora-
tion of natura resources, particularlyin Africa, requires electricity. Wartsila's technology is well positioned to
respond to theneeds arising fromthesetrends
Dialectic CSR Focus on the issue We consider it our obligation to continuedeveloping products and services that radically reducethelevel of emissions
to both air and the sea. Improved ship design, more efficient engines and propulsors, useof gas as fue, and optimized
flexiblepower plants solutions all contribute to a more sustainable environment.
25 StoraEnso Strategic CSR Operationalization We makegreat products using renewableand recyclable raw materials- products can makea real difference for
our customers
Institutional CSR CSR I would also liketo highlight another challenge- our social responsibility - both at home ad in thenew growth markets
Sustainability We makegreat products using renewableand recyclable raw material - products that can makea real difference for our
customers, for their customers, for consumers and for the planet
Stakeholder dialog Like most other corporations we stress that we favor open dialoguewith all stakeholders
Dialectic CSR Global Standards I had thehonor to sigh the UN Global Compact's CEO Water Mandate
Citizenship The impacts of our operations in Latin America and China on local communities arequitedifferent than in our traditional
home base, as thesocial, economic and cultural contexts areso different. To besuccessful in these societies in the long term
as a company and as individual people, we need to beeven more transparent, moresharing and moreprepared to learn
Accountability We need to be even more transparent, more sharing, and moreprepared to learn
Global Agenda I had thehonor to sigh the UN Global Compact's CEO Water Mandate, to show Stora Enso's strong commitment as a com-
panyto make sustainablewater use a real priority
Political role of the firm Political engagement Together with the local and national authorities we need to start looking for new alternatives a lot earlier
26 Tele2 Institutional CSR Stakeholder dialog Our ambition was to createa dynamic, open and accessibleforumfor our customers, shareholders and other stakeholders
Dialectic CSR Focus on the issue Tele2's business is built on facilitating and promoting communication between people. Weare essentially in thebusiness
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of making communication easy
27 Neste Oil Strategic CSR Operationalization We haveput a lot of work into ensuring that theraw materials we useare produced responsibly
Innovation Neste Oil's proprietary NExBTL renewable diesel will be one of our biggest competitiveadvantages. NexBTL generates
lower levels of tailpipeemissions and reduces greenhousegas emissions byas much as 40-80%compared to
fossil diesel
Reputation Neste Oil became one of theworld's largest users of certified palmoil in 2009
Leadership on CSR As theworld's cleanest and best diesel, NExBTL is set to be increasinglyimportant financiallyfor us and bublicly
committed ourselves to using only certified palmoil as soon as possible
Institutional CSR CSR We arecommitted to responsible principles in all our operations worldwide
Sustainability Sustainabledevelopment will continueto bevery important for us as we go forward, and we intend to maintain our
activerolein developing norms and systems to promotesustainability
Stakeholder dialog I believethat the central principles of our changeprocess - fromcustomer focus to common ways of working - havebecome
familiar to our personnel and to our stakeholders as well
Dialectic CSR Accountability NExBTL generates lower levels of tailpipeemissions and reduces greenhouse gas emissions by as much 40-80%compared
to fossil diesel
Partnership We playan activepart in organizations such as theRoundtable on sustainable palmoil and maintain close contacts
with political decision makers and other opinion leaders
Global Agenda This makes it an excellent means for reducing emissions and combating climate change
Political role of the firm Political engagement We playan activepart in organizations such as theRoundtable on sustainable palmoil and maintain close contacts
with political decision makers and other opinion leaders
28 Storebrand Strategic CSR Reputation Our systematic customer satisfaction work has led to Storebrand topping theNorwegian Customer Barometer Survey
among Norwegian customers in theoccupational pensions market for sixyear in a row
Institutional CSR Stakeholder dialog A good dialog with thecustomers, simpler and more understandable products, efficient and customer-friendly
service solutions, and competitive conditions arekeyelements of this work
Dialectic CSR Accountability The most important thing of all is to ensurea transparent and trust-building dialoguewith our customers
Political role of the firm Political engagement Storebrand is an active prime mover in relation to theNorwegian and international authorities when it comes to develo-
ping regulations and a framework for the industrythat areappropriate for both customers and companies
29 SKF Strategic CSR Operationalization We arealready gaining new enquiries, development projects and business dueto our growing rangeof energy-efficient
solutions
Innovation SKF Group won the Swedish Innovation Awards for its work on developing thenew familyof energy-efficient bearings
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During 2009 we launched over 20 new market offers to our customers
Reputation SKF Group won the Swedish Innovation Awards for its work work on developing the new family of energy-efficient bearings
The award as a leader in the Engineering Sector of the Dow Jones Sustainability Indexand the award for Folksamas the
best companyin environmental and human rights in Sweden
Strategic Link Our work in thearea of sustainability, which wecall SKF Care, continued during theyear and I believethis is increasingly be-
Institutional CSR Sustainability coming a competitiveadvantagefor the SKF Group
Dialectic CSR Global Standards The award as a leader in the Engineering Sector of the Dow Jones Sustainability Index
Accountability Theseinvestments arefocused on faster growing segments and geographies and on improving our total manufacturing
footprint
Political role of the firm Rights The award as a leader in the Engineering Sector of the Dow Jones Sustainability Indexand the award for Folksamas the
best companyin environmental and human rights in Sweden
30 Metso Strategic CSR Operationalization In technologydevelopment weare focusing on enhancing equipment performanceand energy efficiencyand minimizing
theuseof raw materials
Strategic Link For Metso, sustainabilityis thecoreof our strategy: Our goal is for environmentallyand sociallysustainable business.
Governance Our values, our Code of Conduct and the UN Global Compact initiative endorsealso guideall Metso employees towards
sustainable operations
Institutional CSR CSR For Metso, sustainabilityis thecoreof our strategy: Our goal is for environmentallyand sociallysustainable business.
Sustainability For Metso, sustainabilityis thecoreof our strategy: Our goal is for environmentallyand sociallysustainable business.
Sustainable growth We takesustainabilityinto account, as a whole in our business. Wewant to solve global problems actively and
comprehensiblyand thus createa foundations fromMetso's sustainable, profitable growth and for the continuous
well-being of our stakeholders
Dialectic CSR Global Standards Our values, our Code of Conduct and the UN Global Compact initiative endorsealso guideall Metso employees towards
sustainable operations
Political role of the firm Political engagement In theory, drasticallylowering our standards of living in the simplest wayto save the world froman environmental
crisis. However, cutting salaries in the western world and putting the brakes on escalating prosperity in theemerging
markets are likely to gaining much support. I personallybelieve that fastest result can beachieved through
technological advancements and byrenewing existing ways of operating
31 Alfa Laval Strategic CSR Operationalization In addition to new and efficient products, it is crucial that Alfa Laval's operations are continuously renewed and streamlined
Strategic Link Sustainability initiatives- part of Alfa Laval's dailybusiness
Institutional CSR CSR Alfa Laval is also governed by its environmental impact, social responsibility, business ethics and transparency
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Dialectic CSR Accountability An order received in 2009 fromone of Russia's largest refineries, whereAlfa Laval's energy-efficient heat ezchangers are
being used to minimizeenergy consumption, therebyreducing emissions byan amount corresponding to theemissions ge-
nerated byall passenger cars in Stockholmin one year, approximately 850,000 tons of CO2.
Global Agenda The Group's sustainability initiatives included continued efforts to reducecarbon emissions, the development of a new occ-
upational safety policyand an expansion of thesupplier development process
32 TrygVesta Strategic CSR Operationalization We havealready introduced reduced CO? consumption as a bonus parameter for the management team
Dialectic CSR Global Agenda But the agenda also includes other items, such as the Group's climate impact and behavior
33 Kesko Strategic CSR Operationalization We areimproving our energy efficiencyand reducing our emissions.
Reputation For years, wehave been included in the most important sustainabilityindexes and thelist of theGlobal 100 most Sustain-
able Corporations
Institutional CSR CSR In accordance with our responsibilityprogramme for 2008-2012, we are improving our energyefficiency and
reducing our emissions
Dialectic CSR Accountability Owing to carbon-free electricity, thecarbon dioxideemissions of electricity used in the K-group properties decreased by
59%in Finland in 2009
Global Agenda In unitywith our responsibility programfor 2008-2012,we areimproving our energy efficiency and reducing our emissions
34 DSV A/S Strategic CSR Operationalization During 2010, we will pursue a strategy which will involvea clear ambition of reducing our carbon footprint
Institutional CSR CSR We experienced an increased focus fromboth customers and shareholders on CSR matters
Dialectic CSR Global Standards We joined the United Nations Global Compact initiative
Accountability We can now identifytheoverall carbon footprint of DSV
During 2010, we will pursue a strategy which will involvea clear ambition of reducing our carbon footprint
Global Agenda DSV's impact on climate and environment caused by greenhouse gases, particulatematter, etc., has been closely measured
for years and wehavefurther expanded our work in this field so that wecan now identify theoverall carbon footprint of DSV
35 SSAB Strategic CSR Operationalization We areconsistentlyengaged in environmental improvement in our day-to-day operations. This year, we invested aproxi-
matelySEK 200 million in an exhaust hood at theworks in Ovelösund, Sweden which will substantially reducedust emi-
ssions fromour coking plant
Reputation SSAB was one of twelve examples of eco-efficient economy presented during the first meeting of theEU environmental
ministerial, during Sweden's Presidency
Strategic Link During 2009 we carried out moredevelopment projects with customers than ever, creating new uses for high strength
steels. This is good for us, our customers, and for theenvironment.
Institutional CSR Sustainability In order to further emphasize our desire to work to achieve a society which is sustainable in thelong term
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Dialectic CSR Global Standards We also decided to sign theUN Global Compact
Accountability In 2009, SSAB adopted a target that, in the coming years, emissions under normal production conditions will be reduced
by two percent per produced time
Partnership SSAB is a core member of theEuropean research consortiumin new blast furnacetechnology.
Global Agenda SSAB's production does impact theenvironment, among other things through emissions of carbon dioxide
Political role of the firm Rights SSAB has for many years worked in accordance with the Compact's principles including standards fir human rights, labor,
theenvironment and anti-corruption
36 Novozymes Strategic CSR Operationalization We mademoreefficient use of both energyand water in our production processes
Reputation We maintain our position as a world leader in bioinnovation
Strategic Link Sustainability is an integrated part of what we do and how we do it
Institutional CSR CSR Contributing to theenvironmental, social, and economic aspects of sustainable development has always been an
Sustainability integral of our strategy
Dialectic CSR Global Standards The requirements are linked to theprinciples of the UN Global Compact
Accountability In 2009, our products enable customers to save around 27 million tons of CO? emissions
Partnership Closer cooperation between governments and business would turn hopeinto action and pavethe way for concrete, sustain-
able solutions
Global Agenda Reduction of CO2 emissions is the top priority on the global agenda
Political role of the firm Political engagement Novozymes and WWF havecome together to encouragepoliticians to further the integration of biotechnologyinto
strategies for reducing climate change and to support theapplication of low-carbon biotechnology in industry
37 Boliden Strategic CSR Operationalization High levels of operational stability, with fewer operational stoppages, and good performances at thefilter installations have
helped reducemetal and sulphur dioxideemissions to air
Strategic Link The is of thecourse is to develop a moreresource-efficient and economical company- which will, in turn, enhance Boliden's
long-termcompetitiveness
Institutional CSR CSR Emissions and discharges of metals to air and water areamong Boliden's most important environmental responsibilities
Sustainability 2009 was in manyrespects a challenging year, but Boliden's sustainabilitywork has not lost ground
Dialectic CSR Accountability Discharges of metals to water fell by50 per cent in comparison with the base year of 2007
Global Agenda Other challenges, such as carbon dioxide emissions in conjunction with energyusageand responsibility for environmental
and social issues bybusiness partners arelargelyoutsidethescopeof Boliden's direct control, but areextremelyimportant
Social contribution Correctlyhanded, the eco-cycle of - and trade in - products and waste products can beof benefit to societyand reduce envi-
ronmental impact
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This thesis looks into how multinational companies differ when they communicate Corporate Social Responsibility (CSR) rhetoric strategies through corporate discourse. Through a rhetoric analysis of 74 executive letter included in annual or sustainability reports from firms located in Latin America and Scandinavia.
MASTER THESIS
MSc INTERNATIONAL BUSINESS (cand.merc.)
DEPARTMENT OF INTERNATIONAL ECONOMICS & MANAGEMENT
CSR rhetoric in Latin
America and Scandinavia
Authors: Ioana Blaga
Victoria Rodríguez
Surpervisor: Itziar Castelló
Department of Intercultural Communication and
Management Centre for Corporate Social Responsibility
(cbsCSR)
Pages: 119
Characters (with spaces): 251 019
17/08/2011
Executive Summary
This thesis looks into how multinational companies differ when they communicate
Corporate Social Responsibility (CSR) rhetoric strategies through corporate discourse.
Through a rhetoric analysis of 74 executive letter included in annual or sustainability reports
from firms located in Latin America and Scandinavia, we have reviewed how their written
discourses can be useful to identify which rhetoric strategy they communicate in relation to
their aim to legitimate their role as multinational businesses. We propose and determine the
existence of 4 types of rhetoric:
? Strategic CSR rhetoric, which is rooted in the economic pattern of the firm.
? Institutional CSR rhetoric, which is entrenched on the fundamentals of CSR theories.
? Dialectic CSR rhetoric aims to improve the dialog between firm and stakeholders.
? Political CSR rhetoric, based on the new political role of the firm and the
collaborations with Governments and civil society.
Each one of these rhetoric categories refers to a different form of legitimacy and is based on
distinct theories of the firm analyzed in this thesis. The pragmatic legitimacy is achieved
through the strategic rhetoric; the cognitive legitimacy through the institutional rhetoric;
and the moral legitimacy through the dialectic and political rhetoric. We claim that the
political rhetoric seems to signal a new understanding of the firm’s role in society and a
search for moral legitimation. However, this new form of rhetoric is still fairly uncommon
although its use is growing.
The business perspective on CSR is not only influenced by internal motivations and
deliberate insight, but is to a large extent guided by the way society defines standards of
acceptable social corporate behavior. Therefore, we also review the state of the national
business systems in both regions and as well acknowledge the perception of stakeholder
pressures toward. We also consider the globalization pressures and the getting closer trends
for CSR reporting.
By combining theory and business examples, this thesis could help managers and scholars in
the conceptualization of how firms understand their role in society and how they try to
differentiate themselves through their CSR rhetoric strategies.
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Table of Contents
1. Introduction ............................................................................................................................4
1.1 Research field ......................................................................................................................4
1.2 Research purpose ................................................................................................................6
1.3 Research question ...............................................................................................................7
1.4 Disposition ..........................................................................................................................7
2. Methodology...........................................................................................................................9
2.1 Preconceptions ....................................................................................................................9
2.2 Choice of Subject ............................................................................................................... 10
2.3 Research Perspective ......................................................................................................... 11
2.4 Research Approach ............................................................................................................ 12
2.5 Research Strategy .............................................................................................................. 16
2.5.1 Rhetoric analysis ........................................................................................................... 16
2.5.2 Thematic analysis as a coding method ........................................................................... 18
2.6 Sample and Data Collection Process .................................................................................. 19
2.7 Data analysis and coding process ....................................................................................... 21
2.8 Research Limitations.......................................................................................................... 22
2.8.1 Researcher bias ............................................................................................................. 23
2.8.2 Source critics ................................................................................................................. 24
3. Theoretical Framework ......................................................................................................... 25
3.1 Definitions of CSR .............................................................................................................. 25
3.1.1 Academic perspectives of CSR ....................................................................................... 25
3.1.2. Institutional factors influencing the scope of CSR .......................................................... 29
3.1.3. The scope of CSR in different regions ............................................................................ 30
3.2 CSR regional overview ....................................................................................................... 31
3.2.1 CSR in Scandinavia ........................................................................................................ 31
3.2.2 CSR in Latin America...................................................................................................... 34
3.3 Strategic CSR and Shared Value ......................................................................................... 35
3.4 Institutional Theory ........................................................................................................... 37
3.4.1 Review of formal and informal institutions .................................................................... 37
3.4.2 The National Business System ....................................................................................... 39
3.5 Global trends: neo-liberalism, neo-institutionalism and the political role of firm ............... 44
3.6 Legitimacy ......................................................................................................................... 50
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3.6.1 Pragmatic legitimacy ..................................................................................................... 51
3.6.2 Cognitive legitimacy ...................................................................................................... 51
3.6.3 Moral legitimacy ........................................................................................................... 52
3.6.4 Managing legitimacy in a globalized world .................................................................... 52
3.7 Reputation ........................................................................................................................ 54
3.8 CSR rhetoric strategies: Strategic, Institutional, Dialectic and Political ................................ 55
3.8 Summation of the theoretical framework .......................................................................... 58
4. Empirical Analysis and Discussion .......................................................................................... 61
4.1 Strategic CSR ..................................................................................................................... 65
4.1.1 Operationalization ........................................................................................................ 67
4.1.2 Innovation..................................................................................................................... 68
4.1.3 Reputation .................................................................................................................... 69
4.1.4 Strategic link ................................................................................................................. 70
4.1.5 Governance................................................................................................................... 71
4.1.6 Shared Value ................................................................................................................. 72
4.1.7 Leadership on CSR ......................................................................................................... 73
4.2 Institutional CSR ................................................................................................................ 74
4.2.1 CSR ............................................................................................................................... 77
4.2.2 Sustainability................................................................................................................. 78
4.2.3 Philanthropy ................................................................................................................. 79
4.2.4 Stakeholder dialog ........................................................................................................ 80
4.2.5 Sustainable growth ....................................................................................................... 81
4.3 Dialectic CSR ...................................................................................................................... 82
4.3.1 Global Standards ........................................................................................................... 84
4.3.2 Citizenship .................................................................................................................... 85
4.3.3 Accountability ............................................................................................................... 86
4.3.4 Partnership ................................................................................................................... 88
4.3.5 Global Agenda ............................................................................................................... 89
4.3.6 Inclusivity ...................................................................................................................... 90
4.3.7 Focus on the issue ......................................................................................................... 91
4.3.8 Social contribution ........................................................................................................ 92
4.4 Political CSR ....................................................................................................................... 94
4.4.1 Access ........................................................................................................................... 96
4.4.2 Development ................................................................................................................ 97
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4.4.3 Rights ............................................................................................................................ 99
4.4.4 Political engagement ..................................................................................................... 99
5. Concluding remarks ............................................................................................................. 102
5.1 Conclusion ....................................................................................................................... 102
5.2 Limitations....................................................................................................................... 108
5.3 Putting the paper into perspective: suggestions for future research ................................ 110
6. References .......................................................................................................................... 112
7. Appendix ..................................................................................................................................i
List of Tables
Table 1 Pragmatism as research philosophy in management research .............................................. 13
Table 2. Major differences between deductive and inductive approaches to research ...................... 14
Table 3. Explicit and Implicit CSR ....................................................................................................... 39
Table 4. Institutional, Strategic, Dialectic and Political Approaches to the Legitimization Process ...... 58
Table 5. Categories of rhetoric and themes' description .................................................................... 59
Table 6. Total number of themes mentioned under the Strategic CSR rhetoric category ................... 66
Table 7. Percentage of companies reporting in each category relative to the total number of
companies ........................................................................................................................................ 67
Table 8. Total number of themes mentioned under the Institutional CSR rhetoric category .............. 76
Table 9. Percentage of companies reporting in each category relative to the total number of
companies analyzed .......................................................................................................................... 76
Table 10. Total number of themes mentioned under the Dialectic CSR rhetoric category .................. 83
Table 11. Percentage of companies reporting in each category relative to the total number of
companies analyzed .......................................................................................................................... 84
Table 12. Total number of themes mentioned under the Political CSR rhetoric category ................... 95
Table 13. Percentage of companies reporting in each category relative to the total number of
companies analyzed .......................................................................................................................... 96
Table 14. CSR focus in Latin America and Scandinavia ..................................................................... 104
List of Figures
Figure 1. Carroll's four-part model of CSR.......................................................................................... 28
Figure 2. Comparison CSR rhetoric strategies, Latin America vs. Scandinavia ..................................... 63
Figure 3. Comparison CSR rhetoric strategies Latin America vs. Scandinavia ...................................... 63
Figure 4. Percentage of total number of themes mentioned by Latin American companies ............... 64
Figure 5. Percentage of total number of themes mentioned by Scandinavian companies .................. 64
Figure 6. Relative weight of each CSR category in relation to the total number of themes ................. 64
Figure 7. Total number of themes mentioned on the Strategic CSR rhetoric strategy ........................ 66
Figure 8. Total number of themes mentioned on the institutional CSR rhetoric category .................. 76
Figure 9. Total number of themes mentioned on the Dialectic CSR rhetoric category ........................ 84
Figure 10. Total number of themes mentioned on the Political CSR rhetoric category ....................... 96
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1. Introduction
This initial chapter will serve as an introduction to the subject of our master thesis,
Corporate Social Responsibility (CSR); and through it we intend to present the research field,
purpose and objectives of our study. At the end of the chapter we also present the
disposition and structure of the thesis.
1.1 Research field
Nowadays the field of corporate social responsibility (CSR) is clearly expanding and gaining
more attention not only from companies but also from scholars, governments or civil
society. CSR can be seen as a social and political phenomenon in its broadest sense
(Vallentin & Murillo, 2009). CSR is considered a necessity for business organizations to define
their roles in society and to adhere social, ethical, legal and responsible standards to its
economic procedures (Maon, Lindgreen, & Swaen, 2008). Carroll defines CSR as follows: “the
social responsibility of business encompasses the economic, legal, ethical and discretionary
[philanthropic or community leadership] expectations that society has of organizations at a
given point in time” (Carroll & Buchholtz, 2003, p. 40).
Within the worldwide sphere a number of initiatives have arisen to set different standards
according to businesses CSR practices. Sustainability reporting practices such as the Global
Reporting Initiative (GRI); indexes based on socially responsible investment criteria like the
Dow Jones Sustainability Index (DJSI) or FTSE4Good; sustainability reporting practices like
the Global Reporting Initiative (GRI); or membership in CSR communities such as the World
Business Council for Sustainable Development or the UN Global Compact (Gjølberg, 2009).
The United Nations (UN) in 2000 set the strategic policy “UN Global Compact” aimed to
encourage business to align their operations and strategies with a set of universal principles
in the areas of human rights, labor, environment and anti-corruption (Global Compact UN,
2010). Following this commitment businesses dealing in a globalized environment assist that
markets, trade, technology or finance advance in sustainable ways benefiting economies and
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societies in all places (Global Compact UN, 2010). Throughout the last decade the European
Commission has released several communications on CSR where a definition of CSR is given:
“Corporate social responsibility (CSR) is a concept whereby companies integrate social and
environmental concerns in their business operations and in their interaction with their
stakeholders on a voluntary basis” (European Comission, 2006, p. 2). For the European
Commission CSR can make a major contribution towards sustainability and competitiveness,
both in Europe and globally. (European Comission, 2006).
Taking into consideration that the global economy in the last four years has undergone
through the worst financial crisis since the great depression in the 1930s, concepts such as
sustainability and competitiveness are even more relevant to overcome the current crisis
and engage business to integrate their strategies with social or environmental concerns, and
this way legitimize their operations and recover their undermined reputation. This
commitment with CSR apart from a way to increase business reputation should be truly
understood as a way of doing business itself, meaning that CSR should be more than a mere
business strategy, but a way of sustainable business philosophy.
In sum, it is straightforward that CSR is more relevant than ever before in the context of the
global economic crisis, it will help building trust in business which is crucial to recover
business operations all over the world, and it can also redirect business to new forms of
value creation through addressing social or environmental challenges creating “shared
value” (Porter & Kramer, 2006; 2011).
It is clear the concept of CSR is very broad; there are many definitions and related concepts,
thus it may lead to confusion to understand the responsibilities of the firm, and so it can be
interpreted and implemented differently in any business. For example some business might
focus in philanthropic issues; while other business might focus on linking CSR with their core
business, which according to Porter & Kramer (2006) is strategic CSR.
It is important to underline that in a globalized world multinational companies need to pay
attention to social and environmental concerns in different countries or regions with
different regulations; which means they might attend legal environmental requirements for
instance in some countries or voluntary CSR actions in other. For the reason that firms are
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embedded in different national business systems, they will experience divergent degrees of
internal, external and lateral pressures to engage in CSR (Matten & Crane, 2005). Then,
international presence of multinational firms also means to interact with multiple and
diverse stakeholders.
1.2 Research purpose
We have realized most of the cross-national or regional studies on CSR have been mainly
focused on studying the situation within Europe (Albareda, Lozano, Tencati, Midttun, &
Perrini, 2008) or between Europe and the United States (Matten & Moon, 2008; Hartman,
Rubin, & Dhanda, 2007; Maignan & Ralston, 2002), therefore the primary purpose of this
study is to fill the gap of research and conduct a regional study comparing two different
regions: Scandinavia and Latin America. Then we take into account the regional basis to
compare corporate approach to CSR in both regions, analyzing the top companies’ self
representations and CSR statements included in the CEO letters. Moreover our main aim is
to detect how corporations in both regions currently make use of CSR statements to
legitimize themselves and if there are significant differences across regions.
Being students from a Master of Science in Business Administration within the International
Business concentration our purpose is to detect which are the main cross regional
differences and similarities and through this study to be able to better understand CSR
practices and rhetoric in two very different regions. By looking at the largest multinational
companies in each region we would like to observe also if trends on CSR are getting closer
even in distinct settings due to the globalization of the economy.
Nowadays we consider corporate responsibility essential to any kind of business; even more
in times of crises helping firms to re-shape their strategies and try to approach their business
operations from more sustainable and innovative ways. After all, they need to legitimize
their roles in society. Therefore we would like to find out how they position themselves
when talking about CSR in their corporate written discourses.
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1.3 Research question
Considering the theme background and the research purpose previously outlined, the main
research question is defined as:
What are the main differences between CSR rhetoric strategies between Latin American
and Scandinavian top companies?
Other specific sub question arises:
How does this influence their legitimacy strategies?
By including this sub question we would like to find out how top companies in Latin America
and Scandinavia legitimize their business strategies through CSR written discourse.
1.4 Disposition
We have structured the thesis into five main chapters. The first chapter above, served as an
introduction to the subject of our thesis, and here we presented the research purpose and
the objectives of our study.
In the second section the methodology is presented. We will explain and motivate the
methodological considerations that we are using for this thesis. We will clarify the research
approach and methods used and how we collected the empirical data to answer the
research question. Also we will present the limitations of the thesis scope and omitted
points of discussion. In addition, we describe the sample of companies by regions, with an
explanation of the reasons why we have chosen them.
Chapter three will cover the theoretical approach. We will describe our theoretical
framework and all the related theories and concepts we will be using later as the
fundamentals for our empirical analysis. This literature review will create the basis for the
analytical framework. Since the field of study lies within the broad concept of corporate
social responsibility, academic literature on CSR is reviewed to offer the reader with
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different insights on the subject. Also we will describe here the general perspectives on CSR
approaches in both regions.
Chapter four will contain the analysis and discussion of the empirical data. The findings from
the organizational documents will be presented to see how CSR is represented in their
written discourses. We analyze our empirical findings and connect them to the proposed
theoretical framework. The focus will be given to the main cross-regional differences or
similarities found among the way top companies from Scandinavia and Latin America
communicate CSR strategies. Moreover having in mind that firms face both operational
challenges and institutional pressures coming from their regulators, it is important to
incorporate this duality into the analysis. Therefore, the analysis section takes both an
institutional and a strategic perspective.
Finally the last chapter will end up with a conclusion. We will describe our concluding
remarks reflected after this research, taking into consideration our research initial purpose;
therefore attempting to answer the research question and mentioning the main points
touched upon in this thesis. In the concluding remarks we will also put the research into
perspective by identifying implications and opportunities concerning future studies.
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2. Methodology
In this section we present the methodological considerations that we are using for this
thesis. We will clarify the research approach and methods used and how we collected the
empirical data to answer the research question. More to the point we describe the sample
of companies by regions. And at the end of this section we will also consider the limitations
of the thesis.
2.1 Preconceptions
In general, people tend to have different perceptions, values, and preconceptions depending
on the particular environment they belong to. It is likely they will interpret any situation
through their own acquired understanding according to their background. In some cases,
people do not realize about such natural influence at all. Likewise, in the world of research,
preconception is a major threat to the validity of qualitative studies (Miles & Huberman,
1994). As preconception also varies from person to person, it may affect particular
researcher’s selection of topic, or methodology etc. According to Maxwell (2005),
researcher’s own values and expectations may positively or negatively influence the conduct
and conclusion of the research. It is not possible to completely eliminate researchers’ values,
beliefs or perceptual lenses; instead it is necessary to identify particular preconceptions and
understand how these issues will be useful and productive for the researcher (Maxwell,
2005).
In this research, the preconceptions are naturally based on the knowledge that the two
authors have acquired through sixteen months as Master Students in Business
Administration within the specialization in International Business, as well as previous
background experiences. In fact, some specific courses like “Corporate Social Responsibility:
Ethical, Political and Strategic Perspectives” and “Social Responsible Consumer Marketing”
offered by Copenhagen Business School helped and inspired the authors to understand the
Introduction
and RQ
Methodology
Theoretical
Background
Analysis Conclusion
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theoretical foundations of Corporate Social Responsibility. Briefly, to date the authors
understand the spread interest in CSR around the entire world, and the growing importance
of the tied concepts and business practices regarding CSR.
Regarding Latin America and Scandinavia as the geographical areas of the study, the authors
realized that there was less connection and background with the Latin American region,
having only studied theoretically some of the most important emerging markets such as
Mexico or Brazil, and that this could lead to the omission of important points. Nonetheless in
order to prevent such bias the authors have approached the situation and have covered
additional readings with the purpose of having a wider knowledge of the whole region in
economic terms as well as in specific CSR terms.
2.2 Choice of Subject
Any kind of research can be conducted because of three different kinds of goals: personal
goals, practical goals and intellectual goals (Maxwell, 2005). Maxwell also suggests that
personal goals and experiences of the researcher play an important role in many research
studies and it is impossible and unnecessary to exclude such personal goals from the
research design. In the same line, Saunders et al. (2009) connotes that it is important to
choose a topic in which the author is likely to do well and already have some academic
knowledge. Though, it is basic to bear in mind that a good research also needs to fulfill the
gap of existing theory and facilitate its development.
With a global mindset and a strong interest in social responsibility issues, the authors
decided to choose the topic relating to corporate social responsibility within an international
perspective.
As introduced in the second part of the first chapter, there have been relatively few
attempts to identify how companies from different geographical regions themselves
approach CSR, we have realized most of the cross-national or regional studies on CSR have
been mainly focused on studying the situation within Europe (Albareda, Lozano, Tencati,
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Midttun, & Perrini, 2008) or between Europe and the United States (Matten & Moon, 2008;
Hartman, Rubin, & Dhanda, 2007; Maignan & Ralston, 2002),
Furthermore, more detailed studies focus their interest in the comparison of different
sectors of activity such as the chemical industry (Hoffman, 1999), energy sector (Sharma,
2000) or automotive industry (Geffen & Rothenberg, 2000); all of them being already known
for its environmental impact. As CSR practices have a much broader scope than only
environmental issues, we believe it would be more interesting to explore the biggest
companies from both regions, consequently covering a wide range of sectors of activity,
mainly because of the nature of such big companies as multinational organizations and as
global players.
Also within the crisis we are immerse, we considered very interesting how the companies
legitimize themselves through their CEO written discourse in their Annual or Sustainability
Reports. They use this annual communications to clearly position their companies in
economic, strategic or sustainability concerns; hence we decided to explore in which
sustainability terms they are more interested and how they communicate their strategies,
operations or future developments concerning CSR themes.
Additionally, the selection of the two specific regions was made due to the interest of the
authors in cross-regional comparisons and it was somehow shaped by the language
capabilities and background of the researchers.
As a result, finally the authors came up with the topic “Corporate Social Responsibility
rhetoric in Latin America and Scandinavia” as the research topic.
2.3 Research Perspective
The purpose of this study is to explore how the largest companies in Latin America and
Scandinavia approach CSR. The study does not investigate concrete social responsibility
practices, but rather explores corporate written discourse about CSR practices and
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approaches. The authors investigated official organizational documents in order to
understand companies’ points of view, especially their self-representation relating to CSR
issues. Precisely we investigated the CEO letters opening the companies’ Annual or
Sustainability Reports. Therefore, the company’s perspective was the one considered for
research purposes.
2.4 Research Approach
We are going to review now the research approach, the research philosophy and the
scientific approach adopted in this paper, these methodological concerns are discussed
under this current point called “Research Approach”.
Business and management research is characterized by the use of both qualitative and
quantitative approaches. These methods have different strengths and are often best used to
address different king of goals (Maxwell, 2005). In the past, qualitative studies were less
accepted by scientific researchers because they considered it provided less rigor, reliability
and verifiability (Berg, 2004). Nonetheless in social sciences research which focuses on
individuals, there are many elements such as emotions, motivations, symbols and their
meanings or any other subjective aspects connected to naturally evolving lives of individuals
and groups that represent their behavioral routines and experiences (Berg, 2004). All these
elements could be considered objective but they are mostly viewed with certain
fundamentals of symbolism, meaning, connotation or understanding that usually require
consideration of the individual’s own perceptions and subjective apprehension, therefore
requiring the use of qualitative studies (Berg, 2004).
According to Weiss (1994) qualitative studies tend to focus on description of visualizable
series of incidents while quantitative approaches tend to asses correlations between an
earlier incident and subsequent incident in terms of quantifiable data. Then, apparently the
main difference between qualitative and quantitative research is the method of collection
and measurement. Another way to distinguish between the two methods is the focus on
numeric (numbers) or non-numeric (words) data (Saunders et al., 2009).
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Instead of identifying which research method is superior to the other, it is necessary to
choose the method that best fits with the research questions and purpose (Saunders et al.,
2009). Consequently we are choosing pragmatism as research philosophy. In terms of
research philosophy, pragmatism argues that the most important factor of the
epistemology, ontology and axiology the researcher adopts is the research question
(Saunders et al., 2009). Table 1 below summarizes the most important aspects of
pragmatism.
Table 1 Pragmatism as research philosophy in management research
Ontology: the researcher’s view of the
nature of reality or being
External, multiple, view chosen to best enable answering of
research question
Epistemology: the researcher’s view
regarding what constitutes acceptable
knowledge
Either or both observable phenomena and subjective meanings can
provide acceptable knowledge dependent upon the research
question. Focus on practical applied research, integrating different
perspectives to help interpret the data
Axiology: the researcher’s view of the
role of values in research
Values play a large role in interpreting results, the researcher
adopting both objective and subjective points of view
Data collection techniques most often
used
Mixed or multiple methods designs, quantitative and qualitative
Source: Adapted from Saunders et al 2009 p. 119.
In this study, the research question is “What are the main differences between CSR rhetoric
strategies between Latin American and Scandinavian top companies?”, thus it is more
appropriate to analyze the case by using the qualitative approach, rather that conduct a
quantitative study based on statistical analysis. Qualitative is used mainly as a data collection
technique (e.g. interview) or data analysis procedure (e.g. categorizing data) which
generates or uses non-numerical data (Saunders et al., 2009). Precisely in this qualitative
study, we will categorize data, coding as a thematic analysis, which will be explained more in
detail in the next point.
As part of the qualitative approach, methods such as interviews, questionnaires or focus
groups could have been used in this study. But due to the specific case, time and budget
constrictions we better considered using and analyzing organizational documents as a main
source of data. Then, the empirical information contained in this paper has been collected
from the CSR, Sustainability or Annual reports (depending how companies name the
corporate document), all of them being organizational documents containing CSR
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information. These corporate documents have been accessed through official companies’
websites.
Regarding the scientific approach, deduction and induction are rational processes broadly
used by researchers (Graziano & Raulin, 2004). With the deductive approach the aim is to
test the proposed hypothesis and the empirical data by using already existing theories; while
using an inductive approach the aim is to analyze and observe the empirical data in order to
build up new theory (Saunders et al., 2009). Then, it is clear deduction will be more suitable
when there is a broad extent on literature related to the research topic, from which the
theoretical framework can be well defined; combined with a research question that lends
itself to a deduction process. Conversely, having a proposed research on any new topic on
which there is very little existing literature, it may possibly be more proper to use an
inductive approach by generating data and analyzing and reflecting upon which theoretical
themes the data are suggesting (Saunders et al., 2009). The Table 2 summarizes some of the
most important differences between induction and deduction.
Table 2. Major differences between deductive and inductive approaches of research
Deduction emphasizes Inductions emphasizes
? scientific principles
? moving from theory to data
? the need to explain causal relationships
between variables
? the collection of quantitative data
? the application of controls to ensure validity
of data
? the operationalisation of concepts to ensure
clarity of definition
? a highly structured approach
? researcher independence of what is being
researched
? the necessity to select samples of sufficient
size in order to generalize conclusions
? gaining an understanding of the meanings
humans attach to events
? a close understanding of the research
context
? the collection of qualitative data
? a more flexible structure to permit changes
of research emphasis as the research
progresses
? a realization that the researcher is part of
the research process
? less concern with the need to generalize
Source: Saunders et al. (2009) p. 127
Although it is valuable to consider the direction of the relationship between theory and
research in terms of the scientific approach, being either deductive or inductive, the line of
division between these two options is not always straightforward (Bryman & Bell, 2007).
Thus, it can be assumed that it is possible to design the research based on both deductive
15
and inductive approaches, if it is more appropriate in any specific case and therefore it can
even lead to a more useful and valuable research approach (Saunders et al., 2009).
In order to understand how CSR rhetoric plays its role in the biggest companies of the
selected regions, in the initial phase of this research the data was collected based on the
framework adapted from the study of Castelló & Lozano (2011). Thereafter, the empirical
study has been carried out and the framework has been revised according to real findings.
Then, apparently this research is trying to test a theory as well as to enrich existing theory
from the empirical data. As a result, the research’s nature is mainly deductive but also
inductive.
As part of business and management research, this paper is intended to gain a deeper
understanding about CSR communications of top companies in Latin America and
Scandinavia, concentrating on subjective factors such as companies’ legitimacy through
outlined strategies and motivations.
The study focuses on companies’ perspectives which are subjective and can change from
time to time. Therefore, the context shown in organizational documents serves as an
important explanatory variable. The study began with gathering qualitative data through
companies’ documents and tried to interpret such context company by company.
