SMEs and Ethics – an Introduction Presenter: Jörg Bürgi, KMU nachhaltig GmbH Workshop: IC3, Small and Medium Entreprises SME Global Ethics Forum of Globethics.net, 28-30 June 2012 “Seeds for Successful Transformation 2012. The Value of Values in Responsible Business”, Geneva/Switzerland 28-29.6.12

Welcome! On behalf of 99 % of all companies On behalf of more than 60 % of all employees On behalf of small and medium sized companies – SME – KMU – PME

SMEs – the giants of economy Country (year of census) < 10 10 - 49 50 - 249 0 - 249 250 + Germany (2010) 83,3 13,8 2,4 99,5 0,5 France (2010) 93,1 5,8 0,9 99,8 0,2 Austria (2010) 88,1 10,0 1,6 99,7 0,3 Great Britain (2010) 88,0 99,6 0,4 Italy (2010) 94,5 4,9 99,9 0,1 Switzerland (2008) 89,3 8,8 EUR-27 (2010) 92,1 6,6 1,1 Japan (2009) USA (2007) 95,4 3,8 0,7 Number of Companies Size in % (according to employees) Country (year of census) < 10 10 - 49 50 - 249 0 - 249 250 + Germany (2010) 19,3 21,8 19,9 60,9 39,1 France (2010) 24,3 20,3 15,7 60,4 39,6 Austria (2010) 25,1 23,1 18,9 67,1 32,9 Great Britain (2010) 21,9 17,2 14,9 53,9 46,1 Italy (2010) 47,3 21,7 12,3 81,4 18,6 Switzerland (2008) 29,9 71,0 29,0 EUR-27 (2010) 29,8 20,4 16,8 66,9 33,1 Japan (2009) 66,2 33,8 USA (2007) 24,5 14,6 14,8 Number of Employees Size in % (according to employees) Source: Swiss Institute for SME, St. Gallen Workshop presentation 28-29.6.12

Flow of the presentation Presentation of participants Introduction Definition CSR SMEs and ethics – differences to large companies Participants – presentations of companies, situation Discussion between participants Plenum – feedbacks of audience Workshop presentation 28-29.6.12

Presentation of participants Manfred TRIES, Owner and CEO / Gesellschafter und Geschäftsführer , TRIES GmbH & Co. KG, Hydraulik-Elemente Ehingen, Germany Pawel STRZELECKI, Key Account and Sales Manager, SkyWork Airlines AG, Switzerland Philippe BARRY, President of CSR Senegal Jörg BÜRGI, Director, KMU nachhaltig GmbH, Switzerland – moderator Workshop presentation 28-29.6.12

Jörg Bürgi – BE NETZ, co-sponsor Consultant of SMEs – SME research – lecturer for quality and environmental management as well as ethics BE NETZ: Main Swiss installer of solar systems – co-sponsor of IC 3 SME interviews KMU nachhaltig GmbH – with BE Netz Winner Swiss Solar Price 2010 – PlusEnergyBuildings Workshop presentation 28-29.6.12

Definition of CSR in ISO 26000 ‘Guidance on Social Responsibility’ “... responsibility of an organization for the impacts of its decisions and activities on society and the environment, through transparent and ethical behaviour that contributes to sustainable development, including health and the welfare of society; takes into account the expectations of stakeholders; is in compliance with applicable law and consistent with international norms of behaviour; and is integrated throughout the organization and practiced in its relationships”. Workshop presentation 28-29.6.12

SMEs and ethics – differences to large companies - 1 From the point of view of the small business owner it is not `un-business-like' to acknowledge social issues, but in fact is quite a normal perspective for small firm owner-managers. This is quite often a characteristic of family SMEs living traditional values and refusing any form of codification; and the practical morality of SMEs is often more sustainable than the intensive reflection about CSR in large companies. Workshop presentation 28-29.6.12

