corporate social responsibility in the innovation … social responsibility in the innovation...

04-10-2010

1

Corporate Social Responsibility in the Innovation Process.The Danish Case, as a concept

Complimentary work for DEA

Phd. in Management and Marketing

Year: 2008-2010

Department of Management and Marketing

Universidade de Vigo, Spain

Author: JORGE OLIVEIRA TEIXEIRA

Director : PEDRO FIGUEROA DORREGO, Phd

2010/10/05

Contents

1. Introduction to CSR

2. Corporate Social Responsibility

3. Innovation

4. Corporate Social Responsibility and Innovation

5. The Danish Case in CSR and Innovation

6. Notes for future considerations

Business Innovation Conference,Presented

at ILLINOIS INSTITUTE OF TECHNOLOGY2

04-10-2010

2


05-10-2010Business Innovation Conference,Presented


2. Corporate Social Responsibility(one definition)


at ILLINOIS INSTITUTE OF TECHNOLOGY05-10-2010 4

“An evolving concept, not universally accepted definition;

The way organizations integrate social, environmental andeconomic concerns into their values, culture, decision-making,strategy and operations, and thereby establish better practiceswithin the organization, create wealth and improve society”.

04-10-2010

3

2.1 Introduction to CSR

CSRVoluntary

CollectiveAgreements

LawRegulated



2.2 Relationship Between an organizationits stakehoders and society



04-10-2010

4

2.3 Corporate Social Responsibility activities



Management

Visions and

values

Stakeholder dialogue

Employee

Customer

Supplier

Community

Environmental

CSR Innovation

Communication




• Why • What

• When• Who

• Where

Communication

• Who are they• Dialogue and inclusion

• Communication

Stakeholder

dialogue

• Prevention• Retention

• Integration

Employee

activities

04-10-2010

5




• Pollution prevention• Waste minimizing

• Reduction of energy, water, etc

Environmental activities

• Community support• Contribution and sponsorship

• Partnerships

Community

activities

• Risk assessment• Guidelines

• Codes of Conduct• Cooperation

Supplier activities




• Demands from, and dialogue with customers

• Product labels

Customer

activities

• New process• New Products

• New Services• CSR Profile Business models

CSR

Innovation

04-10-2010

6

2.5 Advantages of Business DrivenSocial Responsibility



EnhancedProduct

differentiation

Newproducts

GreaterSupplier

relaiability

MoreCommitted

staff

Betterreputation

Lower cost troughEnvironmental

management and reduce energy consumption

RESPONSIBLE

BUSINESS

2.6 The Big picture



04-10-2010

7

2.7 The CSR Approach



Business

Sector

Community

•Handle problems•Handle Requests•Avoid bad publicity

•Focus on request•Establish norms•Stand out

•Comply with sector standards

•Go beyond sector standards•Differentiate yourself from other business in your sector

•Await agreements, collective agreementsor statutory requirements

•Contribute to local community•Market yourself on the basis of your contribution

Defensive Offensive

2.8 Cyclical Matrix of CorporateSocial responsibility



• Corporate governance and economic Responsibility

• Environment Protection and Sustainability

• Ethics and Human Resources

• Social Accountability and Social Investment

Community Workplace

MarketplaceEnvironment

G.K Kanji and P.K. Chopra, 2010

04-10-2010

8

3. Innovation



Key definition

An innovation is the implementation of a new or significantlyimproved product (good or service), or process, a newmarketing method, or new organisational method inbusinesspractices, workplace organisation or external relations.

Innovation activities include all scientific, technological, organisational,

financial and commercial steps which actually lead, or are intend to

lead, to the implementation of innovations. Some of these activities

may be innovative in their own right, while others are not novel but

are necessary to implementation.

Oslo Manual 2005



04-10-2010

9

Types of Innovations



Marketing

Organization

Process

Product

Oslo Manual

2005

Types ofInnovations

3.1 Types of Innovations



Radical & Incremental(Tushman & Anderson,1986)

Sustaining and DisruptiveInnovation

(Hockerts & Morsing, 2008)

User-driven Innovation(Von Hippel, 2001)

represent technical advance so significant that no increase inscale, efficiency, or design can make older technologies competitive with the newTechnology

to new customers and so-far un served markets Innovation can also be characterized by its ability to either strengthen a firm's existingcapabilities and market position or to disrupt them by rendering competencies obsolete or reaching out

introduced the notion of (lead) user-driveninnovation to describe the ability of user communities to initiate and develop exceedingly complex products sometimes even without any specific manufacturer involvement

04-10-2010

10

Elements of a system Innovation



Cotec, Model 1998

The Innovation measurement Framework



Oslo Manual, 2005

04-10-2010

11


and Innovation





The term corporate social innovation is increasingly taken upby practitioners. Patrick Cescau CEO of Unilever for exampledefines corporate social innovation as a way of "finding newproducts and services that meet not only the functional needsof consumers for tasty food or clean clothes but also theirwider aspirations as citizens."(cited in Webb, 2007).