Thereafter, the findings were grouped and analyzed based on the set framework which will
be explained in the next chapter, theoretical framework.
We began the analysis with specific observations through conducting exhaustive readings on
the corporate letters. Subsequently, according to the existing literature we detected
patterns and regularities from this primary data; and also we added other observed patterns
to the theoretical framework. Then as it was mentioned before, we mainly used elements of
deductive reasoning, but inductive reasoning has also been applied.
Before starting the readings, we had an idea about the theoretical framework we already
wanted to apply in the thesis. Then, the insights from primary sources gave us inspiration
together with additional literature on CSR apart from the main theoretical framework we
16
use from Castelló & Lozano (2011) to add new themes in that framework. This illustrates the
flexible approach we have applied in the research process.
2.5 Research Strategy
In this point we would like to explain the specific research strategy we have followed in the
thesis. We refer to the discourse and more specific the rhetoric analysis as the research
methodology and to the thematic analysis as the coding method used throughout the
empirical analysis.
2.5.1 Rhetoric analysis
As we mentioned in the introduction chapter, limited research has been conducted on CSR
communications as a way to legitimize business operations in cross-country or regional
comparative perspectives. Even more now in times of crises we think companies use
corporate discourse to legitimize themselves and the role they play in society. Then, our
research design takes an explorative perspective since we intend to analyze according to
literature, the CSR statements of top companies in two different regions.
The analysis of corporate written discourses will provide us with concrete fundamentals to
evaluate legitimacy strategies. According to (Hardy et al., 2000) discourse is one of the
strategic forms that firms use to legitimize their actions. Within the analysis on corporate
discourse, the study of companies’ rhetoric strategies presents an interesting perspective of
not only corporate procedures and actions but also on their view of the role of the firm in
society (Scherer & Palazzo, 2007).
Thus, we are going to conduct the rhetoric analysis as research methodology. Rhetoric can
be defined as the art of effective or persuasive speaking or writing; or the language designed
to have a persuasive or impressive effect (Oxford University Press, 2011). According to Gross
(1994), rhetoric is a theory capable of analyzing public understanding and an activity capable
17
of creating it. The way organizations define and use words reflects their implicit intentions
and following actions (Searle, 1995). Moreover, rhetoric is seen as a key cultural and
symbolic resource for firms to develop and communicate their shared knowledge (Alvesson,
1993). This author also emphasizes the importance of rhetoric when organizations use it to
show up particular identities and intangible assets as distinctive leading to differentiation
strategies.
The rhetorical strategies firms pursue, act as structural features of their organizational
discourse and thus can be detected through the analysis of corporate communications
(Castelló & Lozano, 2011). The rhetorical strategies frequently acquire the form of
enthymemes or argumentations-in-use; they are syllogisms whose premises are drawn from
the audience. They are usually only partially expressed, so their logic is completed by the
audience. Then enthymemes are not considered universal rational or true but are so only
within specific socio-cultural contexts depending on their conformity to the audience beliefs
and assumptions (Castelló & Lozano, 2011). Thus this analysis strategy gives to this study the
explorative, and subjective character in the interpretations carried out in the analysis.
In this thesis, conducting rhetorical analysis drives an interest in the role of corporate
language in structuring organizational actions and procedures; with the clear focus on CSR
rhetoric and its use as a corporate message to influence an audience, that normally gathers
together a broad range of stakeholders related to any company: from suppliers, customers,
Governments, to NGOs or civil society in general.
We aim to identify legitimacy through CSR strategies and their embeddedness within
differentiated corporate discourses; in order to achieve this aim we study the structure of
corporate rhetoric. To study the latter we will code CEO statements in either sustainability or
annual reports (since not all the companies published a separated sustainability report, we
considered relevant to include CEO letters published also in regular annual reports provided
that they also contain CSR statements in those corporate letters).
It is clear that annual, sustainability or shareholder reports are means to legitimize corporate
actions (Suddaby & Greenwood, 2005). Given that CSR is a relatively new management
18
development (The Economist, 2008) companies reflect these management trends in their
corporate discourses, particularly in letters from top management included in the first pages
of the reports (Snider, Hill, & Martin, 2003). The CEO statements included in the reports
define the companies’ strategic lines and can be considered one of the most representative
parts of the whole report (Abrahamson & Amir, 1996). They usualy cover one or two pages
of length in the report (but it depends on the company, because they can be even longer)
and include a complete description of the company most important performance highlights
and the main strategic lines of action of the company. Hence, they present the company’s
organizational rhetoric, not the individual rhetoric even if they are signed by the CEO being
the main representatives of the firm. The executives make sure these letters transmit the
firms’ image and the main messages the company wants to deliver to its stakeholders and
general public (Castelló & Lozano, 2011). We intend to explore the CEO letter’, to
understand the statements and detect all CSR related issues presented.
2.5.2 Thematic analysis as a coding method
We consider that analyzing the CEO statements gives a clear evidence of the CSR messages
the company wants to share with its stakeholders. Apart from the theoretical framework
proposed by Castelló & Lozano (2011), to be able to analyze the CEO statements we used
thematic analysis which is the process of encoding qualitative information where the
encoding requires and explicit “theme”, a pattern found in the information (Boyatzis, 1998).
Thematic analysis will help us to transform the data analyzed (CEO statements) into codes.
Once we interpret the CEO statements we will be able to create themes and further codes.
This type of analysis is highly inductive, that is, the themes emerge from the data and are
not imposed upon it by the researcher. The data collection and analysis take place
simultaneously. Even background reading can form part of the analysis process, especially if
it can help to explain an emerging theme (Boyatzis, 1998). We can confirm in our research
the new emerging themes (differentiated from the themes proposed by Castelló & Lozano
(2011)) were initially generated inductively from the CEO statement information, but we
were also looking into theory to support some of the new themes.
19
It is clear throughout the research process we have been moving forward and backward
between the CEO letters and the research literature; this actually supporting the premise the
study is not completely deductive or inductive, but an analysis using both research
approaches.
2.6 Sample and Data Collection Process
In order to perform the study, the companies for our analysis where selected from the
ranking “The Forbes Global 2000” (as of 21.04.2010) due to the fact that this was the only
international ranking with a significant group of companies from the countries that forms
both the Latin American and Scandinavian regions. The Forbes Global ranks the 2000
biggest, most powerful listed companies in the world; the multinational companies listed get
a composite ranking from four metrics: sales, profits, assets and market value (Forbes,
2010).
Other available ranking, like the “Global Fortune 500” was also considered in the beginning,
but once reviewed, it did not list many relevant companies for the study. There were a
number of different ranking listing companies separately from the two regions, like the “S&P
Latin America 40” or the “FTSE Nordic 30”, but we did not consider those either, since we
agreed companies from both regions should be listed in the same ranking according to the
same criteria. Then we reached the conclusion, the relevant ranking for this study was the
Forbes Global 2000.
We found a sample of 69 companies from Latin America and 61 companies from Scandinavia
listed in the Forbes Global 2000 ranking. We went through these companies, checking their
corporate websites to access the sustainable or annual reports containing CSR information in
the CEO opening letters. Companies that did not provide CSR information in the corporate
communications were excluded, likewise companies not displaying the documents in English
were also rejected, because we consider English as the international business language, and
the one that we both as researchers can understand and interpret for the following rhetoric
analysis. Hence from the initial sample we ended up excluding 32 Latin American companies,
20
and 24 Scandinavian companies due to the mentioned reasons such as the lack of CEO letter,
no mention of sustainability, the language of the report or the type of report. These
excluded companies are presented in Table I and Table II in the appendix.
As a result the representative sample is made of 37 companies from each region.
The Latin American companies selected are:
Petrobas- Petróleo Brasil, Banco Bradesco, Vale, Itaúsa, Eletrobrás, Femsa, CSN- Cia
Siderurgica, Grupo Mexico, Usiminas , Oi Tele Norte Leste, Grupo Modelo, CBD-Brasil
Distribuiçao, Cemex, Metalurgica Gerdau, Cemig, Grupo Bimbo, CPFL Energia, Braskem,
Redecard, BRF-Brasil Foods, Fibrial Celulose, Cielo, Sabesp- Saneamiento Basico, SQM,
Natura Cosmeticos, Soriana, Fresnillo, Banrisul, BCI- Banco Credito, ALFA, CMPC, Copel,
Embraer, Kimberly-Clark de Mexico, Net Serviços, Fosfertil, and Sul America.
The Scandinavian companies selected are:
Statoil, Nordea Bank, Nokia, TeliaSonera, Ericsson, Danske Bank Group, Fortum, Novo
Noridisk, H&M Hennes & Mauritz, SCA-Svenska Cellulosa, A.P. Moller-Maersk, SEB- Skand
Enskilda Bank, Volvo Group, Atlas Copco, Yara International, Skanska, Orkla, Vestas Wind
Systems, TDC, Swedbank, Electrolux, Kone, Norsk Hydro, Wärtsilä, Stora Enso, Tele2, Neste
Oil, Storebrand, SKF Group, Metso, Alfa Laval, TrygVesta, Kesko, DSV Group, SSAB,
Novozymes, and Boliden.
Detailed information from the selected companies is enclosed in the appendix in Table III
and Table IV where companies are classified according to the ranking Fortune Global 2000,
and facts such as the country of origin, industry of operations and other financial data are
showed.
Then this representative sample shows the list of companies with the common characteristic
that are all multinational engaged in the CSR movement. Our assumption behind the
selection of large companies in both regions is that they are adopting and creating new
trends in CSR rhetoric, so we would like to compare and analyze those trends to find out the
distinctive features in each region.
21
The reporting period considered in this analysis was for the year 2009 and a total of 74
reports, accessed through the corporate websites, were scrutinized. We chose the year 2009
since we wanted to study the most recent trends on CSR; and we considered for year 2010
would be difficult to gather the majority of reports given that many companies publish their
reports after March. Therefore we started the thesis in February 2011 and by then many
companies did not have published yet the 2010 report. Then we decided to take year 2009
for the study.
We would like to point out that since the primary source of data for this research has been
organizational documents, the statements representing the different CSR themes have been
collected directly from those documents available at companies’ corporate websites. We
have organized a data base to quote all the representative statements and to indicate how
many themes each company have mentioned according to the overarching CSR category and
the specific themes forming the categories. The output tables from the data base are
attached in the appendix as Table V and Table VI.
Corporate documents, either Sustainable Reports or in the case the company did not provide
this specific report, Annual Reports were accessed from the corporate websites to access the
executives opening letters. Corporate websites were accessed from March 1st to April 7th,
2011.
2.7 Data analysis and coding process
The process of gathering the empirical relevant data from the CEO letters and the coding
process has been developed by the two authors of this research. In the first stage, each of us
looked for initial patters in the letters according to theory and we also found new patters to
define new codes. Once we looked for those initial patters we put in common our findings
and we created the common encoding framework, clarifying which themes where included
within the proposed overarching themes; which are “institutional”, “strategic”, “dialectic
rhetoric” as proposed by Castelló & Lozano (2011) and “political” the latter theme emerging
from going back and forth from theory of to the data.
22
In order to improve the quality of our analysis before starting the coding process of all the
CEO letters we did a deep review of all the proposed codes so far to set a shared starting
point. Then, we analyzed the total of 74 CEO letters from both regions of study so we could
detect all rhetoric strategies and their patters and similarities.
In the analysis process we detected the relevant sentences containing CSR themes and we
gathered them in our data base, having examples from the letters for all the categories
found across each letter.
As we already mentioned, both researchers went through the whole sample having done a
double analysis. This way we sought to make sure we agreed in all the themes we found. Of
course along the analysis process, there were some examples not so straightforward to
include in one theme or another, so we needed to discuss whether a quote was part of one
code or other, due to the subjectivity of some sentences, but we always looked at the
theoretical frame and themes definitions, discussed deeply and analyzed the quotes
together afterwards so the results could be clear for both of us. Thus we both analyzed
firstly separately and then we put our findings in common to validate all our results into the
proposed themes, therefore adjustments and refinement were done throughout the analysis
process until agreement was achieved.
As part of the analysis we include a more quantitative approach based on the 74 companies
from both regions, when we go through the themes we found and we group them in terms
of the category and we consider the frequency, and relative frequency to the total number
of themes reported.
2.8 Research Limitations
We acknowledge it is necessary to make clear there are some limitations in the study. We
have chosen to limit the geographical scope of the thesis to concentrate in the regions of
Latin America and Scandinavia represented by the 37 companies in each region that supply
the CSR required information. Therefore we have been careful with drawing conclusions
23
from this material, within the countries, there are significant differences in the forms and
intensity of CSR. Also generally concerning their political systems, it can be said Scandinavian
countries are more homogeneous than the Latin American countries. Although the thesis at
hand focuses on how leading companies in both regions communicate different CSR rhetoric
strategies through CEO written discourse, being then a corporate study. But there must be
said political context highly influences the firms dealing in each region, we cover this topic in
the theoretical framework as the institutional factors shaping business CSR strategies.
Furthermore, even if we are analyzing the reports referring to financial year 2009, we do not
intend to deeply discuss the underlying reasons behind the economic recession and how it
has influenced current CSR strategies in firms.
We also acknowledge the limitations of both the sampling selection and sample size. A
sample restricted to 74 reports might be considered small. However provided the
explorative character of the research we consider conclusions arising from this sample to be
significant.
2.8.1 Researcher bias
When performing the qualitative analysis of corporate disclosure through organizational
documents, the researcher can be biased by the previous knowledge on the topic or by the
background, as the analysis involve interpreting and coding data.
In order to try to avoid such bias, the researchers performed an extensive literature review
on the topic, getting familiar with CSR issues and main theories, as well as previous similar
studies. The coding scheme used as the main framework for collecting data (Castelló &
Lozano, 2011) was studied and discussed in order to increase the understanding of how CSR
issues should be categorized.
24
2.8.2 Source critics
Even though documents accessed from private sources like companies are likely to be
reliable, authentic and meaningful, people who write organizational documents, such as
managers, are likely to have a particular point of view that they want to get across (Bryman
& Bell, 2007). In this particular study, the researchers were interested in identifying how
corporations presented their view of CSR through the organizational documents, therefore
the way of performing a self-presentation was itself relevant for the research. Company
reports made available to different stakeholders are likely to be approved and reviewed,
especially in the case of large companies such as the ones selected for this thesis.
As the data sources for the research were organizational documents, the researchers were
somehow limited to the information disclosed by companies through these means.
Considering the aim of the research and the relevance of CSR disclosure in representing CSR
beliefs and behaviors, the data obtained was considered sufficient and relevant in providing
interesting insights into the nature and the differences in CSR approach among regions.
Therefore, such limitation did not influence negatively the outcome of the research.
25
3. Theoretical Framework
In this chapter, we will present our theoretical framework, which we will use later as the
basis for our analysis of the empirical data collected. We have chosen to delimitate our
theoretical framework first on theories related to general CSR definitions, institutional
factors influencing the scope of CSR and the scope of CSR in different regions. Then we also
focus the theoretical frame defining the trends of CSR related to the strategic and shared
value approaches, institutional theory, neo-liberalism, neo-institutionalism and the political
role of firm. We also review legitimacy strategies, as well as CSR rhetoric strategies. Finally,
an overview of the elements included in the theoretical framework is given.
3.1 Definitions of CSR
3.1.1 Academic perspectives of CSR
The concept of corporate social responsibility (CSR) has evolved from a narrow notion into a
complex concept over the past decades. When reviewing the literature on CSR, there are a
few authors that emerge as the main theorists, still the range of definitions and studies
made on CSR shows that there is still no consensus in neither the corporate nor academic
world on how the term should be defined (Dahlsrud, 2006; Lantos, 2001; Sasse & Trahan,
2007).
So far, CSR has been characterized by the integration of social and environmental concerns
into business activities on a voluntary basis, which over the past two decades has gained
widespread popularity and legitimacy (Gjølberg, 2010). Clarkson (1995) highlights the fact
that managers do not think or act in terms of concepts such as responsibility or integration.
Though, if managers do think of CSR, most likely they will concentrate on the demand from
stakeholders that are perceived as being powerful, legitimate and/or urgent (Clarkson, 1995;
Mitchell, Agle, & Wood, 1997). This means that the increasing demand and pressure on
Introduction
and RQ
Methodology
Theoretical
Background
Analysis Conclusion
26
companies by various stakeholders suggest that the CSR efforts neither emerged as of legal
requirements nor as completely voluntary actions; this can also be seen in the European
Commission’s definition on CSR from 2006 who states that “An increasing number of
European companies are promoting their corporate social responsibility strategies as a
response to a variety of social, environmental, and economic pressures” (European
Comission, 2006).
The Corporate Social Responsibility concept was from the beginning business-drive but with
the impact from the economic globalization and deregulation, the concept of CSR is
becoming more and more elevated as new and innovative for national and global
governance. Thus, it is fundamental and relevant not only for companies, but also to
governments (Bendell, 2000). The CSR concept can be interpreted in different means as
there is no specific rules on how to apply it (Crane et al., 2008). Furthermore, the idea is
continuously developing as one can see from the literature (Carroll, 1991). Another reason
why it has been so hard to agree on a single definition of the term is due to the different
understanding of CSR coming from the institutional differences described by the national
systems. The difference of the cultural, national and social environments in some countries
in what firms concerning CSR might not be the same as in other countries, where e.g. CSR
implies the fulfillment of legal requirements (Crane et al., 2008).
The notion of CSR has drawn attention and interest from business, civil society, media and
government and thus its fast growth since the 1990s can be explained as a “unique rise to
prominence” in the management literature (Crane et al., 2008, p. 3). Today, besides a
managerial concept, CSR is in addition promoted as a concept in which civil society and
governments should engage in, for them to be observed as modern and legitimate (Sahlin-
Anderson, 2006).
Bowen who had the first publication on the topic argues that the industry has “an obligation
to pursue those policies, to make those decisions or to follow those lines of actions which
are desirable in terms of the objectives and values of society” (Bowen, 1953, p. 6). Wood
(1991) expanded the ideas proposed by Bowen (1953) and proposed the following three
principles deriving from CSR: 1) That businesses are social institutions and thus, obligated to
27
use their power responsibly; 2) That businesses are responsible for their outcomes coming
from their involvement with society; and 3) That individual managers are also moral agents,
who should exercise discretion in the decision making process.
Friedman (1970) disagrees with Wood (1991) and argues that businesses only have one
social responsibility, maximizing the profit of their owners. He argues that managers who
use the firm’s resources for non-profitable social purposes is imposing a tax on the
organization and diverting economic efficiency.
Frederick et al., (1992), Freeman (1984) and Lodge (1977) disagree with the economic view
proposed by Friedman (1970) claiming that the role of institutions is not working as the
economic model suggests, because of the separation between ownership and management,
the rise of oligopolies and the interactions and influence of governments and society. In their
opinion, businesses should be seen as social institutions rather than mainly private
institutions. In this way, companies are responsible for any of their social and environmental
actions in the community.
Freeman (1984) created the “stakeholder theory of the firm” which addresses the
corporation and its responsibilities by looking at the stakeholders that have a legitimate
interest in the corporation. According to Freeman (1984), companies are not merely
managed at the interests of their shareholders, but also of stakeholders, which are defined
as “any group or individual who can affect, or is affected by, the achievement of the
organization’s objectives" (Freeman, 1984, p. 46).
Elkington (1999) also opposed the economic model suggested by Friedman (1970) and
created the “triple bottom line” implying that businesses should not only have the goal of
adding economic value to the business but as well the aim at adding environmental and
social value, in order to achieve sustainability. The triple bottom line is outlined by the
environmental-, economic-, and social-perspectives (Crane & Matten, 2004).
One of the first authors to establish one of the most accepted theories of CSR is Carroll,
(1979). He argues that corporations have four responsibilities that need to be carried out in
28
order for them to be good corporate citizens: economic, legal, ethical and philanthropic. He
outlines these responsibilities in consecutive layers within a pyramid (Figure 1), which all
need to be carried out/fulfilled in order to achieve ‘true’ social responsibility.
Figure 1. Carroll's four-part model of CSR
Source: (Carroll A. B., The Pyramid of Corporate Social Responsibility: Toward the Moral of
Organizational Stakeholders, 1991)
The first two layers in the pyramid, economic and legal responsibilities are assumed to be
“required” of all corporations, while the ethical and philanthropic responsibilities are
considered “expected” and “desired” by society. Consequently, Carroll & Buchholtz (2003, p.
35) outline the following definition for CSR: “Corporate social responsibility encompasses the
economic, legal, ethical and philanthropic expectations placed on organizations by society at
a given point of time”. What is common for the economic and legal responsibilities is that
businesses are required to have both. Further, companies also are expected to be ethical,
where they not just follow and meet rules and regulations of society but as well the norms
and standards. At the top of Carroll’s pyramid lies the philanthropy.
As discussed, the definition of CSR varies and the views on CSR differ in terms of the
foundation or scope of CSR. Based on the theoretical grounds, Corporate Social
responsibility can be summarized as a voluntary action due to that it goes beyond what laws
require, but not that the activities are totally left to the responsibility of companies.
29
3.1.2. Institutional factors influencing the scope of CSR
In general, there are differences of CSR approaches; theoretically it has been argued that
there are differentiated institutional settings or specific conditions that favor socially
responsible corporate behavior; thus, CSR can be influenced by the region, the nation, the
industry and the company itself. More specifically, at a regional or national level, there is
considerable distinction in economic, cultural, environment or political contexts, which will
be reflected in the level of endorsement of CSR and the types of activity promoted by firms
in particular countries (Welford, 2005).
Campbell (2007) states that the relationship between basic economic conditions in any
business environment and the responsible corporate behavior of companies operating in it is
influenced by several factors that are: public and private regulation, the existence of
nongovernmental and other independent organizations that observe corporate behavior,
the institutionalized norms concerning proper corporate behavior, the associate behavior
among corporations and the shared dialogues among corporations and their stakeholders.
According to Campbell the economic conditions (such as the level of competition, or the
health and progress of the economy) shape the probability that companies will behave in
more socially responsible ways; weak economic performance or an unhealthy economy will
reduce that probability. Campbell sustains that in the case of too high or too low
competition in the environment, companies will tend to behave in less socially responsible
ways, while having moderate competition enhances better CSR approaches by companies. In
the case of having strong State normative regulation, collective industrial self-regulation,
NGOs or any other independent organizations monitoring corporate behaviors then
companies are more likely to operate in socially responsible ways (Campbell, 2007).
In Norway, company policies regarding indigenous population are reflected by the local
condition that there is a large minority indigenous population in the northern part of the
country (Welford, 2005). Some researchers also highlight social issues in the level of the
industry. For example Araya (2006) found out that social and environmental reporting is
30
more common in internationally oriented and socially and environmentally sensitive
industries in Latin America.
At the company level, there are several factors influencing CSR practices such as internal
organizational conditions, strategic attributes, and of course stakeholder pressures (Etzion,
2007).
3.1.3. The scope of CSR in different regions
CSR, has to a great extent its origin as an American concept that focuses on how companies
can align social expectation with profit maximization (Vogel, 2005; Preuss, Haunschild, &
Matten, 2006; Matten & Moon, 2008). However, in the past couple of years it has attained
an audience reaching beyond the business society (Sahlin-Anderson, 2006) where
governments also need to be engaged in this global trend of CSR in order to be perceived as
legitimate and modern. CSR, is a state-market-society model that is neither politically nor
culturally neutral (Blowfield, 2005; Hanlon, 2008), and the common divisions among
American and Europen societies are clearly seen in CSR, as they are noticeable in different
interpretations and practices of CSR across the Atlantic (Matten & Moon, 2008).
There have been several studies made to address the differences in CSR between countries,
mostly within Europe (Aaronson, 2002; Perrini, 2005; Silberhorn & Warren, 2007) and
between Europe and US (Maignan & Ralston, 2002). Some comparisons have been made
addressing differences in CSR among Asian countries (Ang & Leong, 2000; Chapple & Moon,
2005; Welford, 2005) but also studies exploring the differences between countries in Asia,
Europe, North America and other regions have been conducted (Welford, 2005; Baughn,
Bodie, & McIntosh, 2007). For example Maignan and Ralston (2002) discovered that
companies in different countries differed in their managerial practices, stakeholder issues
but also on how much they emphasized and communicated CSR activities on their websites.
In comparison to companies in France and the Netherlands, companies in the UK and the US
usually tend to discuss CSR principles and to mention codes of ethics on their webpage much
more, as well as mentioning what they give to the community through voluntary donations
and solidarity activities (Perrini, 2005; Chapple & Moon, 2005).
31
Most of the academic literature has a focus on ethical and environmental issues, even
though “doing the right thing” appears to have different interpretations across the world
(Baughn, Bodie, & McIntosh, 2007) and the understanding of CSR is different from
organization to organization (Casanova & Dumas, 2010). Therefore, although the existence
of studies made on cross-country and cross-region comparisons addressing CSR practices in
Europe, Asia and Latin America are few, the current studies suggest the existence of
different regional patterns concerning the way CSR is viewed and implemented.
In the US, the CSR concept is more influential than in Europe. In Europe the capitalism model
tends to define the economic responsibility of states more widely and focused while the
Anglo-American region see the legal responsibility from another perspective, that
government intervention and rules are much more likely to be viewed as an intervention
with private liberty, whereas the European thinking tends to see the state in the role of
enforcing the accepted rules (Crane & Matten, 2004).
In Europe most of the social issues on the corporate agenda are located within the field of
ethical responsibility, as corporations need constant reaffirmation of their social legitimacy.
Likewise, the philanthropic activities in Europe are most of the time implemented
compulsory through the legal framework. Perrini (2005) states that corporations’ social
responsibilities in Europe are still connected to protecting the environment and community,
but also taking care of customers and workers. Thus, companies are likely to meet specific
CSR issues such as: health-, safety- and environmental issues, considering them strategic.
3.2 CSR regional overview
3.2.1 CSR in Scandinavia
Sweden, Denmark, Norway and Finland are all characterized by what is called the Nordic
model, which is built on traditions in social responsibility and cooperation’s. The traditions of
social responsibility in the mentioned countries are built upon the traditions of social
responsibility and democracy that are tied to the development of the countries in the first
32
half of the twentieth century (Schiller, 1993). In the later part of the twentieth century, the
major part of the developments is connected to the emergence of the welfare state with
strong social democratic influences.
The “Nordic Model” is often referred to because of the similarities of the Nordic
governments, but also the similarities among the Nordic businesses. This model represents
both the cultural-ideological values and similarities in political-economic institutions. The
business systems in the Nordic companies are often labeled coordinated market economies
(Hall & Soskice, 2001) shared business systems (Whitley, 1999), or social democratic
business systems (Amable, 2006). Other theorists argue that because of the Nordic countries
capability to combine economic competitiveness with social welfare there is an exclusive
“Nordic capitalism” (Byrkjeflot et al., 2001; Fellman & Sjögren, 2008) which has recently
drawn a lot of attention. All five Nordic countries (Denmark, Finland, Norway, Sweden and
Iceland) were in 2009 ranked among the top fifteen most competitive economies (Schwab &
Porter, 2009) and among the top fifteen countries in the UN Human Development Index
(UNDP, 2008). In the Nordic countries the government plays a central role in the economy.
Besides being engaged in the economic issues through public policy and the corporatist
system, the government is as well one of the key players and one of the biggest owners,
investors, and buyers in the Nordic economies (Byrkjeflot H. , Myklebust, Myhrvang, &
Sejersted, 2001; Einhorn & Logue, 2003; Iversen & Thue, 2008).
The essence of the Nordic state-market-society model is a solid embedding of the economy,
that is attained by strong, social-democratic and universalist welfare state, a powerful
corporatist industrial relations system, and a consensual political culture accentuating
equality, discussion and involvement (Dahl, 1984; Esping-Andersen, 1990).
Theoretically, the features of the Nordic countries business systems are “in conflict”,
conflicting, with the underlying business-society model of CSR. To give an example, CSR
implicitly awards discretionary powers to business in issues of great social and
environmental concern, whereas in the Nordic context such concerns are considered to
belong to the public domain, and are to be determined through democratic, collective or
representative process. Therefore, the Nordic Model (with strong collective institutions),
which holds companies responsible could come into conflict with the role of governments
33
and the emphasis on unilateral, voluntary actions by business in CSR. Another example, the
CSR business-society model does not give trade unions a lot of opportunities, but rather
assigns them status as “stakeholders” on bar with non-governmental organizations (NGOs),
activists, and local community groups (Preuss, Haunschild, & Matten, 2006). Though, the
Nordic trade unions can influence the companies’ decision-making through the corporatist
system that takes place in the Nordic countries (Arter, 1999). The privilege by the trade
unions in the Nordic countries can therefore affect the policy process, producing a
uncertainty towards CSR, due to the influence they possess on the Nordic policy formation.
The Nordic governments have all a high international focus on matters such as sustainable
development, poverty reduction, environmental protection and human rights, which are all
central when framing CSR. The governments tend to highlight humanitarianism,
environmentalism, and internationalism as objectives in and of themselves (Lafferty &
Meadowcroft, 2000). From the theory mentioned above it is reasonable to assume that the
change of CSR is relatively similar across all Nordic countries, due to the fact that they all
have similar views on the role of business in society.
Gjølberg (2010) made a comparative analysis of the varieties of CSR in the Nordic countries
and could through collaboration between researchers from major Swedish, Norwegian,
Danish and Finnish business schools and universities represented in the Nordic Centre for
CSR conduct interviews on the matter of CSR in the various countries. The interviewees
were representatives from ministries and government agencies with responsibility for CSR,
as well from labor unions, employee associations, and key NGOs in the national CSR debates.
Gjølberg (2010) could conclude from the interviews that the general description of the
Scandinavian countries is as a well-regulated state with high levels of social and
environmental protection. The interviewees from government, business confederations, and
trade unions describe that the various countries perceive CSR as relevant mainly when
domestic firms do business aboard. “In fact, there is outright skepticism toward introducing
CSR in a domestic context, as this is seen as a return to the old days of paternalism and
charity. Instead, there is a strong preference for the existing regulatory and corporatist
system which grants universal rights administered through a welfare state system, and
several interviewees emphasized that CSR must not be a substitute for state action”
34
(Gjølberg, 2010, pp. 221-222). This development describes CSR explicitly as “second best”, as
a strategy that is primarily relevant overseas, when lacking a global framework. This
reformulation of CSR to some extent dissolves the potential conflict with the basic Nordic
Model of strong government participation in issues of great community concern. (Gjølberg,
2010).
3.2.2 CSR in Latin America
There is no general definition of CSR in Latin America, and different organizations in the
various countries offer diverse definitions. Since it is difficult to generalize about anything in
Latin America so is also the case about the generalization of CSR in the region (Schmidheiny,
2006). Though, if we are to generalize, CSR in Latin America is more focused and being
influenced by social issues such as poverty and inequality than environmental issues because
they are of a challenge and a huge problem for the region.
Over the past 10 years, multinational companies from the region have grown substantially.
Although the economic growth of the region in the last couple of years, poverty is still
widespread and Latin America remains one of the most imbalanced regions across the
world. Despite this, multinational companies from the region have prospered and succeeded
globally with their strong leadership and are integrating CSR practices in their business
strategy. For many Latin American companies the social contributions such as engagement
with employees and local communities to improve the social lives of the society, in terms of
providing housing, education and special health benefits, have been a part of their corporate
vision (Casanova & Dumas, 2010). According to Contreras (2004), many family run
businesses, portray their cooperation and engagement with society as a way to do the ‘right
thing’.
Many corporations are taking the role of the state in Latin America as governments are not
very effective to act in the interest of society but also because of the pressure from civil
society to meet the needs the governments in the region are not meeting. As the region is
becoming more democratic, the opportunities created for people to speak out have
35
increased and so has their pressure increased on the private sector (Casanova & Dumas,
2010).
Many of the recent CSR initiatives in Latin America started around 1997. Latin American
multinationals from Mexico to Brazil feel the need to engage with their communities and
societies. As many public and formerly public owned companies were born with a public
good goal with ethics and public service as part of their core structure. Thus it is not
surprising that we can find a number of local multinationals such as the bakery Grupo Bimbo
in Mexico or the cosmetics company Natura in Brazil where ethical values have been
integrated into their business strategy (Casanova & Dumas, 2010).
3.3 Strategic CSR and Shared Value
It is evident business around the globe have many reasons for engaging in CSR activities that
benefit society and the environment. Executives around the world recognize a strong
strategic business case for engaging in social initiatives. Porter and Kramer are in the leading
position of strategic CSR. They argue that the mutual dependence of businesses and society
implies that both corporate decisions and social policies must follow the principle of shared
value (Porter & Kramer, 2006), that is, corporate success and social welfare are
interdependent.
Porter and Kramer suggest that integrating CSR into corporate core strategies it can
generate “shared value” because businesses create win-win situations with society. The
authors recognize that very often firms’ approaches to CSR are disconnected from business
and strategy, which can give result to less business opportunities and less value creation if
strategic CSR is not well applied. They take the strategic CSR explanation further by
developing a corporate social agenda which “looks beyond community expectations to
opportunities to achieve social and economic benefits simultaneously” (Porter & Kramer,
2006, p. 85). Then CSR moves from performing as mere corporate citizens and reducing
damage from inappropriate business practices, which would form part of a responsive CSR
36
strategy; to a truly engaged strategic CSR that delivers strategies to strengthen corporate
strategy as a whole by the betterment of social conditions (Porter & Kramer, 2006).
Definitively strategic CSR is seeking to align organizational values, business strategy and core
competencies with a social agenda to benefit both the business and society. Whether this
actually occurs is questionable due to the fact that social responsibility is such a broad
concept; it is much more than damage limitation or philanthropy. In any case the evidence
for the advantages of CSR in business emerge as positive but sometimes variable. Businesses
engaged in strategic CSR cannot solve all the world’s problems, but actually they can have a
remarkable influence for good (Holme, 2010).
Porter and Kramer (2006) precisely link competitive advantage to corporate social
responsibility. They say ‘‘CSR can be much more than a cost, a constraint or a charitable
deed – it can be a source of opportunity, innovation and competitive advantage.’’ (Porter &
Kramer, 2006, p. 80). Then, strategic CSR can become an instrument of change in an
organization’s values, behaviors, and performance.
As stated by Porter & Kramer (2006) it is through strategic CSR that the firm will make the
most significant social impact and reap the greatest business benefits. Strategic CSR is about
choosing a unique position by doing things differently from competitors in a way that lowers
costs or better serves a particular set of customer needs.
Nowadays, the application of strategic CSR may well serve as an useful mean to respond to
the negative impact of the current financial crisis, in particular as a helpful strategy to
maintain or regain firms’ reputation and legitimacy through CSR. Specially through creating
shared value, Porter and Kramer suggest how to reinvent capitalism and release a wave of
innovation and growth after the global downturn. They propose there are three key
conducts through which companies can create shared value opportunities: by reconceiving
products and markets; by redefining productivity in the value chain, and by enabling local
cluster development (Porter & Kramer, 2011). In their opinion, every company should look
at decisions and opportunities through the lens of shared value; this would lead to new
approaches that generate greater innovation and growth for companies, and consequently,
37
also superior benefits for society (Porter & Kramer, 2011). In this recent article from
February 2011 Porter and Kramer emphasize the definition of shared value as “policies and
operating practices that enhance the competitiveness of a company while simultaneously
advancing the economic and social conditions in the communities in which it operates”
(Porter & Kramer, 2011, p. 66). They state the concept rest on the premise that both
economic and social progress must be addressed using value principles; being value defined
as benefits relative to cost not only in economic terms but also counting with societal issues.
Therefore we consider this concept to be relevant for our thesis, and precisely we have
included “shared value” as one of the themes included in the theoretical framework, which
will be clarified at the end of this theory section. In the back and forth process from the
theory to the empirical data we observed how companies disclose shared value topics in
their letters so we included it as a new theme. For the purpose of the study and according to
the above reviewed theory we define shared value in our framework as the “firms’ new
discourse on how to deliver sustained social and economic value for both the company itself
and the community that surrounds it”.
3.4 Institutional Theory
3.4.1 Review of formal and informal institutions
There is a broad distinction between formal and informal institutions (Powell & Di Maggio,
1991). The most formal are the regulatory institutions representing principles and standards
provided by laws and other official regulations. The informal institutions can be grouped into
normative and cognitive (Scott, 1995). Normative institutions involve less formal standards
that are accepted in company networks. Cognitive institutions represent the most informal
rules and values that can be exemplified by social interaction between CSR players (Scott,
1995).
38
International companies can find the constraining nature of formal and informal institutions
in their path, for instance resulting from stricter regulation of economic exchanges, and
limitation of business activity in some countries. But also it is recognized that institutions
provide general useful frameworks to enable business procedures, and institutional
regulation helps setting the basic principles for businesses within the broad field of CSR. To
illustrate this, common CSR standards may perhaps produce a number of limitations for
corporations, but it also makes easier the process of sharing business knowledge in the CSR
field. Thus, formal and informal institutions should not be viewed exclusively in terms of
their restricted character, but also as bringing opportunities for those firms who truly
understand and use them correctly.
As we have already mentioned, obviously there will be different regulations, beliefs and
standards connected to CSR in different countries, and therefore those will outline how
businesses must operate in different countries. Matten & Moon (2008) explain and argue
how and why CSR differs among countries and change within them. They suggest a
distinction between “explicit CSR” and “implicit CSR” in their comparative research on
businesses’ CSR communications in the U.S. and Europe that provide relevant and
comprehensible arguments when looking at CSR in both regions. “Explicit CSR” refers to
business policies that take responsibility for society, by integrating voluntary programs or
other CSR strategies with the aim to combine social and business value. Explicit CSR may be
responsive to institutional or stakeholder pressure (Matten & Moon , 2008). Alternatively,
“implicit CSR”, “refers to corporations’ role within the wider formal and informal institutions,
for society’s interests and concerns” (Matten & Moon , 2008, p. 409). It is made of values,
norms and rules that produce requirements for organizations to deal with stakeholder
issues. Continuously, Table 3 shows the main differences between explicit and implicit CSR.
Within the European business environment, CSR has until now been characterized as
“implicit” and relatively moderate in terms of communication. In the U.S., in contrast, a
more “explicit” communication strategy has been evident (Matten & Moon , 2008). They
argue that a reason could be that the European CSR has been originated under wider
institutional responsibility leaving less incentive for firms to take a more explicit
responsibility.
