Budapest University of Technology and Economics (BME) Mûegyetem rkp. 3-9., 1111 Budapest, Hungary
E-mail: erdelyi.evelyn@tik.u-szeged.hu
I. INTRODUCTION
In Hungary, greater and greater emphasis has been put on expressions, such as, Corporate Social Responsibility (CSR), responsible corporation, ethical corporation and environment-conscious corporation in the life of organizations, in the past couple of years and it has also been a topic in electric media for about a year now. Unfortunately, however, there are still some who are unaware of what lies behind these expressions. There is a tendency to use CSR wrongly as a synonym for charity practise, sponsoring or PR.
In the first part of my paper, I present the theoretical background of Corporate Social Responsibility. I present that usually in social sciences more definitions and more types of schools deal with this question. Among others, I present Milton Friedman’s, Kotler’s and others’ concept in connection with CSR, the EU definition of CSR and the Triple Bottom Line (TBL) expression. I would like to give an overall picture about what is CSR and what kind of business is CSR in Hungary so I am examining the followings:
• What kinds of periodicals, books have been published and do they, as printing products, follow
• what is written in them?
• What kinds of applications and what amount have
• been announced in civil sector?
• What kinds of conferences, trainings have been held in connection with this topic in Hungary and what is the difference or similarity between the ‘normal’ and ‘CSR’
conferences, trainings?t.
II. WHYDOWEHAVETOTALKABOUT CSR?
In the past couple of decades our environment and our societies have been going through dramatic changes. We can tell that mass media announce threatening news in connection with ’the end of the World’ in almost every second. Global warming, lack of drinking water, gradually growing population, unemployment, lack of food, natural disasters, crisis of energy and we could continue our list. These are such problems, which could not be solved by the governments themselves.
Multinational enterprises have much higher responsibility in solving of these global questions, mainly because some of them have higher GDP than certain countries. Of course, other participants have to take part in solving of global problems like small and medium-sized enterprises, entrepreneurs, NGOs and last but not least the people themselves. To make the Earth be the living place of the following generations in the oncoming centuries, everybody has to find their own responsibility and role in this issue.
To talk about Corporate Social Responsibility (CSR), it is very important to go back to its historical background and clear its definitions. Let us start with Sustainable Development.
III. SUSTAINABLEDEVELOPMENT When we talk about CSR, we can often hear the expression of Sustainable Development or Sustainable Growth. Unfortunately, the latter expression is used wrongly. Herman E. Daly explained in his article entitled ‘Sustainable Growth:
An Impossibility Theorem’ that Sustainable Growth was such a wrong oxymoron which could not be applied to the economy. ‘To grow means ‘to increase naturally in size by the addition of material through assimilation or accretion.’ To develop means ‘to expand or realize the potentialities of; to bring gradually to a fuller, greater, or better state.’ When something grows it gets bigger. When something develops it gets different. The Earth ecosystem develops (evolves), but does not grow. Its subsystem, the economy, must eventually stop growing, but can continue to develop. To delude ourselves into believing that growth is still possible and desirable if only we label it ‘sustainable’ or colour it ‘green’ will just delay the inevitable transition and make it more painful’ [1].
A best known definition of Sustainable Development was created by the Brundtland Committee in 1987 according to which
‘Development is what meets the needs of the present without compromising the ability of future generations to meet their own needs’. If we want to understand the definition, we can see that the corporations have to take responsibility in economy, society and environment. This is called the ‘Triple Bottom Line’ (TBL), and we got to the definition of CSR [2].
IV. CORPORATESOCIAL RESPONSIBILITY
The modern debate on CR originated in the USA, where it started with the appearance of an article entitled ‘The Social Responsibility of Business Is to Increase Its Profit’ by the Nobel Prize winning economist Milton Friedman, in 1970. He clearly stated that any company should decline to deal with issues which do not belong directly to its core mission of maximising shareholder value, or more simply, increase profit. [3] Although some still think that Friedman was right, most of the ‘voices’ say that companies should not just deal with their profit. We can note that already in the 1970’s researches were carried out in connection with ethics and responsibility of a company in the United States, which were followed by Western European researches within a very short time [4].
The most basic and usable CSR definition was created by the European Union in the Green Paper issued in 2001. According to this definition, CSR is
‘a concept whereby companies integrate social and environmental concerns in their business operations and in their stakeholders on a voluntary basis’ [5].
Who are these stakeholders? They are in temporary and mutual connection with the organisation, for example, shareholders, employees, local communities, NGOs, consumers, suppliers, competitors, authorities, etc.
According to the WBCSD (World Business Council for Sustainable Development), ‘Corporate Social Responsibility is the continuous commitment of a business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large’ [6].
