Www.unido.org. The Importance of Corporate Social Responsibility (CSR) for Small and Medium Enterprises in Bulgaria Kai Bethke 12 June 2007.

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Presentation transcript:

The Importance of Corporate Social Responsibility (CSR) for Small and Medium Enterprises in Bulgaria Kai Bethke 12 June 2007

What is CSR (macro-level) Social and environmental auditing and reporting, voluntary standards, codes of conduct, multi-sector partnerships, stakeholder dialogue, eco-efficiency measures. Strategic alignment towards CSR, community involvement, stakeholder dialogue, multi-sector partnerships, social investment, institution building, CSR-oriented advocacy. Legislation, inspection, criminal and civil prosecution, foreign direct liability (for overseas subsidiaries), industry standards.

Issue and Stakeholders

The Rise of CSR Globalization Increased size and influence of companies Rise in brand reputation > Access to trade Repositioning of government and its roles Growth of global civil society activism EC CSR Year 2005 Ethical Trade Initiatives / “FTSE For Good”

The Evolution of CSR from profit focus a company exists only for short term share holder profit to philanthropy passive donations to charities when requested to community affairs strategic giving linked to business interests (includes cause- related marketing) to corporate community investment strategic partnerships initiated by company to Sustainable Business integrated into business functions, goals, strategy

CSR vs. Philanthropy

CSR - Micro-level A business and management concept Beyond profit Monitoring systematically the environmental and social impact Improving the company’s performance in all 3 areas

The Business Case for CSR CSR becomes part of the core business strategy Link social and environmental responsibility with financial success Three key levels of the business case: (a) Reputation protection (b) Cost benefit (c) Strategic Business activities that promote economic development CAN count as CSR Crucial role for policy

Benefits of CSR Three Stages Reputation protection Cost benefit Strategic Operational cost savings Enhanced reputation Increased ability to recruit, develop and retain staff Better relations with government Sharper anticipation and management of risk Learning and innovation Improving productivity and quality Partnership opportunities Broader social benefits (education, community, etc. development Direct supply chain relationships International standardization and certification

Market Access for SMEs Increased outsourcing of production processes Precondition for doing business with TNCs TNC supply chain standards Most visible aspect of CSR for SMEs Support for SME development can be important part of CSR commitment of TNCs

Emerging Global Standards Global Reporting Initiative (GRI) SA8000 Ethical Trading Initiative (ETI) Base Code AA1000 The OECD Guidelines for Multinational Enterprises ISO (esp & 9000) ISO Social Responsibility Guidance Standard (upcoming) UN Global Compact

CSR and UNIDO The current state and future directions of CSR globally; The implications of CSR for SME development; Strategies to support SMEs in responding to the demands of CSR; CSR approaches that support the role of small businesses in development.

THANK YOU !