39
Table 3. Explicit and Implicit CSR
Explicit CSR Implicit CSR
Describes corporate activities that assume
responsibility for the interest of society
Describes corporations’ role within the wider formal
and informal institutions for society’s interests and
concerns
Consists of voluntary corporate policies, programs,
and strategies
Consists of values, norms, and rules that result in
(often codified and mandatory) requirements for
corporations
Incentives and opportunities are motivated by the
perceived expectations of different stakeholders of
the corporation
Motivated by the societal consensus on the
legitimate expectations of the roles and contributions
of all major groups in society, including corporations
CSR as an explicit element of corporate policies CSR as an implicit element of the institutional
framework of corporations
Liberal market economies Coordinated market economies
National institutions encouraging: National institutions encouraging:
? Individualism ? Collectivism
? Discretionary agency ? Systematic/obligatory agency
? Incentivizing responsive actors ? Incentivizing program-driven agency
? Liberalism ? Solidarity
? Network governance ? Partnership governance
? Policies providing discretion ? Policies providing obligations
? Isolated actors ? Interlocking/associated actors
Source: Adapted from Matten & Moon (2008) p. 410, 411
3.4.2 The National Business System
In this point we will present a theoretical background with the aim of deeper clarifying the
differences in CSR among countries, and how national institutions influence it. Matten &
Moon (2008) adopt the concept of National Business Systems (NBS) which evolves from
differences in historic, legal and institutional structures (Whitley, 1997 cited in Matten &
Moon, 2008, p. 407). The authors identify there are four key subdivisions of national
institutional frameworks, that are the political system, the financial system, the education
and labor market system, and the cultural system
Even if it is common to describe the Scandinavian countries as a homogeneous group, they
are different in some issues such as market, ownership or corporate governance structures.
Although they are quite alike when it comes to macroeconomic conditions such as the
political stability, enforcement of the law, government effectiveness, control of corruption,
40
accountability or labor regulations; displaying then a homogeneous image of the region in
these terms (Thomsen, 2008).
In general Latin America is a much more heterogeneous region. The CSR agenda in Latin
America has been profoundly shaped by socio-economic and political conditions, which have
tended to make worse many environmental and social problems such as deforestation,
unemployment, inequality, and crime (De Oliveira, 2006). Despite these problems CSR is
seen by many Latin Americans as the hope for positive change in the face of persistent
poverty, environmental degradation, corruption, and economic stagnation (Schmidheiny,
2006).
In this section we present a brief description of similarities and differences between
Scandinavian and Latin American institutional systems. For comparison, below we also
present information from Europe and the U.S. from Matten & Moon (2008) keeping the
argument that their framework of “explicit CSR” (represented by the United States) and
“implicit CSR” (Europe) gives significant insights for any CSR regional comparison with
reference to the different national business systems in which firms operate.
The political system
It can be said that the most visible political difference between Europe and the U.S. is the
role the state plays. One of the underlying reasons for the presence of implicit CSR in Europe
is the role of the formal institutions of the region. In contrast, the U.S. market is based on
different values and principles justifying the wider use of explicit CSR (Matten & Moon,
2008).
In Scandinavia the State takes responsibility for its society through programs in public health
and housing, pensions or unemployment compensations for example. Sweden, Denmark,
Norway and Finland are all relatively small, but wealthy social democracies known for their
high government expenditure (Thomsen et al., 2008). The reliance on the government and in
the national institutions has helped businesses in their development.
41
Regarding Latin America, in some of its countries policy change occurs repeatedly, while in
other it is stable, the region obviously being larger and more heterogeneous, definitively is
not as politically homogenous as Scandinavia. Therefore the political conditions under the
institutional framework that influence the capacity for governance vary significantly from
country to country; for example there are countries showing strong executive power and
weak legislature power, giving place to an unstable policy environment. Thus, the result is a
significant disparity in the level of policy stability across the region (Pereira, Singh, &
Mueller, 2011). This might be the reason of one of our suspicions regarding a more explicit
CSR in Latin America, being the largest multinational firms more involved with the
development of the region through CSR programs, covering those health, housing, education
services that the Government does not provide to the Latin population.
The financial system
Within the financial structure in Europe, companies are generally included in networks
consisting of a small number of large investors, being banks key players providing financial
support (Matten & Moon , 2008). Whereas European countries are known for having a large
amount of direct or mutually interlocking ownership; the United States, in contrast have
been more dependent on contract-based ownership. In the U.S., the stock market is the
largest financial source and companies are consequently obliged to show a high degree of
transparency and accountability to investors (Matten & Moon , 2008).
Denmark stands out in the Scandinavian perspective, since about two thirds of listed
companies are controlled by a majority shareholder. In Norway there is still a very significant
state ownership component in commercial banking. Sweden holds a tradition of large
business groups and large industrial firms. This kind of business structure has been favored
by the social democratic governments, by strong labor unions and by the industrialists’
family conglomerates. The result is that almost half of the stock market capitalization in
Sweden has long been under the control of the business spheres (Thomsen et al., 2008).
The most visible characteristics affecting the Latin American economies and financial system
are the rapid technological change, the economic globalization, the concentration of
42
ownership, the defined control, and the need for capital (Bedicks & Arruda, 2005). According
to Al Nasser & Garza (2009) the region has developed stabilization programs designed to
improve the underlying macroeconomic conditions but also significant and deep reforms
intended to liberalize and improve the efficiency of their financial markets. In Latin America
most companies are controlled by dominant groups, frequently families who carry out both
the role of owners and managers at the same time. Moreover Latin America has experienced
a decline in the number of listed companies in domestic markets since companies have gone
private because of the increasing internationalization of industry and finance (Bedicks &
Arruda, 2005).
The current economic crisis has clearly influenced the procedures of the formal institutions;
Governments around the globe have been required to mediate and intervene in the
economy to a greater extent. As a result in the financial system, the ownership structures in
many important financial institutions have moved toward a higher government stake. In
relation to firm’s CSR commitment under weak economic conditions, as it was reviewed
before, Campbell (2007) argues that weak financial performance and an unhealthy economic
environment is likely to reduce the probability that firms keep their CSR commitments as
before the downturn; but we will not able to study if that is true for both regions, since we
are studying a single fiscal year.
The education- and labor market systems
The education and labor market systems also differentiate Europe from the U.S. The
collaboration between the state and the private sector in Europe is much more evident than
in the U.S., since the state offers preliminary and secondary education. In the U.S., the
private sector is shaping the courses of action and strategies (Matten & Moon , 2008). Even
though, privatization of European industry and public services has produced a considerable
delegation of responsibilities to firms and has consequently increased societal expectations
of business (Matten & Moon , 2008).
Scandinavia is well known for its high government spending in education but at the same
time for its high income taxes to fund the latter. All the countries forming the region have
been focused in the high quality of education, being really oriented to the human capital
43
formation as a key asset for the economy. Moreover the state provides social protection,
retirement pensions, the unemployment compensations and other social insurances
(Rogerson, 2007).
On the other hand in Latin America, the education system is well ahead, with lower rates of
high education access. Additionally most social protection is provided through contributions-
based programs, which means is generally linked to employment conditions. Therefore only
workers in formal and structured employment positions have access to a range of social
benefits in most Latin American countries; and only certain types of employment offer
coverage for retirement benefits, unemployment compensation and health insurance
(Gasparini & Bertranou, 2005). Therefore one of the roles of the State to cover this gap
should be to compensate for deficiencies in the labor market through social programs for
individuals unable to find work, with low salaries, or without social benefits.
Notwithstanding there are some social programs that provide cash transfers or
compensations for certain basic services such, medication, as food or educational stuff.
Some governments in Latin America are also providing social security for those who do not
have access through employment (Gasparini & Bertranou, 2005).
In the next section within our empirical analysis we will be able to find out if the analyzed
companies in the region also try to cover the gap in social security, health and education
through their CSR programs.
Cultural system
In this point, the U.S. and Europe take up remarkably different positions that can be tracked
largely into history and culture. Their cultural systems have originated very different wide
assumptions about society, business and government; it can be said that Europeans show a
stronger faith in unions, labor organizations, political parties and the state itself (Matten &
Moon , 2008).
In terms of informal institutions, the Scandinavian countries are relatively small, and key
aspects like trust, transparency and accountability play important roles. Trust can substitute
formal law as a mechanism to protect minority investors in the Scandinavian countries,
44
which are believed to be small tightly networked societies. Media exposure may also be
important in uncovering unsustainable behavior of managers, board members, and brands
(Thomsen et al., 2008).
Looking at Latin America researchers on politics, bureaucracies and federalism have clear up
how institutional design affects the stability and quality of democracy and how the cultural
system of the region have originated related assumptions about society, business and
government. There are still persistent problems of corruption, clientelism, executive
legislative conflict, and the “unrule of law” in the region (Helmke & Levitsky, 2006). Despite
the consolidation of a variety of civil and human rights, many Latin American states have
failed to consistently sustain or enforce the rule of law and, as a consequence, many citizens,
particularly poor citizens do not possess these rights in practice (Helmke & Levitsky, 2006).
After this review of the national business systems and its different components we can
observe how the two regions of study differ in terms of political, financial, labor or cultural
systems. According to the framework proposed by Matten & Moon (2008) and once
reviewed their national institutions and what they encourage to business, we could
categorize the Scandinavian CSR as explicit within a coordinated market economy, and the
Latin American CSR as explicit within a liberal market economy (in general terms, but being
aware of exceptions within the region).
3.5 Global trends: neo-liberalism, neo-institutionalism and the political
role of firm
Recently, multinational companies have shown a more explicit commitment to CSR, as the
concept has been more widely accepted in formal and informal institutions around the
world. This trend is also seen in the companies from Scandinavia and Latin America; they
show a more solid commitment in their CSR written communications. The generalized shift
from implicit to explicit may have increased even more lately due to the effects of the
financial crisis and the blames of irresponsible corporate behavior; but also due to the
globalization and the getting closer reporting trends for international players. There are new
45
similar trends and constructs in CSR within national or regional boundaries of reference,
because of the globalization effects and the harmonization of global CSR beliefs and
practices (Tengblad & Ohlsson, 2010). To explore these current global trends we would like
to review the so called neo- institutionalism, neo-liberalism in politics and economy, and the
relatively novel political role of the firm and political CSR.
Before we start reviewing these global trends, and even if we have already been using the
term and being aware of the general knowledge, we consider suitable to include a formal
definition for globalization in this part. “Globalization can be defined as a process of
intensification of cross-border social interactions due to declining costs of connecting distant
locations through communication and the transfer of capital, goods, and people. This
process leads to growing transnational interdependence of economic and social actors, an
increase in both opportunities and risks, and to intensified competition” (Scherer & Palazzo,
2011, p. 901).
New-institutionalism
Despite the fact that we have just reviewed how CSR differs according to different locations
and therefore how different national business systems influence CSR issues, we are aware
that in recent years institutional and business trends are also shaped by the globalization
effects. It can be said that institutional frameworks and national business systems also
evolve according to globalization pressures; then multinational corporations as part of wider
spheres of action have also to respond to new sources of responsibility. As a result, in terms
of Matten & Moon (2008) explicit CSR is gaining extent across Europe and beyond since the
concept is more generally accepted in formal and informal institutions.
In order to understand this changing process leading to a more explicit CSR communication
the “new institutionalism” (DiMaggio & Powell, 1991; Meyer, 2000) perspective is
appropriate. New institutionalism explains how different institutional environments
influence firms to become more homogeneous across national borders; this theory is more
focused on the external forces coming from the environment than from the company itself.
It focuses on the resulting standardized business practices in organizations across industries
and countries.
46
Matten & Moon (2008) state that the expanding explicit CSR approach can be explained by
the fact that organizational practices have evolved and become institutionalized because
societal actors perceive them as legitimate. According to (DiMaggio & Powell, 1983) this
legitimacy is produced by a process of institutional isomorphism which is shaped by three
external pressures: coercive, mimetic and normative.
Relevant to this study, they are defined below and related to the purpose of the thesis.
Coercive isomorphisms arise primarily from formal and informal pressures laying on
businesses coming from other organizations or institutions they deal with. These types of
pressures refer mainly to the regulatory environment, represented by rules, norms or laws.
In relation to CSR, this would implicate normative initiatives, particularly those of the
governments or other international institutions, advocating and pressuring for a strategic
integration of CSR for example. As a remarkable example in Europe some Governments have
taken serious initiatives to further encourage CSR. Precisely in Denmark from 2009 a new
regulation on CSR has been set, advocating for compulsory CSR reporting for the largest
companies of the country in their annual reports. The aim is to inspire Danish businesses to
take an active position on social responsibility and communicate it, this way promoting more
CSR awareness and transparency (Danish Commerce and Companies Agency, 2011).
Mimetic processes are not a result of coercive authority, but rather of uncertainty and
increasingly ambiguous and complex external business environment. As a result, this
uncertainty leads organizations to shape their behavior according to peer companies. “When
goals are ambiguous, or when the environment creates symbolic uncertainty, organizations
may model themselves on other organizations” (DiMaggio & Powell, 1983, p. 151). Relating
to CSR, this pressure may be identified when international companies imitate one another in
their approach to CSR.
Finally, normative pressures stem primarily from the shared professional systems developed
within a given line of work, which ultimately define what is considered to be the ‘proper’
course of action, the conditions and methods of work, and the morally right thing to do.
Normative pressures revolve around the concept of professionalization (DiMaggio & Powell,
47
1983). For companies, sharing the same knowledge can lead to a standardization of CSR
procedures, and may possibly influence its development toward homogeneity. As an
example, a normative pressure would be present if professional forces such as the corporate
community, academia and soft regulation encourage Scandinavian firms to employ a
strategic approach in relation to CSR. In recent years, educational institutions have played an
important role in promoting CSR. CSR has become an integrated part of education in
business schools all over the world, implying that in the upcoming years business leaders
may be much more familiar with these standards.
Neo-liberalism
Recently we are seeing how contemporary trends in economy and politics are getting closer
around the world towards an economization of public domains and the predominance of
neo- liberal methods of governance and neo-liberal visions of civil society. The so-called neo-
liberalism is such a broad and complex concept, it’s not just an economic doctrine or a mere
set of political measures. According to Shamir (2008, p. 3) “neo-liberalism is rather a
complex, often incoherent, unstable and even contradictory set of practices that are
organized around a certain imagination of the ‘market’ as a basis for the universalization of
market-based social relations, with the corresponding penetration in almost every single
aspect of our lives, of the discourse and/or the practice of commodification, capital
accumulation, and profit making”. Thus, neo-liberalism, transfers the logic of the “market”
to other social domains, therefore extending a model of economic rationality and conduct
beyond the economy itself.
The neo-liberal discourse naturally influences CSR business practices and leads to the
assumption that business responsibilization and morality are grounded in a neo-liberal
epistemology that dissolves the distinction between economy and society with the “social”
being encoded as a specific example of “the economy” (Shamir, 2008). In this subject
Vallentin & Murillo (2009) are articulating similar concerns about the coming neo-liberalism
and the consequences of subordinating CSR to an economic rationale. Moreover, they
acknowledge the emergence of a neo-liberal mindset is not in opposition to CSR, but which
operates within the concept, and which is becoming governmentalized as conduct of
48
conduct through its application (Vallentin & Murillo, 2009). Even though they argue it is
needed to keep up a differentiated view not only of the business and morality of CSR
discourse, but also of CSR governance. The neo-liberal mindset is one of the crucial forces at
play in the CSR field, but it is not the only one (Vallentin & Murillo, 2009).
We recognize that within this neo-liberal global framework and the repercussion of the
financial crisis, in general, the capacity to influence the economic environment of civil
society and national governments is limited compared to the widening sphere of influence of
multinational corporations. On this global level, neither nation-states nor international
institutions alone are able to sufficiently regulate the global economy and to provide global
public goods, the collaborations with international corporations is well needed.
The gap between the rapid pace of economic globalization, especially financial, and the slow,
inadequate or uncoordinated regulatory responses have created huge problems in
governance that are unavoidable to deal with when reviewing the way governments want to
address progress towards sustainability and a more inclusive globalization. Therefore we
assume corporations as key players should innovate and make substantive changes, being
truly responsible for their economic, environmental and social influence. These assumptions
are related to the next point below when the corporations are considered to take a “political
role”.
Political role of the firm and political CSR
As we have explained within the neo-liberal mindset there is a need to redefine the social
responsibilities of businesses as “political actors” in a globalized world.
Scholars in management and economics have widely shared the assumption that businesses
should focus on profits only, while it is the duty of the state organization to provide public
goods for society (Friedman, 1970). In this view business firms are regarded as simply
economic actors, and governments and their state agencies are considered the only political
actors. Scherer & Palazzo argue that, under the conditions of globalization, the strict
separation of political tasks between private business and nation-state governance does not
hold any more; it is clear many corporations have started to assume social and political
49
responsibilities that go well beyond legal requirements and fill the regulatory space in global
governance (Scherer & Palazzo, 2011).
Within the effects of the current crisis corporate responsibility is challenged by a stronger
ethical imperative that goes beyond the framework of legal obligations and demand a
deeper social commitment. For this commitment to be effective, we already know CSR must
be integrated into long-term business strategies and taking into account both the demands
of shareholders and competition, as well as the impact on all the rest of stakeholders.
Increasingly, there is a growing need for preventive and effective regulation to incorporate
an assessment of the potential consequences of economic activity in the social and
environmental settings. Thus, corporate social responsibility has been placed on an
increasingly wide sphere, between the legal regulations and social expectations.
As a consequence of all the global trends, a new role of business arises: the “political role of
the firm” in a globalized economy and society. According to Scherer & Palazzo (2007) this
shift to a politicization of the corporation is due to the shifting societal demands the
corporation has to deal with and therefore firms replace implicit compliance with assumed
societal norms and expectations with an explicit involvement in public processes that before
were exclusively part of the state’s political agenda.
In recent years business firms have started to engage in activities that have traditionally
been regarded as definite governmental activities (Matten & Crane, 2005; Scherer and
Palazzo, 2008). This is especially true and visible for multinational corporations because they
engage in public health, education, social security, and protection of human rights while
often operating in countries with failed state agencies (Matten and Crane, 2005). Therefore
multinational corporations through their CSR programs address social problems (such as
AIDS, malnutrition, homelessness, and illiteracy), identify ethics codes, protect the natural
environment, and engage in self-regulation to fill global gaps in legal regulation and moral
orientation (Scherer & Palazzo, 2011). Scherer and Palazzo (2007) also argue that some of
the observable CSR activities, such as developing corporate codes of conduct in partnership
with critical NGOs, exposing corporate CSR performance to third-party control, linking
corporate decision making to civil society discourses, or changing corporate attention and
50
resources to societal challenges beyond immediate stakeholder pressure, are all pointing to
the “politicization of the corporations”.
These above mentioned activities demonstrate an increasing participation of corporations in
the creation of global public goods and in the development of global business regulation.
Matten and Crane (2005) suggest that in the path of this progress some business firms have
even begun to assume a state-like role. Many companies carry out the functions of
protecting, enabling, and implementing citizenship rights, which have originally been
considered the exclusive responsibility of the state and its related agencies (Scherer &
Palazzo, 2011). Matten and Crane (2005) also maintain that these corporate initiatives often
occur in cases where the state system fails, that is, when the state withdraws, when the
state has not yet implemented basic citizenship rights, or when it is mainly unable,
powerless or unwilling to do so. As a consequence these authors conclude that business
firms have become important “political actors” in the global society.
3.6 Legitimacy
Legitimacy is a concept that has been discussed and researched for several decades and the
broad scope of available literature regarding the subject has been the result of different
takes that researchers have had throughout the years. Though, the key in our reflection has
been Suchman’s (1995) approach of legitimacy, which appears as the most thorough and
comprehensive. He proposes a thorough view of the theory and makes a typology of all
types of legitimacy from different theorists and scholars have come up with.
Organizational legitimacy has been defined by scholars as the acceptance of the organization
by its environment and has suggested it to be vital for the survival and success of
organizations (Kostova & Zaheer, 1999). Organizational legitimacy emphasizes the social
acceptance from adherence to social norms and expectations and is defined as “a
generalized perception or assumption that the actions of an entity are desirable, proper, or
appropriate within some socially constructed system of norms, values, beliefs, and
definitions” (Schuman, 1995, p. 574). In other words, legitimacy is the result of the
51
congruence between the behavior of an entity and the set of beliefs of the audience it is
judged by. What is fundamental is the view of the audience and not the opinion of a single
individual (Schuman, 1995). Without the legitimacy from the stakeholders, the organization
will neither be capable of renewing its license nor gain new areas of power to grow (Castelló
& Lozano, 2011).
In the past years, the legitimacy of corporations has been challenged due to the conflicts
between companies and civil society. Conflicts such as violations of human rights and
environmental side effects have both threatened companies reputation and have raised the
question about the social role of business in general (Palazzo & Scherer, 2006). Legitimacy
has become very crucial for corporations and even more of a crucial issue for those
companies that operate worldwide. Hence, being successful in gaining and retaining
legitimacy demands that a corporation comprehends the norms, values, beliefs and
definitions of its environment and that it changes in order to reach the goals it has set itself.
Schuman (1995) distinguishes among three types of organizational legitimacy: pragmatic,
cognitive and moral legitimacy. The three types of legitimacy have all to some degree a
general perception or belief that organizational actions are desirable, proper or relevant
within some social system constructed of norms (Schuman, 1995).
3.6.1 Pragmatic legitimacy
Pragmatic legitimacy is a result of the self-interest of the organizations stakeholders
(Schuman, 1995). Here, legitimacy is assessed in terms of the extent to which the
organization acts to serve and fulfill the interest of its stakeholders. These “individuals”
(stakeholders) will ascribe legitimacy to the company as long as the corporation acts to serve
the needs and interests but also that the stakeholders perceive to gain a benefit from the
corporation’s activities (Palazzo & Scherer, 2006). The concept can be divided into the
exchange-, influence- and dispositional legitimacy between organizations and its
stakeholders (Schuman, 1995).
3.6.2 Cognitive legitimacy
Cognitive legitimacy is about when the audience sees no other possibility than the existing
52
system. As cognitive legitimacy operates at the subconscious level, it creates difficulties for
companies to manipulate and have an influence over the viewers’ perceptions (Palazzo &
Scherer, 2006). Thus, cognitive legitimacy is more about proposing something to the
audience that its system of values allows it to get an understanding of, if not, the audience
will refuse it. Consequently, the behavior of the corporation could often end with the firm’s
adaption to social expectations (Palazzo & Scherer, 2006).
3.6.3 Moral legitimacy
Moral legitimacy rests on the moral judgments of an organization’s output, procedures,
structures and leaders (Palazzo & Scherer, 2006) but also on the judgment concerning
whether the activity is “the right thing to do” (Schuman, 1995); “it reflects a prosocial logic
that differs fundamentally from narrow self-interest” (Schuman, 1995, p. 579). Thus, it is
expected that moral concerns generally prove to be more resilient/resistant to self-
interested manipulations than purely pragmatic thoughts. According to Schuman (1995), he
describes the moral legitimacy of organizations as the result of “explicit public discussion”
and he believes that corporations can manage moral legitimacy if they are determined to
participate in these discussions (Palazzo & Scherer, 2006). It is also of importance when
managing moral legitimacy, that corporations communicate and convince others by rational
arguments rather than manipulation and persuasion (Palazzo & Scherer, 2006).
3.6.4 Managing legitimacy in a globalized world
Schuman (1995) introduced two approaches when “managing legitimacy” – strategic and
institutional. The institutional approach (cognitive focus) outlines legitimacy as an often-
unconscious alteration process, where the firm reacts to external expectations and therefore
the probability to really manage legitimacy is partial (Schuman, 1995). The strategic
approach (focused on pragmatic legitimacy) implies that companies treat legitimacy as more
of an operational resource where corporations have the capability to “instrumentally
manipulate and deploy evocative symbols in order to garner societal support” (Schuman,
1995, p. 572). However these strategic attempts, often just remain a symbolic reaction to
legitimacy pressure as such firms find it fundamental to conform to the normative demands
of their audience and create support and reputation (Ashforth & Gibbs, 1999). However,
53
according to Schuman (1995) strategic manipulation is not helpful when it comes to ensuring
or stabilizing moral legitimacy because its short term effects.
In Schuman’s (1995) point of view, “pragmatic legitimacy is too weak due to its limited
(group-specific) and ephemeral impact and if we further assume that cognitive legitimacy is
devaluated through pluralisation, moral legitimacy becomes the decisive source of societal
acceptance for corporations in an increasing number of situations” (Palazzo & Scherer, 2006,
p. 74). Palazzo & Scherer (2006) conclude that the move from a stable industry society to a
more globalized post-industrial society, has resulted in the erosion of cognitive legitimacy
and in a world with growing resistance towards pragmatic legitimacy. Palazzo & Scherer
(2006) suggest that the CSR and management strategies of today is built upon a discussion
on organizational legitimacy that does not reflect the conditions in the globalized
economies, as these strategies are primarily based upon pragmatic and cognitive legitimacy.
In the globalized world of today, the pragmatic and cognitive forms of legitimacy are
becoming more and more pressured as a consequence of the increasing role of the
individual in society. In addition, the importance of stakeholder’s pressure at the local level
is destroying the social view on general norms and, hence, institutional legitimacy (Castelló
& Lozano, 2011). It is no longer enough to mainly engage in philanthropic donations and CSR
activities to gain legitimacy from various stakeholders, since what was taken for granted
before is under discussion. Therefore corporations have begun to search for a new form of
legitimacy through their CSR activities, moral legitimacy (Castelló & Lozano, 2011).
Moral legitimacy has become “the core source of societal acceptance” (Palazzo & Scherer,
2006, p. 78). To give an example, after September 11, 2001 companies stopped the habit of
going offshore with their business in order to avoid taxes since this was thought of being
unpatriotic (Johnson & Holub, 2003). This example demonstrates how established
businesses can fail to keep their cognitive legitimacy and become highly politicized (Palazzo
& Scherer, 2006).
Palazzo & Scherer (2006) contend that idea of the public acknowledgement and acceptance
cannot any more be connected from public discourse, even though the legitimacy theories
54
talk about the taken for granted societal background rules. Consequently, Schuman (1995)
argues that moral legitimacy results from communication and Palazzo & Scherer (2006)
suggest that this direction towards moral legitimacy, involves a turn from the economic,
utility driven, and output oriented view on CSR, to a political, communication-driven, and
input oriented concept of organizational legitimacy.
3.7 Reputation
“Reputation is a generalized expectation about a firm’s future behavior or performance
based on collective perceptions (either direct or, more often, vicarious) of past behavior or
performance” (Deephouse & Schuman, 2008, p. 14). Legitimacy and reputation have many
features in common as they both show social perceptions of conformity as being central
determinants of organizational success (Deephouse & Schuman, 2008). Fombrun has argued
that “the more a company pursues a strategy that differentiates it from rivals with each of
its major constituent groups, the more likely are constituents to ascribe a strong reputation
to the company” (Fombrun, 1996, p. 292). The critical media attention makes firms respond
quickly in ways that will maintain or restore their legitimacy and reputation (Wartick , 1992).
Reputation is a continuous measure and a firm’s position usually grows at the other
competitors’ expense. Reputation dynamics also pushes firm’s to differentiate them from
others by being more unique. As firm’s never know exactly the expected outcome of
transactions in advance, their partners or to be partners will look at the reputation of the
company in sequence to map previous performances onto present performances, (Barney,
1991; Deephouse & Carter, 2005). In organizational studies, research has shown that
companies with a advantageous reputation can yield important competitive advantages.
Legitimacy does not only affect how people act towards firms, but also how people see
firms. Weaver, Trevino, & Cochran (1999) claim that the negative media attention has an
impact on the development of CSR programs. Therefore firms must respond to these critics,
as some initiatives not necessarily reflect real problems or are tied to organizational goals.
55
3.8 CSR rhetoric strategies: Strategic, Institutional, Dialectic and Political
Castelló & Lozano (2011) identified 17 themes of rhetoric; in addition we identified 11 more
themes. The themes are grouped into four categories of rhetoric: strategic, institutional,
dialectic, and political role of the firm.
The first domain is the “Strategic Rhetoric”, which highlights how companies manipulate and
position evocative symbols in order to gather support from society (Schuman, 1995). The
themes included under strategic rhetoric are the following: operationalization, innovation,
reputation, strategic link, governance, shared value and leadership on CSR. Through the
strategic rhetoric, firms strive to build symbolic links with values embedded in the strategic
management tradition, for instance efficiency in various organization projects, operations of
innovation and corporate returns, with the goal to implicitly enhance corporate returns and
increase the company reputation.
Strategic rhetoric is accustomed towards what Schuman (1995) defines as pragmatic
legitimacy, where firms have a strategic interest to use their power to influence and
manipulate their social context. Strategic rhetoric assumes that that behind the firm’s CSR
activities lies the organization’s own egoistic interest (Schuman, 1995). Further, in capitalist
societies, corporations are required to maximize profits and thus, shareholder value
(Castelló & Lozano, 2011). In the end, all the organization’s activities (including CSR) should
in one or another way contribute to the firm’s profit (Margolis & Walsh, 2003; Vogel, 2005;
Wartick & Cochran, 1985) and support the business objectives (Wood, 1991). Furthermore,
firms are encouraged to find other forms of rhetoric strategies to explain e.g. hopes and
expectation as strategic rhetoric has its weaknesses in its posivistic character and
instrumental legitimation (Castelló & Lozano, 2011).
The second category of rhetoric is the “Institutional Rhetoric” and includes themes such as:
CSR, sustainability, philanthropy, stakeholder dialog and sustainable growth; this group of
themes is often used in the CEO discourse with the aim to gain legitimacy and acceptance in
society (Castelló & Galang, 2011). Institutional rhetoric is oriented towards cognitive
legitimacy, and implies firm’s desire to conform to the expectations from society (Schuman,
56
1995). Firms use themes, as CSR and stakeholder engagement as they are very common
representations of the CSR movement to show the organization’s worthiness and
acceptability (Oliver, 1991). Castelló & Lozano (2011) argue that that theme, such as CSR and
sustainability, remain fairly academic and meaningless and are losing their normative force
today. Further, although institutional rhetoric is recognized and used as an instrument for
cognitive legitimacy it does not lead to moral legitimacy (Castelló & Lozano, 2011).
The third domain, “Dialectic rhetoric” incorporates themes such as global standards,
citizenship, accountability, partnership, global agenda, inclusivity, focus on the issue and
social contribution; Dialectic rhetoric has its roots in the communication/dialog practice
between corporations and their stakeholders (Castelló & Lozano, 2011). The organization’s
aim is to inform more about their actions and results and increase the acceptance of
corporate decisions making (Scherer & Palazzo, 2007). The language of dialectic rhetoric
used in the CEO discourses underlines the importance of generating the common good
(Argandoña, 1998) and community building through different activities for the citizens
(Waddock, 2004). The Global standards is one of the themes with the clearest example as it
refers to certifiable or non certifiable standards that aims in increasing business
accountability. Some examples of cited standards are: GRI, AA 1000 AS, ISAE 8000, Dow
Jones Sustainability Index, FTS100 and the Global Compact, most of them belonging to civil
society organizations (Castelló & Lozano, 2011). The abundance of dialectic rhetoric should
help the enhancement of discursive quality (Habermas, 1990; Scherer & Palazzo, 2007)
among corporations and stakeholders as it unfolds/opens corporate decisions making to civil
society discourses (Palazzo & Scherer, 2006). The authors claim that the dialectic rhetoric is
based and built upon the communicative efforts between the actors involved. Schuman
(1995) argues that moral legitimacy is the outcome of communicative activity, in which
organizations seek to persuade each other about which direction is more appropriate or
whether or not to share the collective action. The notion of dialectic rhetoric is that it aims
to build a kind of organization that is adapted toward mutual understanding and agreement.
The last domain, the “Political CSR rhetoric” includes themes as: access, development, rights
and political engagement. All of them point out to the new political re-conceptualization of
the role of firms, which we understand as the enlarged political responsibilities for business
57
and the long-term collaborations with governments and civil society actors. We interpret
these themes as a transition from voluntary, business driven or philanthropic acts to a long-
term politicized collaboration with governments and civil society actors. In this domain firms
try to make an effort in the community by undertaking “civilizing” activities ; that is firms try
to engage with the communities and also to create some sort of communication link
between the firm and its communities with the intention of finding a mutual understanding
(Castelló & Galang, 2011). This rhetoric is as the dialectic rhetoric, a new form of legitimacy
that firms try to obtain that we associate with moral legitimacy as well as it is acknowledged
in political CSR theory (Palazzo & Scherer, 2006). Also the political rhetoric as the dialectic
involves a certain degree of stakeholder engagement and the creation of communicative
links and deep collaborations between the firm and its communities with the aim of finding
mutual benefits.
While traditional theories of legitimation such the ones associated to institutional theory
and strategic management theory focus on a specific issue that needs to be legitimated by
the corporation, a political theory perspective emphasizes that the legitimation of
organizations deals with the complex power relationships among the social players involved
(Castelló & Galang, 2011). Within the institutional theories, moral legitimacy has been widely
defined as a process that reflects a positive normative evaluation of the organization and its
activities (Schuman, 1995).
Moral legitimacy refers to conscious moral judgments on the organization’s actions,
structures or leaders; it is resting not on judgments about whether a given activity benefits
the executor, but rather, whether the activity is ‘the right thing to do’ in a given context
(Schuman, 1995). It has been argued that the pluralism of modern societies in the context of
an increasing globalization results in a loss of cultural homogeneity that deteriorate the
normative taken-for-granted of the institutional conception of moral legitimacy (Palazzo &
Scherer, 2006). Corporations obtain moral legitimacy mostly through their strong
involvement in discussions with the rest of the political actors (Palazzo & Scherer, 2006). In
order to manage moral legitimacy organizations need to communicate by persuading others
using reasonable arguments and not through enforcing positions (Scherer & Palazzo, 2007).
58
To sum up, Table 4 below gathers the characteristics of the four different types of rhetoric
strategies.
Table 4. Institutional, Strategic, Dialectic and Political Approaches to the Legitimization
Process
Strategic Institutional Dialectic Political
Who manages
legitimacy
Managers in charge
of management
Organizations by
conscious or
unconscious
adaptation
Organizations aware
of their ethical
dimensions and
power relations to
society
Organizations aware
of their ethical
dimensions and
power relations to
help achieve a more
equal society
Main concepts Performance Social contract,
duty
Inclusion, dialog Collaboration
Management
theories
Strategic
management;
corporate social
performance
Business ethics;
stakeholder
approach
Corporate
citizenship
Political role of the
firm
Role of legitimacy
Pragmatic
llegitimacy
Cognitive legitimacy Moral legitimacy Moral legitimacy
Way
Legitimacy is
managed
through CSR
Organizations
provide concrete
accounts of the
benefits of their
actions to business
Organizations use
normative
structures
recognized by the
public to signal
legitimacy
Organizations
consideration as a
corporate citizen
Organization aims at
improving the
discursie quality
with their
stakeholders
Legitimacy message We manage well;
we are accountable;
we use CSR to earn
additional profit
We are “good” and
responsible; We
belong to the CSR
community
We want to be
engaged in a dialog
We want to engage
you stakeholders in
an equal dialog
Examples in
literature
(Sundaram &
Inkpen, 2004;
Vogel, 2005;
Wartick & Cochran,
1985; Wood, 1991)
(Fombrun &
Shanley,
1990; Gardberg &
Fombrun, 2006)
(Matten & Crane,
2005; Palazzo &
Scherer, 2006;
Scherer & Palazzo,
2007)
(Matten & Crane,
2005; Palazzo &
Scherer, 2006;
Scherer & Palazzo,
2007)
Source: Adapted from Castello & Galang 2011(working paper) & Castello & Lozano (2011)
3.8 Summation of the theoretical framework
Castello & Lozano (2011) identified 17 themes of CSR rhetoric; in addition we identified 7
more themes. Table 5 below outlines these themes we have based the analysis on, and gives
a brief explanation for each.
59
Table 5. Categories of rhetoric and themes' description
Category of rhetoric
(Overarching
dimensions)
Themes Description of Themes Examples
Strategic CSR rhetoric Operationali-
zation
Innovation
Reputation
Strategic Link
Governance
Shared Value
Leadership in
CSR
Mention of how businesses are embedding
CSR in their business systems, processes
and structure including the development of
new capabilities
Any process leading to new products or
processes resulting from CSR policies or
stakeholder engagement.
Any mention of reputation in relation to
CSR
Any mention of the relation between CSR
or sustainability activities and the firm’s
strategy
Any mention of the importance of the
governance structure related to
sustainability or CSR issues. Mention of
compliance of rules or processes. Mention
of ethical norms or policies.
Any mention of policies and operating
practices that enhance the
competitiveness of the firm while
simultaneously advancing the economic
and social conditions in the communities in
which it operates. Shared value creation
focuses on identifying and expanding the
connections between societal and
economic progress
Self representation and companies’ aim to
lead CSR development in their business
strategies.
Business process; systems;
people skills; performance,
excellence, monitoring
performance; coordination with
supply chain to create socially
responsible product.
Innovations; innovate; new
products
Reputation
Corporate performance;
stakeholder value; business case;
increase competitiveness through
CSR
Corporate Governance;
compliance; code of conduct;
integrity; professionalism; ethical
policy
Firms’ new discourse on how to
deliver sustained social and
economic value for both the
company itself and the
community that surrounds it.
Statements or any mention of
addressing the specific CSR
leadership and challenges that
the firm faces (accomplishments
from past years, goals for the
next years)
Institutional CSR rhetoric CSR
Sustainability
Philanthropy
Stakeholder
dialog
Sustainable
growth
Voluntary initiative, integrates social and
environmental concerns in business
operations. Mentions responsibilities.
Any mention of activities aimed at
balancing the fulfillment of human needs
with the protection of the natural
environment so that these needs can be
met not only in the present, but in the
indefinite future.
Voluntary donations, mostly through
foundations to solidarity activities. These
actions are considered to the different
from the object of the core business
Any process of communication with the
stakeholder coming from the firm. Includes
communication, dialog, and response.
Firms engaging in global growth to enlarge
its presence in new regions across the
world and mentioning explicitly sustainable
growth to make it possible.
CSR; triple bottom line; socio-
economic factors; collective
responsibility
Sustainable development;
sustainability.
Philanthropy; solidarity activities;
donations; foundations.
Talking to stakeholders; ensure
we are responding to our
stakeholders; commit to our
stakeholders
Mentions to global sustainable
growth related to the classical
growth strategy but making
connections to a sustainable way
to achieve it.