According to Gergely Tóth, in his book entitled
‘The Truly Responsible Enterprise’, the CSR definition is the followings. The truly responsible enterprise
• ‘sees itself as a part of the system, not a stowaway concerned only about maximizing its own profit;
• recognises unsustainability (the destruction of natural environment and the increase of social injustice) as the greatest challenge of our age;
• accepts that according to the weight they carry in the economy, governments and enterprises have to work on solutions;
• honestly evaluates its own weight and part in causing problems (it is best to concentrate on 2-3 main problems) and
• takes essential steps – systematically, progressively and in a focused manner – towards a more sustainable world’ [7].
In case we examined the concept of CSR on the level of countries, we would find different definitions. For example, in France and in Germany, CSR is about the questions regarding labour
relations and human resources while in Great Britain it answers to the social needs and in the USA, companies say ’the profit first only then good cases’.
If we examine CSR according to the size of a company, we can find different definitions, too.
According to the results of a Hungarian research, the keywords of CSR for small companies are the followings: protection of national product, fair prices, taking care of consumers, fair salary, sensitivity to social problems, respecting the law, environment protection, surviving, innovation and profitability, while in case of enterprises the keywords are the followings: reliable product, salary enough for the cost of living, sensitivity to social problems, respecting the law, environment protection and profit [8]. The difference is not big, but it can be felt. In my opinion, both types of companies have their own responsibilities and do not use evasions.
By reading the book entitled Corporate Social Responsibility by Philip Kotler and Nancy Lee, we can find more definitions for CSR which contain similar elements to the ones mentioned above [9]. As it is shown, there is no uniform definition, we can find different drafting in the special literature but it seems that there is a unity in the basic principles.
The company follows closely the effect of its activity on others and tries to change it so that it would have a positive effect on the society. This includes environmental responsibility thus CSR adjust well to TBL theory. Volunteering is an important element, that is, companies not only meet the requirements of legal measures and laws, but they go beyond them.
V. WHATDOESCSRMEANTOME?
I believe the definition closest to me on corporate level is used by Gergely Tóth. I think it is important that a company takes responsibility for its activities and its stakeholders, surroundings. CSR should be an inner need for making the world better and not an obligation coming from outside and thus getting to a strategic level influencing the processes of a company. Being responsible to me means not wasting water, not using electricity unnecessarily not only at home but at my workplace, too. I take my surroundings into consideration, I do not buy useless products and if it is possible, I buy Hungarian products and I try to make others think and act in the same way.
In the second part of my paper, I would like to introduce what kind of business is CSR in present Hungary. First of all, let us see what kind of periodicals, books have been published.
VI. BOOKS,PERIODICALS
In case we have a look at how responsible a book, a brochure or periodicals dealing with a socially responsible topic is, it is worth looking at the following standpoints:
• What kind of paper is used?
• What kind of printing ink is used?
• What is the press like – does it have ISO 14001 or EMAS certificate?
• How is it distributed?
• In what way can advertisements be placed in it?
• Is it accessible electronically?
Unfortunately, I have not found answers to these questions in most of the cases so I had to be content with the visual impression.
The picture is very variable, but the initiations are encouraging. More than five books in Hungarian on more than 1000 pages have been published within the last two or three years.
VII. APPLICATIONS
In the last period there have been more and more applications which were related to Sustainable Development and CSR. As part of the New Hungarian Development Plan, the National Development Agency advertised more applications in this subject in 2008. For example, KEOP – 6.1.0 and KEOP – 6.2.0, which can together provide more than 1.600.000.000 Forint. Both of them are for promoting sustainable way of living, behaviour and consuming habits [14]. The Eco-school Application is also remarkable, which was presented to more than 270 schools until 2007. The AmCham advertised the Second Sustainable Management Educational Scholarship into which application lectures can be entered for developing the existing CSR courses or launching new ones for 250-500.000 Forint. The KÖVET Association for Sustainable Economies also advertises applications for Environmental Saving Award or Green Office Award, etc.
VIII. CONFERENCES,EVENTS As a conference and event manager, I often see that the environment-conscious behaviour of our Congress Centre (and now I am just talking about the visible items, for example, selective waste collecting, some notes in our toilets, etc.) is very likeable for the future partner. (Once we had an offer in which the organizers required the venue to run selective waste collecting.) Unfortunately, the environment-conscious behaviour is not the main condition to choose venue for the conference organizers, but there are some initiations in connection with responsible conference and event organizing in Hungary. In the past two or three years, there have been about fifteen relevant conferences and other events in CSR. For instance, CSR Management 2007: Dialogue, Marketplace, Conference; Enterprise for the Sustainable World Conference series; KÖVET annual conferences, , etc.
