Diffusion of Corporate Responsibility in the Forestry SectorNatalia Vidal & Robert Kozak

Faculty of ForestryUniversity of British ColumbiaIUFRO All Division 5 ConferenceTaipei, Taiwan – November 1, 2007

sustainable

managementlab

business

Outline Introduction – CR & the forestry sector Study objectives Methods Results

Understanding of CREvolution of CRFramework explaining diffusion of CR

(preliminary results) Key messages

About Corporate Responsibility

No general accepted definition Multiple dimensions (environmental,

social, economic) Need to balance interests of different

stakeholder groups Highly dependent on contextual

characteristics

Corporate Responsibility & Forestry

Corporate Responsibility (CR) has special meaning for the forestry sector Easy target of public criticismOperations have direct environmental impactDepend on sustained extraction of natural

resources

CR & Forestry (cont’d)

Forestry sector provides a great example of variability of CR definitions

Some of the factors that contribute to this variability:Resource managementLand ownershipGovernment regulationsConflicting stakeholder pressuresDifferent manufactured products

Study Objectives

To identify the current understanding of CR in the forestry sector

To identify the recent evolution of CR in the forestry sector

To propose a framework explaining the diffusion of CR into and within forest companies

Methods

•Current understanding of CR

•Recent evolution of CR

Objectives Method

• Framework explaining the diffusion of CR

Content Analysis

Grounded Theory

Methods – Content Analysis

Content Analysis “a technique used to study written material

by breaking it into meaningful units, using carefully applied rules ” (RCR,2006)

Sustainability Reports PwC top 100 forest and paper companiesSoftware: TEXTPACK

Methods – Content Analysis (cont’d)

Dictionary

23 categories (from Tables of Contents): certification to philanthropy

Code TextResult: Frequency

What words to look for

Find words in text

How many times words

appear in text

How TEXTPACK works:

Methods – Grounded Theory

Grounded Theorya research methodology that allows for the

discovery of theory from data (Glaser and Strauss, 1967)

Two countries: Canada & Brazil 3 to 4 companies in each country

High, medium, and low implementation levels of CR

Methods – Grounded Theory (cont’d) In depth, semi-structured personal

interviews Interviews were coded manually Objectives of coding procedure:

To identify categories that describe the phenomenon of study

To understand relationship between categories

Understanding of CR

51 companies of the Top 100 Reports ranged from 2000 to 2005 Interpretation

Frequency of words indicate the importance of that concept in the CR strategies of each company

Su

m o

f fr

eq

ue

nc

ies

Understanding of CR (cont’d)

Evolution of CR

20 companies from the Top 100

Reports in both 2000 and 2005

Categories updated from last analysis

Evolution of CR (cont’d)

2000 2005

Environmental Report 13 3

Annual Report 7 5

Sustainability Report 0 10

Accountability Report 0 1

CR Report 0 1

•361 pages in 2000 to 746 pages in 2005

Types of report:

Fre

qu

en

cy

Evolution of CR (cont’d)

Evolution of CR (cont’d)%

Ch

an

ge

Evolution of CR (cont’d) Words that appeared only in 2005:

Word Frequency

CSR 92

Union(s) 50

Competitiveness 26

Charitable 21

Sponsorship(s) 16

Volunteers 15

Ethic(s) 14

Charity(ies) 13

Fraud 12

Scholarship(s) 12

Results – Grounded Theory

Preliminary results Two frameworks:

Drivers & evolution of concept within companies

Diffusion of CR to & within companies

Drivers & Evolution of CR within CompaniesExternal Contextual

Characteristics

Internal Contextual

Characteristics

Company-external environment interface

External Drivers

•Stakeholders•Location•Competitors

Internal Drivers

Incremental Changes

Formal Processes• Company policies• Mission statement• Task forces / work groups / councils

• Monitoring performance

• CEO• Inside person• Owners’ / founders’ ethics

• Company culture

Implementation of CR

Diffusion of CREntry point of info

•Consultants•Inside company person•Other (e.g. union trainer)

Company-external environment interface

What to do, what to diffuse

Determining what’s necessary for diffusion & implementation

Standardized behavior

Training

• Company policies• Mission statement• Task forces / work groups / councils

• Monitoring performance

Formal Processes

Setting Priorities

Planning

Guidelines

ImplementationControl Action

Adapt Conceptfe

edba

ck

Key Messages

‘Sustainable Forestry’ seems to be equated to CR

More balanced approach to CR / sustainability Social issues are gaining importance, BUT Environmental issues are still at the core of CR

practices

Economic performance from a CR perspective Perfect balance between all 3 dimensions is

unlikely to happen

Key Messages (cont’d) Grounded Theory results suggest that:

CR is implemented through incremental changes

Certification / EMS serve as basis for diffusion of CR

Points that still need to be addressed:How information flows / diffuses outside of

formal processesSocial activities (inside + outside)

Next steps: identify & test hypotheses

References

Responsible Conduct of Research (RCR), 2006. Data Management Glossary. Northern Illinois University, DeKalb, IL. http://www.ori.dhhs.gov/education/products/n_illinois_u/datamanagement/dmglossary.html

Glaser, B.G. and Strauss, A.L., 1967. The Discovery of Grounded Theory: Strategies for Qualitative Research. Aldine de Gruyter, New York.