60
Dialectic CSR rhetoric Global
Standards
Citizenship
Accountability
Partnership
Global
Agenda
Inclusivity
Focus on the
issue
Social
contribution
Certifiable standards focused on increasing
business accountability through reporting
Use of the metaphor of the firm as a citizen
Any mention of a process in which the firm
is held accountable by stakeholders. This
also includes voluntary actions by the firm
to increase its transparency
Any mention of collaborations of
partnerships other than strictly business
partnerships
Any mention of issues that are dealt with
by global institutions such as the UN,
especially if they are included in the UN
Millennium Goal. They can be considered
one of the top priorities for all actors (civil
society, governments and companies).
Mention of any activities aimed at
disfavored/ non-profit/ non-economic
stakeholders that are related to the firm’s
core business
A significant part of the statements refer to
a social/environmental problem that is
core to the firm’s business operation or
strategy
Any explicit mention of the importance of
the firm contributing to social
improvement, benefits to humanity or
positive change
GRI; Dow Jones Sustainability
Index; FTS100; Global Compact
Citizenship
Transparency; footprint; external
review committee, responsible
lobbying; accountable;
accountability
Collaboration between global
business; social entrepreneurs;
activist; governments; NGOs and
civil society
Climate change; poverty; equity;
energy needs; greenhouse gases,
water; carbon emissions; UN
World Diabetes Day; directly
mentioning “global agenda”
Non-traditional stakeholders;
promote an inclusive society
Responsible energy; universal
access to communications;
sustainable mobility
Contribution to positive change;
manage for the communities we
serve; deliver significant benefits
to humanity
Political role of the firm
Development
Access
Rights
Political
engagement
Transition from voluntary, business driven
and case-wise philanthropic acts to a long-
term politicized collaboration with
governments or civil society actors in:
Regional development
Access to services or products to previously
excluded customers. Any investment to
procure access to public services (not
related to the firm’s core business) to non-
economic stakeholders.
Rights and equity (fairness) among
(disfavored) stakeholders to build an
inclusive society.
Firm’s engagement through political
discourses to fill gaps in governments’
actions. Firms assuming enlarged political
co responsibility.
Actions that contribute to
communities, country or region
progress.
Firms’ aim to provide access to
their products/services to
underserved customers. Also the
procurement of access to public
services such as health or
education
Discourse on social and universal
rights touching upon different
social groups.
Democratic integration of the
corporate use of power,
especially in the transnational
context of incomplete legal and
moral regulation
Source: Adapted from Castelló & Lozano (2011) “Searching for New Forms of Legitimacy Through
Corporate Responsibility Rhetoric”, plus inclusion of new themes.
61
4. Empirical Analysis and Discussion
In this chapter we are presenting the findings of our empirical study. These are presented as
a comparison of statements from organizational documents from the Latin American and
Scandinavian top companies, following de theoretical framework or coding scheme
previously outlined. The focus of analysis and discussion is given to the cross-regional
differences and similarities found among Latin American and Scandinavian companies, as
well as to the different factors shaping them.
We would like to point out that since the primary source of data for this research have been
organizational documents, the statements representing the different CSR themes have been
collected directly from those documents available at companies’ corporate websites. We
have organized a data base to quote all the representative statements and to indicate how
many themes each company have mentioned according to the overarching CSR category and
the specific themes forming the categories. The output tables are attached in the appendix
as Table V and Table VI. Corporate documents, either Sustainable Reports or, in the case the
company did not provide this specific report, Annual Reports were accessed from the
corporate websites to access the executives’ opening letters.
In general the findings reveal that CSR rhetoric approach in Latin American companies’ top
companies varies from Scandinavian companies mainly in the “political role” Latin American
companies display. In the rest of rhetoric strategies both are similar and Scandinavian
companies show a more “dialectic” CSR rhetoric approach. Moreover, the statements about
CSR activities provided by companies’ executive letters is quite mature in the case of
companies from both regions; that was unexpected for us as researchers, since we expected
less CSR interest and therefore fewer statements in the Latin American companies’ reports.
Then we have observed how themes related to Corporate Social Responsibility,
Sustainability or Social Responsibility are widely in practice and therefore reported by top
Introduction
and RQ
Methodology
Theoretical
Background
Analysis Conclusion
62
companies from both regions. We think this is due to the effects of globalization making
international companies approach CSR from a standard global approach.
After this general overview, and following the next quantitative review, we will present the
differences among companies from the two regions more in detail for each category and
each theme. We are also including representative quotes from the reports.
Quantitative approach
A more quantitative approach based on the 74 companies analyzed provides opportunity for
further generalizations. The comparison between the themes composing the CSR rhetoric
strategies from both regions suggests that although the strategic and institutional rhetoric
remain dominant strategies, companies are also focusing on the dialectical and political role
of the firm. In the next page, in Figure 2, we can observe the total number of themes found
for each region in each category. In relative terms, we can observe Figure 3 where we
represent the total number of themes on each rhetoric category relative to the number of
themes included on it. (i.e. the Strategic rhetoric category is made out of seven themes:
operationalization, innovation, reputation, strategic link, governance, shared value, and
leadership on CSR; or the political role of the firm category is made out of four themes:
access, development, rights and political engagement). Hence in relative terms both
Strategic and Institutional are the most reported categories in both regions, then the
Dialectic is more reported in Scandinavia and the most significant difference is in the Political
role of the firm rhetoric category, where Latin America is outstanding. We can then refer the
Strategic and Institutional categories as the “mainstream” ones according to Castelló &
Lozano (2011), because they predominate in corporate reports from both regions. But even
though these are the predominant categories, the use of dialectic is also important, and the
political role of the firm is more significant in Latin America with respect to the results of
Scandinavia.
63
Figure 2. Comparison CSR rhetoric strategies, Latin America vs. Scandinavia
Figure 3. Comparison CSR rhetoric strategies Latin America vs. Scandinavia
(total number of themes observed relative to the number of themes of each category)
Continuously in figures 4 and 5 we can observe the percentage of total themes reported in
each category relative to the total number of themes reported in each region (total number
of themes for Latin America is 333 and for Scandinavia is 303). Representing that for
example in Latin America after counting all the themes companies have mentioned on their
corporate reports the Strategic category weights the 32% of the total, the Institutional the
23%, the Dialectic the 29% and the Political role 16%. Being aware that these weights are
relative to the number of themes included in each category, then we can observe how the
more numerous categories that are strategic and dialectic stand out.
107
75
98
53
101
68
101
33
Strategic Institutional Dialectic Policital role
Total CSR themes
Latin America Scandinavia
0
2
4
6
8
10
12
14
16
18
Strategic
CSR
Institutional
CSR
Dialectic
CSR
Political
role of the
firm
Latin America
Scandinavia
64
Figure 4. Percentage of total number of themes mentioned by Latin American companies
Figure 5. Percentage of total number of themes mentioned by Scandinavian companies
For comparison with the above results we can check the theoretical weight of each CSR
category in relation to the total number of themes each category includes, which is
illustrated below in figure 6.
Figure 6. Relative weight of each CSR category in relation to the total number of themes
Strategic
CSR
32%
Institutional
CSR
23%
Dialectic
CSR
29%
Political role
of the firm
16%
Latin America
Strategic
CSR
33%
Institutional
CSR
23%
Dialectic
CSR
33%
Political role
of the firm
11%
Scandinavia
Strategic CSR
29%
Institutional
CSR
21%
Dialectic CSR
33%
Political role
of the firm
17%
65
4.1 Strategic CSR
We name our first category, strategic CSR rhetoric, where we have included themes such as:
operationalization, innovation, reputation, strategic link, governance, shared value and
leadership on CSR. All of these themes focus on the way organizations influence and take
advantage of powerful symbols with the aim to try to get support from society (Schuman,
1995). Through strategic rhetoric, firms must maximize shareholder value by increasing
corporate returns or improving the reputation by embedding symbols in the strategic
management tradition, as for example managing management projects more efficient
(Castelló & Lozano, 2011). Within this rhetoric firms have the aim to relate the CSR activities
to the firm’s strategy, operationalization and innovation processes (Castelló & Lozano,
2011). In this rhetoric, the motives for the CSR interest and activities rest only in the
organizations self-interest, what Suchman (1995) defines as pragmatic legitimacy where the
main reason is for the organizations to earn profits so that in the end all the activities within
the firm, including CSR, must contribute to the profits of the company (Margolis & Walsh,
2003; Vogel, 2005; Wartick & Cochran, 1985). In this category CSR is viewed under the
principle where CSR activities only are accounted for when they support business objectives
(Castelló & Galang, 2011).
This category represents the aim of companies to provide concrete accounts of the benefits
of their actions to business through strategic means with the intention of maximizing
shareholder value and to garner societal support. In our distinction of CSR categories, the
Strategic rhetoric gathering seven different themes out of the 24 total, counts as the 29%
(see Figure 6 above), being the second biggest category after dialectic rhetoric.
We have noticed how companies from Latin American and Scandinavia show strong
commitment to this type of rhetoric by mentioning the different strategic CSR related
themes. By looking at the overall result for the category, the total number of Strategic CSR
themes reported by Latin American companies is 107 and 101 for the Scandinavian
companies, as we can see in Table 6 below. Furthermore in the Table 6 we can observe in
detail how many companies mention the different themes included in the strategic category.
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Graphically we can observe this distinction in Figure 7. Continuously Table 7 gathers in
relative terms the percentage of companies mentioning the different themes in relation to
the total number of companies analyzed in each region.
Notable, we can see how Latin American companies especially stick out in comparison to
Scandinavian companies in “Reputation”, showing a mentioning rate of 70,27 % in
comparison to 40,54% for the Scandinavian companies. In the “Strategic link” and
“Governance” themes, Scandinavian companies stick out in comparison to Latin American
companies and mentions strategic link by 37,84 %, versus 21,62% for the Latin American
companies, and display 72,97% out of the 37 companies analyzed in Scandinavia and 75,68%
respectively (Table 7 below) versus the 51,35% for both themes mentioned by the Latin
American companies.
After this general comparison within the overarching category, we are going to analyze the
different themes included in the Strategic rhetoric category individually.
Table 6. Total number of themes mentioned under the Strategic CSR rhetoric category
Strategic CSR Theme Latin America Scandinavia
Operationalization 29 34
Innovation 8 14
Reputation 26 15
StrategicLink 24 20
Governance 11 7
Shared Value 4 6
Leadership on CSR 5 5
107 101
Figure 7. Total number of themes mentioned on the Strategic CSR rhetoric strategy
0
5
10
15
20
25
30
35
40
Strategic CSR
Latin America
Scandinavia
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Table 7. Percentage of companies reporting in each category relative to the total number of
companies
Latin America Scandinavia
Operationalization 78,38% 91,89%
Innovation 21,62% 37,84%
Reputation 70,27% 40,54%
Strategic Link 64,86% 54,05%
Governance 29,73% 18,92%
Shared Value 10,81% 16,22%
Leadership on CSR 13,51% 13,51%
4.1.1 Operationalization
The “operationalization” theme refers to how corporations are embedding CSR in their
business systems and processes. Here, firms mention how they embed CSR in their business
processes, people skills and how they monitor performance; some of the examples of
companies mentioning this theme are:
“The Organization continues integrating the main indexes of corporate sustainability”, Banco
Bradesco (Brazil).
“In the area of environmental care, we improved processes for efficient water usage, and
appropriate handling or our wastes and emissions”, Femsa (Mexico).
“Internal controls which aim to minimize the potential environmental impact from energy
consumption, waste sorting, disposal of batteries, among others”, Oi Tele Norte Leste
(Brazil).
“We continuously invest in the best globally- available industrial technologies for the
protection of air, water and soil, so as to minimize the impacts of our operations on the
environment”, Gerdau Metalurgia (Brazil).
“We regularly evaluate the use of water and materials, as well as our carbon dioxide
emissions across the supply chain”, Nokia (Finland).
“By focusing on developing increasingly more energy-efficient engines and complete vehicles
that can operate on renewable fuels and by introducing hybridisation we are taking a lead in
the market”, Volvo (Sweden).
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“Electrolux has a three-part climate strategy that connects a crucial cause with good
business. It focuses on climate-smart products, communicating their benefits and
streamlining energy use in our own operations”, Electrolux (Sweden).
In all of these quotations from the companies’ executive letters opening either their
Sustainability or Annual Reports from 2009, we can see how CEOs bring up how the
company integrates CSR and embeds it in the company processes. The level of this theme
being mentioned in the CEO letters is 78,38% for Latin America and 91,89% for Scandinavia.
Most companies mentions something about operationalization as it is a standard theme and
clearly shows how the company stays committed to CSR.
4.1.2 Innovation
The “innovation” theme refers to processes that lead to new products or processes that are
the result either from CSR policies or from the engagement to stakeholders. This can be the
invention of new products that lead to more sustainable products or new processes in
relation to CSR.
Of the 37 companies in Latin America eight CEO letters mentions innovation, which accounts
for 21,62% in comparison to 37,84 % in Scandinavian companies. The quotations below
represent this theme:
“The advances made on managing this resource have resulted in an 8.3% increase in the use
of recovered water”, Grupo Mexico (Mexico).
“Through the "Committed to the Environment" program in 2009 we complemented new
product launches with degradable packaging technology, achieved a significant reduction in
the use of fuel and improved our management of solid waste”, Grupo Bimbo (Mexico).
“With an eye on a future with less emissions from the air transport sector, we participated in
a project for developing a new generation of renewable fuel from sugarcane, which may be a
long-term sustainable”, Embraer (Brazil)
“The realisation of Loviisa 3 as a combined heat and power plant offers an unprecedented
opportunity to even further reduce CO? emissions”, Fortum (Finland).
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“This new generation of insulins has the potential to offer better treatment for people with
diabetes and further strengthen Novo Nordisk's competitive position”, Novo Nordisk
(Denmark).
By looking at the innovation quotations from the executive letters we can observe that
companies in Scandinavia mentions innovations much more than Latin American companies.
The reason behind this can be due do the fact that the Scandinavian region has more access
to more advance technology due to the development of the region;
4.1.3 Reputation
The theme reputation displays any mentioning of reputation in connection with CSR such as
the firm’s achievements, positions and their uniqueness. In Latin America, the companies
tend to bring up more about themselves than in Scandinavia which can be seen from the
percentage of themes reported in the various executive letters, 70,27% in Latin America to
51,35% in Scandinavia. The reputation theme is the second largest theme after
operationalization in Latin America; consequently we can assume that Latin American
companies are more concerned in reputation issues than Scandinavian counterparts. We
include some quotations below to show what kind of reputation firms mentions in their CEO
letters:
“This performance has ranked Petrobas the fourth in the market value among listed global
energy companies”, Petrobas (Brazil).
“The Global Compact of the UN, which for the second consecutive year recognized our
previous sustainability report as a Notable Communication on Progress”, Vale (Brazil)
“Also being appointed for the third consecutive year, as a leading company in sustainability
in the financial services sector”, Itaúsa (Brazil).
“Today, we are the third largest clean energy company in the world), Electrobas (Brazil).
“This year Nokia was chosen as the “World Technology Supersector Leader.” This honor
means Nokia was ranked No 1”, Nokia (Finland).
“Fortum's reputation has improved and our investments in sustainability have received
recognition”, Fortum (Finland).
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“SKF Group won the Swedish Innovation Awards for its work on developing the new family of
energy-efficient bearings”, SKF (Sweden).
In the reputation quotes we can observe how Latin American companies are more
concerned about reputation and considers it more important to write about as the region is
developing and doing much better than previous years and try to make stakeholders more
aware about them and their economic, environmental and social performance
achievements. In general what we can deduce from the reputation mentions by companies
in both regions it that the Latin American companies mention how they are among the
leading companies in sustainability in their sector (i.e. the previous quotation from Petrobas
and Electrobas) while Scandinavian companies are mentioning how they are winning awards
(i.e. previous quotation from SKF).
4.1.4 Strategic link
When the CEO mentions anything about the relation between CSR or sustainability activities
and the firm’s strategy such as corporate performance, stakeholder value or increased
competitiveness through CSR it is a part of the “Strategic Link” theme. In Latin America 34
companies out of 37 (64,86%) have mentioned this theme in their executive letters while in
the Scandinavian companies 20 have mentioned this theme, therefore the percentage of
companies is 54,05%. The difference between the regions in this theme is not very large, and
as operationalization this theme is also commonly used in the CEO discourse, therefore the
high degree of appearance in both regions. We include some quotations below to represent
how various companies mentions this type of relation:
“In the economic area, our sustainability strategy proved its worth. Faced with a dramatic
global financial crisis, Vale demonstrated the practical competitive advantages of its
consistent management strategy”, Vale (Brazil).
“We firmly believe that integrating social responsibility into our business strategy not only
has immediate benefits, but is a factor in our success in confronting the difficulties companies
around the world are facing”, Femsa (Mexico).
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“In 2009, Cemig sought to continually improve its corporate sustainability actions, aligning
the creation of economic value respect for social environment with stakeholder preservation
of the environment”, Cemig (Brazil).
“Our business success is interconnected with innovating energy-savvy, resource-efficient
appliances. Embedding high social and environmental standards throughout our daily
operations is a crucial part of doing business well”, Electrolux (Sweden).
“Reaching the best results begins with having a solid strategy that includes analyzing our
performance on the economical, social and environmental levels”, Atlas Copco (Sweden).
“H&M strives to be a sustainable business- financially, socially and environmentally. If we are
to continue being a successful company, we believe that integrating sustainable thinking into
everything that we do is absolutely necessary”, H&M (Sweden).
4.1.5 Governance
The theme governance represents any mentioning of the importance of the governance
structure related to sustainability or CSR issues, the compliance of rules or processes and
ethical norms or policies. The associated issues are: corporate governance, compliance, code
of conduct, integrity, professionalism and ethical policy.
In Latin America 11 companies out of 37 (29,73%) have mentioned governance issues in
their executive letters which is the among the top 4 mentioned themes comparing to
Scandinavia where only 7 companies (18,92%) mentions this theme. Thus we can assume
that Latin American companies mention more governance issues than their counterparts,
since Scandinavia has more economic, political and social stability and because the
governments in Scandinavian countries plays a huge role in making sure that the governance
structures are very well established. Therefore in Scandinavia the companies don’t have the
same urge to mention governance structures as much as in Latin American corporations.
Some examples of companies mentioning this theme are:
“With improvements in corporate governance and in the managing methods, besides
developing a group of projects aiming at the integration of all Electrobas companies”,
Electrobas (Brazil).
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“Enhancing the corporate governance practices is also one of our priorities. Our Code of
Ethics and Conduct of Company was widely disseminated”, Sabesp (Brazil).
“For the Itausa group the operations carried out by its subsidiaries must be grounded on the
commitment to Corporate Governance ans sustainble actions. “, Itausa (Brazil).
“We have started the implementation of a group-wide Code of Ethics and Conduct, to
provide guidance for all employees in our day-to-day work”, Telia Sonera (Sweden).
“Our Code of Conduct and Code of Business Ethics are regularly assessed, making sure we are
on track wherever we are in the world”, Ericsson (Sweden).
“Our values, our Code of Conduct and the UN Global Compact initiative endorse also guide all
Metso employees towards sustainable operations”, Metso (Finland).
4.1.6 Shared Value
The theme “Shared value” includes the mention of policies and operating practices that
enhance the competitiveness of the firm while simultaneously advancing the economic and
social conditions in the communities in which it operates. The shared value creation focuses
on identifying and expanding the connections between societal and economic progress;
In Latin America 4 companies out of 37 (10,81%) have mentioned shared value in their
executive letters, which is the lowest mentioned theme in the region, while in Scandinavia 6
companies have mentioned this theme (16,22%). From these numbers we can assume that
both regions are concerned with delivering sustained social and economic value for both the
company itself and the community surrounding it; we include some quotations below to
represent what firms understand and mention in their CEO letters about shared value:
“Our capacity to generate value makes us one of the economic pillars of development in the
regions where we operate”, Grupo Mexico (Mexico).
“Thanks to our deep sense of service and to an understanding that attention to the needs of
the environment and the search for the welfare of the individual represent a commitment
and a raison d'etre that will continue to generate value for our stakeholders and future
generations”, Grupo Bimbo (Mexico).
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“Motivate us to continue to advance our corporate management alligned with Corporate
Social Responsibility aiming to achieve sustainable development that generates value for all
our stakeholders”, BCI (Chile).
“CSR should be an integral part of every organization that wants to build strong relationships
with its customers and have the acceptance of the societies in which it operates”, Nordea
Bank (Sweden).
“I am personally committed to continuing the sustainable approach we have employed for
many years. But this is not about sustainability and corporate responsibility just for the sake
of it. It is about creating long-term shareholder value, building the brand, and engaging with
customers and employees.”, Ericsson (Sweden).
“We are moving towards sustainability becoming a shared responsibility. “, H&M (Sweden).
“Sustainability efforts are an important component of the Volvo Group's competitiveness and
our ability to create value for customers, shareholders and future generations”, Volvo
(Sweden).
4.1.7 Leadership on CSR
This theme focuses on the self representation and companies aim to lead CSR development
in their business strategies. This can be statements or any mention of addressing the specific
CSR leadership and challenges that the firm faces (accomplishments from past years and
goals for next years).
In both Latin America and Scandinavia 5 companies out of 37 have mentioned leadership on
CSR in their executive letters, representing a 13,51% of the total number of companies
analyzed. Hence, we can assume that both regions have the same thought about the
importance of mentioning this theme in the CEO discourse. As this is a new theme that we
have discovered in the analysis of the CEO letters, companies are becoming more aware
about the importance of not just i.e. integrating CSR into business processes and strategy
but also the magnitude of becoming a world leader on CSR. We include some quotations
below to represent what firms mention in their CEO letters about this theme:
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“The improvement in our performance in the sustainability indicators that are detailed in this
report. They are contributing to the search for excellence in the management of our
businesses, making our actions transparent to society, and helping to spread our practices in
the sustainability area across all different countries in which we operate”, Vale (Brazil).
“To be in 2020 one of the two largest energy groups in Brazil in terms of market value, with a
significant presence in the Americas and to be a world leader in sustainability in the sector”,
Cemig (Brazil).
“2009 posed important challenges that we transformed into opportunities in order to keep
our commitment to efficiency, productivity and job creations, with the aim of strengthening
our leadership as a company that conducts itself in a dynamic and flexible manner, but above
all transparency, under the premise of fair and responsible practices”, Grupo Bimbo
(Mexico).
“KONE wants to be a part of finding solutions to these challenges by aiming to be the eco-
efficiency leader in the industry” KONE (Finland).
“As the world's cleanest and best diesel, NExBTL is set to be increasingly important financially
for us and publicly committed ourselves to using only certified palm oil as soon as possible”,
Neste Oil (Finland).
4.2 Institutional CSR
We name our second category, institutional CSR rhetoric, where we have included themes
such as: CSR, sustainability, philanthropy, stakeholder dialog and sustainable growth. This
category of themes is very often used in the executive letters and have the purpose to gain
legitimacy and garner society acceptance (Castelló & Galang, 2011). Institutional rhetoric is
oriented towards cognitive legitimacy, and implies firm’s desire to conform to the
expectations from society (Schuman, 1995). Themes such as CSR and stakeholder dialog are
very common in CEO discourses as they represent the CSR movement and presents the
firm’s worthiness and acceptability (Oliver, 1991). Castelló & Lozano (2011) argue that that
theme, such as CSR and sustainability, remain fairly academic and meaningless and are
losing their normative force today. Further, although institutional rhetoric is recognized and
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used as an instrument for cognitive legitimacy it does not lead to moral legitimacy (Castelló
& Lozano, 2011).
The institutional CSR rhetoric themes are quite common in CEO discourse from both regions
as these themes.
In our distinction of CSR categories, the institutional rhetoric gathering five different themes
out of the 24 total, counts as 20,8 % (Figure 6, p. 64) being the third biggest category after
strategic rhetoric.
We have noticed how companies from Latin American and Scandinavia show strong
commitment to this type of rhetoric by mentioning the different institutional CSR related
themes. By looking at the overall result for the category, companies from Latin America
show more commitment to this rhetoric strategy; quantitatively, the total number of themes
reported in the institutional category represent the 33,33% over the total of themes
mentioned by Scandinavian companies. In the case of Latin America this category represents
the 29,43% over the total of themes mentioned by all the Latin American companies. Then
the total number of Institutional CSR themes reported by Latin American companies is 75
and 68 for the Scandinavian companies, as we can see in Table 8 below. Also in Table 8 we
can observe in detail how many companies mention the different themes included in the
strategic category. Graphically we can observe this distinction in Figure 8.
Continuously Table 9 gathers in relative terms the percentage of companies mentioning the
different themes in relation to the total number of companies analyzed in each region.
Remarkable, we can see how Latin American companies stick out in comparison to
Scandinavian companies in themes such as “sustainability”, showing a mentioning rate of
70,27% in comparison to 56,76% for the Scandinavian companies. As well as in the
philanthropy theme where Latin America has a mentioning rate of 16,22% in comparison to
Scandinavia’s merely 2,7%. On the other hand themes such as CSR and Stakeholder dialog
are more mentioned in the CEO discourse of the Scandinavian companies, although it is not
by many percentages (see Table 9). After this overall comparison within the overarching
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category, we are going to analyze the different themes included in the institutional rhetoric
category separately.
Table 8. Total number of themes mentioned under the Institutional CSR rhetoric category
Institutional CSR Theme
Latin America Scandinavia
CSR 19 22
Sustainability 26 21
Philanthropy 6 1
Stakeholder
dialog
15 18
Sustainable growth 9 6
Total 75 68
Figure 8. Total number of themes mentioned on the institutional CSR rhetoric category
Table 9. Percentage of companies reporting in each category relative to the total number of
companies analyzed
Latin America Scandinavia
CSR 51,35% 59,46%
Sustainability 70,27% 56,76%
Philanthropy 16,22% 2,70%
Stakeholder dialog 40,54% 48,65%
Sustainable growth 24,32% 16,22%
0
5
10
15
20
25
30
Institutional CSR
Latin America
Scandinavia
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4.2.1 CSR
The “CSR” theme refers to how firms with a voluntary initiative, integrates social and
environmental concerns into their business operations. Here, the CEO mentions
responsibilities and voluntary actions taken by the company to promote responsibility such
as CSR, triple bottom line, socioeconomic factors and collective responsibility. In Latin
America 19 companies out of 37 (51,35%) have mentioned CSR in their executive letters; in
Scandinavia 22 companies (59,46%). Some examples of companies mentioning this theme
are:
“These changes in the economic, social, cultural, and human spheres which led FEMSA to
reinforce its business strategies including those related to social responsibility”, FEMSA
(Mexico).
“We take this opportunity to reaffirm our commitment, stated at the time that Fibria was
conceived, to develop our renewable forestry business as a sustainable source of life,
generating wealth and economic growth, , promoting human and social development and
guaranteeing environmental conservation”, Fibria Celulosa (Brazil).
“We are a company committed to society, to the environment, and to the rational,
sustainable use of natural resources” Kimberly Clark de Mexico (Mexico).
“In power and heat production, our strengths are in our production portfolio that supports
sustainability and utilizes renewable and low-carbon energy sources”, Fortum (Finland).
“We strive towards excellence in all areas of corporate responsibility, including economic,
environmental and social responsibility”, KONE (Finland).
“In accordance with our responsibility programme for 2008-2012, we are improving our
energy efficiency and reducing our emissions”, Kesko (Finland).
CSR is a theme that is often mentioned in the CEO letters, this can also be seen in both the
regions where more than 50% of the companies have mentioned this concept to a greater
extent. As can be seen from the quotations above this theme is often used to demonstrate
the organizations worthiness and acceptability. Companies use words as commitment and
responsibility towards in order to gain support from the society. The theme is often used as
a consideration to good business practice.
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4.2.2 Sustainability
The “sustainability” theme refers to activities aimed at balancing the fulfillment of human
needs with the protection of the natural environment so that the needs can be met not only
in the present, but in de indefinite future.
Of the 37 companies in Latin America 26 CEO letters mentions sustainability, which accounts
for 70,27% in comparison to 21 companies (56,76%) in Scandinavian companies. The
quotations below represent this theme:
“During 2009, Redecard remained dedicated to improving its market practices, supporting
the changes necessary to make its business more sustainable”, Redecard (Brazil).
“Grupo Modelo maintains its commitment with the company's sustainable development in
the communities in which it operates”, Grupo Modelo (Mexico).
“In 2009, Cemig sought to continually improve its corporate sustainability actions, aligning
the creation of economic value respect for social environment with stakeholder preservation
of the environment”, Cemig (Brazil).
“Managing responsibly. As we see it, a business can only be sustainable in the long term if it
meets stakeholders' expectations regarding social and environmental impact, in addition to
delivering strong financial performance. This is the core of our Triple Bottom Line approach.”,
Novo Nordisk (Danmark).
“Our performance in 2009 demonstrates our strong commitment to conduct our business in a
responsible and sustainable manner at all times”, Kone (Finland).
“We make great products using renewable and recyclable raw material - products that can
make a real difference for our customers, for their customers, for consumers and for the
planet”, Stora Enso (Finland).
By looking at the above quotations from the CEO letters we can observe that the term
sustainability is on many occasions lacking in-depth meaning. Kone and Novo Nordisk
constitutes two good examples of how the term is loosing its deeper meaning since it does
not refer to any new understanding of the role of the firm when applying the institutional
rhetoric, but instead to a collection of cognitive rhetoric that is already familiar to the
audience.
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4.2.3 Philanthropy
The theme “Philanthropy” displays voluntary donations mostly through donations to
solidarity activities. These deeds are considered to be different from the object of the core
business. By looking at the executive letters from both regions there is a noteworthy
difference in the mentioning of this theme between the regions. Out of all the Latin
American companies we have analyzed 6 of them are mentioning these theme, accounting
for 16,22% of all the Latin American. companies, while only one company of all the 37
Scandinavian companies mentions anything about philanthropy (2,7%). The reason behind
this can be the role of the state in both the regions. As Scandinavian governments are doing
much more for society and companies in Scandinavia are more focused on the regions
where they operate this could be the reason why they mention so little about philanthropy
while in Latin America the companies take the government’s role and takes the role of the
state in society. Consequently we can assume that Latin American companies are more
concerned in philanthropy issues than Scandinavian counterparts. We include some
quotations below to show what kind of philanthropy firms mentions in their CEO letters:
“We created the Vale Fund for Sustainable Development which is designed to support actions
by NGOs to balance environmental conservation with the improvement of social and
economic conditions of communities, with an initial focus on the Amazon rainforest blome”,
Vale (Brazil).
“In a related initiative, in 2009 SQM inaugurated a cultural center at a school in Toconao,
restoring the building, furnishing it, and providing the necessary equipment in order to offer
classes and workshops to the community”, SQM (Chile).
“Through the ALFA Foundation, we continued to promote all levels of the teaching-learning
process through such initiatives as scholarship programs, support to educational institutions
and infrastructure as well as teacher training”, Alfa Laval (Sweden).
“Our long term financial commitment to the World Diabetes Foundation, a leading funding
body devoted solely to projects within diabetes care and prevention in the developing world”,
Novo Nordisk (Danmark).
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4.2.4 Stakeholder dialog
The “Stakeholder dialog” theme includes any process of communication with the
stakeholder coming from the firm and includes communication, dialog and response to
various stakeholders.
In Latin America 15 companies out of 37 (40,54%) are communicating with stakeholders in
their executive letters while among the Scandinavian companies 18 (48,65%) mentions this
kind of communication in the CEO letters. In this theme, companies from both regions are
talking to stakeholders in almost the same extent, same number. We include some
quotations below to represent some types of stakeholder communications from the CEO
letters from both regions:
“To Petrobas the Sustainability Report is an essential tool for transparency in monitoring,
disclosing and rendering accounts to its stakeholders about its economic, environmental an
social performance”, Petrobas (Brazil).
“We would like even to communicate in a more and more effective way with our
stakeholders, recognizing the diversity of their expectations concerning our business and
offering then timely and appropriate answers”, Electrobas (Brazil).
“We understand that we can positively influence our stakeholders by providing high quality
information and promoting initiatives that contribute to the creation of a new consciousness
and the adoption of sustainable habits”, CPFL Energia (Brazil).
“A good dialog with the customers, simpler and more understandable products, efficient and
customer-friendly service solutions, and competitive conditions are key elements of this
work”, Storebrand (Norway).
“We do these things because we believe the sustainable development of Atlas Copco will
benefit all our stakeholders”, Atlas Copco (Sweden).
“A business can only be sustainable in the long term in it meets stakeholders' expectations
regarding social and envrion-metal impact, in addtion to delivering strong financial
performance”, Novo Nordisk (Danmark).
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4.2.5 Sustainable growth
The theme sustainable growth represents firms engaging in a global growth to enlarge their
presence in new regions across the word, mentioning explicitly sustainable growth to make
it possible.
In Latin America 9 companies out of 37 (24,32%) have mentioned sustainable growth in their
executive letters; in Scandinavia 6 companies (16,22%), which is one of the least mentioned
themes in both regions. From these finding we can deduce that Latin American companies
are to some level more concerned about achieving a sustainable growth than Scandinavian
companies.
Some examples of companies mentioning this theme are:
“We would like to achieve much more. Our future vision expressed in our 2010-2020 Strategic
Plan, shows the width of our ideal: to be the largest global corporate clean energy system in
2020”, Electrobas (Brazil).
“The new energy generation projects ensure the company's growth in the generation of
energy utilizing clean and renewa-ble sources”, Cemig (Brazil).
“In addition we invest in conservation and biodiversity efforts and closely collaborate with
communities to ensure that our growth is truly sustainable”, Fresnillo (Mexico).
“Economic responsibility for KONE means creating value for our stakeholders through long-
term growth in sales and profits. Value can only achieved by continuously developing our
competitiveness in a sustainable way”, Kone (Finland).
“We take sustainability into account, as a whole in our business. We want to solve global
problems actively and comprehensibly and thus create a foundations from Metso's
sustainable, profitable growth and for the continuous well-being of our stakeholders”, Metso
(Finland).
“As we grow and globalise our business, it is critical that all employees develop a deep
understanding of the principles at the heart of Novo Nordisk Way of Management, which
describes our vision, our values, our commitment and our policies, and thereby guides all of
our actions. Continual training is necessary as our business grows and attracts new people
and as the regulatory environment and global norms change”, Novo Nordisk (Denmark).
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4.3 Dialectic CSR
In this category of dialectic CSR rhetoric we have included the themes: global standards,
citizenship, accountability, partnership, global agenda, inclusivity, focus on the issue and
social contribution. All of them point out to the communication or dialog practice between
the corporations and their stakeholders; and all the activities they carry out to keep
acceptance from stakeholders. Therefore the dialectic themes are related to companies’
efforts to keep a good open dialog with stakeholders.
Through dialectic rhetoric organizations show awareness of their ethical dimensions and
power relations to society. Thus corporations recognize themselves as corporate citizens.
Then in contrast to the performance of just economic interests, dialectic CSR rhetoric brings
a form of harmonized dialog that is oriented toward mutual understanding and agreement
between the organization and the broad range of stakeholders and civil society (Castelló &
Lozano, 2011). As a result moral legitimacy (Schuman, 1995) emerges from that
communicative activity in which incumbents try to persuade each other to take joint
collective action or decide what direction is more suitable.
This category represents the aim of companies to share some values or principles with
stakeholders through dialectic means with the intention of addressing social issues. The
partnership and accountability themes might be the best representations of the
organization’s willingness to establish direct relationships with diverse stakeholders. Social
contribution and inclusivity themes are more focused on social progress towards equality.
Global standards and global agenda focus on global guidelines and global issues.
In our distinction of CSR categories, the Dialectic rhetoric gathering eight different themes
out of the 24 total, counts as the 33% (see Figure 6, p. 64), being then the most numerous
category.
We have observed how companies from Latin American and Scandinavia display strong
commitment to this type of rhetoric by mentioning the different dialectic CSR related
themes. Looking at the overall result for the category, companies from Scandinavia show
more commitment to this rhetoric strategy; quantitatively, the total number of themes
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reported in the dialectic category are representing the 33,33% over the total of themes
mentioned by Scandinavian companies. In the case of Latin America this category represents
the 29,43% over the total of themes mentioned by all the Latin American companies. Then
the total number of Dialectic CSR themes reported by Scandinavian companies is 101 and 98
for the Latin American companies, as we can see in Table 10 below. Also in the table 10 we
can observe in detail how many companies mention the different themes included in the
dialectic category. Graphically we can observe this distinction in Figure 9. Continuously table
11 gathers in relative terms the percentage of companies mentioning the different themes in
relation to the total number of companies analyzed in each region.
Noteworthy, we can observe how Scandinavian companies stand out in comparison to Latin
American companies in the “Accountability” and “Global Standards” themes, displaying a
72,97% out of the 37 companies analyzed in Scandinavia and 75,68% respectively (Table 11)
versus the 51,35% for both themes mentioned by the Latin American companies. Latin
American companies stand out comparing to Scandinavia in the “social contribution” theme,
having a 45,95% versus a 29,73%.
After this general comparison within the overarching category, we are going to analyze the
different themes included in the Dialectic rhetoric category separately.
Table 10. Total number of themes mentioned under the Dialectic CSR rhetoric category
Dialectic CSR Theme
Latin America Scandinavia
Global Standards 18 17
Citizenship 2 2
Accountability 19 27
Partnership 13 8
Global Agenda 19 28
Inclusivity 6 2
Focus on the issue 4 6
Social contribution 17 11
Total 98 101
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Figure 9. Total number of themes mentioned on the Dialectic CSR rhetoric category
Table 11. Percentage of companies reporting in each category relative to the total number of
companies analyzed
4.3.1 Global Standards
The “global standards” theme refers to the certifiable standards focused on increasing
business accountability through reporting. For example we consider part of this theme
companies mentioning in their executive letters that they are included in global
sustainability indexes like the Dow Jones Sustainability Index or the FTS100; or when
companies subscribe the United Nation’s Global Compact principles or the GRI reporting
initiative.
In Latin America 18 companies out of 37 (48,65%) have mentioned global standards in their
executive letters; in Scandinavia 17 companies (45,95%). Some examples of companies
mentioning this theme are:
0
5
10
15
20
25
30
Dialectic CSR
Latin America
Scandinavia
Latin America Scandinavia
Global Standards 48,65% 45,95%
Citizenship 5,41% 5,41%
Accountability 51,35% 72,97%
Partnership 35,14% 21,62%
Global Agenda 51,35% 75,68%
Inclusivity 16,22% 5,41%
Focus on the issue 10,81% 16,22%
Social contribution 45,95% 29,73%
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“The company also maintained its investments grade rating and ensured for the fourth
consecutive year its listing on the Dow Jones Sustainability Index. In line with the ten
principles of the UN's Global Compact […]”, Petrobas (Brazil).