04-10-2010

12

4.1 The CSR innovation objective field


at ILLINOIS INSTITUTE OF TECHNOLOGY 23

In a strategic CSR innovation process, business use theircore competences to develop new concepts, products, etc.

4.2 CSR AND INNOVATION – What is it?



Literature bringing together CSR and innovation has emerged

gradually over the past decade. One interpretation of “social

innovation” can refer to improvements in the CSR process.

Examples could be improved social reporting tools or CSR

management systems.

Corporate Social Innovation

The term “corporate social innovation” was first introduced byRosabeth Moss Kanter (1999) who argues that firms should usesocial issues as a learning laboratory for identifying unmetneeds and for developing solutions that create new markets.

04-10-2010

13

4.4 CSR AND INNOVATION – What is it ?



Social Entrepreneurship

According to Hockerts it describes “the discovery and sustainable

exploitation of opportunities to create public goods”.

This is usually done through the generation of disequilibria in market

and non-market environments. Social Entrepreneurship can in some

cases lead to the creation of social enterprises. These social ventures

are hybrid organizations exhibiting characteristics of both the for-profit

and not for profit sector.

4.4 CSR AND INNOVATION – What is it ?



Eco-Innovation

The notion that sustainable development drives disruptive innovations

has come quite naturally to the sustainability debate (Hockerts,1999,

2003). Sustainability innovations (also called eco-innovations, eco-

design, eco-preneurship, or cleantechnology venturing) have been

proposed as a source for "environmentally benign growth" (Dyllick,

1994).

04-10-2010

14

4.5 Base of the Pyramid (BOP)



An important subtheme of corporate social innovation is thefocus on low-income markets. Prahalad and Hart (1999) talk in thiscontext of the potential of the bottom or base of the pyramid(BOP). Ex: reverse innovation

The BOP premise is that by focusing on the unmet needs of low-income populations firms can create profitable markets while alsohelping the poor address some of their most urgent.

Prahalad’s most notable assumption is that BOP markets have topay a “poverty premium”(This means that many poor have to paymore for products and services such as food, water,medication,credit, or telecommunication, than their middle or upper classcompatriots.

4.6 CSR and Innovation – How Does It Happen?



04-10-2010

15

5. The Danish Case in CSR and Innovation



5.1 General Principles



UN GLOBAL COMPACT

UN PRI

OCDE Guidelines

General principles

04-10-2010

16

5.2 Key Specific Principles



UN Environment Programe Financial Iniciative (UNEP FI)

Key specific

principles

The Equator Principles

Global Reporting Iniciative ( GRI)

Transparency International – Business Principles for Countering Bribery ( BPCB)

Carbon Disclosure Project (CDP)

UN Caring for Climate

5.3 The Danish model for CSR in innovation



Business

Process

Product

CustomerContact

CSR

05-10-2010

04-10-2010

17

5.4 Key Action Areas


at ILLINOIS INSTITUTE OF TECHNOLOGY3305-10-2010

The government wantsbusiness to contribute

actively to tacking global climate challenges

Wants the marketing ofDenmark for responsible

growth to help Danishbusiness reap greater benefits

from their S R work

The government wants to underpin large

business´CSR reports

The state sector also has a number of options for

aiding in disseminatingS R through its own

activities

5.5 Clarification through 12 types of innovation



Type of Innovation Explanation CSR Example

04-10-2010

18

5.5a Clarification through 12 types of innovation



Type of Innovation Explanation CSR Example

• Greater attention to political accountability in the innovation process

• More informed consumers

• Global brands

• The noticeable increase of socially responsible brands

• New consumers trends

• Measure of Corporate Social Performance (CSP).