The Conference named Corporate Climate Change – the effect of the climate change on the companies and the answer of the business sector to this challenge (25th October 2007) was the first CO2 free conference in Hungary. The organizers took the use of the electricity in the lecture room, the entertaining of the participants as well as the transportation of the participants to the venue into consideration. They counted the whole CO2 emission in connection with the organizing of the conference and they neutralized it with the help of one of the projects of the Hárskuti Renewed Energy Centre.
Beyond this, the KÖVET does not prepare any printed invitations only electric ones. Lectures are not printed for the participants as they can download them from their website. If they print, they use recycled paper. They choose the venue consciously:
there has to be natural light, the possibility to air without air conditioning, etc. ‘At smaller events they tried fair-trade- or organic buffet.
It has got a good message, but there are only few catering companies who can solve it in a professional way.’ – told Tóth-Baltási Péter to me, who is the event organizer.
TOP 200 Gala of ‘Figyelő’ newspaper contained similar elements, where the programme booklet was made of recycled paper, in which eleven NGOs could introduce themselves. The purpose of this list was to call the guests’ attention to their activities and co-operational possibilities. Besides these, energy saving bulbs, recycled decoration elements and paper furniture were used during the gala. The ingredients of the gala dinner, mainly organic products, were purchased from local growers. The guests could also taste fair trade coffee and sweets [15].
Summer University Training for the Future 2008 organised was about the CSR as well. Choosing the venue was already very important as it was held in the Family Elementary School in Keszthely, which is an alternative entrepreneur. We, the participants were accommodated at the local camping site and our means of transport was the bicycle. During the six days we went for a longer journey three times by bicycle, which was a very good recreation for all of us.
The summer university proved that training could be organised in a simple and responsible way.
What other events does the CSR appear on?
It might be surprising that CSR has reached the festival market, too. SZIN Festival in Szeged in 2008 was organised with regards to environment-conscious behaviour and CSR. We could meet selective waste collecting, returnable beer glasses, biologically broken down cutleries, free cycle parking lot and rickshaw taxi. The Festival gave places to the Park of Equal Opportunities and Eco-village, where several NGOs were represented [16].
IX. CONCLUSION
From the answers given to my questions, it turns out that CSR is not only a business of enterprises. In my paper, I present that independent from sectors, the size of a company or forms of organizations, more and more people and organizations deal with this field. As shown above, more and more periodicals, associations, books, applications and event organizers deal with CSR. The question is if it might mean a new opportunity to increase the competitiveness of Hungary. According to some researches, the managers agree on the fact that CSR ensures better financial results in the long term so those who take no notice of CSR might lag behind. I hope that more and more people, organizations, companies will be involved in this topic and CSR is going to gain strength.
REFERENCES
[1] Herman E. Daly: Sustainable Growth: An Impossibility Theorem.Development, 1990: ¾, Rome (Translated Károly Kiss) www.c3.hu/~bocs/eletharm/harpart/daly3pi.htm
[2] Kapusy Pál: A fenntarható fejlődés és a vállalatok, Minőség és megbízhatóság, 2007. január pp. 22-28.
[3] Milton Friedman: The Social Responsibility of Business Is to Increase Its Profit, The New York Times, 1970. Sept. 13.
[4] Fülöp Gyula-Robert D. Hirsrich-Szegedi Krisztina: Vállalati etika és társadalmi felelősség: nézetek és intézményesülés, Vezetéstudomány, 1998. 04. pp.1-20.
[5] Baseline study on CSR practices in the new EU member states and candidate counties, UNDP, 2007. pp. 15.
[6] Phil Watts-Lord Holme: Meeting Changing Expectations – Corporate Social Responsibility, WBCSD Report, 1998.
www.wbcsd.org
[7] Tóth Gergely: A Valóban Felelős Vállalat, KÖVET, Bp., 2007.
pp.22.
[8 ] Fülöp Gyula-Robert D. Hirsrich-Szegedi Krisztina: Vállalati etika és társadalmi felelősség: nézetek és intézményesülés, Vezetéstudomány, 1998. 04. pp.1-20.
[9] Philip Kotler – Nancy Lee: Vállalatok társadalmi felellősségvállalása, HVG Kiadó Zrt., Bp., 2007.
[10] www.kovet.hu [11] www.piac-profit.hu
[12] Ligeti György: CSR – Vállalati felelősségvállalás, Kurt Lewin Alapítvány, Bp., 2007.
[13] CSR Best Practice 2006 - A vállalati felelősségvállalás példaértékû magyar gyakorlatai, Révai Digitális Kiadó Kft., Bp., 2007.
[14] www.nfu.h [15] www.bpcsr.com [16] www.szin.org