“In 2009 we reinforced our commitment to the Global Compact- a United Nations framework
that sets out 10 principles”, Banco Bradesco (Brazil).
“With the publication of Vale's third sustainability report, prepared in accordance with the
guidelines of the Global Reporting Initiative (GRI)”, Vale (Brazil).
“I am also pleased that we have regained our position in the global FTSE4Good responsible
investment index”, Telia Sonera (Sweden).
“After several years favorable rating by the widely recognized Dow Jones Sustainability
Indexes […] in the process of developing this report, we have referred to the guidance and
requirements of the Global Reporting Initiative (GRI) and UN Global Compact reporting
guidelines”, Nokia (Finland).
“Given our commitment to being a responsible business, it is natural that we continue to
support the ten principles of the United Nations Global Compact” H&M (Sweden).
In all of these quotations from the companies’ executive letters opening either their
Sustainability or Annual Reports from 2009, we can see how CEOs stress the importance of
their organizations subscribing the different global standards to keep their sustainability
commitments under the standard values of international organizations or indexes. It is
positive they keep the level of commitment set by the different organizations, so
stakeholders can check organizations follow these standards set internationally. By
mentioning the global CSR standards, companies legitimize themselves as following common
rules, so stakeholders perceive they are operating according to globally set CSR principles.
4.3.2 Citizenship
The “citizenship” theme refers to the use of the metaphor of the firm as a citizen, when the
company considers its citizenship, i.e. its concerns as corporate citizen.
We have only found two companies in each region that in their written communications
consider and explicitly mention themselves as corporate citizens. Therefore they only count
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as the 5,41% of the analyzed companies in each region. The quotations below represent this
theme:
“It is essential that Telia Sonera is regarded as a responsible employer -a good corporate
citizen”, Telia Sonera (Sweden)
“The impacts of our operations in Latin America and China on local communities are quite
different than in our traditional home base, as the social, economic and cultural contexts are
so different. To be successful in these societies in the long term as a company and as
individual people, we need to be even more transparent, more sharing and more prepared to
learn” Stora Enso (Finland).
“Projects of social, environmental and citizenship responsibility implemented by the Company
[…]”, Copel (Brazil)
“We will continue to play the role that corresponds to us as a good corporate citizen in the
social and economic sphere”, Kimberly-Clark de Mexico.
Then we can observe how this theme is the least mentioned by the companies in both
regions. Therefore we are able to deduce citizenship is not a common consideration for
multinational companies in Latin American or Scandinavia.
4.3.3 Accountability
The theme accountability gathers any mention of processes in which the firm is held
accountable by stakeholders. This also includes voluntary actions by the firm to increase its
transparency. As a result the theme includes issues mentioned concerning accountability,
transparency, footprints, external review committees, or responsible lobbying.
In Latin America 19 companies out of 37 (51,35%) have mentioned accountability in their
executive letters; on the other hand, in Scandinavia 27 companies have mentioned this
theme, therefore the percentage of companies is 72,97% which is the second highest
comparing to the rest of themes included in the dialectic rhetoric category. Then we can
deduce Scandinavian companies are more concerned in accountability issues than Latin
American counterparts.
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We include some quotations below to represent what firms understand and mention in their
CEO letters about accountability issues:
“To Petrobas the Sustainability Report is an essential tool for transparency in monitoring,
disclosing and rendering accounts to its stakeholders about its economic, environmental and
social performance […] Our 2009-2013 Business Plan calls for avoiding the emissions of 4,5
milion tons of CO? equivalent in 2013”, Petrobas (Brazil).
“Such is the context in which we have mapped out our strategy, using Balanced Scorecard
(BSC) methodology, in order to make our future strategy transparent and objective”,
Usiminas (Chile).
“We also recorded progress on the corporate sustainability front with the institution of a
sustainability committee to structure related issues”, CBD Brazil GPA.
“Above all transparency, under the premise of fair and responsible practices”, Grupo Bimbo
(Mexico).
“It is also vitally important that we keep our own company, and the industry's carbon
footprint, in check. In 2009 we achieved our carbon-footprint-reduction targets, meeting our
portfolio-efficiency aims”, Ericsson (Sweden).
“At SEB, we raised our sustainability ambition significantly during 2009, addressing both our
own footprint management and business practices […] We decided, among other things, to
reduce our carbon footprint by 45 per cent until 2015”, SEB (Sweden).
“Our Environmental Excellence development program includes actions to strengthen KONE's
innovation leadership in the area of eco-efficiency and to minimize KONE's carbon footprint”,
KONE (Finland).
We can observe how Scandinavian companies are more focused on mentioning their
footprint reductions to be more eco-efficient, on the other hand Latin American companies
apart from footprints they also focus in transparency and other tools for monitoring,
disclosing and rendering accounts to its stakeholders about its economic, environmental and
social performance.
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4.3.4 Partnership
The theme partnership includes any mention of collaborations or partnerships other than
strictly business partnerships. It includes then collaborations between corporations and
global organizations, social entrepreneurs, activists, governments, NGOs or civil society.
In Latin America 13 companies out of 37 (35,14%) have mentioned partnership in their
executive letters; on the other hand, among the Scandinavian only 8 companies have
mentioned this theme, therefore the percentage of companies is 21,62%. Then we can
observe the Latin American hold more partnership agreement with diverse organizations
that the Scandinavian companies analyzed.
We include some quotations below to represent which partnerships other that strictly
business ones are mentioned by companies in both regions:
“In parallel, Vale in conjunction with civil society organizations, oversaw the publication of an
Open Letter to Brazil on Climate change” Vale (Brazil).
“We are proud of having been the first to accept the invitation of the Colombian government,
and thus to serve as an inspiration for other companies interested in joining in the work of
rebuilding peace in the country” FEMSA (Mexico).
“Also to the Rio Grande do Sul Recycling Project, in partnership with Vonpar Foundation and
Banco do Brasil Foundation, besides proceeding with various already existing initiatives”,
BRASKEM (Brazil)
“We play an active part in organizations such as the Roundtable on sustainable palm oil and
maintain close contacts with political decision makers and other opinion leaders” Neste Oil
(Finland).
“Our long-term financial commitment to the World Diabetes Foundation, a leading funding
body devoted to solely projects within diabetes care and prevention in the developing world”,
Novo Nordisk (Denmark)
“We reinforced our commitment to social contribution by joining forces with the Red Cross on
providing IT and telecommunications facilities in disaster scenarios”, TDC (Denmark).
In general what we can deduce from the partnership mentions by companies in both regions
it that the Latin American companies have created partnership with governments in the
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region and other organizations to overcome the social, environmental or economic problems
the region still has (i.e. the previous quotation from FEMSA Mexico referring to its
contribution for peace in Colombia). In contrast, Scandinavian companies mention
partnerships normally involved with global problems, since the region counts with political,
social and economic stability. Then their partnership with national governments does not
play the role they show in Latin America, all the contrary, because the national systems in
Scandinavia are really well established and they count with social peace and economic
welfare.
4.3.5 Global Agenda
The theme global agenda represents any mention of issues that are dealt with by global
institutions such as the UN, especially if they are included in the UN Millennium Goal. They
can be considered one of the top priorities for all actors (civil society, governments and
companies). Thus, the associated issues are: climate change, poverty, equity, energy needs,
greenhouse gases, water, carbon emissions, UN World Diabetes Day or any other issue
directly mentioning “global agenda”.
In Latin America 19 companies out of 37 (51,35%) have mentioned global agenda issues in
their executive letters; in Scandinavia 28 companies (75,68%) which is the most mentioned
theme comparing to the rest of themes included in the dialectic rhetoric category. Then we
can deduce Scandinavian companies are really concerned about global agenda issues.
Some examples of companies mentioning this theme are:
“Climate change has established itself at the top of the environmental agenda in recent
years- a situation that will remain for the foreseeable future, since it ultimately involves our
survival”, SCA (Sweden).
“We innovate and are committed to help fight against climate change”, A.P. Moller-Maersk
(Denmark).
“After the UN Climate Conference in Copenhagen in December it has become increasingly
clear that businesses have a key role to play in delivering on public expectations of change”
SEB Group (Sweden)
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“This year we want to emphasize the importance of more responsible water management
this being vital element for the planet” Grupo Mexico.
“In the view of the worldwide debate about climate change and greenhouse gas emissions by
our industry, Braskem resolved to include these issues in its agenda”, Braskem (Brazil).
“We reconfirm our commitment to address climate change and to the development of a low-
carbon economy as a result of this concern, CPFL is an active participant in discussions
between corporations regarding the subject of global warming”, CPFL (Brazil).
4.3.6 Inclusivity
The theme inclusivity includes the mention of activities aimed at disfavored, non-profit, non-
economic stakeholders that are related to the firm’s core business.
In Latin America 6 companies out of 37 (16,22%) have mentioned inclusivity issues in their
executive letters; on the other hand, in Scandinavia only 2 companies have mentioned this
theme, therefore the percentage of companies is 5,41% which is one of the lowest from
Scandinavia comparing to the rest of themes included in the dialectic rhetoric category. Then
we can deduce Latin American companies are more concerned with inclusivity issues than
Scandinavian counterparts; this is due to social differences in Latin America; companies
operating there can help to reduce them. On the contrary, Scandinavia is already a fair equal
society, and then companies rarely mention inclusivity actions.
We include some quotations below to represent what firms understand and mention in their
CEO letters about inclusivity issues:
“Braskem has made a significant contribution to the Social Insertion Program in the Deep
South of the state of Bahia”, Braskem (Brazil).
“The inauguration in November of the first bank branch in Heliopolis, a destitute community
with about 100000 inhabitants […] in the domestic market we are the private bank with the
largest presence in classes D and E”, Banco Bradesco (Brazil).
“In 2009, we welcomed 550 persons with disabilities, senior citizens, and members of other
vulnerable groups into our Workplace”, FEMSA (Mexico).
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“We believe that we have an obligation and an opportunity to develop new and better
therapies both for inhibitor patients and for general hemophilia patients as well as other
patients with rare coagulation disorders”, Novo Nordisk (Denmark).
“The Millennium Development Goals and our work in the Millennium Villages in sub-Saharan
Africa continue to be among our core commitments. The support we provide is not in the
form of charity, but rather through technology and competence, and is built on a sustainable
business case”, Ericsson (Sweden).
4.3.7 Focus on the issue
The theme focus on the issue has been considered when a significant part of the statements
refer to a social/environmental problem that is core to the firm’s business operations or
strategies. Then issues such as responsible energy, universal access to communications or
sustainable mobility are included in this dialectic theme.
In Latin America 4 companies out of 37 have mentioned focus on the issue in their executive
letters, representing a 10,81% of the total number of companies analyzed; in Scandinavia 6
companies have mentioned this theme, therefore the percentage of companies is 16,22%.
Then we can deduce Latin American and Scandinavia companies rarely mention focus on the
issue facts, but if a bit more frequent for Scandinavia companies, this can be due to their
great concern on environmental issues.
We include some quotations below to represent what firms mention in their CEO letters
about this theme:
“Instead of utilizing fresh water from aquifers, the flotation plants at Fresnillo and Sucito will
use treated water, which brings environmental benefits to the community and reduces our
fresh water consumption costs” Fresnillo (Mexico).
“Sets the goal of achieving levels of excellence in the energy industry with regard to the
intensity of greenhouse gas emissions in processes and products”, Petrobas (Brazil).
“The scarcity of water can limit our ability to generate value as this is a basic supply for our
mining-metallurgic processes. The advances made on managing this resource have resulted
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in an 8,3% increase in the use of reverted water, which means that 69% of the water we
consume is water recovered from our own processes”, Grupo Mexico.
“Increasing the efficiency of the energy markets and responding to the challenge of climate
change require market-driven integration and a coherent energy policy”, Fortum (Finland).
“We consider it our obligation to continue developing products and services that radically
reduce the level of emissions to both air and the sea. Improved ship design, more efficient
engines and propulsors, use of gas as fuel, and optimized flexible power plants solutions all
contribute to a more sustainable environment”, Wärtsilä (Finland).
“We have further broadened our environmental focus areas, with water and biodiversity
issues growing in importance. In 2009, we continued to look at reducing the environmental
impact of our devices and operations”, Nokia (Finland).
4.3.8 Social contribution
The theme social contribution includes any explicit mention of the importance of the firm
contributing to social improvements, benefits to humanity or contribution to positive
change. Mentions of the way companies manage the contributions for the communities they
serve, or the way they deliver significant benefits to humanity.
In Latin America 17 companies out of 37 (45,95%) have mentioned accountability in their
executive letters; on the other hand, in Scandinavia 11 companies have mentioned this
theme, therefore the percentage of companies is 29,73% which is the second highest
comparing to the rest of themes included in the dialectic rhetoric category.
In Latin America 17 companies out of 37 have mentioned social contributions in their
executive letters, representing a 45,95% of the total number of companies analyzed; in
Scandinavia 11 companies have mentioned this theme, therefore the percentage of
companies is 29,73%. Then we can deduce Latin American companies are more concerned in
social contribution issues than Scandinavian counterparts.
We include some quotations below to represent the social contributions firms mention in
their CEO letters:
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“As part of its community efforts, the Company has implemented multiple initiatives focusing
on recovering heritage, improving education and culture, and socially advancing these
important communities” SQM (Chile).
“All this aims at creating opportunities of social and economic growth, especially for the 300
Mapuche communities living close to forests and areas where the company operates in Chile”
CMPC (Chile).
“Company performs with devotion, dedication and efficiency its role of fomenting and
promoting social and economical development of State of Paraná, serving population with
quality and providing conditions to its own growth as a company, contributing with welfare
of the community”, Copel (Brazil).
“We see the effect telecommunications are having in alleviating poverty. Access to
communications has a positive impact on GDP and socioeconomic development” Ericsson
(Sweden).
“Our products are our greatest contributions to society. They provide significant benefits to
patients, tangibly improving people's health Novo Nordisk”, (Denmark).
“The World Bank Green Bonds, where SEB as the supporting the build-up of more sustainable
economies in developing countries”, SEB (Sweden).
In general what we can deduce from the social contribution mentions by companies in both
regions is that the Latin American companies have greater commitment to alleviate social
problems in locations with problems inside Latin America; this way again we can see how
Latin American corporations try to overcome the social or economic problems the region still
has to deal with. We therefore reaffirm that for many Latin American companies the social
contributions such as engagement with employees and local communities to improve the
social lives of the society, in terms of providing housing, education and special health
benefits, is a part of their corporate vision (Casanova & Dumas, 2010). On the other hand,
when Scandinavian companies mention social contributions they are normally related to
alleviating global problems (i.e. from the previous quotations companies refer to alleviating
poverty in developing countries) again this is due to the welfare state of the region given
that the region counts with political, social and economic stability.
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4.4 Political CSR
In this category of political CSR rhetoric or political role of the firm we have included the
themes: access, rights, development, and political engagement. We interpret these themes
as a transition from voluntary, business driven or philanthropic acts to a long-term
politicized collaboration with governments and civil society actors All of them point out to
the new political re-conceptualization of the role of firms, which we understand as the
enlarged political responsibilities for business and the long-term collaborations with
governments and civil society actors in.
This rhetoric category explains the nature of the role of the firm as a political actor in regular
interactions with the communities it operates in and signals the effectiveness of stakeholder
engagement through collaborations. The political rhetoric as the dialectic involves a certain
degree of stakeholder engagement and the creation of communicative links and deep
collaborations between the firm and its communities with the aim of finding mutual
benefits.
As an example of the political rhetoric we include the following quotation:
“The company made progress at several long term programs that have already benefitted
thousands of users throughout the state of Minas Gerais, with an emphasis on the "Luz Para
Todos" Program, directed at providing universal electric energy service” CEMIG (Brazil).
This type of rhetoric is associated with an increasing aim of firms to gain a new form of
legitimacy which is moral legitimacy as understood in political theory (Palazzo & Scherer,
2006). While traditional theories of legitimation such the ones associated to institutional
theory and strategic management theory focus on a specific issue that needs to be
legitimated by the corporation, a political theory perspective emphasizes that the
legitimation of organizations deals with the complex power relationships among the social
players involved. (Castelló & Galang, 2011).
In our distinction of CSR categories, the Political role of the firm rhetoric gathering four
different themes out of the 24 total, counts as the 17% (see Figure 6, p.64), being then the
category with less themes included on it.
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Looking at the overall result for the category, companies from Latin America show a more
solid commitment to this rhetoric strategy comparing to Scandinavian companies;
quantitatively, the total number of themes reported in the political CSR rhetoric category are
53 for Latin America and 33 for Scandinavia, as we can see in Table 12 below. These figures
from the political CSR rhetoric category are representing the 15,92% over the total or
themes mentioned in all the rhetoric categories by Latin American companies; and in the
case of Scandinavia this category represents the 10,89% over the total of themes mentioned
by all the Scandinavian companies. Also in the Table 12 we can observe in detail how many
companies mention the different themes included in the political CSR category. Graphically
we can observe this distinction in figure 10. Continuously table 13 gathers in relative terms
the percentage of companies mentioning the different themes in relation to the total
number of companies analyzed in each region. Remarkably, we can observe how Latin
American companies stand out in comparing to Scandinavian companies in the “access” and
“development” themes, displaying a 24,32% of mentions of access themes out of the 37
companies in Latin America, versus a 10,81% for Scandinavia; and 40,54% for development
in Latin America comparing to only the 8,11% in Scandinavia. Latin American companies
stand out comparing to Scandinavia in the “social contribution” theme, having a 45,95%
versus a 29,73%.
Table 12. Total number of themes mentioned under the Political CSR rhetoric category
Political role of the firm Theme Latin America Scandinavia
Access 9 4
Development 15 3
Rights 7 5
Political engagement 22 21
Total 53 33
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Figure 10. Total number of themes mentioned on the Political CSR rhetoric category
Table 13. Percentage of companies reporting in each category relative to the total number of
companies analyzed
Latin America Scandinavia
Access 24,32% 10,81%
Development 40,54% 8,11%
Rights 18,92% 13,51%
Political engagement 59,46% 56,76%
4.4.1 Access
The theme access describes the firms’ aim to provide its services or products to previously
excluded customers, also in this theme we include any investment to procure access to
public services (not related to the firm’s core business, i.e. health or education) to non-
economic stakeholders.
In Latin America 9 companies out of 37 (24,32%) have mentioned accountability in their
executive letters; on the other hand, in Scandinavia only 4 companies have mentioned this
theme, therefore the percentage of companies is 10,81%. Then we can realize Latin
American companies are more concerned in access issues than Scandinavian counterparts.
We include some quotations below to represent what firms mention in their CEO letters
about access issues:
“With this new service station Bradesco reached 100% coverage in Brazilian municipalities.
We continued on our quest to provide access to banking services and the democratization of
credit in thousands of locations previously underserved”, Banco Bradesco (Brazil).
0
5
10
15
20
25
Access Development Rights Political
engagement
Politcal role of the firm
Latin America
Scandinavia
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“We continued to find ways to promote access to better housing and community
infrastructure. For example we launched our most successful low-income housing solution,
Patrimonio Hoy, in the Dominican Republic” CEMEX (Mexico).
“The company made progress at several long term programs that have already benefitted
thousands of users throughout the state of Minas Gerais, with an emphasis on the "Luz Para
Todos" Program, directed at providing universal electric energy service” CEMIG (Brazil).
“The link between access to communication, GDP growth and poverty reduction is well
documented. Access to communications has a positive impact on GDP and socioeconomic
development; a 10% increase in mobile penetration leads to a 1,2% GDP increase in
developing countries” Ericsson (Sweden).
“We have continued our efforts to expand access to diabetes care throughout the world as a
company and via the World Diabetes Foundation […] Our approach to improving access to
diabetes care in developing countries […] Our commitment to supply life-saving insulin at
reduced cost in the poorest countries of the world”, Novo Nordisk (Denmark).
When comparing the quotations from companies in both regions, we can realize how the
Latin American companies mention access to their services underserved customers and also
they mention the provision of other services that traditionally in other setting would be only
responsibility for nation governments (i.e. education, health or housing); then we assume
Latin American companies care for the low income stakeholders and they provide means to
provide them access and to create at the end a more equal society. Alternatively
Scandinavian companies the few mentions they have about access themes are all related to
access to their product and services in developing countries. Then we can conclude they care
also for the global betterment to reduce differences between developed and developing
countries, even supposing the great existing differences they try to show they would like to
collaborate to reduce them.
4.4.2 Development
This theme includes any mention by companies about their engagement on regional
development. It considers actions that contribute to communities, country or regional
progress.
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In Latin America 15 companies out of 37 have mentioned development in their executive
letters, representing a 40,54% of the total number of companies analyzed; in Scandinavia
only 3 companies have mentioned this theme, therefore the percentage of companies is
8,11%. Then we can deduce Scandinavia companies hardly ever mention development, but
in contrast the theme is more frequent for Latin American companies, this can be due to
their concern for the ongoing development of the region, still with many gaps. We include
some quotations below to represent what firms mention in their CEO letters about this
theme:
“We have contributed for the economic and environmental development of the State of Sao
Paulo”, SABESP (Brazil).
“The company continued its program to develop and fund a contest to finance micro-
entrepreneurs in the region. The objective of this program, which is now in its third year, is to
foster the economic and social development of the communities around San Pedro de
Atacama” SQM (Chile).
“The Vale foundation continued to establish Knowledge Stations, which aim to contribute
towards improving the quality of life and to the integrated and sustainable development of
the communities in six Brazilian states”, Vale (Brazil).
“To develop a strong performance on HSE (health, society and environment) and social
indicators such as local development and human rights improvements”, Statoil (Norway)
“Access to communications has a positive impact on GDP and socioeconomic development; a
10% increase in mobile penetration leads to a 1,2% GDP increase in developing countries.
Ericsson”, (Sweden).
“The World Bank Green Bonds, where SEB as the supporting the build-up of more sustainable
economies in developing countries”, SEB (Sweden).
Once more within this theme we can observe how Latin companies are focused on regional
development in deprived regions within Latin America and Scandinavian companies when
mention development they are focused on developing countries in general as a global issue
for multinational companies.
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4.4.3 Rights
This theme groups the firms’ mentions referring to rights and equity (fairness) among
disfavored stakeholders to help building an inclusive society. The theme refers to the
discourse on social and universal rights touching upon different social groups.
In Latin America 7 companies out of 37 have mentioned issues related to the theme rights in
their executive letters, representing a 18,92% of the total number of companies analyzed in
the region. In Scandinavia 5 companies have mentioned this theme, therefore the
percentage of companies is 13,51%. Then we can deduce Latin American and Scandinavia
companies seldom mention rights in their written discourses. We include some quotations
below to represent what firms mention in their CEO letters about this theme:
“Usiminas will reaffirm its commitment to foster effective action to fight corruption and
defend Human Rights, decent working conditions and the environment”, Usiminas (Brazil).
“As well as in resource allocation, the Fund for Children and Adolescent (FIA) with a focus on
guaranteeing the rights of children and adolescent”, Petrobas (Brazil).
“To provide broad coverage of subjects related to labor relations, human rights, and the
fight against corruption”, Embraer (Brazil).
“Millions of people the world over have a legitimate ambition to rise from poverty an raise
their standard of living […]To develop a strong performance on HSE and social indicators such
as local development and human rights improvements” Statoil (Norway).
“We have to deal with important and sensitive issues in our daily work – ranging from fair
business practices – to freedom of speech – and the right to privacy and integrity” Telia
Sonera (Sweden).
“Our technology, solutions and services strengthen access to basic human rights: the right to
health, education and the right to earn a livelihood. And we see access to communication as
a basic human right”, Ericsson (Sweden).
4.4.4 Political engagement
The political engagement theme reflects the democratic integration of the corporate use of
power, especially in the transnational context of incomplete legal and moral regulations. It
shows the firms’ engagement through political discourses to fill gaps in governments’
actions. Therefore we observe firms assuming enlarged political co responsibility.
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We have created this theme being part of the overarching category also called “political
CSR” because we detected in firm’s discourses that apart from the other specific themes
access, development or rights just reviewed before, firms were also creating a new discourse
talking about other responsibilities, not only as businesses but also as pure political actors
part of the communities where they operate or when talking about global issues.
In Latin America 22 companies out of 37 have mentioned political engagement issues related
to the theme rights in their executive letters, representing a 59,46% of the total number of
companies analyzed in the region. In Scandinavia 21 companies have mentioned this theme,
therefore the percentage of companies is 56,76%. Then we can deduce Latin American and
Scandinavia companies are committed and they often mention political engagement in their
written discourses. We include some quotations below to represent what firms mention in
their executive letters about this theme:
“Our investment plan reflects the positive outlook for the Brazilian economy and confirms
our commitment to the creation of jobs and the development of the country as a whole”
CBD Brazil.
“We have primarily supported education, at various levels, and public administration,
stimulating improvement in services provided to society” Gerdau Metalurgia (Brazil).
“Behind our commitment to continue supporting programs that we consider of special value
for the community, there are a series of further efforts to participate in health, education,
food and environmental care actions, convinced that only when all society collaborates we
can achieve significant progress” Soriana (Mexico).
“Banrisul is in line with the State government's public policies- and that is how it should be,
given the Bank's important social role” Banrisul (Brazil).
“Novozymes and WWF have come together to encourage politicians to further the
integration of biotechnology into strategies for reducing climate change and to support the
application of low-carbon biotechnology in industry” Novozymes (Denmark)
“We recognize that global problems require global solutions, and we will continue to work in
relevant forums to help drive adequate political responses”, A. P. Moller-Maersk (Denmark).
“We play an active part in organizations such as the Roundtable on sustainable palm oil and
maintain close contact with political decision makers and other opinion leaders” Neste Oil
(Finland).
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“Storebrand is an active prime mover in relation to the Norwegian and international
authorities when it comes to developing regulations and a framework for the industry that
are appropriate for both customers and companies”, Storebrand (Norway)
Within this theme once more we can observe the pattern already described in previous
themes: Latin American firms show political engagement with the state of the region and
Scandinavian firms show political engagement with global issues. Hence Latin American
mention how they are collaborating with national governments or other organizations to
sustain national regional development, they mention health, education or housing initiatives
and they also mention their support to governmental policies. Since Scandinavian firms are
focused on global issues, they mention how they help to create international regulations or
frameworks for many issues included in a global agenda i.e. industry environmental
regulations, climate change, water disposition etc. What it is common to companies in both
regions is that they clearly show a deep political engagement in line with the new political
role of the firm. They have reported about their CSR procedure as businesses but we can
detect in their written discourses how they go beyond their business profile to talk about
what before was exclusively to be considered part of governments’ speech.
Through the empirical analysis of the factors influencing the legitimacy strategies followed
by the Scandinavian and Latin American companies, we find that political rhetoric is relevant
in both regions but in particular for Latin America. We can argue that in a highly pluralized
context such as the one in Latin America cognitive legitimacy of CSR might be limited by the
range and complexity of societies (Palazzo & Scherer, 2006) and its relations with different
social claims. Consequently, firms increasingly balance their legitimacy with political
legitimacy strategies in a dynamic debate on their role in society, which we consider part of
the moral legitimacy search. Therefore in general with the themes included in this political
CSR rhetoric category we can observe how they transmit moral legitimacy because these
corporations communicate and try to convince the audience or stakeholders by rational
arguments and they communicate what is the right thing to do, instead of using
manipulation or persuasion (Palazzo & Scherer, 2006). Moreover often they communicate
the result of “explicit public discussions”, when they mention collaborations with
governments, civil society organizations or other stakeholders.
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5. Concluding remarks
In this final section, we present our conclusions and personal reflections on this study,
connected to our research aims. Additionally we include the limitations of the thesis and
final remarks on its perspective and suggestions for additional research.
5.1 Conclusion
In order to proceed to the main conclusions that arise as the outcome of the thesis, it is
relevant to review the research aim proposed in the beginning of the thesis work. The main
research question was defined as:
“What are the main differences between CSR rhetoric strategies between Latin American
and Scandinavian top companies?”
Other specific sub question was outlined, in order to define the research area:
How this influences their legitimacy strategies?
These questions were answered in the previous chapter, where we carried out a cross-
regional analysis and discussion of results, linking the findings to the theoretical framework.
In this research we have distinguished four types of CSR rhetoric applied by firms when
communicating their CSR approaches and by them trying to gain legitimacy. These rhetoric
strategies are strategic, institutional, dialectical and political role of the firm. The four have
different mainstays and they are related to different management theories. They also
engage different forms of firms’ legitimization. Following the frame of Castelló and Lozano
(2011) we argue that strategic rhetoric try to set pragmatic legitimacy, which is based on the
fundamental firm’s economic rationale; institutional rhetoric refers to cognitive legitimacy,
being then CSR mentions related to the sense of belonging to a group of companies; while
Introduction
and RQ
Methodology
Theoretical
Background
Analysis Conclusion
103
the dialectic and political of the role categories aims to create moral legitimacy, which is
related to civil society engagement and it is the more advanced legitimacy type.
We found out that top companies from Latin America and Scandinavia primarily refer to
strategic and institutional CSR rhetoric categories, but that they are also starting to look for
moral legitimacy by engaging either in a dialectic or political role of the firm strategies. This
might point out that they are searching for a new form of moral legitimacy which aims to
improve the discursive quality between them and their stakeholders (dialectic category) and
their role within civil society and collaborations with Governments (political role of the firm).
The communication of these two CSR rhetoric categories indicate the shift from the basic
economic rationale, utility driven view of CSR into a political, communications-driven
concept of organizational social responsibility (Palazzo & Scherer, 2006). This communicative
approach to ethical and moral issues shows a strong association connecting corporate
decision making and the influence of the firm’s broad stakeholder network.
The differences in CSR approaches found between companies from the two regions seems to
be driven by economic, institutional and cultural differences (Matten & Moon, 2008). Since
Latin America is a region characterized by unsteady economic environment and political
instability, this leads to understand why Latin American top companies tend to communicate
their political role focused on the engagment with the Latin American society progress. On
the other hand, the economic and instituional state of Scandinavia being characterized by
the political stability and the admirable welfare state leads to understand the Scandinavian
firms’ aproach to gain moral legitimacy by mentioning themes related to the management of
environmental issues globally through their value chain, and their focus to solve social global
problems such as poverty in developing countries.
The predominant strategic approach communicated by companies in the two regions might
indicate that CSR has come a long way from its early roots of charity to become a strategic
business practice inserted in corporate values. This means that top companies in the two
regions have adopted a comprehensive CSR notion that is aligned with the fulfillment of all
levels of Carroll (1991) pyramid, and follows the main ideas proposed by Freeman (1984) in
the stakeholder theory and Elkington (1999) in the “triple bottom line” (TBL) approach, as
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part of the strategic CSR rhetoric mentioned in their reports to gain pragmatic legitimacy
based on the economic rationale of the firm.
Companies generally address a comprehensive set of stakeholders in their CSR approach and
give emphasis to social, economic and environmental issues, although some issues are more
stressed in one region than in the other, as we have already noticed due to the different
stages of development: Latin America is more focused on its own social progress and
Scandinavia is focused on other global issues such environmental care and poverty in
developing countries.
These regional differences have arisen through the way companies communicate CSR issues,
some generalizations for each region can be drawn from the analysis previously presented,
and taking into consideration the general CSR profiles of the two regions. This overview can
be outlined by looking at the CSR themes, that is to say, the main CSR focus given by
companies in each region. Table 14 shows the regional profile that can be noted through the
analysis of findings, and that shape the entire study. Scandinavian companies are strongly
focused on environmental issues and stress the idea of sustainability, whereas Latin
American companies show high concern for social issues, which can be perceived in the
nature of CSR processes the companies mention, the stakeholders addressed and in the
political role companies seem to take as social agents, fulfilling the gap left by the national
governments.
Table 14. CSR focus in Latin America and Scandinavia
Latin America:
Social issues and
Political role
•Most CSR mentions
address social issues
related to employees
and community
•Companies try to fulfill
the gap left by
Goverments as social
agents
Scandinavia:
Sustainability and
Environment
•Focus on the
management of
environmental impact
through the value chain
•The concept of
sustainability arises as
part of their strategy
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The cross-regional differences were apparently mainly shaped by regional factors. The CSR
profile of companies seems to be determined a by a mix of factors, at a regional, national,
industrial and company level, that created an interesting set of characteristics and provided
meaningful insights into the way CSR is communicated. In example Statoil from Norway
which belongs to the oil and gas industry is really focused on environmental concerns, and
focus its attention to climate change, (“as an energy company, we find ourselves at the
crossroads between two apparently irreconcilable challenges- the energy crisis, and the
climate crisis”); on the other side, Petrobas from Brazil also an energy company providing oil
and gas, apart from sustainable development and environmental concern mentioning
footprint reduction, they are explicitly taking a political role when they say “Petrobas is
rewriting the history of the Brazilian presence in the global energy scenario, ensuring
considerable reserves to Brazil” clearly stating their importance as an international company
for the Brazilian economy. Apart of this, they also highlight their social programs: “Petrobas
Development & Citizenship program, the Petrobas Environmental Program, and the Petrobas
Cultural Program, and the Petrobas Cultural Program, as well as in resource allocation to the
Fund for Children and Adolescents (FIA)”. Just comparing this two companies belonging to
the same industry we can see how both focus on sustainable development, but Petrobas
from Brazil has an outstanding political role, also when describing all the social programs
they have to help communities in Latin America.
The analysis and discussion included in the previous section showed that most differences
and similarities among countries could be explained by the literature review previously
carried out. However, because there are no previous studies that compare countries in Latin
America and Europe in terms of CSR approaches, there is no exact basis of comparison in
terms of the results concerning cross-regional agreements and disagreements. This might be
one of the main contributions of this research, by looking at such different regions of the
globe and attempting at identifying patterns in CSR rhetoric strategies, as well as the factors
shaping them.
The effectiveness of firm’s discourse in shaping organizational legitimacy is well
acknowledged, and apart from mapping out different CSR rhetoric strategies, this research
aims to achieve deeper understanding of the way firms search for legitimacy through their
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corporate CSR discourse. We have analyzed firms’ written discourses and we have allocated
the CSR themes around a frame made out of four CSR rhetoric strategies, which relate to
gaining distinct types of legitimacy (pragmatic, cognitive, or moral). After the analysis
regarding legitimacy, our major finding is that corporations are adapting their legitimacy
strategies toward a new understanding of their role in society. Corporations have integrated
the language of civil society, which we connect with the dialectic and political rhetoric, into
their legitimacy approach found in their discourses.
We argue corporations are seeking legitimacy through new forms of argumentations that
relate to values and beliefs, as well as in new forms of dialog and engagement with civil
society. The use of dialectic and political rhetoric by corporations from both regions might
lead firms to make more balanced decisions that increase the stakeholders’ acceptance of
the subsequent effects. Moreover the use of these CSR categories might also advance a new
open relationship with stakeholders, leading to mutual collaborations and common goals.
For example within the dialectic CSR category, the mentions of partnerships (non strictly
related to core business), deep stakeholder dialogs, global agenda issues or accountability
mechanisms, among others, is changing not only the way corporations face current
challenges but also the way they make sense of their activities and communicate to
stakeholders. Also within the political CSR category when firms talk about the commitment
with the communities around them, and they mention issues related to human rights,
development or they show political engagement in general, they are also trying to gain
moral legitimacy. We have observed how Scandinavian companies try to gain moral
legitimacy mainly through the dialectic strategy; and Latin America apart from the dialectic
they are really focused on the political role of the firm strategy. Even so, further research
would be needed to better understand how companies actively recognize and define their
new political role.
Connected to the research question, our proposed sub question associated to corporate
legitimacy aimed to enrich the research, and contribute to further explore and link the
differences in the CSR rhetoric strategies to different legitimacy strategies of firms as reliant
on the regional firm distinctiveness. Though exploratory in nature, this empirical research
show how the political rhetoric is more utilized in the context of potential divergences with
107
civil society, like the case of Latin America; this also encourages further debate on the
changing nature of the societal understanding of the role of the firm.
Then we agree firms in both regions as social and political actors need to provide new social
and environmental values to society, highlighting the pressure they receive from its
stakeholders regarding these issues. We consider companies are responding to these
pressures with new legitimacy strategies in the form of communication processes and new
rhetoric in which they state their responsibilities with society and with the environment.
Organizations are using communicative strategies that show the engagement with
stakeholders with the aim to achieve higher levels of agreement and social stability and
progress.
As mentioned before our results for the Scandinavian companies confirm these strategies of
legitimization might be the result to the need of responding to stakeholders pressuring
about risky issues such as environmental problems together with the active reflection about
principles of stakeholder inclusion, corporate responsibility or citizenship. On the other hand
we find Latin American companies are concerned in a deeper way with social inclusivity and
responsibility.
We also acknowledge the majority of companies use the concept of sustainability or
sustainable development and other related issues, fact supporting the idea of the
isomorphic growth of the CSR movement around the world and its entailed cognitive
legitimacy search.
We consider our research contributes to the limited number of CSR studies that have been
conducted in Latin American, especially adding the comparison with one of the more
developed regions as it is Scandinavia. By using the region as level of comparison, we wanted
to bring out the context influence and at the same time to show the impact of globalization
on the CSR strategies spreading across different types of firms.
We consider that comparing Scandinavia as a homogeneous region with Latin American as
one of the more heterogeneous one brings the opportunity to discover the disparity in
108
institutional, cultural or economic issues that the region provides. However, this opportunity
also limits the generalization of these findings to the rest of the region, since there are
countries without representation on the sample; because the biggest multinationals of Latin
American are located in Mexico, Brazil or Chile, and there are many countries with no
representation in the sample.
In conclusion, despite the limitations of the study (that will be better reviewed in the next
point below), the research aims could be successfully reached and the analysis provided
valuable insights into the way companies communicate and approach CSR and how
companies from the two analyzed regions differ in their CSR rhetoric strategies. The study
showed that although CSR is increasingly seen as strategic by companies and there is a
common ground in the CSR practices they communicate related to the strategic and
institutional category, there are also significant cross-regional differences in the way
companies approach CSR issues dealing within the dialectic and political role of the firm
categories. Therefore we think this analysis contributed to clarify the interconnections and
relationships between organizations’ CSR strategies and their engagement with their
political and social contexts.
5.2 Limitations
There are certain limitations and shortcomings in the research. The limitations of this thesis
were dealt with in the methodology section; but this part of the thesis aims to summarize
and to clarify the main points.
