csrd: smes and csr 11 october 2010. introduction summary – codes of conduct and workers smes and...
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CSRD: SMEs and CSR
11 October 2010
Introduction
Summary – Codes of Conduct and workers SMEs and CSR
* Understanding SMEs
* Importance of SMEs & CSR issues The Business Case (?) CSR as a means of exclusion Exam/evaluation requirements
Summary: Codes of Conduct & Workers
Codes of conduct Ethical guidelines for company behaviour Self-regulation, Private Authority A means to respond to ’sweatshop critique’, image, branding Company claims: Fulfilment of Codes = Proper working conditions Few investigations, little knowledge (ETI + Nelson et al) IA: Some improvements to some (outcome rights) The limited improvements often counteracted by ’market development’
(pressure to deliver, lowering of prices, Increasing informalisation, absence of proper government policies
SMEs and CSR
Perceptions:
SMEs don’t care about CSR SMEs lack resources to do CSR SMEs are main polluters
SMEs and CSR
Understanding SMEs (Jenkins (2004)) Norms, models, thinking, agendas derived from
large companiesSMEs are little big companiesSMEs are alike – homogenousSMEs don’t care about CSRImpacts SMEs policies (which are insufficient etc)
SMEs and CSR
Understanding SMEs (Jenkins (2004)) All myths!Situation among SMEs is differentNeed to understand SMEs and their situation
What is a Small and Medium-sized Enterprise (SME)?
SMEs and CSR
Understanding SMEs (Jenkins (2004)) SMEs are many different things – heterogeneous Quote (by Wilkinson):
‘..if what constitutes ‘smallness’ is contextual and possibly subjective and interpretational, then we need to examine what factors combine to explain patterns of ‘small’ business behaviour ...’
Understanding SMEs & CSRFrom To
Size One person 200-250 employees
Sector Agriculture Manufacturing, Service
Market Village, town City, regional, global
Product Standardised Specialised
Management Hierarchical (top-down)
Flat (bottom-up)
(Jeppesen, 2009)
Understanding SMEs and CSR
Vives (2006):Know little about practicesSMEs do numerous CSR practices (Often) informallyPractices differ
* Medium-sized more than small
* More internal than external and environmentalRole of culture (religious values and norms)
Understanding SMEs and CSR
Vives (2006):Why such practices? SMEs Different Motives
* Profits, Making Products, Helping OthersCommitment of Founder/Owner highly influentialContext mattersAge (old vs. young), market, sector matter
SMEs and CSR
Importance of SMEs and CSR:Given that SMEs constitute 90% or more of all
enterprises in an economyWhat are the implications for CSR in
development?Why is it important to investigate CSR-issues
relating to SMEs?
Importance of SMEs and CSR
Implications for CSRD?Most/all cases investigated will include SMEsInvolve environmental issues (Kasur), working
conditions (safety and health, wages and freedom of association etc), and
Employment and growth (poverty and economic development)
Importance of SMEs and CSR
Why is it important to investigate CSR-issues related to SMEs?Possibilities for spreading ‘good practices’, win-
win situations etcReveal problems of ‘win-win’, disclose power,
conflicts, exclusion etc, understanding obstacles View of Southern Voices (SMEs) –
key to poverty and economic development
The Business Case Luetkenhorst 2004:
SMEs majority of firms (+90%) Key to economic development, growth and employment (30-50% of
output and 50-60% of employment) Labour intensive Important to social cohesion (reduce poverty, ensure more equality) Innovative Make economies more resilient Produce in niche markets, flexible Foster economic cohesion
The Business Case Luetkenhorst 2004:
Three types of SMEs
A: In supply chains, B: Own export, C: Nationally oriented
Note: States that type A is the interesting category!? Support SMEs (linkages, capacity development) Use PPPs
Exploit the win-win options!
The Business Case Luetkenhorst 2004:
The Business case: Cost savings Enhanced staff loyalty Improved government relations Innovation and learning Enhanced reputation Consumer response
The Lack of Business Case Jenkins 2004:
Few stakeholders (mainly customers) Risk, reputation and consumer pressure limited
* No brands, little public awareness and contact
* But consumer pressure at large firms going to SMEs! Limited employee motivation & management time CSR = costs & no extra markets Limited profits & financial resources No enforcement of regulation – why go beyond?
CSR a means of exclusion Fox (2004):
SMEs heterogeneous Most SMEs are micro firms in the informal (service) sector Little interest in tools and framework from large firms SMEs in value chains – concerns only a minority of SMEs!
* Either engage and implement codes etc – some do
* Or not engage – others do Supply chains (GVCs) are ‘rationalised’ = exclusion The agenda needs to be changed!
Making sense of CSR to SMEs Fox 2004:
SMEs and CSR linked to the Sustainable Development agenda
BOP, Clusters and linkages, Business support & institutions Make existing CSR-incentives relevant to SMEs Assist in the transition (from informal to formal) Make CSR more relevant
* SMEs do carry out CSR practices (informally)
* Provide appropriate incentives
SMEs and CSR: Summing up
Business Case versus CSR as a means of exclusion?
The business case is there – however in most cases not realised Need to understand SMEs and their situation(s) Focus on SMEs advantages (if engaged: quick to change & flexible,
set strategies regardless of shareholder pressure, existing practices (though ad-hoc and informal) scaled up)
Beyond Large firms’ agenda (set conditions, define rules of the game, down-ward pressure in GVCs)
CSR (Codes of conduct, fulfilment of standards and requirements) intends to raise standards, but becomes a means of exclusion
Business Case versus CSR as a means of exclusion?
Promoting the SMEs case: The role of governments and international organisations
key (National) Governments to outline relevant
industrialisation policies and (local governments) to implement programs (support to SMEs, incentives etc)
International organisations to assist, e.g. Voice the concerns regarding GVCs (market development)
Relate to Reed & Reed: What type of development?
Exam/evaluation requirements
Essay exam: Written Max. 10 pages Assessed by course teachers and internal examiners
Evaluation criteria:Learning objectivesKnowledge on the course curriculum
Exam/evaluation requirements
Evaluation criteria (Learning objectives): Understanding CSRD Concepts Strengths and Weaknesses Cultural and Social Contexts Implications
Firm Profitability Workers’ Conditions Environmental Conditions
Exam/evaluation requirements
Evaluation criteria:Knowledge of the curriculum:Relate to most if not all lectures and many/most of
the textsEssay – clear structure:
E.g. (short) Abstract, Clear Line of Argument, Substantiated by Evidence, Sufficient Use of References, Solid Conclusions, Future Implications
Exam/evaluation requirements
Examples of former essay titles:
Three types1. The topic/curriculum related2. The cross-cutting3. The case/example based
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