• Aplication to SME

• Public concern about Corporate Social Responsibility

6. Notes for future considerations


at ILLINOIS INSTITUTE OF TECHNOLOGY3605-10-2010

04-10-2010

19

Q & A05-10-2010



Thank you for your attention



Jorge Oliveira Teixeira

jorgeteixeira@accelperiberia.comwww.accelperiberia.comwww.linkedin.com/in/jorgeoliveirateixeira

04-10-2010

20

Appendix 1



Appendix 2



04-10-2010

21

Appendix 3



Appendix 4



04-10-2010

22

Appendix 5



• KEY ACTION AREA 1: PROPAGATING BUSINESS-DRIVEN SOCIAL RESPONSiBILITY

• The Government wants to:

• encourage Danish companies and investors to continue and develop theircommitment and CSR work

• make it mandatory for large business to report on CSR in the management’s reviewof the annual report

• make it mandatory for institutional investors and unit trust to report on CSR in themanagement’s review of the annual report

• set up to the Social Responsibility Council charged with making recommendationsfor the Government, the corporate sector and associations

• establish a new social responsibility communication portal(www.samfundsansvar.dk)

• organize international conference “Danish Business innovating for WorldChallenges” to identify innovation areas for Danish business

• set up a knowledge network among organizations, researchers and advisors onbusinesses-driven social responsibility and responsible supplier management

• advise business though Danish representations in other countries

• work to ensure a transparent market that promotes social responsibilityconsiderations in consumer purchasing. The Government will launch a study ofconsumers‘ role in CSR

• prepare a biennial progress report on Danish businesses’ observance of andcommitment to Global Compact and PRI, first time in 2010

Appendix 6



• KEY ACTION AREA 2: PROMOTING BUSINESSES’ SOCIAL RESPONSIBILITY THROUGHGOVERNMENT ACTIVITIES


• ensure that, in the future, joint state supply contracts will systematically embed requirements forsocial responsibility as articulated in the conventions that provide the foundation for the UN GlobalCompact

• ensure that all state procurement officers can access the guidelines for embedding socialresponsibility

• open up dialogue with local authorities and regions with a view to disseminating experience inembedding social responsibility in their areas

• make it mandatory for state-owned public limited companies to report to CSR in the management‘sreview for the annual report

• ensure that all major state-owned public limited companies accede to the UN Global Compact

• ensure that the Vækstfonden accedes to the UN principles for responsible investment (PRI)

• ensure that the Eksport Kredit Fonden (EKF) accedes to the UN Global Compact

• continue its work for embedding social responsible in Danish development work

• ensure that the Industrialiseringsfonden for udviklingslande (IFU) and the Investment Fund forCentral and Eastern Europe (Iø) accede to the UN Global Compact

• organize conferences on businesses‘ social responsibility in developing countries jointly withDanish representations outside Denmark, local players and businesses

• ensure that the regional trade and industry development system contributes to propagatingbusiness-driven social responsibility

• strive to ensure that international investment banks embed social responsibility in their businessand investment strategies

04-10-2010

23

Appendix 7



• KEY ACTION AREA 3: CORPORATE SECTOR‘S CLIMATE RESPONSiBILITY


• encourage businesses to include sections of climate responsibility in their reports on CSR

in the management‘s review of the annual report (see the mandatory requirement in key

action area 1)

• jointly with Confederation of Danish industries develop the Climate Compass - a web-

based climate tool aimed at helping businesses prepare climate accounts and climate

strategies

• initiate four partnerships on climate responsibility in relations to investors, in the retail

sector, the construction sector and the maritime sector

• KEY ACTION AREA 4: MARKETING DENMARK FOR RESPONSIBLE GROWTH

• The Government wants the marketing of Denmark for responsible growth to help Danish

businesses reap greater benefits from their social responsibility work.


• promote Danish tools and competences in the area of corporate social responsibility

• head up a 2010 international summit on international standards for social responsibility in

Copenhagen (ISO 26000)

• organize an international conference on responsible investments aimed at creating the

basics for better targeted and usability oriented research

Credits

• Draft international Standard ISO/DIS 26000

• Oslo Manual, Guidelines for Collecting and interpreting

Innovation Data

• Action Plan for Corporate Social Responsibility,

The Danish Government, May 2006

• Modelling The Firm in its Markets and Organizational Environment:

methodologies for Studying Corporate Social Respnsibility, Gopal K.

kanji and Parvesh K. Chopra, Total Quality Management.

• Project People & Profit, The Danish Commerce and Companies

Agency



corporate social responsibility in the innovation … social responsibility in the innovation...

Documents