The qualitative research method employed in this thesis is not designed to give a fixed
conclusion. Instead, our findings make the conclusion more advisory than absolute. As noted
earlier, there are many institutional factors shaping CSR strategies, as well as a great number
of stakeholders linked to the activities of multinational corporations. However we have
reviewed the institutional influence in general and we have not considered explicit country
specific factors for the analysis, since we compare the two groups of companies regionally.
109
This thesis has concentrated then on the regional basis for the analysis instead on country
level, even if we are aware the Latin American region is very heterogeneous; this has been
necessary in order to limit the scope of the thesis, but it may fail to give a comprehensive
picture of the external and internal pressures that multinational companies experience.
We have incorporated a theoretical background to describe the institutional settings in both
regions in order to build a stronger argument, but a quantitative study of a representative
number of firms would be necessary in order to create new theories. It is tough to generalize
on behalf of the current findings because the number of studied companies is limited to 74
firms among the biggest companies from the two regions. The findings are also limited to
the way companies present themselves in terms of CSR rhetoric strategies, given that the
aim of the research was to analyze the corporate communications and self representations
regarding CSR strategies rather than the actual CSR practices.
A broader research with the use of alternative research methods such as interviews or
surveys would certainly enrich the analysis by gathering additional data, investigating the
actual CSR practices and comparing them to the ones presented in organizational
documents. It is believed that such methodological limitations are inherent to the nature of
this research, and do not have a negative impact in the study outcomes, or on the
achievement of the research aims. Moreover provided the explorative character of the
research we considered conclusions arising from this sample to be important.
Lastly, concentrating on the executives CSR written discourse as representing the company
may well give the holistic view of the organization to their CSR approach and strategies. But
the findings could appear different if we had had the opportunity to interview them directly
to contrast their written discourse. But due to CEOs availability, time and budget
constrictions we better considered using and analyzing organizational documents as a main
source of data.
110
5.3 Putting the paper into perspective: suggestions for future research
Being immerse in the current economic crisis, it is clear companies need global
development, which will bring stability and prosperity. That is why they need to contribute
to the improvement of the state of the world. Companies are global citizens and their values,
goals and strategies should reflect that. We are facing a new phase of globalization in which
the business economic model if it is based on global sustainable economic growth will have
to go with the general sustainable well being of societies. Then, definitively multinational
corporations in this context have to go beyond profit making and share responsibilities with
governments to solve social issues. Even more companies operating in emerging markets
have to go past what the regulations establish and be partners with the governments and
the civil society in reducing poverty or any other social issues. Corporate social responsibility
should include a clear compromise in improving the societies in which firms operate.
Companies all over the world are experiencing a crisis of responsibility, or the lack thereof.
Legitimacy and reputation will only be repaired by the re-establishment of trust between
firms and with their stakeholders. To move away from the bad reputation and legitimate
their roles, firms need to continue their work on strategic and institutional CSR as basis and
then they should definitively include in an increasing way the dialectical and the political role
strategies into their CSR approach.
With the shortcomings mentioned in the previous point taken into consideration, it is likely
that a study with similar aims but using alternative research methods would enrich the
present findings, by investigating what companies actually do regarding CSR practices. This
could be carried out through surveys, interviews or case studies.
In addition, since the findings from the present study suggest that the cross-regional
differences in CSR rhetoric strategies are due to a large extent to regional and national
factors, it would be interesting to perform a larger study including companies from other
countries, in order to check if the same patterns emerge. Therefore the study could be
enriched by adding other countries giving place to a comparison between Latin America
111
versus Europe, in order to gain deeper insights into the regional differences in terms of CSR
approaches.
Following, in terms of future research, it could be fruitful to interview with companies
operating in different institutional environments to assess the differences and similarities in
stakeholder pressure, how firms use CSR in dealing with organizational crises, and ultimately
how CSR can be useful in efforts to repair legitimacy and reputation.
Differences between large and small companies from Latin America and Scandinavia could
also be investigated as well as firms facing varying levels of legitimacy and reputation
threats. Another area that could be worth examining is how homogeneous the CSR
initiatives taken by firms in the two regions are viewed by different stakeholders. Whether
the heightened expectations from stakeholders demand firms to implement unique
approaches, or if copying the mainstream is sufficient. This research approach could be
interesting to assess in connection with legitimacy and reputation. The CSR developments in
the coming years will also be interesting to follow, as new regulations are likely to change
current CSR practices.
In order to improve the validity of our results, further research is needed with a larger
sample and over a period of time to bring other findings on changes in the kinds of CSR
rhetoric applied and the characteristic of the firms applying each. A broader study would
provide further insights regarding the variability of the rhetoric employed in the
conversations different firms have with their stakeholders. Further research then is needed
for understanding how companies actively make sense of their role and new responsibilities
and how this is evolving over time.
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i
7. Appendix
Table I. Excluded companies from the Latin American region
Rank Forbes
Global 2000
Company Country Industry Sales
($bil)
Profits ($bil) Assets ($bil) Market
Value($bil)
Reason of exclusion fromthe
sample
1 52 Banco do Brasil Brazil Banking 56.10 5.82 406.46 42.78 Report not available in English
2 131 América Móvil Mexico Telecommunications
Services
30.22 5.40 34.70 72.09 No CSR information in the CEO
letter
3 222 Ecopetrol Colombia Oil & Gas Operations 14.26 2.40 27.20 54.14 No CSR information in the CEO
letter
4 309 Carso Global
Telecom
Mexico Telecommunications
Services
16.04 1.23 27.85 15.65 No CSR information in the CEO
letter
5 681 BanColombia Colombia Banking 4.14 0.62 30.28 9.25 Report not available in English
6 698 JBS Brazil Food, Drink & Tobacco 20.19 0.07 24.37 12.18 No CEO letter included
7 714 GFNorte Mexico Banking 4.28 0.45 43.33 7.61 No CSR information in the CEO
letter
8 754 Antarchile Chile Diversified Financials 10.38 0.29 12.21 8.73 No CSR information in the CEO
letter
9 791 Inbursa Mexico Banking 2.10 0.62 22.07 11.47 Report not available in English
10 829 Grupo Aval Colombia Diversified Financials 4.85 0.34 28.31 6.19 Report not available in English
11 834 Falabella Chile Retailing 6.33 0.36 8.15 13.59 Report not available in English
12 896 Grupo Televisa Mexico Media 4.01 0.46 9.69 11.34 Report not available in English
13 925 Cencosud Chile Food Markets 10.49 0.19 9.84 8.75 Report not available in English
14 930 BM&F Bovespa Brazil Diversified Financials 0.76 0.45 12.17 13.17 Report not available in English
15 953 Grupo Carso Mexico Conglomerates 5.06 0.49 7.48 8.17 Report not available in English
16 961 Credicorp Peru Banking 2.10 0.49 22.15 6.35 No CSR information CEO letter
17 1009 Grupo Elektra Mexico Retailing 3.28 0.38 9.12 12.89 No CSR information CEO letter
18 1179 McDermott
International
Panama Construction 6.19 0.39 4.85 5.48 Report not available in English
ii
19 1190 Ultrapar
Participacoes
Brazil Oil & Gas Operations 18.31 0.24 6.37 3.87 No CSR information in the CEO
letter
20 1297 Mercantil Venezuela Diversified Financials 2.92 0.37 24.72 0.54 No CSR information in the CEO
letter
21 1335 Bradespar Brazil Diversified Financials 1.79 0.49 5.08 7.67 Report not available in English
22 1338 Industrias Peñoles Mexico Materials 3.33 0.39 3.79 7.91 Report not available in English
23 1380 CCR Brazil Transportation 1.57 0.32 5.22 9.31 Report not available in English
24 1385 Banesco Banco Venezuela Banking 2.57 0.36 17.31 0.19 None report available
25 1436 Cantv Venezuela Telecommunications
Services
4.62 0.68 4.41 0.58 Report not available in English
26 1461 OGX Brazil Oil & Gas Operations 0.00 0.16 4.18 29.30 No CSR information CEO letter
27 1505 El Puerto de
Liverpool
Mexico Retailing 3.47 0.28 4.52 6.32 No CEO letter included in the
report
28 1646 LAN Airlines Chile Transportation 3.52 0.23 5.77 5.89 Report not available in English
29 1648 WEG Brazil Capital Goods 2.14 0.28 2.49 6.04 No CEO letter included in the
report
30 1653 Volcan Compania
Minera
Peru Materials 0.69 0.18 1.27 10.48 No CEO letter included in the
report
31 1734 Banco de Chile Chile Banking 3.23 0.06 28.34 1.88 No CEO letter included in the
report
32 1886 Buenaventura Peru Materials 0.74 0.15 1.99 9.27 No CSR information in the CEO
letter
Source: Adapted from “The Global Forbes 2000” available at:http://www.forbes.com/2010/04/21/global-2000-leading-world-business-global-
2000-10_land.html [Accessed May, 3 2011].
Table II. Excluded companies from the Scandinavian region
Rank Forbes
Global 2000
Company Country Industry Sales
($bil)
Profits
($bil)
Assets
($bil)
Market
Value($bil)
Reason of exclusion fromthesample
1 200 DnB NOR Norway Diversified Financials 13.06 1.48 315.61 18.37 No CSR information in the CEO letter
2 267 Svenska
Handelsbanken
Sweden Banking 8.81 1.43 297.27 17.20 No CSR information in the CEO letter
iii
3 273 Telenor Norway Telecommunications
Services
16.85 1.55 28.49 21.42 N o CSRinformation in the CEO letter
4 409 Sampo Finland Insurance 8.04 0.92 37.41 13.69 No CSR information in the CEO letter
5 435 Carlsberg Denmark Food, Drink & Tobacco 11.42 0.69 25.94 11.85 No CSR information in the CEO letter
6 462 Investor Sweden Diversified Financials 4.98 4.38 23.84 13.59 No CSR information in the CEO letter
7 819 UPM-Kymmene Finland Materials 11.06 0.24 19.11 5.63 No CSR information in the CEO letter
8 896 Sandvik Sweden Capital Goods 10.05 -0.37 12.83 12.91 No CSR information in the CEO letter
9 1161 Aker Solutions Norway Construction 9.33 0.39 6.84 3.61 No CSR information in the CEO letter
10 1176 Assa Abloy Sweden Business Services &
Supplies
4.88 0.37 5.97 6.92 No CSR information in the CEO letter
11 1183 Pohjola Bank Finland Banking 3.08 0.28 50.93 3.56 No CSR information in the CEO letter
12 1201 Kinnevik Sweden Diversified Financials 1.17 2.28 7.46 4.57 No CSR information in the CEO letter
13 1212 Industrivarden Sweden Diversified Financials 2.79 2.89 7.53 4.27 No CSR information in the CEO letter
14 1311 Securitas Sweden Business Services &
Supplies
8.75 0.30 4.31 3.96 No CSR information in the CEO letter
15 1525 D/SNorden Denmark Transportation 4.03 0.67 2.04 1.79 No CSR information in the CEO letter
16 1528 Swedish Match Sweden Food, Drink & Tobacco 1.98 0.44 2.29 5.26 No CSR information in the CEO letter
17 1628 SpareBank 1 SR-
Bank
Norway Banking 1.12 0.19 21.62 1.10 Annual report
18 1654 Jyske Bank Denmark Banking 1.97 0.09 43.30 2.24 CSR Report
19 1674 Sydbank Denmark Banking 1.42 0.15 30.43 1.83 Annual report (mentions a little about CSR
in the CEO letter)
20 1684 Getinge Sweden Health Care Equipment
& Svcs
3.19 0.27 5.09 5.60 Report not available in English
21 1721 FLSmidth & Co Denmark Construction 4.33 0.31 4.22 3.42 No CSR information in the CEO letter
22 1850 NCCGroup Sweden Construction 7.24 0.18 4.18 1.80 No CEO letter available
23 1909 Lundbergs Sweden Diversified Financials 2.94 0.22 10.23 2.98 No CSR information in the CEO letter
24 1913 Fred. Olsen Energy Norway Oil & Gas Operations 1.14 0.47 2.39 2.35 No CSR information in the CEO letter
Source: Adapted from “The Global Forbes 2000” available at:http://www.forbes.com/2010/04/21/global-2000-leading-world-business-global-
2000-10_land.html [Accessed May, 3 2011].
iv
Table III. Latin American companies included in the research
Rank Forbes
Global 2000
Company Country Industry Sales ($bil) Profits
($bil)
Assets
($bil)
Market
Value($bil)
1 18 Petrobras-Petróleo
Brasil
Brazil Oil & Gas Operations 104.81 16.63 198.26 190.34
2 51 Banco Bradesco Brazil Banking 59.10 4.60 281.40 54.50
3 80 Vale Brazil Materials 27.82 5.88 100.81 145.14
4 82 Itaúsa Brazil Conglomerates 66.36 2.25 342.63 28.74
5 235 Eletrobrás Brazil Utilities 13.11 2.68 58.00 15.95
6 432 Femsa Mexico Food, Drink & Tobacco 15.08 0.76 16.07 14.84
7 478 CSN-Cia Siderurgica Brazil Materials 5.57 1.32 16.74 25.30
8 612 Grupo Mexico Mexico Materials 5.02 0.90 12.01 18.97
9 620 Usiminas Brazil Materials 5.54 0.68 14.78 14.26
10 658 Oi_(Tele Norte Leste) Brazil Telecommunications
Services
8.17 0.50 16.73 7.99
11 681 Grupo Modelo Mexico Food, Drink & Tobacco 6.27 0.66 8.92 17.42
12 701 CBD-Brasil
Distribuição
Brazil Food Markets 13.34 0.34 10.33 9.54
13 713 Cemex Mexico Construction 14.54 0.10 44.51 9.30
14 732 Metalurgica Gerdau Brazil Materials 13.46 0.19 26.23 7.42
15 782 Cemig Brazil Utilities 4.75 0.82 10.44 9.25
16 841 Grupo Bimbo Mexico Food, Drink & Tobacco 8.64 0.44 7.41 8.81
17 864 CPFL Energia Brazil Utilities 5.36 0.65 7.02 10.16
18 919 Braskem Brazil Chemicals 8.75 0.53 12.68 3.58
19 942 Redecard Brazil Business Services &
Supplies
1.39 0.80 10.01 10.20
20 953 BRF-Brasil Foods Brazil Food, Drink & Tobacco 8.07 0.06 14.76 10.75
21 980 Fibria Celulose Brazil Materials 3.44 0.32 16.25 8.72
v
Source: Adapted from “The Global Forbes 2000” available at:http://www.forbes.com/2010/04/21/global-2000-leading-world-business-global-
2000-10_land.html [Accessed May, 3 2011].
22 1102 Cielo Brazil Business Services &
Supplies
1.98 0.88 1.61 11.03
23 1316 Sabesp Brazil Utilities 3.13 0.49 11.61 3.89
24 1351 SQM Chile Chemicals 1.44 0.33 3.20 10.32
25 1399 Natura Cosmeticos Brazil Household & Personal
Products
2.15 0.35 1.57 8.22
26 1400 Soriana Mexico Retailing 7.03 0.22 5.02 4.82
27 1421 Fresnillo Mexico Materials 0.85 0.32 1.20 8.38
28 1432 Banrisul Brazil Banking 2.85 0.31 16.41 3.38
29 1438 BCI-Banco Credito Chile Banking 2.32 0.24 20.00 3.59
30 1468 ALFA Mexico Conglomerates 8.58 0.15 8.26 3.80
31 1468 CMPC Chile Materials 2.96 0.20 7.60 8.61
32 1472 Copel Brazil Utilities 2.38 0.47 5.51 5.66
33 1486 Embraer Brazil Aerospace & Defense 5.12 0.19 9.04 3.96
34 1615 Kimberly-Clark de
Mexico
Mexico Household & Personal
Products
1.89 0.32 2.08 5.74
35 1680 Net Serviços Brazil Media 2.65 0.42 4.78 4.31
36 1705 Fosfertil Brazil Chemicals 1.49 0.34 1.79 4.81
37 1813 Sul America Brazil Insurance 4.62 0.21 7.14 2.47
vi
Table IV. Scandinavian companies included in the research
Rank
For2000
Company Country Industry Sales ($bil) Profits
($bil)
Assets
($bil)
Market
Value($bil)
1 64 Statoil Norway Oil & Gas Operations 79.76 3.16 97.09 72.26
2 95 Nordea Bank Sweden Banking 22.81 3.41 729.06 39.42
3 135 Nokia Finland Technology Hardware &
Equip
58.72 1.28 49.11 49.18
4 208 TeliaSonera Sweden Telecommunications
Services
15.24 2.63 36.20 31.30
5 276 Ericsson Sweden Technology Hardware &
Equip
28.83 0.51 35.78 32.55
6 290 Danske Bank Group Denmark Banking 30.41 0.33 597.03 15.75
7 353 Fortum Finland Utilities 7.79 1.88 28.40 22.79
8 422 Novo Nordisk Denmark Drugs & Biotechnology 9.83 2.07 10.27 44.65
9 427 H&M Hennes &
Mauritz
Sweden Retailing 14.54 2.35 7.60 50.24
10 452 SCA-Svenska
Cellulosa
Sweden Household & Personal
Products
15.48 0.67 20.99 10.52
11 453 Mxller-Maersk Denmark Transportation 48.70 -1.32 66.49 33.77
12 527 SEB-Skand Enskilda
Bank
Sweden Banking 13.02 0.16 323.28 13.50
13 537 Volvo Group Sweden Consumer Durables 30.49 -2.06 44.77 18.31
14 564 Atlas Copco Sweden Capital Goods 8.90 0.87 9.17 17.41
15 590 Yara International Norway Chemicals 10.50 0.65 10.34 12.03
16 640 Skanska Sweden Construction 19.10 0.51 11.17 6.89
17 641 Orkla Norway Food, Drink & Tobacco 9.70 0.45 16.39 8.16
18 651 Vestas Wind Systems Denmark Capital Goods 9.51 0.83 9.08 9.89
19 686 TDC Denmark Telecommunications
Services
6.91 0.47 16.65 8.77
vii
20 688 Swedbank Sweden Banking 10.23 -1.47 251.18 9.11
21 790 Electrolux Group Sweden Consumer Durables 15.24 0.36 9.80 6.09
22 856 Kone Finland Construction 6.80 0.67 5.07 10.72
23 959 Norsk Hydro Norway Materials 11.63 0.05 13.43 8.20
24 1039 Wärtsilä Finland Capital Goods 7.54 0.56 6.55 4.78
25 1044 Stora Enso Finland Materials 12.82 -1.26 16.41 5.06
26 1045 Tele2 Sweden Telecommunications
Services
5.48 0.63 5.01 6.58
27 1062 Neste Oil Finland Oil & Gas Operations 13.81 0.32 8.16 3.64
28 1100 Storebrand Norway Insurance 7.71 0.15 63.24 3.14
29 1104 SKF Group Sweden Capital Goods 7.85 0.23 6.91 7.23
30 1281 Metso Finland Capital Goods 7.19 0.21 7.95 4.69
31 1392 Alfa Laval Sweden Capital Goods 3.64 0.38 3.45 6.02
32 1418 TrygVesta Denmark Insurance 3.50 0.39 8.36 4.07
33 1502 Kesko Finland Food Markets 12.10 0.18 5.51 3.56
34 1598 DSV Group Denmark Transportation 7.00 0.23 4.38 3.42
35 1667 SSAB Sweden Materials 4.17 -0.14 8.44 5.48
36 1743 Novozymes Denmark Drugs & Biotechnology 1.63 0.23 2.09 6.41
37 1747 Boliden Sweden Materials 3.86 0.35 4.65 3.47
Source: Adapted from “The Global Forbes 2000” available at:http://www.forbes.com/2010/04/21/global-2000-leading-world-business-global-
2000-10_land.html [Accessed May, 3 2011].
viii
Table V. LATIN AMERICAN COMPANIES
Company Category of rhetoric Themes Quotations
1 Petrobas Strategic CSR Operationalization Petrobas's excellencein deep and ultra deep water technology and exploration, thecapacity of its staff and theadoption
of best corporategovernancepractices afforded thecompany consistent results in 2009
This bet was proven right and allowed us to maintain uninterrupted, thecorporate strategy to expand business in an
integrated manner, with profitability and in compliance with social and environmental standards.
Reputation This performancehas ranked Petrobas thefourth in themarket value among listed global energycompanies
Strategic Link Petroba's strategyto drivebusiness and activities with social and environmental responsibility
Governance Adoption of best corporate governance practices
Institutional CSR CSR The corporatestrategyto expand business in an integrated manner, with profitability and in compliance with social and
environmental responsibility standards
Sustainability This will allow the companyto expand its growing investments in a solid, sustainable manner
Giving back to societya part of the outcome of its activities, maintaining its commitment to sustainable development.
Philanthropy Additionally, the companysupports cultural, sports, social and environmental projects in which it invested about $R 464,5
million in 2009
Stakeholder dialog To Petrobas the SustainabilityReport is an essential tool for transparencyin monitoring, disclosing and rendering
accounts to its stakeholders about its economic, environmental and social performance
Dialectic CSR Global Standards The company also maintained its investments graderating and ensured for thefourth consecutive year its listing on the
Dow Jones Sustainability Index. In line with the ten principles of theUN's Global Compact
Accountability To Petrobas the SustainabilityReport is an essential tool for transparencyin monitoring, disclosing and rendering
accounts to its stakeholders about its economic, environmental and social performance
Our 2009-2013 Business Plan calls for avoiding the emissions of 4,5 million tons of CO? equivalent in 2013
Inclusivity Petrobas Development & Citizenship program, thePetrobas Environmental Program, and the Petrobas Cultural Program,
and the Petrobas Cultural Program, as well as in resourceallocation to theFund for Children and Adolescents (FIA)
Focus on the issue Sets the goal of achieving levels of excellence in theenergy industrywith regard to the intensityof greenhousegas
emissions in processes and products.
Social contribution As a result of all of these efforts, Petrobas is rewriting thehistory of the Brazilian presence in theglobal energyscenario
ensuring considerablereserves to Brazil and giving back to thesociety a part of theoutcomeof its activities maintaining
its commitment to sustainabledevelopment
Political role of the firm Rights As well as in resource allocation the Fund for Children and Adolescent (FIA) with a focus on guaranteeing therights
of children and adolescent
Political engagement This goal will mitigatetheemissions growth curvewithout restricting business expansions or jeopardizing theinterna-
tional commitments Brazil has taken-on. Petrobas is rewriting thehistoryof theBrazilian presencein theglobal energy
scenario, ensuring considerable reserves to Brazil
ix
2 Banco Strategic CSR Operationalization The Organization continues integrating themain indezes of corporatesustainability
Bradesco Innovation Bradesco opened thefirst fluvial bank branch in Brazil, in a vessel. The new systemoffer onlineservices such as bill
payment, consumption bills, deposits, taxes, withdrawals and loans all by satellitecommunication
Reputation All this is reflected in the recognition of the Organization as oneof the best places to work
Institutional CSR Philanthropy We seek to develop a sense of solidarity among our morethan 85 thousand employees. In line with this, wemaintain
theBradesco Volunteer Program
Dialectic CSR Global Standards In 2009 we reinforced our commitment to the Global Compact- a United Nations framework that sets out 10 principles
Partnership We joined the Brazilian platformCompanies for Climate (EPC) of the Center for Sustainability Sudies at Fundaçao
Getulio Vargas and also entered into commitment with Ethos Institutea
Global Agenda Which aims at encouraging society as a wholeto join theinternational agreement on climatechange
Inclusivity The inauguration in November of thefirst bank branch in Heliopolis, a destitutecommunitywith about 100000 inhabitants
In thedomestic market weare theprivate bank with thelargest presence in classes Dand E
Banking inclusion was also extended to 40000 riverside dwellers
Social contribution Concern about health and quality of lifeis a premise at Bradesco's human resources management
Employees and student engaged in activities throughout thecountry for thebenefit of over 1,6 million of people
Political role of the firm Access With this new service station Bradesco reached 100%coveragein Brazilian municipalities. We continued on our quest
to provide access to banking services and thedemocratization of credit in thousands of locations previouslyunderserved
Development Thus, webelieve to have contributed to thedevelopment of these communities and of the country at a large
Rights The democratization of credit to these millions of Brazilians is certainly one of themost important tasks undertaken by
theorganization. Banking inclusion was also extended to 40000 riverside dwellers
3 Vale Strategic CSR Operationalization In a context of uncertaintyin global markets, in 2009 wemade extensive social and environmental investments, tota-
lling US$781 million, with $580 million going into environmental actions and US$201 million into social projects
Reputation The Global Compact of theUN, which for thesecond consecutive year recognized our previous sustainabilityreport as a
Notable Communication on Progress
Strategic Link In theeconomic area, our sustainabilitystrategy proved its worth. Faced with a dramatic global financial crisis, Vale
demonstrated thepractical competitiveadvantages of its consistent management strategy
Leadership on CSR The improvement in our performancein the sustainability indicators that are detailed in this report. They arecontributing
to thesearch for excellence in themanagement of our businesses, making our actions transparent to society, and helping
to spread our practices in thesustainabilityarea across all different countries in which weoperate
Institutional CSR Sustainability We havereinforced our sustainabilitystrategywith thepublication of significant global guidelines that serve to guide
our action, in particular our SustainableDevelopment Policy, which aims also to construct a social, economic, and
environmental legacy in theregions where we operate, based on three main areas; Sustainable Operator, Local
Development Catalyst and Global SustainabilityAgent
Philanthropy We created the ValeFund for SustainableDevelopment which is designed to support actions byNGOs to balance
environmental conservation with theimprovement of social and economic conditions of communities, with an initial
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focus on the Amazon rainforest blome
Sustainable growth We also made investments that arefundamental to our organic growth and to our economic sustainability in the
mediumand long terms
Dialectic CSR Global Standards With the publication of Vale's third sustainability report, prepared in accordancewitht the guidelines of the Global
Reporting Initiative (GRI)
Accountability We areconsolidating our stratety of transparent and accountable actions
Partnership In parallel, Vale in conjunction with civil society organizations, oversaw thepublication of an Open Letter to Brazil on
Climate change
Global Agenda We participated with proposals in thedebate on the Brazilian government's position at theUN on Climate Change (COP15)
Social contribution We striveto contributeto the reduction of thedeficit in sanitation and housing in the areas where we operate
Political role of the firm Development The Valefoundation continued to establish Knowledge Stations, which aimto contribute towards improving thequality
of lifeand to theintegrated and sustainabledevelopment of thecommunities in sixBrazilian states
Political engagement In 2009, theVale Foundation invested a total of US$11 million in infrastructureand housing projects, and this resulted
in the allocation of US$395 million by the municipalities and theFederal Government
Supporting local municipalities, wedevelop executive engineering projects and provide support in winning the resources
that are available fromstate and federal government
4 Itausa Strategic CSR Reputation Also being appointed for the third consecutive year, as a leading company in sustainabilityin thefinancial services sector
Governance For theItausa group the operations carried out by its subsidiaries must begrounded on thecommitment to Corporate
Governanceand sustainableactions.
Dialectic CSR Global Standards As part of market recognition, Itausa was proud to rank in the Dow Jones Sustainability Index(DJSI) for thesixth time
5 Electrobas Strategic CSR Reputation Today, we arethe third largest clean energy companyin the world
Strategic Link The commitment with sustainabilityis not only a speech, but it is a continual corporatepractice;
Governance With improvements in corporate governanceand in themanaging methods, besides developing a group of projects
aiming at the integration of all Electrobas companies
Leadership on CSR Today, we arethe third largest clean energy companyin the world
Institutional CSR Sustainability For more that fiftyyears, Electrobas companies have generated clean and renewable energyand haveshown that the
commitment with sustainabilityis not only in speech, but it is a continual corporatepractice
Philanthropy
Stakeholder dialog We would likeeven to communicate in a moreand moreeffectivewaywith our stakeholders, recognizing thediversity
of their expectations concerning our business and offering then timely and appropriate answers
Sustainable growth We would liketo achievemuch more. Our future vision expressed in our 2010-2020 Strategic Plan, shows thewidth of
our ideal: to be thelargest global corporate clean energysystemin 2020
Dialectic CSR Global Standards The same commitment makes us signatories of the Global Compact
Accountability We embrace the challengeof visibility and wewould like to beassessed, compared and, furthermore, recognized as an
exampleof consistent growth, aligned with sustainability principles
xi
Global Agenda Our clean energy platformgives us a prominent position in theenergy industry, in a world struggling with social envi-
ronmental impacts and climatic changes
6 FEMSA Strategic CSR Operationalization In thearea of environmental care, we improved processes for efficient water usage, and appropiate handling or our
wastes and emissions
Reputation The GRI organization has granted us with a level A in the verification process
Strategic Link We firmlybelieve that integrating social responsibilityinto our business strategynot onlyhas immediate benefits, but is
a factor in our success in confronting the difficulties companies around the world arefacing
Institutional CSR CSR Thesechanges in the economic, social, cultural, and human spheres which led FEMSA to reinforce its business strategies
including thoserelated to social responsibility
Sustainability Through this policy, we formalizethe integration of social responsibility into our strategic business processes and mana-
gement systems, and unify our criteria under the basic premise of sustainability
Stakeholder dialog Communication with our stakeholders
Sustainable growth During 119 years, our social investment, communication with stakeholders, and theconviction of behaving responsibly
toward our communities and theenvironment have proven to bethe right path to growth, and a strength amid adversity
Dialectic CSR Global Standards This report has been prepared based on indicators of theGlobal Reporting Initiative (GRI G3)
Partnership We areproud of having been the first to accept the invitation of the Colombian government, and thus to serveas an
inspiration for other companies interested in joining in thework of rebuilding peace in thecountry
Inclusivity In 2009, wewelcomed 550 persons with disabilities, senior citizens, and members of other vulnerable groups into our
workplace
Social contribution In thematter of social responsibilities, thereare manyissues on which wehave focused our efforts: combating obesity,
supporting water preservation, reducing emissions and solid waste, proper management of PET, and thematerial of
plastic bags used in our conveniencestores
Political role of the firm Development Tima Bank program, which continued to work with former members of guerrilla and paramilitarygroups in their efforts
to rejoin societyand develop their own business
Rights We held 450 educational programs and morethan 230 familydevelopment programs in thecountries whereweoperate
Political engagement Charting myown destiny, our programfor encouraging thedevelopment of lifeskills among young people, has become
FEMSA flagship program. This year, we reached two more states in Mexico and are prepared to expand into other countries
in Latin America. The success achieved by this programis proof that private-government alliances can maximize thevalue
generated for other communities
7 CSN-Cia Political role of the firm Development Demonstration of our commitment to thedevelopment of thecountry, by generating jobs and wealth
siderurgica Political engagement Our investments, even during such an adversemoment, totaled 1.9 billion. This is an unequivocal demonstration of our
commitment to the development of the country, by generating jobs and wealth.
8 Grupo Strategic CSR Operationalization This year we want to emphasizetheimportanceof moreresponsible water management this being vital element for
Mexico theplanet
Innovation The advances made on managing this resource haveresulted in an 8.3%increasein the useof recovered water
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Strategic Link It is only with thecommitment of everyone that wewill be ableto facetheglobal responsibilityof sustainabledevelopment
Shared Value Our capacity to generatevalue makes us one of theeconomic pillars of development in the regions whereweoperate
Institutional CSR CSR The companies that compromisethegroup arejoined in a philosophy of continual improvement that includes theprinci-
ples of social responsibility and has been a constant sinceour company began
Sustainability Sustainabledevelopment is an ongoing challengefor Grupo Mexico
Only with the commitment of everyonethat wewill beable to face theglobal responsibilityof sustainabledevelopment
Dialectic CSR Global Standards The information provided has been prepared according to Global Reporting Initiative (GRI)
Accountability In themining division, our consumption of electricitylowered 1,2%compared to 2008 and our goal is to reduce this by a
further 2%for 2010
Global Agenda This year we want to emphasizetheimportanceof moreresponsible water management this being vital element for
theplanet
Energy is oneof the principal costs for our operation, in both themining and railroad sectors, thereforeconcern for the
conservation and efficient useof energy is especially clear
Focus on the issue The scarcityof water can limit our abilityto generatevalueas this is a basic supply for our mining-metallurgic processes.
The advances made on managing this resource haveresulted in an 8,3%increasein the use of revered water, which
means that 69%of thewater weconsumeis water recovered fromour own processes
Social contribution This commitment extends to our neighboring communities, through the investment of US$7 million in building infrastruc-
ture, developing social programs, promoting productions projects and generating opportunities in health and education
Political role of the firm Access We invested US$ 12,5 million in our schools for employee families, sports and cultural programs, and also in basic resi-
dential infrastructureand services
This project is one of themost modern of its type in theworld and will guaranteea greater supplyof qualitywater for
both thecommunityand our operators
Development Our capacity to generatevalue makes us one of theeconomic pillars of development in the regions whereweoperate
Political engagement Social and communityinfrastructure is another keyaspect for thedevelopment of our pleople
9 Usiminas Strategic CSR Reputation Inclusion of Usiminnas in BM&F Bovespa's CorporateSustainability Index(ISE), which brings together a select group of
enterprises considered references in thepracticeof sustainability and corporategovernance
Governance Throughout 2009 we developed and formalized our Corporate SustainabilityGuidelines to promoteobjectiveand veri-
fiable good practice
Dialectic CSR Global Standards A signatoryof theUN Global Compact since2004
Accountability Such is thecontext in which we have mapped out our strategy, using Balanced Scorecard (BSC) methodology, in order to
makeour futurestrategytransparent and objective.
Political role of the firm Rights Usiminas will reaffirms its commitment to this UN initiativefor 2010 and will foster effective action to fight corruption
and defend Human Rights, decent working conditions and the environment
10 Oi Tele Strategic CSR Operationalization Internal controls which aimto minimizethepotential environmental impact fromenergy consumption, wastesorting,
Norte Leste disposal of batteries, among others
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Reputation For thesecond consecutiveyear, Oi is a member of the CorporateSustainability Indexat BM& Fbovespa
Strategic Link It also means fromthe strengthening of this theme(sustainability) within the company's strategy, capping actions re-
Institutional CSR Sustainability Our performance in theIndexresults fromthe evolution and continuation of sustainabilityactions promoted by several
areas
Dialectic CSR Global Standards Oi has been a member of the United Nations Global Compact since August 2009
Political role of the firm Access Oi's unwavering commitment to reach all national frontiers with broadband internet access
Development Reasserting its commitment to the country's social development and to thedemocratization of access to knowledge, Oi
Futuro expanded its programs in education, cultureand sports
Political engagement The commitment to take freebroadband serviceto all public schools, thus to morethat 54 million students, adds Oi to
theuniverse of public policies, given the introduction of new technologies and, under the coordination of the Education
Ministry, radicallychanges education and thequalityof teaching in Brazil
11 Grupo Strategic CSR Operationalization Through theimplementation of profitable productive activities, long-termvision and adherence to theprinciples that gave
Modelo birth of our companyin Mexico almost 85 years ago, Grupo Modelo continues to advance on the road to sustainability
Reputation We areparticularlyproud to be Mexico's current leader beer company and, as a Mexican company, weare also proud to
hold theseventh position within the global beer industry
Strategic Link Thanks to our special business model, allowing us to consolidateour leadership in Mexico, and at thesame timestreng-
then our international presence, while still making positiveeconomic, environmental and social contributions
Institutional CSR CSR This report, which constitutes therecount of the most important actions undertaken in theareas of social responsibility
and corporate sustainability
Sustainability Grupo Modelo maintains its commitment with the company's sustainabledevelopment in the communities in which it
operates
Stakeholder dialog To our shareholders, suppliers, clients, consumers, government institutions and social organizations: wearegrateful for
your confidenceand support and we renew our commitment to continueworking for a better society through profitable
responsible and long-termproductiveactivities, aimed to collaborate towards thepreservation of a viable and balanced
environment for future generations, who will be ableto take advantageof it for new and better opportunities
Dialectic CSR Global Standards This report is presented for thethird consecutiveyear, following the guidelines of Global Reporting Initiative(GRI)
Accountability With the representation of the2009 Sustainability Report Grupo Modelo reasserts its commitment to a responsibleper-
formance and transparencytowards our stakeholders
Global Agenda Thanks to our environmental protection programs, todayan important percentage of thetotal energyconsumed byGrupo
Modelo comes fromalternative sources of energy
12 CBD Strategic CSR Operationalization Implementation of various initiatives, including building new "green" stores, promoting of theuseof recycled bags and
Brazil GPA mitigating environmental impact in regard to water and energy
Reputation Consolidate our leading position as Latin America's largest retail company
Strategic Link In 2010 we expect to score further advances in this area, ensuring that the principles and ideals of sustainabilityplay an
increasinglyimportant rolein our dailyactivities
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Institutional CSR Sustainability We also recorded progress on the corporate sustainabilityfront with the institution of a sustainability committeeto
structure related issues
Sustainable growth Our objectives have been clear since the outset: to grow in a sutainable manner
Dialectic CSR Global Standards We also maintained our commitments with the Global Compact, a UN initiative designed to promote ethical ans socially
responsible business conduct
Accountability We also recorded progress on the corporate sustainabilityfront with the institution of a sustainability committeeto
structure related issues
Political role of the firm Development Our investment plan reflects the positive outlook for the Brazilian economyand confirms our commitment to the crea-
tion of jobs and thedevelopment of the country as a whole
Political engagement Our investment plan reflects the positive outlook for the Brazilian economyand confirms our commitment to the crea-
tion of jobs and thedevelopment of the country as a whole
13 CEMEX Strategic CSR Operationalization We areexpanding and strengthening our efforts in key areas such as safetytraining for drivers and contractors. Above
all, we remain committed to our global long-termgoal of zero incidents
Strategic Link We took important and decisivesteps to strengthen not only our business model, but also out commitment to
sustainable development
Governance We activelyengage with our global panel of sustainabilityexperts, who provideimportant and valuable advice
Institutional CSR CSR As a global company, weare deeplyaware of our responsibility to address complexsustainability challenges
Stakeholder dialog We engaged the communities in which we operatethrough open and ongoing dialogue, social initiatives, and
volunteer efforts
Dialectic CSR Accountability We continued to reduce our carbon footprint by improving the energy efficiencyof our operations and expanding our use
of alternativefuels. As a result, in 2009 weincreased our use of alternative fuels to 16,4%, exceeding our target for
2015 ahead of time
Global Agenda We reconfirmour commitment to address climate changeand to the development of a low-carbon economy
Focus on the issue We arecommitted to further reducing our impact on the environment and recognizethat we havemany opportunities
to improve
Social contribution We continued to find ways to promoteaccess to better housing and community infrastructure
Political role of the firm Access We continued to find ways to promoteaccess to better housing and community infrastructure. For example welaunched
our most successful low-incomehousing solution, Patrimonio Hoy, in the Dominican Republic
14 Gerdau Strategic CSR Operationalization We continuously invest in thebest globally- available industrial technologies for the protection of air, water and soil, so
Metalurgia as to minimizetheimpacts of our operations on theenvironment
Reputation The implication of SafetyHour at our plants in Brazil has been internationally recognized by the World Steel Association
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Institutional CSR Sustainable growth We also believethat the growth of a company should always be aligned to community development and respect for the
environment.