SME model explaining sustainability Jörg Bürgi – KMU nachhaltig GmbH – SME sustainable Ltd Staff knowledge of SME‘s leadership, management system, moral stance, environmental situation and practice External actors: e.g. consultants, customers, suppliers, finance INPUT Environmental influences: e.g. moral views, standards, laws, economy, local community, physical environment A system to improve the sustainability of SME’s by active consideration by the staff of the SME – in conjunction with external actors and its environmental circumstances and influences – the management system, the moral standards underpinning the SME’s values and operation Increased sustainable performance of SME SYSTEM OUTPUT Workshop presentation 28-29.6.12

A To be an example, to implement ideals and to keep commitments B To be integrated in decisions C To be strictly compliant with standards and laws D Fun is the most important element of my life E To produce a good impression, image E To have enough time for private relations, family, leisure G To put justice, community, solidarity, participation and tolerance in front H To be behave responsible - even if there is resistance within the company I To avoid all cost which are not directly productive, to maximise profit J To aim mental, psychic and physical health K To have the possibility for lifelong learning, to be enabled and challenged L To be loyal - to have primarily an engagement for tasks and the company M To be open to others, to respect one another - feedback (positive and negative) N To think in long terms, to value and integrate consequences O To have alternatives in work and private life P To have enough time for planning and reflecting Q To be flexible, spontaneous Evaluation of Values – Research with 27 SMEs Jörg Bürgi – KMU nachhaltig GmbH – SME sustainable Ltd 0.5 1 1.5 2 2.5 3 3.5 A B C D E F G H I J K L M N O P Q Workshop presentation 28-29.6.12

SMEs and ethics – differences to large companies 2 Social responsibility is for many SMEs a matter of course. Moral activities concentrate on employees and their families, local communities, business partners, and physical environments. Motivating backgrounds include personal interests, responsibility towards the family, giving something back to the community and business reputation. Because ownership, management and control are usually concentrated in the same hands, the personal preference of top management and owners is the most influential factor. Workshop presentation 28-29.6.12

SMEs and ethics – differences to large companies 3 Ethical responsibility is more important than financial performance. Moral attitudes and behaviours can be influenced by size, geographical region, economic situation, use of strategies, company culture, and the use of management systems . Main barriers for moral behaviour are lack of time and motivation, insufficient resources or capabilities, missing knowledge for engagement in social responsibility or inability to see suitable opportunities, not being in touch with local needs and a perception that community involvement is not related to business. Workshop presentation 28-29.6.12

Flow of the presentation Presentation of participants Introduction Definition CSR SMEs and ethics – differences to large companies Participants – presentations of companies, situation Discussion between participants Plenum – feedbacks of audience Workshop presentation 28-29.6.12

Discussion – Questions Which are the impacts of your company on society and environment (positive & negative)? How can you influence and manage these impacts? Which are your experiences with ethical behaviours – internally in your company and externally as part of your relationships and interaction with other stakeholders? Workshop presentation 28-29.6.12

Discussion – Questions 4. Tell us specific cases when you have made challenging ethical business decisions and how did they influence the business outcomes? 5. What are the basic core ethical principles that you apply in your decision making concerning management, operations and governance of your company as well as relationships with your stakeholders? Workshop presentation 28-29.6.12

Discussion – Questions 6. Which are the backgrounds of your ethical attitudes? How did you come up with the formulation of the above ethical principles? 7. What provides and what hinders ethical attitudes and behaviours? 8. Which are limits of your ethical behaviours? 9. Which are your plans for future? How do you plan to further apply business ethics as part of the development of your company? Workshop presentation 28-29.6.12

Discussion – Questions 10. Which recommendations should be given to the Global Ethics Forum – how better to respond to company’s needs concerning business ethics and CSR, what questions should be discussed further, and what topics should be addressed in next GEF? Workshop presentation 28-29.6.12

Flow of the presentation Presentation of participants Introduction Definition CSR SMEs and ethics – differences to large companies Participants – presentations of companies, situation Discussion between participants Plenum – feedbacks of audience Workshop presentation 28-29.6.12

Thank you very much for sustaining SMEs and Ethics 28-29.6.12