Dialectic CSR Partnership We haveprimarilysupported education, at various levels, and public administration, stimulating improvement in services
provided to society.
Global Agenda We continuously invest in thebest globally- available industrial technologies for the protection of air, water and soil, so
as to minimizetheimpacts of our operations on theenvironment
Social contribution We haveprimarilysupported education, at various levels, and public administration, stimulating improvement in services
provided to society.
Political role of the firm Political engagement We haveprimarilysupported education, at various levels, and public administration, stimulating improvement in services
provided to society.
15 CEMIG Strategic CSR Operationalization Knowledgemanagement took another step forward with thecreation of theUniverCemig, a corporate universityaimed at
ensuring managerial and operation excellenceat Cemig, whose tonic is the integration of peopleand efforts to generate
ans shareknowledge
Reputation Cemig has also been elected, onceagain, global leader in theutilities super sector
Strategic Link In 2009, Cemig sought to continuallyimprove its corporatesustainabilityactions, aligning thecreation of economic value
respect for social environment with stakeholder preservation of theenvironment
Leadership on CSR To be in 2020 oneof the two largest energy groups in Brazil in terms of market value, with a significant presencein the
Americas and to be a world leader in sustainability in the sector
Institutional CSR CSR Reinforcing its commitment to the corporateresponsibility
Sustainability In 2009, Cemig sought to continuallyimprove its corporatesustainabilityactions, aligning thecreation of economic value
respect for social environment with stakeholder preservation of theenvironment
Stakeholder dialog In its quest to continuallyimproverelations with its suppliers theCompanydeveloped the "Cemig Suppliers and Relation-
ship with Supplier Manual" in order to establish a set of principles and directives, translated into commitments, that will
guide theactions undertaken byCemig and its suppliers
Sustainable growth The new energy generation projects ensurethecompany's growth in the generation of energyutilizing clean and renewa-
blesources
Dialectic CSR Global Standards Cemig celebrated its tenth year of inclusion in theDow Jones SustainabilityIndex
Accountability In 2009, water sources wereresponsiblefor 99%of Cemig's energygeneration, allowing thecompany to make water the
driving force behind its development and ensuring that greenhousegas emissions arewell below theaverage levels of
theglobal electric energy sector
xvi
Partnership In 2009, Cemig implemented the Special Integrated Management Programof Networks and Trees-Premiar together with
municipalities, universities and the population
Global Agenda Ensuring that greenhousegas emissions are well below the average levels of the averagelevels of theglobal electric
energysector
Political role of the firm Social contribution The company madeprogress at several long termprograms that havealready benefitted thousands of users throughout
Access thestate of Minas Gerais, with an emphasis on the"Luz Para Todos" Program, directed at providing universal electric
energyservice
16 Grupo Strategic CSR Operationalization Each one of our efforts to minimizeenvironmental impact represents and efficiency improvement in thesupply chain and
Bimbo generates tangiblebenefits to the organization
Innovation Through the"Committed to theEnvironment" programin 2009 wecomplemented new product launches with degradable
packaging technology, achieved a significant reduction in theuseof fuel and improved our management of solid waste
Reputation Moreover, Reforestamos Mexico has done an extraordinaryjob through its effort to contribute to Mexico's reforestation
earning the2009 National Forestry Merit Award
Strategic Link We area global, modern and sustainable company, permanently striving to maintain adherence to best practices through
local initiatives and programs that will ensure thecommon good and will generate long-termsocial, economic and
environmental benefits
Shared Value Thanks to our deep sense of service and to an understanding that attention to the needs of the environment and the
search for thewelfareof the individual represent a commitment and a raison d'etrethat will continue to generatevalue
for our stakeholders and future generations
Leadership on CSR 2009 posed important challenges that wetransformed into opportunities in order to keep our commitment to efficiency,
productivity and job creations, with the aimof strengthening our leadership as a companythat conducts itself in a dynamic
and flexiblemanner, but above all transparency, under the premiseof fair and responsiblepractices
Institutional CSR CSR We havealways assumed thecommitment to responsible performancetowards our diverse stakeholders and society
Solid strategyof social responsibilitythat is incorporated throughout our operations, supported bythehighest ethical and
human values in all the countries whereweoperate
Sustainability We areglobal, modern and sustainablecompany
Dialectic CSR Accountability Aboveall transparency, under the premiseof fair and responsible practices
Global Agenda Grupo Bimbo committed to theenvironment voluntarilyoffsets greenhouse gas emissions generated
Social contribution Our "Committed to Your Health" programpromotes an appropriatediet and a healthy lifestyle, aligned with the World
Health Organization Global Strategy(WHO)
xvii
Political role of the firm Political engagement "Committed to Our Society" program, and was madeevident through social projects and support given to organizations
that work for the well-being, health and education of thousands of people. We want our presence to make a positive
difference in thecommunity
17 CPFL Strategic CSR Operationalization We also invested in clean and renewableenergy and sugarcane biomass cogeneration
Energia Reputation For thesecond year running CPFL Energia received the award for Best Companyin Latin America for Sustainabilityfrom
Latin Finance magazineand the Management Excellenceconsulting firm
Strategic Link Our strategyof maintaining disciplined financial management, diversifying thebusiness portfolio and seeking greater
Governance operating efficiency, led by the search for excellence as regards sustainability and superior corporate governancepractices
Shared Value This is about adopting a responsible attitudetowards thecommitments wehave with employees, customers, suppliers,
shareholders and public authorities. Thegeneration of valuein the future depends on responsibledecisions taken today
Institutional CSR Sustainability Our strategyof maintaining disciplined financial management, diversifying thebusiness portfolio and seeking greater
operating efficiency, led by the search for excellence as regards sustainability and superior corporate governancepractices
Stakeholder dialog We understand that wecan positivelyinfluenceour stakeholders by providing high quality information and promoting
initiatives that contribute to thecreation of a new consciousness and theadoption of sustainablehabits
Dialectic CSR Global Standards CPFL is also a member of theBrazilian Committeeof the Global Compact in threeof its four commissions
Partnership We support the A Bag is a Drag campaign of the Brazilian Environmental Ministry, which aims to reduceconsumption of
plastic bags and therebyreduce the environmental impact of our daily activities
Global Agenda As a result of this concern, CPFL is an activeparticipant in discussions between corporations regarding the subject of global
warming.
18 BRASKEM Strategic CSR Operationalization We haveundertaken to reducetheintensity of our emissions of greenhouse gases, stating Braskemcorporate views in
thedocument e preciso amadurecer para ser verde (Weneed to matureto begreen). This document also reaffirmed
Braskemcommitment to the search for new technological opportunities and increased energy efficiency, furthering the
useof 100%renewablematerials and development of a market for products capable of reducing greenhouse gas emissions
Innovation In 2009 Braskemstarted the ETBE plant. ETBE is a bioadditivepartially manufactured fromsugar cane ethanol and this
plant was established in Camaçari (Bahia), replacing the MTBE unit. The construction, in Triunfo (Rio Grande do Sul), of
enable production of the Green Polyethylene product also evolved quickly
Strategic Link It is our understanding that a company that enforces such practices (sustainable development) is technologicallyhealthy,
economically viable and socially fair.
Leadership on CSR Company achievements in 2009 and the vision of the futureBraskemhas of ranking among thefive majors of theglobal
petrochemical industry, and to beseen in 2020 as an organization that has made an outstanding contribution to sustainable
xviii
development, werethehallmarks of our actions in this period
Institutional CSR CSR It is our understanding that a company that enforces such practices (sustainable development) is technologicallyhealthy,
economically viable and socially fair.
Sustainability Since it was established in 2002, Braskemhas been acting based on sustainabledevelopment principles
Dialectic CSR Accountability The fourth inventory of greenhouse gases must also behighlighted. In 2009 this inventoryevidenced that emissions had
been reduced by 8,3%in absolutefigures, and their intensity by11.5%, against 2008 figures, evidencing thedepth of our
commitment
Partnership Also to theRio Grande do Sul Recycling Project, in partnership with Vonpar Foundation and Banco do Brasil Foundation,
besides proceeding with various already existing initiatives
Global Agenda In theview of theworldwidedebate about climate change and greenhouse gas emissions by our industry, Braskemresol-
ved to include theseissues in its agenda.
Inclusivity Braskemhas madea significant contribution to theSocial Insertion Programin the Deep South of thestate of Bahia
Social contribution Our main challenge is to improveCompany Private Social Investment Model in order to seethese projects actually contri-
buting to a change in social reality
Political role of the firm Political engagement Our main challenge is to improveCompany Private Social Investment Model in order to seethese projects actually contri-
buting to a change in social reality
19 Redecard Strategic CSR Reputation In addition, Redecard also becamea constituent of theBusiness SustainabilityIndex(ISE) of theSão Paulo Stock Exchange
Institutional CSR Sustainability During 2009, Redecard remained dedicated to improving its market practices, supporting the changes necessaryto make
its business more sustainable
Dialectic CSR Global Standards It was the onlyBrazilian companyto be included in the Dow Jones Sustainability World Index– DJSI World in 2009
Political role of the firm Political engagement I have no doubt that thanks to the work and dedication of all our employees, Redecard is recognized in themarket as a
company that is innovative, secure, and flexible with a completeproduct portfolio, customer focused and that seeks
sustainable development of commerce, thus helping to drive theCountry’s economy
20 BRFBrasil Strategic CSR Strategic Link We areaware that these financial and operational results will onlycarry theseal of approval over theyears to comeif
Foods theyareachieved together with respect for the human being and the environment
Institutional CSR CSR Our operations are based on the constant search for economic, social and environmental equilibrium
Sustainability Without ever losing sight of our commitment to the sustainabilityof thebusiness and also for ensuring thecreation of
valuefor all our stakeholders
Stakeholder dialog At BRF, we believethat dialog and generation of valuefor all our stakeholders are fundamental to ensure thesustaina-
bility of thebusiness
xix
21 Fibria Strategic CSR Reputation Where Fibria is theonlyforestrysector representative (DJSI)
Celulose Strategic Link We takethis opportunity to reaffirmour commitment, stated at the time that Fibria was conceived, to develop our rene-
Institutional CSR CSR wableforestrybusiness as a sustainablesourceof life, generating wealth and economic growth, , promoting human and
social development and guaranteeing environmental conservation
Dialectic CSR Global Standards The market has shown considerable faith in theCompany, borneout by our selection for leading sustainabilityindicators,
such as the Dow Jones Global Sustainability World Index
22 Cielo Strategic CSR Operationalization We madeinvestments with our own resources and through fiscal incentives in cultural, social and sports projects, looking
for programs focused on education, child health and training youngsters for thelabor market
Reputation Our actions on this front in 2009 were recognized by several institutions in different areas, as wewereawarded the"Valor
Carreira" prize for excellence in people management
Institutional CSR CSR Awareof our social responsibility, wecontinued to invest in social projects and environmental preservation projects
Dialectic CSR Global Agenda Looking for programs focused on education, child health and training youngsters for thelabor market , prioritizing social
Inclusivity and economic inclusion
Focus on the issue During theyear, we invested in familyhealth assistance (Hospital Pequeño Prinicpe), culture (Insituto Brazil Leitor), social
Social contribution networking through sport (Fundaçao Gol deLetra and Instituto EsporteeEducaçao) and education (Instituto Ayrton Senna)
23 SABESP Strategic CSR Operationalization Theseinvestments improved the quality of living of the population. We maderoughly201,000 new water connections and
184,000 new sewage connections
Innovation In thesameline, it is important to emphasize the continuityof the pioneering implantation in a state-owned companyof
theVauleAdded Management (VAM) model, which is crucial to steer theactions related to theoptimization our asset
base and improve the quality of investments, to strengthen SABESP and its long-termsustainability
Reputation Additionally, SABESP is for the third consecutiveyear part of the CorporateSustainabilityIndexportfolio of the Sao Paulo
Mercantileand Stock Exchange (BM&F Bovespa)
Strategic Link The Company's strategic repositioning in view of thechallenges of the new regulatoryframework and theCompany's
expectations as regards the water and wasteservices and theenvironmental conservation
Governance Enhancing the corporategovernance practices is also oneof our priorities. Our Code of Ethics and Conduct of Company
was widely disseminated
Institutional CSR Sustainability The Vaule Added Management (VAM) model, which is crucial to steer theactions related to theoptimization our asset
base and improve the quality of investments, to strengthen SABESP and its long-termsustainability
Dialectic CSR Accountability We prioritized theWater Loss Reduction Programin 2009, water losses decreassed to 26%of revenue. Thegoal for 2010
We highlight theimplementation of moredetailed environmental clauses in supplier contracts, and the retaining of a
xx
consultant to implement and environmental accounting and balance sheet system
Partnership We also expanded partnering projects, such as collection of frying oil in the other cities, and theforestation of areas
around companyfacilities
Global Agenda In 2009, weprogressed in actions to mitigate the impact of climatechanges byplanting approximately 678,000 young
trees, and reducing by2,3%specific power consumption by cubic meter of water supplied
Political role of the firm Access The first was investment acceleration aiming universal services
Development We havecontributed for the economic and environmental development of theStateof Sao Paulo
Political engagement We havecontributed for the economic and environmental development of theStateof Sao Paulo
24 SQM Strategic CSR Operationalization SQM is committed to protecting its workers, thesurrounding communities and natural resources in theareas in which it
operates. Consistent with this commitment, SQM operates using an environmental management systemthat allows it to
identify and control environmental aspects of theCompany’s production processes
Strategic Link SQM’s long-termbusiness development is framed within its Sustainable Development Policy, whoseprinciples are
thecornerstoneof SQM's commitment to caring for theenvironment and our workers, the satisfaction of our customers
and our relationship with the communities in which we work
Institutional CSR Sustainability SQM's long-termbusiness development is framed within its sustainable development policy
Philanthropy In a related initiative, in 2009 SQM inaugurated a cultural center at a school in Toconao, restoring thebuilding, furnishing
it, and providing thenecessaryequipment in order to offer classes and workshops to thecommunity
Stakeholder dialog For this reason, wehavedevoted considerableefforts to strengthen our relationships with thesecommunities
Dialectic CSR Partnership SQM collaborates with high-level technical organizations to conduct environmental assessments and ensurefollow up of
environmental monitoring. The Pontificia Universidad Católica, which conducts hydro geological studies in the Tamarugal
Plains, the Salar de Llamara and the Salar de Atacama, has collaborated with SQM for several years
Social contribution As part of its community efforts, the Companyhas implemented multipleinitiatives focusing on recovering heritage,
improving education and culture, and socially advancing these important communities
Political role of the firm Access SQM understands that education enables individuals and communities to succeed and achievetheir goals, which is why
theCompany renewed its educational alliancewith theMunicipality of San Pedro deAtacama. Through this program,
which has been in placesince2007, SQM finances thesalaryof an educational specialist to work with local students with
learing disabilities
Development CommunityDevelopment. During 2009, theCompany continued its programto develop and fund a contest to finance micro-
entrepreneurs in theregion. The objective of this program, which is now in its third year, is to foster the economic and
social development of the communities around San Pedro deAtacama.
xxi
Political engagement During 2009, the Companycontinued its efforts to recover and restoreMaría Elena, a nitrate enclave that suffered
damagein the earthquake that struck the Antofagasta Region in Novemeber 2007. This works included rebuilding and re-
pairing damaged homes and infrastructure, painting all of thetown houses, stabilizing roads, and supervising thedesign
and development of public spaces
25 Natura Strategic CSR Operationalization We also increased the distribution of wealth to our stakeholders and were more efficient in our environmental manage-
Cosmetics ment, reducing by5.2%relative greenhouse gas emissions and offsetting the emissions of our chain bysupporting
socio-environmental projects
Reputation Listening to yourself, others, and the world, is and will always beour great inspiration in our persistent search for better
and stronger relationships with our many stakeholders: themost legitimate means of increasing therecognition of our brand
Strategic Link In Latin America, we want to bean important player who is committed to regional sustainable development. To this
end wewill adapt marketing, portfolio, logistics, and various channels, such as sales communication to meet theneeds
of each country
Institutional CSR CSR The strength of our operations brought impressiveprogress in all the main economic, social and environmental indicators
Thus wewill fulfill our vocation to striveto create economic, social, and environmental value
Stakeholder dialog We continued to invest in improving thequalityof relationships with manyof our stakeholders in 2009, making progress
on thesensitiveissues of theserelationships. This requires a collective effort to approach and engage in continuous
dialogue with all stakeholders
Dialectic CSR Accountability We also increased the distribution of wealth to our stakeholders and were more efficient in our environmental manage-
ment, reducing by5.2%relative greenhouse gas emissions and offsetting the emissions of our chain bysupporting
socio-environmental projects
Global Agenda In a year characterized bytheglobal economic crisis and thefrustrating impasse in negotiating an agreement on global
climate change
Political role of the firm Development In Latin America, we want to bean important player who is committed to regional sustainable development. To this
end wewill adapt marketing, portfolio, logistics, and various channels, such as sales communication to meet theneeds
of each country
Political engagement The third largest cosmetic market in theworld, Brazil signals that it is entering a virtuous cycle of prosperity. Our strong
identification with its soul and development cheers us; we will continue with our efforts to build a beautiful business
and a fairer societythat is moreethically committed to futuregenerations
26 Soriana Strategic CSR Operationalization We reinforced our training and integral development, and labor health programs directed to our collaborators
Institutional CSR CSR At the same time, we reinforce our commitment to continueattending our corporate social responsibilityactions
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Sustainability We havemadegreat efforts to maintain our labor plant and meet our financial commitments, guaranteeing the Com-
pany's long-termsustainability and profitability
Dialectic CSR Accountability We havefound formulas to involve more peopleand companies in our activities directed to theenvironment and have
expanded our reach. Wemanaged to recycle 85,000 tons of materials
We strivefor a company with clarityin goals, transparencyin its business administration and financial continuity
Partnership Especiallyvaluablethis year was our strategyof searching for synergies and bringing together theefforts of different
organizations, when innovativesolutions were required to meet the growing needs of themost vulnerable population
We havecontinously collaborated for approximately10 years with some of these organizations, such as food banks, the
Tarahumana Foundations, Un Kilo de Ayuda etc.
Political role of the firm Political engagement Behind our commitment to continue supporting programs that weconsider of special value for the community, thereare
a serieof further efforts to participate in health, education, food and environmental careactions, convinced that only
when all societycollaborates wecan achieve significant progress
27 Fresnillo Strategic CSR Operationalization We havedeveloped a comprehensivehealth, safety and environmental management systemthat integrates personnel
training and development. In addition we invest in conservation and biodiversityefforts and closely collaborate with
communities to ensurethat our growth is truly sustainable
Strategic Link Commitment to sustainabledevelopment, health, safety, environment and community relations programmes are an
integral part of the Group's activities
Institutional CSR Sustainability Theseattributes are backed up byour commitment to sustainabledevelopment
Stakeholder dialog We havea strong foundation upon which to deliver on this commitments to stakeholders
Sustainable growth In addition weinvest in conservation and biodiversity efforts and closely collaborate with communities to ensurethat
our growth is truly sustainable
Dialectic CSR Global Standards Our adherence to domestic and international standards of environmental performance is evidenced by ISO 14001
Partnership In 2009 Fresnillo plc becamea founding member of theCorporatecommitment to Wilderness. This is an initiative of the
WILDFoundation, an international non-profit organization dedicated to wilderness protection around theworld
Global Agenda The company also endorsed the Copenhagen Communiqué, an initiative of the Princeof Wales Corporate Leaders Group
on Climate Change
Focus on the issue Instead of utilizing fresh water fromaquifers, theflotation plants at Fresnillo and Sucito will use treated water, which
brings environmental benefits to the community and reduces our fresh water consumption costs
Social contribution Communityinvestments this year included education programmes and sponsorship of athletic teams, arts and culture
28 Banrisul Strategic CSR Operationalization There were also significant operational changes. Internal processes werereviewed, sectors were integrated in business
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platforms, targets were reassessed, and a people management policy sustained bycontinuous training and performance
valuing was adopted
Reputation The past years were marked by substantial investments in technological innovation and Banrisul received national
an international awards
Strategic Link We havebalanced modernityand personalized service, boldness and respect, efficiency and accessibility, results and
communityparticipation, profit and peoplevaluing, commercial prospects and social actions
Governance Banrisul continuity is ensured byits consolidated management model, which is supported by corporate governance prac-
tices focusing on institutional results and delivering increasing efficiencyto its clients
Institutional CSR Stakeholder dialog However, technical and joint decision represent a straight, secure path for the organization and its various stakeholders
Political engagement Banrisul is in linewith theState government's public policies- and that is how it should be, given the Bank's important
social role
29 Bci Strategic CSR Operationalization The strict attachment to ethical values that wepromote among our teammembers and which weincorporateinto our
management wererecognized
Innovation We also developed an innovativeproduct and concrete serviceoffering which allowed us to reaffirmour position as in-
dustry leaders in service quality
Reputation Fundacion Generación Empresarial when awarding us the "Ricardo Claro Valdés" award, founded this year
Strategic Link We seek to show in what wayour mission and values areexpressed and orient our actions in fundamental areas like cor-
porate governance, ethics, quality of work life, customers and suppliers, commitment to thecommunityand environment
Governance In thearea of corporate governance, this report expresses Bci's proactivespirit by referring to the policies and measures
adopted by theBoard aiming to advance thecompliance with theregulations
Shared Value Motivateus to continueto advanceour corporatemanagement aligned with CorporateSocial Responsibility aiming to
Institutional CSR CSR achieve sustainabledevelopment that generates value for all our stakeholders
Sustainability Contribute to our corporation's sustainabilitybywayof economic, social and environmental valuecreation
Stakeholder dialog I hopethis report allows you to better know us and share your ideas, comments and suggestions
Dialectic CSR Accountability We redoubled our efforts to continue progressing in transparency, trust and innovation
Partnership Another step to encouragethe reduction of C02 emissions thanks to our voluntary incorporation in the MayDay Network
Global Agenda Bci has been outstanding in the Chilean banking systemfor its commitment to managing its possibleenvironmental im-
pacts and using clean technology, as well as for the implementation of its energy efficiencyprogram. In 2009, we took
another step to encouragethereduction of C02 emissions thanks to our voluntary incorporation in the MayDay Network
Political role of the firm Access In 2009, weresolutelycontinued supporting our customers, especiallythose that were most affected by the economic
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crisis, and wereinforced the financial literacy programdirected at the C3 and D socioeconomic sectors
Development To continueshaping thebanking industry's development and so contributing to the realization of our people's dreams
and the progress of our country
Political engagement We redoubled our efforts to continue progressing in transparency, trust and innovation sinceweconsider themto be
essential elements to promoteprosperity in Chile
30 ALFA Strategic CSR Operationalization Despitethe economic restrictions imposed bythe crisis, we continued to support high impact projects, increasingly fo-
cusing our social responsibility efforts to optimize their efficiency
Reputation We arebuilding what is to be thelargest PET bottle recycling plant when it comest to initiates operations in 2010
Institutional CSR CSR We continued to show our unfailing commitment to corporate social responsibility
Philanthropy Through theALFA Foundation, wecontinued to promoteall levels of theteaching-learning process through such
initiatives as scholarship programs, support to educational institutions and infrastructureas well as teacher training
Sustainable growth A solid financial structureand perspectives for sustained, long termgrowth, but also a companywith a clear vision of its
social responsibility with an international community
Dialectic CSR Accountability Further achievements of the year include Nemak recycling 360,000 tons of aluminum, a significant reduction in energy
consumption, the treatment of wastewaters and thereduction in atmospheric emissions in our plants, all of which
represent important contributions with immediateenvironmental impact
Partnership ALFA has lead thefield in this area and continues to implement important environmental initiatives, for example, in con-
junction with our partner Shaw Industries of theU.S., weare building what is to beNorth America’s largest PET bottle
recycling plant when it initiates operations in 2010
Global Agenda In regards to climate change and environmental protection, 2009 was a very important year with the reaching of a world
consensus on theimportance of theenvironment
Social contribution Through theALFA Foundation, wecontinued to promoteall levels of theteaching-learning process through such
initiatives as scholarship programs, support to educational institutions and infrastructureas well as teacher training
Political role of the firm Development We maintained our support for the ALFA Planetarium, northern Mexico’s most visited museumwhose mission is to
promotethelearning of scienceand technology, areas that areinstrumental for thedevelopment of any country
Rights The challenging economic environment confirmed to us that crisis affect communities to a far lesser extent if theyare
well prepared, with an efficient social structure based on solid educational grounding. This fact serves to underscore our
conviction that education should bethecornerstoneof our corporate social responsibility program
Political engagement Also a company with a clear vision of its social responsibility with an international community that shares thesame
values and is positioned to capitalizeon numerous opportunities to continuecontributing to the progress of society
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31 CMPC Strategic CSR Operationalization Contains four priorityareas: development of renewableforest plantations, substitution of fossil fuels for biomass, certi-
fication of our clean production processes and increase in therecycling of paper
Institutional CSR Sustainability We stronglybelieve in theactual realization of theSustainableDevelopment principle, which essentially means to make
productive activities, required for thegrowth of our countries, compatiblewith the legitimateright that the future gene-
rations have to livein a suitable environment
Philanthropy The CMPCfoundation which supports schools located near the areas wherethe companyruns industrial operations
Stakeholder dialog I would welcome your views- shareholders, clients, suppliers, employees as well as government authorities and the co-
community' in general. Your feedback is much valued and appreciated since it will allow us to improve
Dialectic CSR Accountability We aremonitoring the carbon footprint of our products, initiallypine and eucalyptus pulps. Theresults of this work will
shortlybemade available to our clients, suppliers and anybody elsewho might be interested
Global Agenda There is also universal concern over world climatechange and how it is affecting every aspect of modern life, from
everyday activities to complexindustrial processes
Inclusivity The Good Neighbourhood Plan has placed special emphasis on developing projects such us direct employment for those
neighbours fromMapuche origin, educational support programs and encouragement of productivedevelopment
Social contribution All this aims at creating opportunities of social and economic growth, especially for the 300 Mapuchecommunities
living closeto forests and areas where thecompany operates in Chile
Political role of the firm Access The provision of theeducation children receive to makesuretheyhaveaccess to more opportunities in life and can in
return help their community grow
Development We stronglybelieve wehave contributed effectivelyto the development of our country, creating job opportunities and
wealth for Chile
Political engagement The wayCMPCdoes business and also in the constant commitment to the development of our country and its people,
especially those communities wherethe companyoperates
32 Copel Strategic CSR Operationalization Creation of Environment and Corporate Citizenship Management, that madeCopel the first company in theBrazilian
electric sector to grant first level subject status
Innovation Copel becamein 2009 thefirst electric power concessionairein thecountryto enter into contracts for purchaseof
electricitysurplus generated frombiodigestion of organic wastes
Reputation Integrate the CorporateSustainability Index- ISE of BM&Fbovespa, certifying effectiveness of programs and projects
Strategic Link We proudly present the Management and Sustainability Annual Report of Copel for 2009, prepared based on strategic
directives and sustainability commitments assumed bytheCompany
Institutional CSR CSR To Company's activities, conciliating sustainability with corporate responsibility, not setting corporate result aside
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Sustainability Copel practices, supports and promotes sustainability
Sustainable growth Copel practices, supports and promotes sustainability, it reaffirms its recognition as theonlyway capable of providing
thecompany, associated agents and environment with the opportunity to enjoy as partners of growth and development
Dialectic CSR Global Standards Signatoryof United Nations Global Compact, participant of Global Reporting Initiative- GRI
Citizenship Projects of social, environmental and citizenship responsibilityimplemented bythe Company
Accountability Company identified through it its main operating units, activities and processes that generate larger amount of these
gases and units, activities and processes capableof compensating or mitigating such issuances
Global Agenda Another innovative posturewas publication in 2009 of its first inventoryof emission of greenhousegases, according to
GHGprotocol methodology. Such inventorywill support outlining and formation of Copel Agenda for Climatic Changes
Social contribution Company performs with devotion, dedication and efficiencyits role of fomenting and promoting social and economical
development of State of Paraná, serving population with qualityand providing conditions to its own growth as a
company, contributing with welfare of thecommunity
Political role of the firm Development Company performs with devotion, dedication and efficiencyits role of fomenting and promoting social and economical
development of State of Paraná
Rights Also in 2009, Copel joined the Programin Favor of Gender Equity before Special Department of Policies for Women, of
Presidency of Republic, an important step for thedefinitive change of conceptions in people management and organiza-
tional culture in order to promoteequity of Company's gender
Political engagement Not losing sight of its important role on promoting economic and social development of Paraná, practicing the smallest
electricitytariff of Brazil and providing again discounts to consumers that pay electricity bill on time
33 Embraer Strategic CSR Operationalization Embraer has been improving its corporate risk controls, which arenow evaluated quarterly, representing and improve-
ment in corporate governance
Innovation With an eyeon a future with less emissions fromtheair transport sector, weparticipated in a project for developing a
new generation of renewable fuel fromsugarcane, which maybea long-termsustainablealternative
Reputation As a result, for thefifth consecutive year wewerelisted on the CorporateSustainabilityIndex(ISE) of the Sao Paulo Stock
Exchange (BM&FBOVESPA)
Governance We maintained thesamehigh corporategovernancestandards adopted in 2006. Theindependence and transparencyof
theEthics Committee within the scope of theBoard of Director
Institutional CSR CSR Embraer's commitment to building a sustainablefuture is based on all of its dimensions- economic, financial, social and
environmental
Sustainability Embraer's commitment to building a sustainablefuture is based on all of its dimensions- economic, financial, social and
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environmental
Dialectic CSR Global Standards We reaffirmed our commitment to theUnited Nations Global Compact
Global Agenda Embraer has an ongoing programof technological development that has delivered improved efficiencyfor aircraft
performance, and reduced fuel consumption and theemission of gases that contributes to global warming
Political role of the firm Rights Providebroad coverageof subjects related to labor relations, human rights, and thefight against corruption
34 Kimberly- Strategic CSR Operationalization In 2009, wewereable to reduceenergy and water consumption per metric ton of product. Wecontinue to useprimarily
Clarkde recyclable fiber; and thevirgin fiber we purchasecomes fromcertified forests
Mexico Institutional CSR CSR We area company committed to society, to theenvironment, and to the rational, sustainableuseof natural resources
Sustainability We area company committed to society, to theenvironment, and to the rational, sustainableuseof natural resources
Dialectic CSR Citizenship We will continueto play the rolethat corresponds to us as a good corporate citizen in thesocial and economic sphere
Social contribution And as wedo every year, in 2009 we gaveour support to morethan 200 institutions, benefiting more than 20,000 families,
5,000 women, 3,000 older adults and 5,000 infants
Political role of the firm Political engagement It continues with our productive chain, which benefits tens of thousands of families through Mexico; and with our
country, by fullycomplying with all our obligations
35 Net Strategic CSR Strategic Link We achieved these feats byadopting an ethical business posture, one that is based on respecting the market norms and
Services laws, and preserving and prioritizing the quality of our relationships with all the groups weinteract with
Institutional CSR Sustainability NET’s first Social Report, a starting point that shows what we have achieved and our current position, which reinforceour
belief in the directives wehave adopted towards ensuring our sustainability
Stakeholder dialog Preserving and prioritizing thequalityof our relationships with all the groups we interact with
36 Fosfertil Strategic CSR Operationalization Fosfertil invests in new technology, in thetraining and preparation of teams, in the qualityof operations and, aboveall,
in the safety of its employees, in theprotection of theenvironment, and in thegood relationship with theneighboring
communities
Reputation For thefifth timein a row, wereceived the Best in Agribusiness award, fromGlobal Rural magazine
Institutional CSR CSR Investing to keep up with thecontinuous growth of theBrazilian agriculture, and expanding and modernizing units and
Sustainability processes in the permanent search for economic, social and environmental sustainability
Political role of the firm Political engagement Investing to keep up with thecontinuous growth of theBrazilian agriculture, and expanding and modernizing units and
processes in the permanent search for economic, social and environmental sustainability
37 SulAmerica Strategic CSR Operationalization The useof water-based paint for repairs to our insured parties' vehicles, benefiting theenvironment, partner workshops
and clients
Reputation SulAmerica, for thesecond year running, as oneof Brazil's best companies in terms of people management, according to
xxviii
a study published in Valor Economico newspaper
Strategic Link I cannot omit highlighting our evolution in making sustainability and increasingly important part of our culture, operations
and day-to-dayroutinein managing thecompany
Governance We haveset up a SustainabilityCommittee and an area working exclusivelyon this issue, as well as including specific
sustainabilitytargets in our new cycleof strategic planning
Institutional CSR Sustainability I cannot omit highlighting our evolution in making sustainability and increasingly important part of our culture, operations
and day-to-dayroutinein managing thecompany
Dialectic CSR Accountability The modern building meets requirements for sustainability and operational efficiency, allowing for a reduction of up
to 30%in theuseof energyand natural resources
Political role of the firm Development We will have an opportunity to contribute to therevitalization of this new urban development area in Rio de Janeiro
Table VI. SCANDINAVIAN COMPANIES
Company Category of CSRrethoric Themes Quotations
1 Statoil Strategic CSR Operationalization In Canada, wehave great expectations for our oil sand test facilitythat will test several new technologies.
We believethis will makesignificant inroads into improving the environmental footprint and operational viability of
of this operation
Innovation Off thewestern coast of Norway, we aretesting a prototypeof the world's first full-scale floating wind turbine,
turbineHywind, designed for operation in deeper waters
Reputation The Forewind consortium, where we participate, was awarded the largest development area in theUK third licensing
round for offshore wind farms
Institutional CSR Sustainability To us, sustainabilityis a way of doing business
Dialectic CSR Global Agenda As an energycompany, wefind ourselves at thecrossroads between two apparentlyirreconcilablechallenges-
theenergy crisis, and the climate crisis
Political role of the firm Access Millions of people theworld over havea legitimateambition to risefrompoverty an raise their standard of living
Development To develop a strong performanceon HSE and social indicators such as local development and human rights
Rights improvements (both development & rights)
Political engagement To us sustainability is a wayof doing business. We believe that stricter regulations will makeit a profitableinvestment
2 Nordea Strategic CSR Operationalization In 2009 we have improved the waywerun our business byworking smarter not harder; it is more environmental
Bank friendlynow than a year ago and we use less energy in our main buildings and produce less CO2 emissions
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Strategic Link In Nordea we believe that responsible business is a prerequisite for sustainable results
Shared Value CSRshould be an integral part of every organization that wants to build strong relationships with its customers and
have the acceptance of thesocieties in which it operates
Leadership on CSR Business owns and drives CSRin Nordea
Institutional CSR CSR We hope wecan describeour commitment to CSR in a clear and interesting way. Thegoals for 2009 wereto ensure
theenvironmental-friendliness of our own operations and to integrateCSR with our internal processes.
Stakeholder dialog We learned that the report is of interest to a wide audience: students, customers, employees, shareholders, analysts
and Non Governmental Organizations (NGOs). We aregrateful for your interest and hope that wecan describeour
our commitment to CSR in a clear and interesting way
Dialectic CSR Global Standards During 2009 we continued to work according to the international standards wevoluntary signed years ago and the
consequential procedures theyentail.
Political role of the firm Access There aresections on improved accessibility, education, data gathering, materials management, product energy
efficiency and thevarious environmental services availablethrough mobiledevices.
3 Nokia Strategic CSR Operationalization We regularly evaluate the useof water and materials, as well as our carbon dioxide emissions across thesupply chain
Reputation This year Nokia was chosen as the“World Technology Supersector Leader.” This honor means Nokia was ranked No 1
in sustainability across the entireglobal technologysector on the basis of a detailed corporate sustainabilityanalysis
Strategic Link We havebeen working hard to rebuild our R&D organization and define new ways of working
Leadership on CSR At Nokia we striveto lead in sustainability bytaking it into account in everything wedo.
Nokia was ranked No. 1 in sustainability across theentireglobal technology sector
Institutional CSR Sustainability Nokia has a long track record of taking sustainabilityinto account in the waywedo business every day
Stakeholder dialog We would welcome your views on our sustainability performanceand this report
Dialectic CSR Global Standards After several years favorablerating bythewidely recognized Dow Jones SustainabilityIndexes […]in the process of
developing this report, we havereferred to theguidanceand requirements of the Global Reporting Initiative (GRI) and
UNGlobal Compact reporting guidelines
Accountability In 2009, wereduced our facilities’ CO2 emissions by 12 percent, compared with levels in 2006. During the same year,
we also reached theenergy savings target we had set to reach by 2012
Global Agenda Opportunities to cut greenhousegas emissions and address global warming.
Focus on the issue We havefurther broadened our environmental focus areas, with water and biodiversity issues growing in importance.
In 2009, wecontinued to look at reducing the environmental impact of our devices and operations
Social contribution We believethat better useof information and communication technologies can contributein a big way to economic
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growth whileoffering considerable opportunities to cut greenhousegas emissions and address global warming
4 Telia Strategic CSR Strategic Link TeliaSonera’s core business is to provide peopleand businesses with opportunities to communicate with each other
Sonera and connect to the rest of the world in an easy, efficient and environmentallyfriendly way
Governance We havestarted theimplementation of a group-wideCode of Ethics and Conduct, to provide guidance for all
employees in our day-to-daywork
Shared Value Corporateresponsibility is important to us, becauseit creates valuefor our customers, employees and our shareholders
Leadership on CSR TeliaSonera’s vision is to be a world-class service companyand contribute to a world with better opportunities for.
people and business
This is theonlyway wecan reach our goal of becoming a world class servicecompany and a good corporate citizen.
Institutional CSR Stakeholder dialog We havea group-wide approach, engage in stakeholder dialogueand aimfor continuous improvement
Sustainable growth Our services drivegrowth, competitiveness and contributeto a more open society, byproviding possibilities for more
people to communicate
Dialectic CSR Global Standards I amalso pleased that wehave regained our position in theglobal FTSE4Good responsibleinvestment index
Citizenship It is essential that Telia Sonera is regarded as a responsible employer -a good corporatecitizen-
Political role of the firm Rights We haveto deal with important and sensitiveissues in our daily work – ranging fromfair business practices – to
freedomof speech – and theright to privacyand integrity
5 Ericsson Strategic CSR Operationalization In shifting fromproducts to services, with today's technologyand know-how, wehave thepotential to affect climate
changepositivelyin ways that could not have been imagined few years ago.
Innovation Also in 2009 we developed a new framework to help our customers meet their energyand CO? , called TCO?. It intro-
duces carbon metrics into a total-cost-of-ownership (TCO) methodologythat allows operators evaluatethe carbon
intensity their networks whilemaking economical network investments decisions.
Reputation As themarket leader in telecom, we know we have a huge role to playin addressing these challenges, but this
responsibilityis also a business opportunity
Strategic Link We see our technology having the power to createa moresustainableplanet
Governance Our Code of Conduct and Code of Business Ethics are regularly assessed, making sure weare on track wherever weare
in the world
Shared Value I ampersonallycommitted to continuing the sustainableapproach we have employed for manyyears. But this is not
about sustainabilityand corporateresponsibilityjust for thesake of it. It is about creating long-termshareholder value,
building the brand, and engaging with customers and employees.
Institutional CSR CSR When it comes to corporateresponsibility, our unique global management systemensures that we apply the same
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standard in every market in which weoperate
Sustainability I ampersonallycommitted to continuing the sustainableapproach we have employed for manyyears. But this is not
about sustainabilityand corporateresponsibilityjust for thesake of it. It is about creating long-termshareholder value,
building the brand, and engaging with customers and employees.
Stakeholder dialog We areworking with key stakeholders in the industry to makea mass market product that will connect phones, PCs and
wall screens at a fraction of the current cost and with less complexity than today's telepresence systems
Dialectic CSR Global Standards We remain stronglycommitted to theUN global Compact principles
Accountability It is also vitally important that wekeep our own company, and the industry's carbon footprint, in check. In 2009 we
achieved our carbon-footprint-reduction targets, meeting our portfolio-efficiency aims.
Partnership We aregoing to work with governments and other industries, using telecommunication to reduce CO? emissions
We will be part of ICT-related work for StockholmRoyal Seaport, a sustainable city project that aims to befree of
fossil fuels by2030 and cut carbon emissions to less than 1,5 tones per person by 2020.
Global Agenda The MillenniumDevelopment Goals and our work in the MillenniumVillages in sub-Saharan Africa continue to be
Inclusivity among our corecommitments. Thesupport weprovideis not in theformof charity, but rather through technologyand
Focus on the Issue competence, and is built on a sustainablebusiness case
We envision that video communication will be available anywhere, anytime, to everyone;
Social contribution We see the effect telecommunications is having in alleviating poverty.
Access to communications has a positiveimpact on GDP and socioeconomic development;
Political role of the firm Access The link between access to communication, GDP growth and poverty reduction is well documented. Access to commu-
Development nications has a positive impact on GDP and socioeconomic development; a 10%increasein mobile penetration leads
to a 1,2%GDP increase in developing countries. And weseeaccess to communication as a basic human right.
Rights Our technology, solutions and services strengthen access to basic human rights: the right to health, education and the
right to earn a livelihood. And weseeaccess to communication as a basic human right.
Political engagement By 2020, we see a world with 50billion connected devices. But to reach that vision, we need open standards and
interoperatibility. If we don't drive down costs, billions of peoplewill be left out of global conversations
6 Danske Strategic CSR Operationalization We stayed focused on ensuring good, flexible working conditions to all our employees
Bank Strategic Link We kept working to integrate CRin our corebusiness
Institutional CSR CSR Continuing commitment to CR, exercising corporateresponsibility remains pivotal in theDanske Bank Group's business
model
Dialectic CSR Accountability In December 2009 we met an important goal byattaining carbon neutrality
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Partnership We worked together with tradeunions to mitigatethe number of layoffs
Global Agenda The achievement coincided with the UN ClimateChangeConference in Copenhagen (COP15) and sent a strong signal
about our ongoing commitment to mitigating climate change
7 Fortum Strategic CSR Operationalization In power and heat production, our strengths arein our production portfolio that supports sustainabilityand utilizes re-
newable and low-carbon energysources
Innovation The realization of Loviisa 3 as a combined heat and power plant offers an unprecedented opportunityto even further
reduceCO? emissions
Reputation Fortum's reputation has improved and our investments in sustainability have received recognition
Institutional CSR Sustainability In power and heat production, our strengths arein our production portfolio that supports sustainabilityand utilizes
renewableand low-carbon energysources
Stakeholder dialog I would liketo thank our employees for their dedication and willingness to makeFortuman even better companyin the
challenging operating environment. Thanks arealso owed to our customers and partners for a successful year
Dialectic CSR Accountability Fortumis well positioned to respond to future challenges because sustainability is oneof our cornerstones, and as
much as 91%of our power generation in the EU is CO? free
Global Agenda Increasing the efficiencyof the energymarkets and responding to the challenge of climate change require market-
driven integration and a coherent energy policy. The importanceof reducing emissions is recognized globally
Focus on the issue Increasing the efficiencyof the energymarkets and responding to the challenge of climate change require market-
driven integration and a coherent energy policy
Social contribution A European-widewholesale market for electricity benefits everyonebecause it increases competition, improves secu-
rityof supply, and enables the achievement of climate goals at the lowest possible cost for society
Political role of the firm Political engagement Harmonizing the various national support systems would be central, sincethe energy market is no longer national or
regional but increasinglyEuropean
8 Novo Strategic CSR Operationalization At the same timewehave reduced CO? emissions through greater efficiency and a new partnership model that helps
Nordisk drive themarket for renewableenergy
Innovation This new generation of insulins has the potential to offer better treatment for peoplewith diabetes and further
strengthen Novo Nordisk's competitiveposition
Reputation Global values for global growth. In theinsulin market we havemaintained our position as the world leader with a
market shareof morethan 50%byvolume
Institutional CSR CSR Managing responsibly. As we see it, a business can only be sustainablein the long termif it meets stakeholders'
Sustainability expectations regarding social and environmental impact, in addition to delivering strong financial performance. This is
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thecoreof our TripleBottomLineapproach.
Philanthropy Our long termfinancial commitment to the World Diabetes Foundation, a leading funding body devoted solelyto projects
within diabetes care and prevention in the developing world
Stakeholder dialog A business can only besustainablein the long termin it meets stakeholders' expectations regarding social and envrion-
metal impact, in addition to delivering strong financial performance
Sustainable growth As we grow and globalizeour business, it is critical that all employees develop a deep understanding of the principles
at the heart of Novo Nordisk Wayof Management, which describes our vision, our values, our commitment and our
policies, and thereby guides all of our actions. Continual training is necessaryas our business grows and attracts new
people and as the regulatory environment and global norms change
Dialectic CSR Accountability We havedecoupled growth in CO? emissions from business growth. By the end of 2009, emissions from pro-
duction had fallen below the level of the2004 baseline year
Partnership Our long-termfinancial commitment to the World Diabetes Foundation, a leading funding body devoted to solely
projects within diabetes careand prevention in thedeveloping world
Global Agenda We think that, viewed retrospectively, theoutcomeof the meeting, the Copenhagen Accord, will proveto bea turning
point in thecommitment to curb man's impact on theclimate
Inclusivity We believethat wehavean obligation and an opportunityto develop new and better therapies both for inhibitor
patients and for general hemophilia patients as well as other patients with rarecoagulation disorders
Social contribution Our products are our greatest contributions to society. They provide significant benefits to patients, tangiblyimproving
people's health
Political role of the firm Access We havecontinued our efforts to expand access to diabetes care throughout the world as a company and via theWorld
Diabetes Foundation. Our approach to improving access to diabetes carein developing countries
Our commitment to supply life-saving insulin at reduced cost in the poorest countries of the world
Political engagement As a global business, weneed a long-termand global framework to make decisions about our future operations. We
would thereforehave preferred clear targets for CO? emissions fromtheCOP15 meeting in Copenhagen in Dec 2009
9 H&M Strategic CSR Operationalization Like everything else at H&M, our sustainabilityagenda is based on a drive for continuous improvement. Ultimately, our
entire value chain has to be leaner, smarter and moresustainable than that of our competitors
Innovation We also continueto look for ways to limit theenvironmental impact of our products, for example using and trying out
new sustainablematerials
Strategic Link H&M strives to be a sustainablebusiness- financially, sociallyand environmentally. If weare to continuebeing a
successful company, webelievethat integrating sustainablethinking into everything that we do is absolutelynecessary
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Governance Therefore, implementing our Code of Conduct remains at the heart of our sustainabilityagenda
Shared Value We aremoving towards sustainability becoming a shared responsibility.
Institutional CSR CSR We aimto be a more sustainablealternativeby offering products that havebeen made under good working conditions
and with limited environmental impact
We areconstantly looking for ways to bea moreresponsible company
Sustainability Continuous improvement, as for everything wedo, has been at theheart of our approach to sustainability fromthe
beginning. Weareconstantlylooking for ways to be a more sustainable company- and to integrate sustainable thinking
into all thedecisions we make
Stakeholder dialog At the same timecustomers, employees, investors and others -rightfully- demand that weimprove working conditions
in our supplychain
Dialectic CSR Global Standards Given our commitment to being a responsiblebusiness, it is natural that we continueto support theten principles of
theUnited Nations Global Compact
Accountability At H&M wehavedecided to step up our efforts in thenext three years to further increase energyefficiency and
reducecarbon emissions
Global Agenda I signed the Copenhagen Communiqué to encourage theworld's leader to agree on an ambitious climatedeal
Social contribution I think thegreatest contribution H&M makes to the communities wherewe operateis thejobs that we help create
Political role of the firm Political engagement We havea responsibilitytowards everyone who contributes to our success, and weneed to make surethat weuse our
planet's resources wisely
10 SCA Strategic CSR Operationalization Are weusing the appropriate technology? How can weminimisethe products' environmental impact? Can wefind new
Innovation ways to distributeour goods? One exampleof innovation is ESAVE, SCA's Group-wideprogramme to reduceenergy
usage and environmental footprint. Byinvolving employees in thework since theproject's inception in 2003, approx.
900 small-scaleprojects havebeen executed, resulting in significant reductions in energy consumption and CO? emissions
Strategic Link Sustainability is verymuch a global issueand influences all aspects of enterprise, fromcapital to employees, customers
and suppliers
Institutional CSR Sustainability It has becomeevident that theissue of sustainabilityhas taken on a new guise. It is no longer a matter of legislation or
image, or indeed can it be reduced to emissions or resources. Sustainabilityissues cannot be traced separately; theyare
now thehub fromwhich thefuturedevelopment of our society -and our world- will emanate
Stakeholder dialog SCA is a global companywith operations in about 100 countries and our business has a broad interface with all types
of stakeholders. During theyear, wereceived acknowledgement that thesestakeholders appreciate our way of working
with sustainability
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Sustainable growth For SCA, sustainabilityinvolves viewing our business froma global perspective and being prepared to rethink deep-rooted
beliefs and methods of approach
Dialectic CSR Accountability The growth in SCA's well-managed forests exceeds harvesting, which means that theyabsorb 2,6 million tonnes of
carbon dioxide net on a annual basis. This almost corresponds to the carbon emissions fromSCA's entire production
Global Agenda Climate change has established itself at thetop of theenvironmental agenda in recent years- a situation that will remain
for theforeseeable future, sinceit ultimatelyinvolves our survival
Focus on the issue One exampleof innovation is ESAVE, SCA's Group-wideprogramme to reduce energyusageand environmental footprint
Political role of the firm Political engagement The business community holds a number of keys that can help resolve theissue, which is especiallyrelevant at a time
when the governments of theworld are finding it difficult to agree upon common targets
11 A.PMoller Strategic CSR Operationalization We areworking on theissues of labor relations, responsibleprocurement and anti-corruption, and now embrace thesust-
ainabilityagenda in our work and reporting
Innovation New innovativetechnologies will continue to reduceboth costs and environmental impact
Strategic Link Getting all theelements of sustainability integrated into current business models takes time, but each we make progress
Institutional CSR CSR We want to bea profitable, responsibleand sustainablebusiness
Stakeholder dialog We reported detailed performance data for each business unit, providing our stakeholders with more insight
Dialectic CSR Global Standards We signed up to the UN Global compact
Accountability In 2009, theGroup cut its total GHGemissions byalmost 7%compared to 2008
Global Agenda We innovateand are committed to help fight against climate change
Political role of the firm Political engagement We recognize that global problems require global solutions, and wewill continue to work in relevant forums to help drive
adequatepolitical responses
12 SEBGroup Strategic CSR Operationalization We arealready doing work in the area of sustainable financeand investments, as presented later on in this report. Let me
just mention theWorld Green Bonds, where SEB as the financial intermediary is supporting thebuild-up of moresustain-
able economies in developing countries
Strategic Link The greater challengewill beto make sustainabilitya fully integrated part of our business - making it a core capabilityfor SEB
Institutional CSR CSR We must meet increasingly higher expectations on responsible corporatebehavior if we want to remain successful
Sustainability We aimto build a sustainablebusiness for the long term: supporting our customers; continuing to valueour people and
being an innovative financial partner
Dialectic CSR Global Standards We thereforealso continue to support UN Global Compact
Accountability At SEB, weraised our sustainability ambition significantly during 2009, addressing both our own footprint management
and business practices throughout theGroup
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We decided, among other things, to reduce our carbon footprint by45 per cent until 2015
Global Agenda After theUN Climate Conferencein Copenhagen in December it has become increasingly clear that businesses havea keyrole
roleto play in delivering on public expectations of change
Social contribution The World Bank Green Bonds, whereSEB as the supporting the build-up of moresustainable economies in developing
Political role of the firm Development countries
Political engagement As a Nordic bank with largecorporate, small and medium-sized enterprises, institutions and private individuals among our
customers, our business carries impact in manycountries and local communities
13 Volvo Strategic CSR Operationalization By focusing on developing increasinglymoreenergy-efficient engines and complete vehicles that can operateon
renewablefuels and byintroducing hybridisation we aretaking a lead in the market
Reputation This vision shows our increased ambition for the futureand the responsibility wetakeas one of the world's largest
manufacturers of commercial vehicles
Strategic Link Our values and commitment to sustainabilityare, and will continueto be, reflected, promoted and implemented in Group
strategy, decisions and actions
Governance It also shows our commitment to theprinciples of the United Nation's Global Compact initiative and in our Code of Conduct
Shared Value Sustainability efforts are an important component of theVolvo Group's competitiveness and our ability to create value for
customers, shareholders and futuregenerations
Institutional CSR CSR This vision shows our increased ambition for the futureand the responsibility wetakeas one of the world's largest
manufacturers of commercial vehicles
Sustainability This report gives you a view of our strategies and commitment to sustainabledevelopment
Stakeholder dialog To promotesustainable transportation solutions, several stakeholders must partner and work towards a common goal
Dialectic CSR Global Standards It also shows our commitment to theprinciples of the United Nation's Global Compact initiative
Partnership In order to create sustainablemobilityit is necessary to cooperatewith different actors in society. That is whywe are
participating in a number of projects for theadvancement of futuretransports
Global Agenda Rising fuel prices have a largeimpact on our customers' economyand thenecessity of combating climate change becomes
increasinglyurgent
Social contribution The Group's products and services contribute to thedevelopment of society
Political role of the firm Political engagement We can offer the necessarytechnology, but we cannot create sustainabilityalone. Weneed to find moreefficient ways to
pool resources fromindustry, government and academia to address themajor environmental and societal challanges we
are facing
14 Atlas Strategic CSR Operationalization They havebeen designed taking human and environmental aspects into consideration in process of increasing productivity
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When wesay we arecommitted to sustainable productivity, it means that we do everything wecan to ensure reliable,
lasting results with a responsible use of resources; human, natural, and capital
Innovation We launched manynew and upgraded products, such as rollers for road development with reduced fuel consumption
and ergonomically developed battery-powered screwdrivers. We also announced that a rangeof oil-free compressors, with
heat recovery equipment, is thefirst in theworld to be certified for 'net zero energyconsumption'
Reputation Our work to reducetheimpact of HIV/AIDSin South Africa was recognized with the Swedish WorkplaceHIV and AIDS
Proramme/SWHAP) Achievement award
Strategic Link Reaching thebest results begins with having a solid strategy that includes analyzing our performanceon theeconomical,
social and environmental levels
Institutional CSR CSR When wesay we arecommitted to sustainable productivity, it means that we do everything wecan to ensure reliable,
lasting results with a responsible use of resources; human, natural, and capital
Sustainability Sustainability is therefor not an optimal add-on, but a routeto prosperityfor Atlas Copco
Stakeholder dialog We do thesethings because webelievethe sustainabledevelopment of Atlas Copco will benefit all our stakeholders
Sustainable growth Atlas Copco is prepared for sustainable, profitablegrowth
Dialectic CSR Accountability Oneclear outcome is that initiatives to introduce more environmental friendlyenergy sources resulted in a decreaseof
Global Agenda CO2 emissions
Social contribution Our work to reducetheimpact of HIV/AIDSin South Africa
Political role of the firm Political engagement Given this opportunity to reduceCO2 emissions, one might wonder whyit is not as natural with governments incentives to
modernizemanufacturing morerapidly, as it is with stimulus packages to invest in alternativeenergysources
15 Yara Strategic CSR Operationalization We established a compliancefunction in order to coordinate our efforts to uphold ethical and responsible business practices,
and in early 2010 welaunched thenew Yara Ethics Programproviding practical adviceand support for employees
Innovation Yara also launched its Yara Crop Nutrition concept, encouraging a shift fromtraditional soil management to tailored
crop management. Increased precision, through delivering nutritients to crops according to specifics needs, enhances
farmers' profits and benefits local environments
Reputation Yara has also a leading industryposition in safety
Governance We established a compliancefunction in order to coordinate our efforts to uphold ethical and responsible business practices,
and in early 2010 welaunched thenew Yara Ethics Programproviding practical adviceand support for employees
Dialectic CSR Global Standards Our commitment to the UN Global Compact
Global Agenda We view ourselves as a key stakeholder striving to enable more efficient crop production, in order to address several
challenges facing mankind: scarcityof water and croplands, pressure for increased foor production while preserving areas
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of biodiversity and limiting greenhouse gas emissions
Social contribution We presented an investment blueprint for the Beira Growth Corridor in Mozambique. In addition to kick-starting
agricultural markets, analyses suggest living conditions for as many as onemillion peoplecould improve
Political role of the firm Political engagement We can support legislators in pursuing solutions, through delivery of our expertiseand technology. We view
ourselves as a keystakeholder striving to enablemore efficient crop production, in order to address several
challenges facing mankind: scarcityof water and croplands, pressure for increased foor production while preserving
areas of biodiversityand limiting greenhousegas emissions
16 Skanska Strategic CSR Operationalization There is enormous potential for us in this field, and weare taking a new aggressive step to generatemore green business.
Our Green Business Officer will further refine our green construction portfolio and activelydemonstrate its advantages to
customers
Dialectic CSR Global Agenda The climate change issuerequires action. Thepotential for and interest in green construction aregrowing. Skanska
is needed for the environment and for building social infrastructure
17 Orkla Strategic CSR Operationalization The Group has increasinglyestablished common standards to ensure more uniformpractices in areas such as EHS, food
safetyand supplier monitoring
Strategic Link Work on revising and further developing theGroup's common guidelines and systems relating to ethics and corporate res-
Governance ponsibility will continuein the years ahead. Theseefforts will also strengthen the Group's long-termcompetitiveness
Institutional CSR CSR A strength of Orkla's corporateresponsibilitycommitment
Sustainability How to ensurea sustainable development of society that safeguards theneeds of both present and future generations
in a satisfactory manner. In order to earn society's trust, wemust ensureOrkla's activities createpositiveripple
effects and contribute to desirable social development
Stakeholder dialog The abilityto understand the needs of customers, employees, shareholders, authorities and other stakeholders, and to res-
pond effectivelyto theseneeds, is crucial to achieving long-termtrust and profitability
Dialectic CSR Accountability The Group has increasinglyestablished common standards to ensure more uniformpractices in areas such as EHS, food
safetyand supplier monitoring
Global Agenda The financial crisis and climate challenges havegiven rise to renewed debateabout how to ensure sustainable
development
18 Vestas Strategic CSR Operationalization Vestas is intensifying its efforts to enhancesafety, reduce our environmental footprint and useof Earth's resources
in order to strengthen our reputations as a responsible employer and competitivecollaboration partner
Innovation We haveannounced new wind turbines for theonshoreand offshore segments
Reputation In order to strengthen our reputations as a responsibleemployer and competitivecollaboration partner
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Dialectic CSR Accountability Vestas is intensifying its efforts to enhancesafety, reduce our environmental footprint
Global Agenda COP15 did not turn out to betheglobal and supranational climate breakthrough that Vestas has hopefor
Political role of the firm Political engagement Vestas will continueto promotea fixed price of CO2 which would give theenergy sector thepredictabilityrequired to carry
out the largescale investments in infrastructure. Over the next 25 year, an increasein the global population of two billion
people will raisethe priceof fossil fuels, thereby adding further strength to thecompetitiveness of modern energy.
19 TDC Strategic CSR Operationalization Finally, weare committed to bolstering our winning culture, increasing leadership capabilities and improving
employee motivation and productivityacross the organization
Shared Value
We can do much more to further improveour business and create added value for all our stakeholders: customers,
employees,
shareholders and the communities in which we operate
Institutional CSR CSR We reinforced our commitment to social responsibility
Dialectic CSR Global Standards We committed to the UN Global Compact
Accountability We commit to increasing energyefficiency by15%annuallyand reducing our CO2 emissions by5%by2014
Partnership We reinforced our commitment to social contribution byjoining forces with the Red Cross on providing IT and telecommuni-
cations facilities in disaster scenarios
Social contribution TDCwill continue to punch thetechnological boundaries to benefit our residential and corporatecustomers and societyat
large
Political role of the firm Political engagement TDCplayed a crucial rolein facilitating the industrial revolution and sub sequentiallyin the digital transformation of
Denmark, and wecontinue to assume our role and responsibilityas the backboneof Denmark's world-leading
communications infrastructure
20 Swedbank Strategic CSR Operationalization Our efforts to help fight unemployment among young peoplestarted lass autumn, are an exampleof our heritage
of taking social responsibility
Institutional CSR CSR Are an exampleof our heritageof taking social responsibility
Sustainability More actors have to act moreresponsibly through theentire business cycle, and lending must beapproached froma more
a more long-term, sustainableperspective
Stakeholder dialog Our aimis to be open, accessible and transparent to all our stakeholders and everyonewho influences our image
Dialectic CSR Accountability Transparency and regulations areneeded in everypart of thefinancial industry
Our aimis to be open, accessible and transparent to all our stakeholders and everyonewho influences our image
Political role of the firm Political engagement Since weare such an important part of every small town and big city wherewe operate, the needs of small business for
Capital, payment routines or advice, are not just purely business. What we do affects
the community, job opportunities, young people’s future confidence, cultural
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activities an sports
21 Electrolux Strategic CSR Operationalization Electroluxhas a three-part climatestrategythat connects a crucial causewith good business. It focuses on climate-smart
products, communicating their benefits and streamlining energyuse in our own operations
Innovation Our business success is interconnected with innovating energy-savvy, resource-efficient appliances
Strategic Link Our business success is interconnected with innovating energy-savvy, resource-efficient appliances. Embedding
high social and environmental standards throughout our daily operations is a crucial part of doing business well
Institutional CSR CSR Our performance this year demonstrates that by helping shapea moresustainablemarket, Electroluxcan makea positive
contribution and generate benefits to thebottomline
Sustainability In 2009, welaunched our vision and valued programin part to further integratesustainability into our business culture
Stakeholder dialog Seeking the opinions of our stakeholders and sharing ideas with themallows us to better understand these changes
Stakeholder engagement is a key focus area for us as wemoveforward
Dialectic CSR Accountability We exceeded our 2009 target to reduceenergy use by15%compared to 2005
Global Agenda Climate is oneimportant topic on our agenda
Political role of the firm Political engagement Getting peopleto switch to the most resource efficient products remains a key challenge. Cutting-edge products
alreadyin themarket can help us lead moreclimate-smart lives. What's needed arestrong markets frameworks,
including a global price on carbon emissions and financial incentives for consumers to purchaseenergy-lean appliances
22 KONE Strategic CSR Operationalization Investing in peopleleadership skills and training in general has helped us keep up a good spirit and a can-do attitude.
Innovation Another innovation is the KONE IDF300TM solution that integrates automatic building doors and elevatos enabling a safe
and easyhands-freeaccess to the building
Strategic Link Economic responsibilityfor KONE means creating valuefor our stakeholders through long-termgrowth in sales and profits
Leadership on CSR KONE wants to be a part of finding solutions to these challenges byaiming to be the eco-efficiency leader in the industry
Institutional CSR CSR We strivetowards excellence in all areas of corporate responsibility, including economic, environmental and social
Sustainability Our performance in 2009 demonstrates our strong commitment to conduct our business in a responsibleand sustainable
manner at all times
Sustainable growth Economic responsibilityfor KONE means creating valuefor our stakeholders through long-termgrowth in sales and
profits. Valuecan onlyachieved by continuously developing our competitiveness in a sustainableway
Dialectic CSR Accountability Our Environmental Excellence development programincludes actions to strengthen KONE's innovation leadership in the
area of eco-efficiency and to minimizeKONE's carbon footprint.
Global Agenda The most significant carbon dioxide impact of our operations relates to our car flee, electricityconsumption and logistics
23 Norsk Strategic CSR Operationalization And throughout thevalue chain, we will look for opportunities to minimize thecarbon footprint of aluminium-
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Hydro and of Hydro. In our own primary production as well as in products that help our customers reduce their emissions
and their energyconsumption
Dialectic CSR Global Standards Hydro is affiliated with theUnited Nations Global Compact
Accountability There arestill obstacles to overcome before we can implement a brand-new cell technologyproducing zero-emissions
aluminum, but every daywe aremaking progress in our determined efforts to save energy, emissions- and costs
Global Agenda Meeting thechallenges of climate changewill demand morealuminumand smart, energy-efficient solutions
Political role of the firm Political engagement Ever since Hydro 105 years ago, we have transformed scientific knowledgeand natural resources into products that help
create viablesocieties
24 Wartsila Strategic CSR Operationalization Environmental considerations favor investments into renewablepower sources and the active search and explora-
tion of natura resources, particularlyin Africa, requires electricity. Wartsila's technology is well positioned to
respond to theneeds arising fromthesetrends
Dialectic CSR Focus on the issue We consider it our obligation to continuedeveloping products and services that radically reducethelevel of emissions
to both air and the sea. Improved ship design, more efficient engines and propulsors, useof gas as fue, and optimized
flexiblepower plants solutions all contribute to a more sustainable environment.
25 StoraEnso Strategic CSR Operationalization We makegreat products using renewableand recyclable raw materials- products can makea real difference for
our customers
Institutional CSR CSR I would also liketo highlight another challenge- our social responsibility - both at home ad in thenew growth markets
Sustainability We makegreat products using renewableand recyclable raw material - products that can makea real difference for our
customers, for their customers, for consumers and for the planet
Stakeholder dialog Like most other corporations we stress that we favor open dialoguewith all stakeholders
Dialectic CSR Global Standards I had thehonor to sigh the UN Global Compact's CEO Water Mandate
Citizenship The impacts of our operations in Latin America and China on local communities arequitedifferent than in our traditional
home base, as thesocial, economic and cultural contexts areso different. To besuccessful in these societies in the long term
as a company and as individual people, we need to beeven more transparent, moresharing and moreprepared to learn
Accountability We need to be even more transparent, more sharing, and moreprepared to learn
Global Agenda I had thehonor to sigh the UN Global Compact's CEO Water Mandate, to show Stora Enso's strong commitment as a com-
panyto make sustainablewater use a real priority
Political role of the firm Political engagement Together with the local and national authorities we need to start looking for new alternatives a lot earlier
26 Tele2 Institutional CSR Stakeholder dialog Our ambition was to createa dynamic, open and accessibleforumfor our customers, shareholders and other stakeholders
Dialectic CSR Focus on the issue Tele2's business is built on facilitating and promoting communication between people. Weare essentially in thebusiness
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of making communication easy
27 Neste Oil Strategic CSR Operationalization We haveput a lot of work into ensuring that theraw materials we useare produced responsibly
Innovation Neste Oil's proprietary NExBTL renewable diesel will be one of our biggest competitiveadvantages. NexBTL generates
lower levels of tailpipeemissions and reduces greenhousegas emissions byas much as 40-80%compared to
fossil diesel
Reputation Neste Oil became one of theworld's largest users of certified palmoil in 2009
Leadership on CSR As theworld's cleanest and best diesel, NExBTL is set to be increasinglyimportant financiallyfor us and bublicly
committed ourselves to using only certified palmoil as soon as possible
Institutional CSR CSR We arecommitted to responsible principles in all our operations worldwide
Sustainability Sustainabledevelopment will continueto bevery important for us as we go forward, and we intend to maintain our
activerolein developing norms and systems to promotesustainability
Stakeholder dialog I believethat the central principles of our changeprocess - fromcustomer focus to common ways of working - havebecome
familiar to our personnel and to our stakeholders as well
Dialectic CSR Accountability NExBTL generates lower levels of tailpipeemissions and reduces greenhouse gas emissions by as much 40-80%compared
to fossil diesel
Partnership We playan activepart in organizations such as theRoundtable on sustainable palmoil and maintain close contacts
with political decision makers and other opinion leaders
Global Agenda This makes it an excellent means for reducing emissions and combating climate change
Political role of the firm Political engagement We playan activepart in organizations such as theRoundtable on sustainable palmoil and maintain close contacts
with political decision makers and other opinion leaders
28 Storebrand Strategic CSR Reputation Our systematic customer satisfaction work has led to Storebrand topping theNorwegian Customer Barometer Survey
among Norwegian customers in theoccupational pensions market for sixyear in a row
Institutional CSR Stakeholder dialog A good dialog with thecustomers, simpler and more understandable products, efficient and customer-friendly
service solutions, and competitive conditions arekeyelements of this work
Dialectic CSR Accountability The most important thing of all is to ensurea transparent and trust-building dialoguewith our customers
Political role of the firm Political engagement Storebrand is an active prime mover in relation to theNorwegian and international authorities when it comes to develo-
ping regulations and a framework for the industrythat areappropriate for both customers and companies
29 SKF Strategic CSR Operationalization We arealready gaining new enquiries, development projects and business dueto our growing rangeof energy-efficient
solutions
Innovation SKF Group won the Swedish Innovation Awards for its work on developing thenew familyof energy-efficient bearings
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During 2009 we launched over 20 new market offers to our customers
Reputation SKF Group won the Swedish Innovation Awards for its work work on developing the new family of energy-efficient bearings
The award as a leader in the Engineering Sector of the Dow Jones Sustainability Indexand the award for Folksamas the
best companyin environmental and human rights in Sweden
Strategic Link Our work in thearea of sustainability, which wecall SKF Care, continued during theyear and I believethis is increasingly be-
Institutional CSR Sustainability coming a competitiveadvantagefor the SKF Group
Dialectic CSR Global Standards The award as a leader in the Engineering Sector of the Dow Jones Sustainability Index
Accountability Theseinvestments arefocused on faster growing segments and geographies and on improving our total manufacturing
footprint
Political role of the firm Rights The award as a leader in the Engineering Sector of the Dow Jones Sustainability Indexand the award for Folksamas the
best companyin environmental and human rights in Sweden
30 Metso Strategic CSR Operationalization In technologydevelopment weare focusing on enhancing equipment performanceand energy efficiencyand minimizing
theuseof raw materials
Strategic Link For Metso, sustainabilityis thecoreof our strategy: Our goal is for environmentallyand sociallysustainable business.
Governance Our values, our Code of Conduct and the UN Global Compact initiative endorsealso guideall Metso employees towards
sustainable operations
Institutional CSR CSR For Metso, sustainabilityis thecoreof our strategy: Our goal is for environmentallyand sociallysustainable business.
Sustainability For Metso, sustainabilityis thecoreof our strategy: Our goal is for environmentallyand sociallysustainable business.
Sustainable growth We takesustainabilityinto account, as a whole in our business. Wewant to solve global problems actively and
comprehensiblyand thus createa foundations fromMetso's sustainable, profitable growth and for the continuous
well-being of our stakeholders
Dialectic CSR Global Standards Our values, our Code of Conduct and the UN Global Compact initiative endorsealso guideall Metso employees towards
sustainable operations
Political role of the firm Political engagement In theory, drasticallylowering our standards of living in the simplest wayto save the world froman environmental
crisis. However, cutting salaries in the western world and putting the brakes on escalating prosperity in theemerging
markets are likely to gaining much support. I personallybelieve that fastest result can beachieved through
technological advancements and byrenewing existing ways of operating
31 Alfa Laval Strategic CSR Operationalization In addition to new and efficient products, it is crucial that Alfa Laval's operations are continuously renewed and streamlined
Strategic Link Sustainability initiatives- part of Alfa Laval's dailybusiness
Institutional CSR CSR Alfa Laval is also governed by its environmental impact, social responsibility, business ethics and transparency
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Dialectic CSR Accountability An order received in 2009 fromone of Russia's largest refineries, whereAlfa Laval's energy-efficient heat ezchangers are
being used to minimizeenergy consumption, therebyreducing emissions byan amount corresponding to theemissions ge-
nerated byall passenger cars in Stockholmin one year, approximately 850,000 tons of CO2.
Global Agenda The Group's sustainability initiatives included continued efforts to reducecarbon emissions, the development of a new occ-
upational safety policyand an expansion of thesupplier development process
32 TrygVesta Strategic CSR Operationalization We havealready introduced reduced CO? consumption as a bonus parameter for the management team
Dialectic CSR Global Agenda But the agenda also includes other items, such as the Group's climate impact and behavior
33 Kesko Strategic CSR Operationalization We areimproving our energy efficiencyand reducing our emissions.
Reputation For years, wehave been included in the most important sustainabilityindexes and thelist of theGlobal 100 most Sustain-
able Corporations
Institutional CSR CSR In accordance with our responsibilityprogramme for 2008-2012, we are improving our energyefficiency and
reducing our emissions
Dialectic CSR Accountability Owing to carbon-free electricity, thecarbon dioxideemissions of electricity used in the K-group properties decreased by
59%in Finland in 2009
Global Agenda In unitywith our responsibility programfor 2008-2012,we areimproving our energy efficiency and reducing our emissions
34 DSV A/S Strategic CSR Operationalization During 2010, we will pursue a strategy which will involvea clear ambition of reducing our carbon footprint
Institutional CSR CSR We experienced an increased focus fromboth customers and shareholders on CSR matters
Dialectic CSR Global Standards We joined the United Nations Global Compact initiative
Accountability We can now identifytheoverall carbon footprint of DSV
During 2010, we will pursue a strategy which will involvea clear ambition of reducing our carbon footprint
Global Agenda DSV's impact on climate and environment caused by greenhouse gases, particulatematter, etc., has been closely measured
for years and wehavefurther expanded our work in this field so that wecan now identify theoverall carbon footprint of DSV
35 SSAB Strategic CSR Operationalization We areconsistentlyengaged in environmental improvement in our day-to-day operations. This year, we invested aproxi-
matelySEK 200 million in an exhaust hood at theworks in Ovelösund, Sweden which will substantially reducedust emi-
ssions fromour coking plant
Reputation SSAB was one of twelve examples of eco-efficient economy presented during the first meeting of theEU environmental
ministerial, during Sweden's Presidency
Strategic Link During 2009 we carried out moredevelopment projects with customers than ever, creating new uses for high strength
steels. This is good for us, our customers, and for theenvironment.
Institutional CSR Sustainability In order to further emphasize our desire to work to achieve a society which is sustainable in thelong term
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Dialectic CSR Global Standards We also decided to sign theUN Global Compact
Accountability In 2009, SSAB adopted a target that, in the coming years, emissions under normal production conditions will be reduced
by two percent per produced time
Partnership SSAB is a core member of theEuropean research consortiumin new blast furnacetechnology.
Global Agenda SSAB's production does impact theenvironment, among other things through emissions of carbon dioxide
Political role of the firm Rights SSAB has for many years worked in accordance with the Compact's principles including standards fir human rights, labor,
theenvironment and anti-corruption
36 Novozymes Strategic CSR Operationalization We mademoreefficient use of both energyand water in our production processes
Reputation We maintain our position as a world leader in bioinnovation
Strategic Link Sustainability is an integrated part of what we do and how we do it
Institutional CSR CSR Contributing to theenvironmental, social, and economic aspects of sustainable development has always been an
Sustainability integral of our strategy
Dialectic CSR Global Standards The requirements are linked to theprinciples of the UN Global Compact
Accountability In 2009, our products enable customers to save around 27 million tons of CO? emissions
Partnership Closer cooperation between governments and business would turn hopeinto action and pavethe way for concrete, sustain-
able solutions
Global Agenda Reduction of CO2 emissions is the top priority on the global agenda
Political role of the firm Political engagement Novozymes and WWF havecome together to encouragepoliticians to further the integration of biotechnologyinto
strategies for reducing climate change and to support theapplication of low-carbon biotechnology in industry
37 Boliden Strategic CSR Operationalization High levels of operational stability, with fewer operational stoppages, and good performances at thefilter installations have
helped reducemetal and sulphur dioxideemissions to air
Strategic Link The is of thecourse is to develop a moreresource-efficient and economical company- which will, in turn, enhance Boliden's
long-termcompetitiveness
Institutional CSR CSR Emissions and discharges of metals to air and water areamong Boliden's most important environmental responsibilities
Sustainability 2009 was in manyrespects a challenging year, but Boliden's sustainabilitywork has not lost ground
Dialectic CSR Accountability Discharges of metals to water fell by50 per cent in comparison with the base year of 2007
Global Agenda Other challenges, such as carbon dioxide emissions in conjunction with energyusageand responsibility for environmental
and social issues bybusiness partners arelargelyoutsidethescopeof Boliden's direct control, but areextremelyimportant
Social contribution Correctlyhanded, the eco-cycle of - and trade in - products and waste products can beof benefit to societyand reduce envi-
ronmental impact
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